According to my two articles, writing a reflective paper for the management course needs to include management knowledge, such as why to start, love, sustainability, etc. The goal is to have you refle
Running Head: REPORT 0
Jiangsu leipeng Electric Co. Report
Qi Wang
May 20th, 2020
Jiangsu leipeng Electric Co. Report
Jiangsu leipeng Electric Co., Ltd is a business enterprise in the electrical and manufacturing industry founded on 26 May 2011. The business scope of the company includes voltage switchgear, power control panel, aluminum files, copper bar, bus, bridge, industrial electric heater, distribution board, frequency converter, plastic transformer, electrical components, expansion joint, metal products, lamp manufacturing and processing, cable, wire, sensor, AC contactor, circuit breaker, spring shock absorber, general parts, transformer, fire-fighting equipment, sewage treatment equipment, instrument heat preservation box, dust removal, copper bar, and cable trough. The company operates both nationally and internationally but has no branches. Its registered capital is general but it saw a change in registered capital from RMB 51800000 to RMB 101800000 in 2014 registering a 96.53 percent increase. The company occasionally changes its scope with some new business being added such as bus and transformer which were added in 2015. The availability of cheap raw materials and labor has allowed the company to operate competitively within the industry. The company uses a low-cost structure business strategy to be competitive in the industry.
Business Strategy
Low-Cost Structure
Jiangsu leipeng Electric Co., Ltd has adopted a low-cost structure as its business strategy by taking advantage of the availability of local cheap raw materials and labor in the country. However, in the initial stages of establishment, the company operated under the shadow of large companies before it established its business chain. The large companies enabled the company to acquire markets for its products before it built its brand. The low-cost model allowed the business to gain a competitive edge in the market by producing quality products at competitive prices. The availability of cheap raw materials locally enabled the company to set lower prices than the competitors. The initial partnerships also allowed the company to maintain its cost structure since it didn’t require to incur huge marketing costs to compete with the existing market players. The company adopted a cost-driven business strategy since its inception and has focused on minimizing costs in every business activity the business undertakes. To maintain its low-cost strategy, the company ensures that its fixed costs do not vary even with an increase in production. For example, when the company added new businesses, only the variable costs were altered but the fixed costs remained the same.
Economies of Scope. Jiangsu leipeng Electric Co., Ltd has expanded its scope of business over the years to increase its market share. The expansion of the business scope has been in-line with the existing business operations. The businesses are undertaken using mutually supporting activities which have ensured the increase in the business scope doesn’t affect the fixed costs of the company. Most of the technologies used in the production of the equipment manufactured by the company are the same, thus, making it possible for the company to maintain its cost structure.
Employee Rewards
The electrical and manufacturing industry is a labor-intensive industry. Therefore, the relationship between the company and its employees is key to its success. Jiangsu leipeng Electric Co., Ltd has maintained a healthy relationship with its employees to ensure high levels of motivation are maintained. The company has created a system of rewarding high performing employees, most improved as well as the long-serving employees to keep a motivated workforce. Meals and staff vouchers have been the most commonly used rewards to motivate employees. This strategy has enabled the company to increase its retention levels and reduce recruitment costs due to the low employee turnover. Also, extra pay is offered for employees who work overtime to surpass production targets.
Challenges
High-Cost of Skilled Labor
The major challenge facing the company is the lack of low-priced skilled labor. The company has to train the employees recruited to equip them with the necessary skills. The few skilled individuals demand high wages above the industry’s average which affects the company’s cost structure. The company has tried to overcome the challenge by retaining its employees and using old employees to train new ones. However, the time taken before the employees gain sufficient skills affect business operations to some extent.
Employee Safety
Manual handling of equipment is associated with health hazards which although non-fatal cost the company millions of dollars settling employee claims for injuries suffered in the workplace. The industry regulations require manufacturers to take precautionary measures to ensure worker safety in the workplace. Some of the injuries that occur in the workplace are unpreventable by the company management and are related to human negligence and carelessness but fall under the company’s liability.
Mistakes
Overreliance of Human Labor
Most of the company’s critical operations are manually operated by humans making it difficult for the company to efficiently and effectively service its orders. Automation increases production efficiency and lowers the cost per unit. Robots have been extensively used in manufacturing and have replaced humans in most of the operations. However, the high cost of acquiring robots has been the major hindrance to the full automation of operations in the company. The inability to fully automate its services has affected the company’s low-cost strategy. The long-term cost benefits of automation are critical for the company’s business strategy.
Best Practices
Waste Management
The company has been able to control its industrial waste to minimize pollution of the environment by recycling its waste products such as scrap metals. The waste management strategies have saved the company millions of dollars over the years because the company has been able to stay compliant with environmental regulations. The company efficiently uses its resources to minimize the waste material produced. Waste management is not limited to materials but also labor hours need to be efficiently controlled.
Lessons Learned
First, technology can be used in the electrical and manufacturing industry to increase production efficiency as well as production output. However, companies are prevented from automating their operations by the huge costs incurred in acquiring robots. Second, companies need to control their waste disposal to protect the environment and the ecosystem in general. Careless waste disposal can lead to huge losses as companies settle the litigation filed by environmental protection agencies. Waste management can be a cost-saving technique in the long-run. Third, a company’s business strategy need to be cascaded in all its operations and business decisions. Small mistakes such as lack of sufficient automation of operations in the manufacturing industry can affect a company with a low-cost structure. Lastly, good employee relations are critical for smooth business operations. Motivated employees are likely to leave their jobs prematurely, thus, saving the company recruitment and training costs.
Conclusion
The interview allowed me to learn from an individual who has been in the electrical and manufacturing industry for nearly 10 years as a business owner. I have learned the benefit associated with technology in the manufacturing industry and that minimal human labor will be required in the manufacturing industry in the future. More people working in the manufacturing industry are likely to be left jobless as companies replace human labor with new technologies such as robots in their operations. Although full automation less likely means zero requirements of human assistance, it is a threat to human employment. Also, companies need to manage their waste to conserve the environment and prevent the occurrence of climate change which is a point of concern across the world. I also noted the importance of employee relations in organizations to maintain a good relationship with employees by adopting strategies to motivate them.
