chowdhury leather craft ltd. (2)

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Assume that you are a top executive of an organization. Now think of a decision that will bring a significant change in your organization. Justify why do you want to take such a decision and how will you implement it. By: Name Roll No. 1.Debashish Mondal 048 2.Alvy Riasat Malik 123 3. Sadi Mohammad Ziaul Abedin 128 4.Md. Mafi Ullah 016 5.Md. Zakir Hossain 145 6.Fahim Lodhi 149 7. Md. Mohibbul Islam 007 8. Taj Mohammad Sagar 139 9.Md. Samir Shaker 100 BBA 13th Batch Department of Management Studies University of Dhaka 1

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Page 1: Chowdhury Leather Craft Ltd. (2)

Assume that you are a top executive of an organization. Now think of a

decision that will bring a significant change in your organization. Justify

why do you want to take such a decision and how will you implement it.

By:

Name Roll No.

1. Debashish Mondal 048 2. Alvy Riasat Malik 123 3. Sadi Mohammad Ziaul Abedin 1284. Md. Mafi Ullah 016 5. Md. Zakir Hossain 145 6. Fahim Lodhi 149 7. Md. Mohibbul Islam 007 8. Taj Mohammad Sagar 1399. Md. Samir Shaker 100

BBA 13th Batch Department of Management Studies

University of Dhaka

Supervisor:

Md. Salim BhuiyanProfessor

Department of Management StudiesUniversity of Dhaka

November20, 2007

To,

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Md. Salim BhuiyanProfessorDept. of Management StudiesUniversity of Dhaka

Sub: Submission of Term paper.

Dear Sir,

This is a great pleasure for us to submit the term paper, which is a partial requirement for the

degree of BBA. We have been assigned to do term paper on Fundamentals of Management. Our

assigned topic is Assume that you are a top executive of an organization. Now think of a decision

that will bring a significant change in your organization. Justify why do you want to take such a

decision and how will you implement it. Our analysis is based on what we have learned from this

study. There may be some limitations, but we have tried our best to make it as accurate as

possible.

We sincerely hope that you will enjoy reading this report. We will be very glad if the study can serve its actual purpose and we are ready to explain anything to you if necessary.

Yours faithfully,

Name Roll No.

1. Debashish Mondal 048 2. Alvy Riasat Malik 123 3. Sadi Mohammad Ziaul Abedin 1284. Md. Mafi Ullah 016 5. Md. Zakir Hossain 145 6. Fahim Lodhi 149 7. Md. Mohibbul Islam 007 8. Taj Mohammad Sagar 1399. Md. Samir Shaker 100

BBA 13th Batch Department of Management Studies

University of Dhaka

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ACKNOWLEDGEMENT

This is a short ranged study report submitted to the Department of Management

Studies, University of Dhaka. This research focuses on the decision making process

in a particular organization. At first, we take the opportunity to thank The Almighty.

Then we express our thanks to our department and authorities for granting us such

opportunity in this level.

First we would like to express our gratitude to our honorable teacher Md. Salim

Bhuiyan, Professor, Department of Management Studies, University of Dhaka,

with whose wise and liberal supervision we were able to complete our research

paper. He built us for our journey with his insightful advice and continual

encouragement and support with unforgettable caring. We are deeply indebted to

him for removing some of our great confusions during the research work. We are

also thankful and grateful to him for his skilled effort and contribution to build up

our research methodological knowledge.

Our sincere thank goes to our two fellow senior students of this department for

helping us to understand the structure of our research work and data collection

techniques.

We would like to thank to the officials of “Chowdhury Leather Craft Ltd.” For

helping us to find out the essential data we need and warm hospitability and

cooperation.

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Table of Contents

Title Page i

Letter of transmit ii

Acknowledgement iii

Table of Contents iv

CHAPTER-ONE : INTRODUCTION 1.1 Introduction to our study 4

1.2 Objective of the study 4

1.3 Methodology 5

1.4 Limitations 5

CHAPTER-TWO: 2.1 Overview of the company 7

2.2 vision of the company 7

2.3 Goal of the company 8

2.4 Organ gram of the company 8

CHAPTER-THREE: 3.1 Analysis of last five years business report 3.2 The major problems of the organization 3.3 Alternative solution 3.4 Evaluating alternative solutions 3.5 Conclusion

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CHAPTER -ONE

INTODUCTION

1.1 Introduction to our study:This term paper is prepared on the basis of decision making process in a

particular organization. There are many leather companies who are exporting

finished leather products from Bangladesh. We have chosen one of this well

known leather product manufacturing and exporting company named

“Chowdhury Leather Craft Ltd” for making our term paper. It is a repudiated

leather product exporting company in Bangladesh. It has been exporting leather

products with a great success. This company is now one of the best leather

companies in Bangladesh. But as the competitors are increasing in this sector

“Chowdhury Leather Craft Ltd” is facing some problems. And as the top

executive of this company we are to find out the problems and to find out the

best solutions for those problems.

1.2 Objectives of the study:

Have an experience of real life business situations.

Representing a company’s top management.

Finding out the major problems of an organization.

Finding solutions of those problems according to the process of decision

making.

Experiencing the process in which different management decisions are

made.

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1.3 Methodology:

When we were given this term paper on decision making process, the first

question raised in our mind was from where we should start, which type of data,

what type of data we need and from where we would collect them.

Then we selected the company upon which we will make our term paperand we

selected “Chowdhury Leather Craft Ltd” as our company.

The report is prepared on the extensive use of secondary data. We gathered

most of our data from the following two places

WWW.Chowdhuryleather.com

Annual report of 2006 (Chowdhury Leather Craft Ltd)

1.4 Limitation of the study:In the way of preparing this report we faced many problems. These problems

caused many obstacles in our report. In spite of these obstacles we tried to make

our report well informed, logical, analytical and well arranged. The limitations

are as follows...

Shortage of information in the official web site of “Chowdhury Leather

Craft Ltd”

We got a very few managerial information in their annual report.

Very little data was available to prepare this report.

CHAPTER –TWO6

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2.1 Over view of the company:“Chowdhury Leather Craft Ltd” is a leading leather product exporting company

in Bangladesh. It is a producer and exporter of 100% finished leather Products.

It is a private limited company and it was incorporated in 1997. It has started its

venture in 1998 and still exporting leather goods.

Its corporate office is in Motijhil and its main factory is situated in Savar. Its

registered capital is 200crore taka and now it is running with a capital f

107crore taka. More than 8000 people directly and indirectly work in this

organization. Now “Chowdhury Leather Craft Ltd” is recognized as one of the

leading leather company in Bangladesh.

2.2 Vision of the company:

We will be the top leather products exporter in Bangladesh. We will produce

and export the finest leather products in Bangladesh and outside Bangladesh.

We will be company with qualified professionals, who will work together as a

team and serve the company with dignity and the highest integrity.

We believe in excellence and will continuously improve our product’s quality

and design.

“Excellence in everything” will be the operative words for our organization.

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2.3 Goal of the company:

Produce and export the finest leather products.

Achieving every year’s company objective which is a specific amount of

net profit on the basis of the total cost.

Spreading our product’s market in all over the world.

Making the company assets double within the next 8 years.

2.4 Organ gram of the Company:

CHAPTER-THREE8

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3.1 Analysis of last five years business reports:

As a exporting company we are exporting finished leather products for last 10 years.

Every year company sets a target of net profit which is to be achieved. But last 2 years

we found that we were not able to achieve company's target. In the previous years we

were very much near to the target but last 2 years we couldn't even go near to the

target. Our business report of last five years is given below....

Year Total cost

(Tk.)

Sales Total Sales Profit Profit

%

company

targetExport Local

market

2002 350000000 351847000 22753000 374600000 24600000 7.03% 9%

2003 420000000 432806000 28270000 461076000 41276000 9.78% 11%

2004 450000000 409928000 48796000 491520000 47520000 10.56% 12%

2005 480000000 467056000 47552000 514608000 34608000 7.21% 14%

2006 520000000 497122000 54754000 551876000 31876000 6.13% 15%

If we see this report we will be able to see that the company's target was to make 14%

and 15% net profit on the total cost but were could only make 7.21% and 6.13% net

profit on the total cost.

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When we started to investigate the reasons why we aren't being able to achieve the

company’s objective we find out many reasons.

For the last 2 years we aren't being able to fulfill our buyer's demand that's why they

canceled some big orders. Sometimes it is seen that we aren't able to produce enough

products in given time.

They are also complaining about the quality of our products and the high price of our

products.

Where technology is improving day by day there we are using the same old

technologies and that is the main reason why we are not being able to improve our

products quality. Our competitors are using new technologies and by using these new

technologies they are improving their products quality. And most of all by using the

new technologies they are being able to produce more products at a low cost of

production. So they are supplying products at a chief rate. So we are losing our market

to them.

3.2 The major problems of our organization:

We gathered information from different sources as much as we can and then analyzed all the

reports and information we have found out the major problems of our organization.

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High cost of production.

Low production rate

Qualities and designs

If we see clearly through these problems, we will be able to find out some problems behind

these major problems. These small problems are causing these major problems.

High employee turn over

Absenteeism

Lack of experience of workers

Lack of advanced technology

High price of lather

Mismanagement of time

Lack of motivation

Lack of training programs

Power supply shortage

HIGH EMPLOYEE TURNOVER:

Employee turnover means employees switch off one company to another company for better

facilities. Labor turnover measures the movement of workers in and out of employment with

a particular firm. The success of an organization largely depends on the performance of its

human resources that means on the performance of its skilled and experienced employees. If

skilled and experienced employees of an organization change their company frequently then

the effect of this change create a problem with its internal and external people and as a result

it is so difficult for an organization to make profit. If a post becomes vacant the activities of

management become hampered. And ultimately this effect goes to the production ratr and

high cost of production.

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ABSENTEEISM:

There is a tendency of being absent in the work place of the workers. Sometimes

they come to work place after the work starting time and leave before the work

time ends. So absenteeism of workers and employees is another major problem in

our company.

TECHNOLOGICAL PROBLEM:

The buyers are raising question about quality of our product. By seeing deeply

through the production process, we managed to find out that the technologies we

are using are backdated and old. That’s why we can’t improve our product quality

and design comparing to the other leather companies in Bangladesh. It is one of

the main reasons behind low production rate.

Lack of expert workers:

Another major problem is lack of expert workers. Maximum of our workers don’t

have enough technical knowledge and working knowledge. As a result our production

rate is not increasing and we are getting less expert finishing in our products.

Time mismanagement:

There is a serious problem of time management in producing products in appropriate

time. We are not being able to meet up with the orders of our buyers. Sometimes it is

seen that we are asking more time for producing their ordered products.

High price of lather:

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Another major problem is high cost of lather. We purchase our raw materials from the

local markets and which costs us a huge amount of money. As result our cost of

production has increased.

Lack of motivation and training program:

There is serious lacking in motivating the workers so that they can work more

efficiently and effectively in their work place. Because of the lacking in motivation

the rate of employee turnover is increasing.

We also have a poor quality of training facility. So there isn’t enough chance of train

the workers and make them expert workers.

Power supply shortage:

The power we get in our factories is not sufficient enough for our production. Rapid

fluctuation of electricity hampers our productivity a lot.

3.3 Alternative solutions:13

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In decision making process the second step is to find out alternative solutions. As the

top executive of the organization it’s our responsibility to find out the solutions of

every obstacle which are in the path of company’s objective. So after finding out the

problems which are the main reasons why could not achieve company’s objectives,

we have gathered as much information as we can and analyzed them very carefully.

After analyzing all the information, we thought of some alternative solutions and tried

to find out their effectiveness and limitations towards the problems we have

discovered. And finally we find out the following alternatives….

Reduce high cost of production:

Payment of wages on the basis of Units:

Workers will be paid on the basis of units rather than on the basis of hours. It

will reduce absenteeism of workers in the workplace. Most often workers

spend time in gossiping, working slowly and carelessly. If wages are paid on

the basis of unit, workers won’t get enough time to gossip or work slowly. It

will also decrease the tendency of workers of leaving workplace before the end

of the work time.

Purchasing raw materials:

Raw materials of shoes, bags, coats, jackets, lather pants from the local markets

and if possible from the raw material producers at a cheap rate so that our high

cost of production can be reduced. We also have to be sure about the quality of

the raw materials we are purchasing for manufacturing our products.

Adoption of advance technologies:

We need to change a major part of our machinery. We have decided to buy

some new advanced machinery especially computer based machines.

To reduce the high cost of production we have thought about some steps as follows:

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Overtime should be reduced from 2 hours to 1 hour, because in overtime

workers are given for each unit of production and that leads to high cost of

production.

Number of workers should be reduced because there are extra employees

comparatively.

Good relation must be remained with the raw material producers, so that we

can get raw material when needed at a cheap rate.

There are many paid holidays in a month and this paid holidays leads to the

high cost of production.

The workers must be conscious about the high cost of production.

Raise production rate:

Reasonable wages:

Reasonable wages will be paid to the workers so that they get motivated and

can work efficiently in the workplace and to reduce high turnover.

Grading workers:

Workers will be graded on the basis of their produced units as average workers,

above average workers, below average workers.

Above average workers will be given bonus, below average workers will be

given training. Separate below average workers from the average workers and

above average workers and train them to make them average workers.

Training programs:

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Every worker has to participate in the annual training program. Below average

workers will be given extra training.

In spite of providing training among the below average workers if they are not

able to reach the level of average workers they must be suspended from the

organization.

Motivation:

Motivation will be provided to encourage the workers on the basis of their

needs, so that they can find work enjoyable in their workplace.

Above average workers will be given bonus. Providing bonus to the workers on

the basis of their production at the end of every month.

Employees will be given transport facilities; lunch will be provided at a low

cost to the workers and the employees.

Power supply:

We have to increase the number of our generators. Because the electricity govt.

provide us is not enough for our production.

For improving our production rate we have thought of some extra steps as follows:

Workers who will present 100% in a month will be given bonus.

The employees who will present less than 80% will be given lower amount of

money than their average pay scale.

Supervisors should consult with the employees about their problem directly.

Efficiency and effectiveness must be remained among the existing workers.

The workers must be attentive to the work so that they can give their best in the

workplace.

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3.4 Evaluating alternative solutions:

After finding the alternative solutions, evaluating the alternative solutions are the third

step of decision making process. In the evaluation process we followed some strategic

process such as ….

Cost benefit analysis

SWOT analysis

Analytic Hierarchy Process

Strategic planning process - applying the objectives,

SWOTs, strategies, programs process

Six Thinking Hats - symbolic process for parallel thinking

After finding out the alternative solutions we realized that we might not be appropriate

in all the decisions because management always has some limitations of information

about the lower level of management and workers. So we need to consult with mid

level, lower level managers and work union leaders, because only top management

cannot implement a decision, we need active participation of all level managers.

Lower level managers and the workers are the people who run all the task of the

company, so if the top level management doesn’t consult with them in making new

decisions the management will not be able to know the reasons of their hesitation.

And if they are hesitated about the taken decisions they will not be able to work at

their full capacity. They will think the management is only forcing them to do what it

wants them to do. As a result it may hamper the existing production rate. So the

management needed to take their opinions before making any final decision.

So we made a group meeting with the mid level and lower level managers and work

unions. In this meeting they freely expressed their opinions. We considered these

opinions to evaluate our alternative decisions.

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Opinions given by the subordinates:

1. Holidays should not be withdrawn.

2. Attendance of the subordinates will be reduced to 90% from 100% because 100%

attendance is not possible on the part of the subordinates.

3. The manager should consult with the subordinates so that any problem can be

solved.

4. Every employee and workers will be given Life insurance facility.

5. Over time must be remained from two hours to four hours.

6. Workers and employees should be given medical facilities.

7. General workers should have pension and retirement fund.

8. Subordinates and workers should have communication channel through which

they can consult with the mid and top level management.

9. The festival bonus should be given to the workers and the amount of the festival

bonus of the workers and employees should be increased.

10. All salaries and wages should be paid within the third day of the month.]

11. The right to commence worker unions.

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Making final decisions:

Making decisions is the most difficult job of a manager. After evaluating all the

decisions we have finally taken some decisions which will be very important for

the development of our organization.

Final decisions are given below…..

1. Old machines will be changed and new machines will be used.

2. Experienced workers will be employed for high production.

3. Experienced trainers will be employed in the factory so that they can give their best

training to the subordinates and workers.

4. Reasonable overtime will be given to them.

5. Proper ventilation and sanitation system will be adopted.

6. There will be only one holiday in a week.

7. Employees will get the pension facility but workers only above 45 years old will get

pension facility.

8. Wages and salaries will be paid within the 3rd date of the month.

9. Attendance of subordinates will be reduced from 100% to 95% and 95% attendance

will be given rewards and attendance below 90% will be given punishment.

10. Wages will be paid on the basis of the units rather than on the basis of hours.

11. Workers will be graded on the basis of their produced units as average workers,

above average workers, below average workers.

12. Above average workers will be given bonus and below average workers will be

given training.

13. Departmentalization on the basis of functions.

14. Workers and employees should be given medical facilities.

15. Vacant managerial posts will be filled up by promoting the employees within the

organization.

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Conclusion:

We think the decisions we have made will help us a lot in achieving our company

objectives. From now on we will use a management information system. This system

will help us implementing our taken decisions. If there is any problem implementing

the decisions, it will be detected by the management system and the problem will be

treated instantly.

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