Problem Statement and Company Objectives

Problem Statement and Company Objectives

        In 1987, Campbell Soup Co. was a leading diversified food processor in soup products with 60% of the market share in the U.S. In addition, the $1.6 billion revenue allowed them to prevail in the condensed soups and ready-to-serve soups market. During the 1980s, there were rapid changes in customer demand for greater product quality and convenience as well as new competition in the market. Campbell responded by exploring different options in ready to serve microwavable products until Plastigon was identified. The Plastigon project was initially seen as an extension of existing production methods and not much resources were allocated to it. However, it proved to be much different than what was expected and greater technical expertise was required. Since it was an uncharted territory for them, various managerial and technical issues caused the Plastigon project to be plagued with huge delays, preventing it from reaching a working state. A more detailed discussion about the problems as well as the proposition of alternative strategies will be addressed in the following case study. In addition, a revenue projection analysis was done to determine whether going forward with Plastigon project is more favorable compared to abandoning it and focusing on other product lines such as the DRG.

Issues in Plastigon and Improvement Strategies

One of the major issues that caused the Plastigon project to fall apart was the lack of integration between the product and process capabilities. During the design stage of the Plastigon container, the engineers did not consider the current processing capabilities which later proved to cause a lot of technical issues. Ideally, representatives from both the packaging and engineering systems department should have communicated frequently during the design stage. One of the most crucial steps at the design stage was to define the constraints on the product design, which will determine whether the project can be very time consuming and costly depending on the compatibility with the current manufacturing facilities and techniques as well as the level of internal knowledge to accommodate for this novel design.

As suggested by Gaimon et al. (2017), it is important to achieve a perfect integration between product and process capabilities and this requires the ability to manage the amount of knowledge development and knowledge transfer between teams. In this case, it seemed that Campbell had a higher knowledge base in terms of the Plastigon product development compared to the process design. Hence, the packaging team should transfer more of their knowledge to the engineering systems team during the earlier stages of the project. To further increase its knowledge on Plastigon, the engineering team itself should also focus on enriching their knowledge through extensive experimentation and/or acquiring it from external sources such as competitors and allies. In practice, for this strategy to work, it is important that the engineering team is competent enough to be able to grasp and implement the knowledge obtained.

Geographical limitations was also a limiting factor in this project that contributed to the longer period of time required to set up and test the production line. Engineers assigned to the project were mainly based in Camden, New Jersey and had to fly to Maxton, North Carolina each time a new component had arrived in order to work on assembling the equipment, which usually involved major construction and hence greater supervision. This frequent need to travel continued for 2.5 years and it proved to be a toll on the engineers, which led to a lower retention rate of engineers working on this project. This, in turn, would require people who may be unfamiliar with the project to take over and it is possible that this frequent change of hands would have led to further communication breakdown and also a possible lack of direction or motivation to keep the project going.

A fixed core team of engineers with the right expertise in each section of the line should have been formed instead and relocated permanently to Maxton for the duration of the project to ensure their full commitment. While this involves larger initial costs and probably not all the engineers selected would be willing to relocate to another place for a long period of time given personal or other current work commitments, doing so would had been more cost efficient in the long run than setting up a test line at Camden since they would have to move it to one of the main plants in the future when the line is up and fully running. Since the decision to set up the Plastigon line at Maxton was due to the space available there and the efficiency of operations in general, there should not have been a better location to set up the new line. At the same time, an operator team from Maxton can also be formed to work with this core team and be able to gain experience in working on the new line, easing the transition at the plant.

The lack of support on the ground can also be attributed to the lack of understanding of the objective at the higher level, which is to launch Campbell into the microwavable product market. The plant managers were more concerned with their own current performances such that they were not willing to risk lowering their monthly operating results for a yet “untested” line. Given the larger scale of the project, the higher management should have provided some leeway such that the Maxton plant will not be held accountable for any less-than-stellar results within this testing period. This could possibly ease the load and allow some reallocation of manpower resources to help out with debugging the Plastigon line. Granted that Maxton was undergoing a strain during the same period to produce more on the main lines, as this was a long term investment, more resources could have been put in if the team was committed to making the project work.

Campbell’s decentralized system promotes better specialization and faster decision making process but due to its nature, it renders the communication between departments to be ineffective. Since Plastigon involved the expertise from various different departments, there were conflicting interests and lack of commitment towards the project. For instance, the standard procedure in the factory prevented them from cooperating with the engineering team when it was actually needed the most. In this particular situation, Campbell should not have implemented this rule and allow them provide their resources and help towards the project. There were also conflicts between the engineering and packaging department regarding whether they should start the production line or do more testing. On top of that, the team also received huge pressure from the marketing people which might have caused the project team to become less careful and meticulous in their decision making. Therefore, Campbell should increase cooperation not within the project team, but also as a whole corporation. With a more cooperative company culture, Campbell can significantly improve in handling innovative and large projects to further promote their competitiveness in the market.