Peejay A. Basa Mrs. Araceli Yap, MBA. I. II. III. IV.

Time Context: Present Time Viewpoint: Owners of Lajoma Furniture

MBA 4 Case Title: Lajoma Furniture

Central Problem: Potential loss of customers due to delays of materials causing increasing orders not to be accommodated. Statement of Objectives: Must: Redesign Lajoma products thru innovation and continuously accommodate increasing demand from customers. Want: Retention of current customers and sustain companys success and profitability. Areas of Consideration TOWS (external environment) THREATS 1. Delayed delivery of raw materials 2. Prime raw material is becoming scarce 3. Competition from other furniture manufacturer 4. Increasing price of wood and sometimes price monopoly from suppliers OPPORTUNITIES 1. Other substitute for wood can be used by Furniture manufacturers. 2. Product can be re-innovated thru product reengineering and by becoming innovative and creative. 3. Theres an increasing demand for furniture (be it household and industrial need) 4. Steady supply of other raw materials (steel and plastic) that can be considered by the manufacturers. 5. Increasing popularity of Philippine furniture in global market. 6. Cheaper raw materials will increase profit. WEAKNESSES 1. Current layout is not flexible. It needs restructuring. 2. Employees need to be trained to be more flexible as well. They need to be oriented with other means and raw materials in doing their products. 3. Current machinery is not suited to be used for other raw materials. Theres a need to invest on new machineries. Its capability is limited. STRENGTHS 1. Expertise of owners on various field is essential to companys growth 2. Hands on management style and high involvement rate of the owners on the operation

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3. Lajoma is already established and experienced venture in terms of furniture manufacturing. 4. Lajoma has built customer based market and following which patronized their products 5. Strong sense of partnership among business owners 6. VI. Alternative Courses of Actions Redesign Lajomas product line by using other raw materials (like steel and plastic) through product innovation and breakthrough in relation to Mr. Lauro Gaffuds recommendation.

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Advantages 1. It will draw interest from the current market and its potential market as well. 2. It will give customers an impression that Lajoma is seeking for continuous development thru reengineering and product innovation. 3. New raw materials are highly accessible and available for Lajoma. 4. New raw materials are being offered at a lower price and its supply is stable. 5. New product line with bigger variety, designs and form will be possible. It can be differentiated that will attract bigger customers. Disadvantages 1. Its costly and will require huge investment for Lajoma (in terms of changing machinery, equipment and layout) 2. Customer acceptance is uncertain. 3. New marketing strategies need to be deployed. 2. Find and qualify new suppliers that can provide steady supply of wood and ensure delivery when Lajomas production needs it. Advantages 1. No additional cost will be incurred in terms of restructuring current layout, training of employees and acquiring new machineries to replace current one. 2. Lajoma can do price negotiation if there will be new vendors since wood will not be single sourced anymore. 3. It can retain current product line which has market acceptance. 4. No need to change current marketing strategies and activities Disadvantages 1. Qualifying another supplier is costly and time consuming. 2. There will never be a guarantee that wood supply can be continuous.

3. Wood price vary from time to time since supply is unstable.

3. Import supply from international market. Advantages 1. There will be regular supply of woods for consumption. 2. There will be greater selection and variety of woods that will be available for Lajoma. 3. Another design can be obtained by using different types of wood. 4. Product will be highly regarded since raw materials are imported from other country. Disadvantages 1. Its costly. Additional cost may be incurred like transport and legal processing fee across legal boundary. 2. Potential legal exposure 3. Availability will be longer since transit time will be included on total lead time for the primary raw material. VII Recommendation Adopt ACA number 1 VIII Detailed Course of Action
ACTIVITIES Set a meeting to discuss the possible conversion of process and product Brainstorm about the proposal and study its PROS amd CONS Prepare cost report and analysis Prepare and submit proto types, drawings and sample of the products using new raw material Source out for new suppliers that will provide supply of the needed raw materials (based on the approved product lines that will be released by Lajoma) Source out for new suppliers of needed machine and equipment Restructure production line to meet the requirement of the new process Training of employees Communicate to current customers the changes Lajoma is planning to take Generate Marketing Strategies and Plans Run some samples for product demos and marketing samples Generate Cost Analysis Report comparing actual incurred cost against the planned cost. Mass Production build of new products/ designs Monitoring of Sales and customer acceptance Revisit marketing plan and strategies Release of new designs and product line Monitoring and review of the overall result RESPONSIBLE Mr. L. Gaffud Owners Finance Head Mr. L. Gaffud and his DE team Mr. Jose Roque and His Purchasing Team Mr. Jose Roque and His Purchasing Team IE and Prodn team Skills Training Group of Lajoma Mr. M. Palisoc and Marketing Team Mr. M. Palisoc and Marketing Team Prodn team Finance Head Production Team Mr. M. Palisoc and Marketing Team Mr. M. Palisoc and Marketing Team Mr. L. Gaffud Owners TIME FRAME 1 day 7 days 3 days 21 days 14 days 7 days 7 days 7 days 4 days 7 days 7 days 3 days continuous continuous if needed continuous continuous