I have never written a blog or written any article that needs to be published. In all honesty, It feels strange, overwhelming and exciting. This new obligation will likely become a habit by the time I am done with the MBA program. Today I am writing on the analysis of business problem cases which we treated during the last intensive week.
Most cases which we had to deal with weren’t Nigerian based therefore they were difficult to relate to. The case study done on Okoye Food Processing Company was the most relatable since it was Nigerian based. The summary of the case was that a food processing company which produced and packaged Corned beef, Pork chops, Chicken Parts, Turkey, and Smoked meat to be sold to retailers, hotels, restaurants and other large users was outsourcing one of their product lines which made it difficult for them to turn as much profit as they would like. Their total annual sales came up to 65million Naira. The price of the smoked meat delivered to OFP was N2,450/100kg which was believed to be a very low price. The supplier of the smoked meat was reliable and product was of good quality. Executives wanted to produce the smoked meat to enable them monitor quality and also for salesmen to sell at higher prices. Status quo made it impossible for them to sell at higher prices since they couldn’t stress quality as they didn’t produce themselves. The requirements to manufacture included an In-house industrial smoker bringing the total estimate for the manufacturing cost to 2400 Naira per 100Kg. The sales manager stated that the lower cost of the smoked meat, if the company manufactured it, would allow the company to compete with other manufacturers in selling large orders to restaurants and hotels. He believed also that the lower cost would put the company in a better position to compete for the large volume of export business available. Though OFP sold many of its products to such customers, but had never been able to offer them prices low enough on the smoked meat, to obtain their orders for this product.
In the course of analysing this business problem which the decision question was produce in house or continue outsourcing, the entire class agreed that production was not favourable since the analysis showed it would be cheaper for them to continue purchasing. We also realised that the salesmen were just being difficult and lazy to work, given excuses which the manager was taking as facts rather than assumption. It has shown me the danger of assuming and how lack of proper analysis before decision making can cause more problems for the company.
Analysis of business problems taught me how to identify a problem, map out an objective, design a criteria, analyse using numbers, weigh the qualitative options and then come to a decision. The way the process is meticulously carried out marvels me all the time and I look forward to learning more.
