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Category: Social Issues

Autor: anton 26 March 2011

Words: 1285 | Pages: 6

Situation Analysis and Problem Statement

Imagine being Chief Executive Officer of a Fortune 1000 company with projected annual earnings of $46 million dollars and revenues totaling in excess of one billion dollars. However, the company has operated from a status quo position for years, you find that your company sales revenue is quickly declining, profits are uneven, and the ability to retain staff is being negatively impacted. As Chief Executive Officer it is your duty to turn the company’s situation around so as to not loose any ground in the industry. This is precisely the situation that Riordan Manufacturing is currently facing. How would you go about resolving the myriad of problems at hand without losing

anymore profits and revenues? The following pages will address some viable options to address the situation described above.

Situation Background

Riordan Manufacturing Company is a global plastic producer with three production facilities one in Albany, Georgia; a second in Pontiac, Michigan; and a third in Hangzhou, Chine. Riordan Manufacturing employs 550 workers, has annual projected earnings of $46 million dollars. Riordan Manufacturing primary clients are automobile parts and aircraft manufacturers; the Department of Defense, beverage makers, bottlers, and appliance manufacturers (University of Phoenix, 2006.

The company found itself in a very delicate situation with decrease in sales revenues, low employee morale; due to the lack of incentives and rewards employee retention also declined. The Chief Executive Officer knows that something must be done immediately to turn the situation around if the company is to minimize the impact of the situation. Assistance in rectifying the precarious position of Riordan Manufacturing must be a collaborative effort between members of upper management, the human resource department, as well as employees

Issue Identification

Riordan Manufacturing is facing two years of declining sales, employee morale, and work ethics. Due to this tenuous situation, Riordan Manufacturing is being forced to implement strategic changes in manufacturing and marketing. The changes primarily focused on the company’s sales practices, leading to include a new system strategy called adopt a customer-relationship management (CRM) system. Another issue is some of the company’s work was redirected to a new manufacturing plant in China. Some plants restructuring have occurred leading to a self-directed work team approach, as a result more employees are leaving the company. Riordan Manufacturing completed their annual employee survey, revealing a decrease in overall job satisfaction, especially in the areas of compensation and benefits (University of Phoenix, 2006.

Opportunity Identification

Implementing the CRM system is an opportunity to increase sales profits, by using the team approach to servicing each customer. The sales team approach is specifically design to focus on the individual customer’s need. Each team includes a sales person, product engineering specialist, and a customer service representative; working together to ensure their individual customer’s sales need (University of Phoenix, 2006.

The annual employee survey results are an opportunity for Riordan Manufacturing to address key concerns of their employees. Based on the survey results an employee recognition and rewards program is critically needed to ensure staff retention and job satisfaction in the areas of salary adjustments and financial incentives. The salary adjustments and financial incentives should be a direct result of performance appraisals that clearly align with the business strategy (University of Phoenix, 2006).

An outside consulting firm is a worthwhile expense, especially if the firm is able to identify the critical issues and make suggestions regarding the most effective way to identify and rectify the numerous internal problems experienced by the company. The consulting firm is able to identify time frames, cost and outcomes of any suggested solution the company implements.

Stakeholder Perspectives/Ethical Dilemmas

The employees and customers who depend on Riordan Manufacturing are the stakeholders who will be impacted the most, should the company not address the issues that are causing the decline in company’s profits. From the customer’s point of view, if Riordan Manufacturing is not serving their complete needs, there is no reason for the customers to purchase products and services from the company. Employees are the key to a successful company; therefore, if employees are concerned with their compensation and benefits he/she will not work up to his/her full potential.

This type of behavior will significantly impact the company’s ability to generate profits. Some ethical dilemmas that may arise can be a direct result of lack of proper focus, incentives and rewards. This issue can lead to personality conflicts between frontline employees and middle to upper management. This type of ethical dilemma can lead to a collapse of the staff driven infrastructures.

From the customer’s perspective, if his or her sales needs are not being met appropriately it is likely that customer will turn to Riordan’s competitors for the same goods and or services. A reduction in staff and or lost of sales volume can severely impact the bottom line profits of the company, which will directly impact the profitability of the investors. Any person considering investing in a company will have second thoughts if the company is not showing an increase in income and profits.

Problem Definition

Riordan Manufacturing must completely overhaul the company’s structures and processes while paying special attention to their current sales and marketing strategy. Specifically, Riordan Manufacturing must redesign the financial incentives and rewards being offered to its employees in hopes of finding new motivational strategies. Successful restructuring of the company’s solutions and benefit packages will go a long way to stabilizing the company financially. A system that buys, builds, borrows, bounces, binds, and boosts staff is appropriate for the company. This system will bring people into the organization, train and develop the staff, remove the non performing staffs, retaining the appropriate talents for the jobs, including boosting people into the right positions (Ulrich & Wayne, 2005.

End-State Goals

A complete overhaul of the reward system is necessary, in addition to using concrete solutions to address the most critical staff issues and as a way to find new strategies for motivation. Additionally, issues leading to employee dissatisfaction at Riordan Manufacturing must be quickly identified, and a positive course of action adopted and recommended as-soon-as-possible. An adequate Human Resource system must be put into place to assist with staff issues and monitor the flow of people and performances. This includes a reward system to motivate and keep employees on the job long term.


A complete overhaul of a company’s practices and procedures takes in-depth research and requires the assistance of a neutral party such as a consulting firm that specializes in that type of research. Once the findings are identified it is critical to the company survival that all recommended solutions be implemented; the cost of the implementations must be affordable.


Ulrich and Wayne (2006). The Work of HR Part One: People and Performance 4(5), 21-23. Retrieved May 10, 2006, from

University of Phoenix (2006).

Riordan Manufacturing Company Overview. Retrieved May 10, 2006, from

University of Phoenix (20046). EBook Collection. Chapter 2: Some Basic Theory about Ability, Motivation, and Opportunity. Retrieved May 10, 2006, from

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