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Flexit International

Case Study

Osama Khalil

on 15 October 2012

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Transcript of Flexit International

New research on the European market needs.
Proper advertisement and promotions for the sales.
Continues surveys about the product quality and customers’ feedbacks .
Expert teams in international issues.
Building new plant in Europe. Future plans
To assure the quality control program in my plants.
To Concentrate on producing spare parts for all our products.
To Give special attention for the production of digital thermometer and pregnancy tests as they are our vital few products in this situation as a result of study of sales breakdown.
To keep producing the other items as they are our useful many products after making the required improvements. Future plans
Question 4b Establish an effective quality system with an expert quality manager assignment.
Adopting a future plan for building new plants in Europe.
Training programs for the workers.
Establish service center for repair of guaranteed products and receiving customer complaints.
Surveys for customers, retailers and wholesalers.
There should be available stock based on surveys and analysis of sales breakdown and customer feedbacks.
Dealing with more than one distributor with proper follow up of their work. products should be tested again before release to the market.
Increase the inventory of spare parts.
Arrangement with certified service center in europe to repair the guaranteed products at the customers’ location.
Outsourcing to cover the defects and meet the increased requirements as soon as possible.
Assigning an emergency team to deal with current situation.
Maintenance of the plants and machines.

Do not continue a second shift at ALL the factory sites but focus on the plants providing products which have higher sales records as to ensure the quality of the products.
Question 3b: FISH BONE DIAGRAM Question 3a:
Operational decisions incorrectly made by
Flexit international These are 1-Why was there a loss in the European Market ?
Diminished sales and increased inventory due to returned products.

2-Why were there diminished sales and an increase in inventory ?
Products were returned due to faultiness or inaccuracy of the product and therefore, also , slow sales.

3-Why were the products faulty ?
Use of defective materials, and no spare parts.

4-Why were the materials defective and no spare parts ?
No time to test them before leaving plant and no enough time to produce spare parts quickly.

5-Why was there not enough time ?
Due to rush to penetrate European market quickly.

6-Why was there a rush ?
Lack of knowledge and bad leadership. Loss Of European Market WE'LL PUT THE 5 WHYS as to…

Defective products
1. Why were the products defective?
Because they were not tested before leaving plant.
2. Why were they not tested?
Lack of time
3. Why was there a lack of time?
Because of sudden rush for aggressive penetration of European market.
4. Why was the sudden rush?
Because this didn’t wait before performing a proper market study
5. Why did not they do a proper market study?
Bad leadership

My company is not ready at the mean time to penetrate the European market successfully.

Our future European plan is to reintroduce the product to the European market but after making drastic changes in Flexit’s organogram, strategic and operational planning that will take some time.. Future plans
Question 4a

Penetrate European market quickly.
Predictions and forecasts are the basis for decisions not research and evidence based data.
let the market settle down , very reluctant way to deal with problems.
Placing all the logistics activities burden on Physique alone. MARKETING
Strategic planning activities were carried out by Mr.goodbody only.
Mr.sellem had no international experience in marketing.
A decision was made to adopt direct sales exporting approach not based on research and even though there was no plan on how to implement it.
One distributor in the whole European area taking exclusive rights.
No experienced people in international expansion were consulted.
Forecasting marketing results was based on no market research.
Not considering data and feedbacks obtained from sales pattern breakdown. QUALITY
No quality control system checking all steps of production starting from raw material used ending by packing the final product.
No auditing activities.
No corrective action was taken as regards the defective products. Surveys.
Swot analysis.
BrainStorming. Question 2:
Additional information needed before
entering European market? The problems in this case were:
Problems related to Flexit’s facilities:

-Adding a second work shift was not enough to increase productivity
-No future plans to build new firms in Europe .
-Manufacturing overlap between plants wasn't considered to cover any shortage or emergency situations. The problems in this case were: Problems related to the management:

- Improper leadership and management as there was no team work activity for taking decisions. It was Mr Goodbody's decision alone.
-No plan from the start on how to meet the required needs and increase the production level in the plants before considering exporting to the European market.
-No good research on European market needs.
-No good plan on how to enter the European market.
-No consultation of expert people in the European market.
-No proper quality control programme in the company at the first place (testing every item before leaving the factory may be time consuming on large production basis.).
-Great dependence on physique,ltd.which was not a good partner and representative for Flexit company.
-No good arrangement for the shipment in case of emergencies or considering other forms of transportation. Not at all, it could be an excellent decision.
International expansion is the dream and aim of any ambitious company ,as this leads to increase in their revenues, increase their market share in their existing countries and have better reputation. But, this has to be done on strategic basis, tactics, good planning and good study of the new market requirements.
In the light of the result of Flexit’s attempt to penetrate the European market, Yes ,the company was wrong in even considering international expansion at that time. Was the company wrong in considering international expansion? Question1 Dr Bothina Ahmed
Dr Ebaa Ibrahim
Dr Eman Awad
Dr Osama Yehia
Dr Hani RahmatAllah
Dr Belal Mohamed No proper handling of the problem due to not
putting into consideration feedbacks about sales breakdown. Second wok shift wasn't an effective way with
the same number of workers due to no HR planning strategies. No market research before conducting
export to european community. Lack of procedures to test products before leaving
the states as a normal ruslt of rush in penetrating european market. Low inventory of spare parts leading to
inability to meet increased requirements in the
european market within required time frame. Work overload on the machines leading to defective maintenance
&irregular calibration with the result of low quality products. No verification or validation of the products before delivery to the european market due to rush to cover the european market needs. Machines Materials Methods No indicators for quality measurement
were put from the start. Failure to achieve the expected revenues as being based on assumptions&forecasts not on accurate market study. Measurements Loss of European
market Workers not prepared to
second shift due to time rush. No plan or research if additional manpower was needed to meet the increased production level and no time frame was given. No experience in international market. Bad management &leadership Manpower FUTURE PLANS Future Plans Part1 Part2 Low competition markets are not always promising as there will be no motivation to innovation and creation . Thank you Thank you again!! ◄What are the different routes available for my company to enter the international market?
◄What is the optimal form of market entry for my company?
◄What are the needs of our customers?
◄Who are my vital few customers?
◄What are their benefits from my company?
◄How will my company create those benefits?
◄Who are my competitors in the European market? ◄What are the best selling home medical equipment in this region in the last 5 years?
◄What are the average prices of those items?
◄A list of all foreign distributors who can help me is essential.
◄What will be the fate of my products in the European market?
◄How much will the company pay for this project to be successful?
◄A predicted percentage of success to my project.
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