Problem statement
The boots division of the Gibbs shoe company had been the most efficient department, efficient and profitable since the company started. The organization departments that include, accounting, human resource, quality assurance, research and development, legal, and advertisement are costing the company more money and their results cannot be attributed. This has resulted to low profitability in the organization calling for the management to identify the loopholes and seal them. Similarly, the organization has received many complain form the clients of poor services and poor quality goods.
Analyzing the affinity diagram
The quality of the boots it used to produce used to be impeccable and was received by the customers’ whole-heartedly. The company had even specialized to boot production before it ventured into the diversification of shoes based on the most successful competitive and yielding portfolio. All the employees had divided labor to fewer amounts of time to producing boots that met standards and were plausible by all. However, recently the Gibbs boot department turned both inefficient and ineffective. It has been making substantial amounts of loss consistently for the second year in a row. The current system of boot production is not competent enough to match the market structure.
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The boot department losses affect six cost centers. Cost centers are departments charged for accounting only but do not generate direct revenues for a firm. They are not profit centers in that case. Not all the cost centers are affected directly here. The most affected cost center is the human resource that has deployed staff in the department, but the department is not fruitful. The human resource department has to pay the salaries.
The Accounting and Finance department is associated with the preparation of the financial statements of the organization and overseeing the finances of the organization. The department seems to have been authorizing payment of goods and services that are substandard. These practice has been costing the company more money resulting in reduction and profitability, and the customer complaints. Likewise, the customer services department representatives have been rude to some client costing the company big deals that should have generated substantial income to the organization. The representatives should be vetted to identify the individuals who are not friendly to the customers.
The human resource department is one of the most important divisions in the organization as it involves the recruitment of new staff members for the team. The staff has been recruiting people are not qualified for certain jobs and paying the high salaries resulting in reduced profits. The unskilled employees lead in making products that are inferior products. This has affected the quality of product that the company is producing. Consequently, the company has lost many customers due to poor quality products.
The quality assurance department has not been working to ensure the products of the enterprise are satisfactory to the customers. The department needs an overhaul to make sure that the workers there know their responsibility. The research and development department has to search for better and a new means of producing goods, which are well acceptable by the customers today. The maintenance staff will be the least affected as their job description goes on as usual. Whether the company makes profits or losses, the support staff will still get paid.
Similarly, the advertising department has been making expensive advertisements that do not reach the intended audience. The department needs to cut its cost and come up with new mechanism ad strategies that will enable the promotions and advertisement reach the target audience. Additionally, the legal department has been losing paramount cases costing the company massive loss regarding fines.
This salary has to come from the other departments, which are doing well. The customer service department is also directly affected as dissatisfied customers come back and have to be served by this office. The accounting department is not that much affected as it has to deal with the internal control to ascertain its effectiveness in resources. The most common problem with the identified departments is labor. Most of workers in the organization are not qualified for the postions they hold. Resulting in customer complaints and lose of income.
