Question

MI Toys is an electronic toys manufacturing company. The company sells its products all over Middle East and North Africa. The company builds its brand image by assuring quality of its products, the company also aims to be socially responsible by managing their environmental impact through ISO certification. The company enrolled for ISO certification and all its processes are well governed and follow ISO guidelines. It delivers excellent products to customers. Company B is the competitor of MI Toys and it does not have ISO registration, but it still manufactures products as good as MI Toys.

Also, the company MI Toys was facing problems in inventory management. So the company plan to benchmark its inventory management process with a car manufacturing company which had an efficient inventory management process. The proposed benchmarking process displays four phases of benchmarking - planning, data collection, analysis and adaptation. For the effective implementation of benchmarking the following factors are required: The support of top management is a is an essential factor with respect to the accomplishment of benchmarking process. The lack of support and involvement from the top management or even fellow colleagues is often caused due to a lack of benchmarking-understanding. Subsequently, the promotion of benchmarking-knowledge is needed to launch a smooth benchmarking process. High level of employee involvement and teamwork in a benchmarking process is necessary. Benchmarking might be unsuccessful due to lack of managerial planning. Hence, the preparation before the start of a benchmarking project and the evaluation at the end of a benchmarking project is significant.

QUESTION NO:1

Analyse and identify the suitable ISO standards (at least 2 standards) registered by MI Toys with proper justification, explore the benefits (at least 4) of implementing the ISO standards in the MI Toys and how can you prove MI toys company is superior than its competitor.                                       

(Analyse = 2 Marks, Justification = 2 Marks, Benefits = 4 Marks, Compare =2 Marks)

QUESTION NO:2

Analyse the benchmarking level followed by MI toys, identify the challenges (3 points) & requisites (3 points) for successful implementation of benchmarking, and what way will it help to get the edge over the competitors?

(Analyse = 2 Marks, Challenges =3 Marks, Requisites= 3 Marks, Way to help = 2 Marks)

Answer 1

1) As given in the case,

• MI company delivers quality products to it's customers.
• MI company is socially responsible by managing environment impact.

Suitable ISO standards registered by MI company are following:

ISO 9000

• It is related to quality management of products.
• As MI company delivers quality products to the customers and meet their expectations so, this standard is suitable for the company.

ISO 14000

• It is related to the environmental management by the company.
• This is a family of standards which provides essential tools and guidelines for the companies to manage their responsibilities for environment.
• MI company also manages it's environment impact due to production etc. So, this standard is suitable for the company.

Company is also following it's social responsibility by managing environment impact so ISO 26000:2010 for social responsibility is also suitable for the MI company.

MI company is following ISO standards, and there are always some benefits for the companies which are as follows:

• Company is increasing it's marketability by following ISO standards because company is delivering quality products and meeting customers' expectations.
• Increased customer retention by the company.
• Operations expenditures are reduced due to ISO standards because these standards show the areas of improvement in operations and management.
• Internal communication is improved.
• ISO standards facilitate reduction of products liability risks.
• Attractiveness to investors.
• Customer service is improved.

So, these are some benefits of implementing ISO standards in MI company and for other companies too.

MI company is superior to it's competitors because:

• MI company is ISO certified which gives an upper hand over other companies.
• MI company is building trust by serving it's customers by providing quality products, this gives the competitive advantage.
• Company is also going to follow benchmarking which will again give competitive advantage.
• Company is enjoying customers' retention which is always important in business.
• Following ISO standards, winning customer satisfaction and trust always lead to better brand image and it is a competitive advantage.

So, these are some reasons why MI company is superior to it's competitors.

2) Level of benchmarking

• As given in the question, MI company is benchmarking it's inventory process with a car manufacturing company which has a good inventory management process.
• This kind of benchmarking is called functional benchmarking which is one of the three levels of benchmarking.
• In functional benchmarking, functions or processes of a company are compared with other best company.
• After comparison, processes and functions are followed in order to achieve improvements.
• MI company is doing the same by the support of top management and employees team within the company.

So, MI company is following functional benchmarking level.

Challenges for successful implementation of benchmarking:

Granularity

• Benchmarking research is too general or too specific.
• Often the topic for benchmarking is too general or too high level in a company that makes difficult to take the appropriate steps.

Data

• Availability, quality, statistical relevance and more in benchmarking.
• One of the challenges in benchmarking is data, because data is not easily available and hard to collect at once.

Getting values from the results

• It's a challenge to apply the results of benchmarking on the operations.
• It's really hard to make the results acceptable for all the levels of the company or department of a company.
• Benchmarking is not a one time process but it is a continuous improvement. So, keep this continuity on is really a challenge hy applying results of benchmarking.

So, these are some challenges of benchmarking.

Requisites for successful implementation of benchmarking:

To implement benchmarking process successfully following are the requisites:

• Goals and objectives of benchmarking should be set across all levels of management.
• Each role and each responsibility should be in writing to make the benchmarking process clear and understandable.
• Outcomes or results from the benchmarking process should be communicated clearly.
• Results of benchmarking process should be shared with each participant or employee and each performance should also be highlighted.
• Solicit solutions and adjustments.
• Implementation of changes.
• Benchmarking data should be collected and saved for long continuous improvement.
• Each participant should be rewarded and success of benchmarking process should be celebrated.

So, these are some requisites which should be done effectively and efficiently for the successful implementation of benchmarking process.

Benchmarking helps in following ways in getting an edge over the competitors:

• Benchmarking allows a company to gain an independent perspective about the performance compared to other companies which in turn results in competitive advantage.
• Benchmarking allows a company to identify the areas of improvement so, by improving the weak areas a company gets competitive advantage.
• Benchmarking allows a company to develop a standardized set of processes and metrics which increases productivity.
• Benchmarking facilitates continuous improvement in a company and this continuous improvement results in an edge over competitors in a long run.
• Benchmarking allows a company to set performance expectations which in turn results in high performance thus resulting in competitive advantage.
• Benchmarking allows a company to monitor performance and manage changes time to time which results in efficiency and effectiveness of work.

So, in this way benchmarking helps a company to get an edge over competitors.

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