Crown Point Cabinetry Case Study Analysis Grading

 

Analysis of Crown Point Cabinetry

Prepared by Keith Tarvainen

Objective:

The purpose of this analysis is to determine the causes for the turnaround at Crown PointCabinetry and determine what other changes (if any) need to be made. This report will determineif Brian Stowell, CEO of Crown Point Cabinetry, should continue with the changes he began in1993. Are the safety changes, increased benefits, increased wages, gainsharing and team-basedmanagement systems working or could Crown Point handle this process differently? This reportwill guide Crown Point into the future and determine what should be done to continue its productivity gains in an increasingly competitive cabinetmaking industry.

Executive Summary:

Crown Point Cabinetry has transformed itself into a profitable company with a motivated,content workforce which should be a role model for other small companies. Brian Stowellimplemented changes in 1993 that have greatly reduced absenteeism and made turnover almostnonexistent. This was accomplished with programs such as gainsharing which also reduced labor costs and wage increases. Management level was eliminated in favor of employee basedmanagement teams which control employee reviews and hire and termination of employees. Thisreduced cost and increased employee participation. These changes have transformed CrownPoint Cabinetry into a profitable, admired company that people want to work for which wasBrian Stowell’s goal. No changes need to be made at this time as what Brain did was successful.Continuing to focus on its employees is all that Crown Point needs to do at the present time.

Description of Current System:

Crown Point Cabinetry was founded in 1979 by Norm Stowell when he began makingcabinets in his garage. Crown Point was a family run business which included all seven of hischildren and expanded to 100 employees by 1992. Brian Stowell, with his father’s and siblingsagreement, became lead executive in 1993. When Brain Stowell took over, things were notrunning smoothly at Crown Point. Annual worker turnover was 300 percent and absenteeism wasa major problem. Employee/management relations were described as “horrible.” Management’ssolution to handle the situation was to wield a heavy hand but this had little effect. The greatest problem at this time was poor in-process quality control. Some cabinets were built three or four times before they got out of the shop. Brian decided to take a different approach.Brian called a company meeting and announced that he would be making changes. Brianwanted people to say that they loved to work at Crown Point (which was not a desirable place towork at the time).He encouraged his skeptical workers to trust him.From 1994 to 2002, Brian Stowell and his wife Becky, introduced many changes to CrownPoint Cabinetry. First he reduced payroll from 76 to 53 people. This increased unit and dollar sales. The management system was then revamped. The management layer was removed andreplaced by a team-based management approach. These employee-based management teamswere empowered with personnel and management decision-making responsibilities. These teams

KASUS 12-2 CROWN POINT CABINETRY PENDAHULUAN Paragraf 1--Saat itu adalah tahun 2002 dan Brian Stowell, CEO Crown Point Cabinetry, sedang merenungkan perubahan luar biasa yang dialami selama sembilan tahun periode kepemimpinannya di perusahaan manufactur skala kecil tersebut. Berlokasi di daerah pedesaan Claremont, New Hampshire, Crown Point memasok lemari cabinet dapur bermutu tinggi yang dibuat sesuai pesanan untuk pelanggan di seluruh Amerika Serikat. Perusahaan tersebut merupakan pemberi kerja yang dihormati dan diminati dalam komunitas kecil tersebut, menyombongkan bahwa perusahaan itu memiliki angkatan kerja yang terinspirasi dan termotivasi. Perusahaan tersebut telah memperoleh kepercayaan dari ribuan pelanggan dalam negeri. Akan tetapi keadaan ini tidak selalu berlaku. Industri Paragraf 2--Industri lemari cabinet di Amerika Serikat sangat terfragmentasi, dengan lebih dari 5.000 produsen yang menghasilkan cabinet standar ( stock cabinet ), cabinet semi pesanan ( semi-custom ) dan cabinet sesuai pesanan ( custom cabinet ) melalui berbagai saluran distribusi. Pada tahun 1998, produsen terbesar menguasai 15 persen pangsa pasar ini, sementara produsen terbesar kedua hanya menguasai 7 persen. Lebih dari saparuh produsen memperkerjakan kurang dari 10 orang. Paragraf 3--Permintaan terhadap cabinet mengikuti tren industri konstruksi rumah tinggal. Distributor dan dealer masing-masing mewakili sekitar 30 persen pembelian cabinet produsen, sementara pusat peralatan rumah dan pemborong mewakili sisanya dengan masing-masing mewakili jumlah yang sama. Kurang dari satu persen cabinet dibeli secara langsung dari produsen. Bersamaan dengan munculnya peritel pengembangan rumah besar pada tahun 1990-an, tren permintaan terhadap cabinet standar telah menguat sementara pangsa pasar cabinet sesuai pesanan turun dari 26 persen pada tahun 1989 menjadi kurang dari 15 persen pada tahun 1993. Paragraf 4--Crown Point, dengan 85 tenaga kerja, relative dikategorikan sebagai produsen besar, meskipun beberapa perusahaan produsen cabinet mempekerjakan lebih dari 1.000 orang. Crown Point memproduksi cabinet yang dibuat berdasarkan pesanan dan, dengan rata-rata penjualan pada tahun 2001 mencapai lebih dari $25.000 untuk satu set cabinet dapur, bersaing di pasar kelas atas dari pembuatan cabinet. Sejarah Paragraf 5--Norm Stowell yang mendirikan bisnis ini pada tahun 1970, memproduksi cabinet pertama di garasi rumah nya dengan menerapkan prinsip kualitas dan jasa sekitar pada tahun 1992 Norm telah mengembangkan bisnis tersebut menjadi lebih dari 100 tenaga kerja, termasuk ketujuh anaknya. Sementara pendapatan perusahaan tumbuh secara substansial, laba mengalami penurunan. Brian Stowell, salah satu putra Stowell yang terlibat di perusahaan tersebut, mengelola penjualan pada tahun 1992 tetapi lebih memiliki minat untuk 1

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