Unicon Concrete Products Case

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Production of Slabs and Facades at current Factory utilizing current shift of workers

Long Term

1. Develop Strategic Partnerships with Architectural and Structural Engineering Firms in Hong Kong and PRC

2. Continue patents renewing after 3 years for a maximum of 20 years •Expand facility as future prospects and current profits dictate after the 2 year boom.

3. Emphasize in sales and advertising the overall total cost savings and benefits of the pre-fabrication method.

4. Create a cross functional team to research improved concrete technology. (e.g. roman concrete)

Pros & Cons

1. Keeps competitive edge and going forward in to the future Potential loss of customers who need “one stop shopping”

2. Can accommodate a temporary increase in capacity

3. Ability to revert back to one shift when necessary

4. Keeps quality and customer responsiveness consistent

5. Time and cost associated with each approval greatly reduced

6. The main disadvantage in a “blanket” approval is that if Unicon gets it then the competitors would also get it. This standardization could lead to all customers and then customers could interchange one firm’s product for another.

Alternative #2:

Short Term

1. Immediate expansion of production facilities adding 5000 square meters to the facility

2. Continue to offer current line of products and add a second shift of workers to increase production of both the Facades and Slabs to try to meet market demand.

Long Term

1. Continue Expansion of the facility to meet market demand and grow industry capacity to 50+ blocks per year

Pros & Cons

1. Future possibility of re-entering the partition and stairs market Does not provide company with a competitive advantage

2. Covers immediate and possible future demand Risk in reduction of quality and customer responsiveness from new employees

3. Still provides the “one stop shop option for customers” Hiring of more staff and layoffs during slow periods

Recommendations

It is recommended that Unicon proceed with alternative number 1.There is already a strong relationship with the HKHA as they currently do 80 percent of the Unicons business; this is an opportunity that can’t be avoided. It could prove beneficial for both parties as this will greatly reduce lead time and costs. This is the growing trend in the industry and will allow Unicon to take advantage of much different cost savings that come with it. The detailed benefits of this path are outlined below:

1. To take advantage of maximum benefit of the market boom by having Unicon meet the current market demand as much as possible, while starting a strategy that will give them a competitive advantage.

2. It is recommended that Unicon develops partnerships with other prefabricated concrete companies in mainland China to focus on precast only and work together with them on contracts with HKHA and other general contractors

3. To become the leader in the market of pre-fabricated concrete products and control the expansion of the company based on the anticipated rise and fall of the industry, utilizing research, patents and strong business relationships to gain a competitive edge.

Implementation

1. Continue to work with HKHA and firms to obtain patents and pre-approvals for all pre-cast construction products

2. Notify employees of decisions made/obtain employee support. Immediately notify workforce of the decisions that were made. Develop and execute an employee incentive program , success depends on having full support from employees

3. Need for change management as deletion of product lines can cause job anxiety

4. Increase production of slabs and facades

Monitor and Control

Push for the blanket approval which will lead to higher volumes.

First of all, the management should announce the upcoming changes to the whole company. With a new change of focus on the product lines, the production workers will need to work with management to re-configure the floor space.

Meanwhile, to development an Element Evaluation. It is impotent to measure success or failure. A quarterly review of production, Quality and upcoming contracts is needed. Daily production quantity of facades and slabs 50 facades/day > 98 %

Unicon could also attempt to establish other barriers such as product innovation, long term contracts or other regulatory barriers. Take advantage of the Registered Structural Engineer (RSE) for each project.

Conclusion

The booming market Unicon is currently experiencing in Hong Kong should be seen as an opportunity for the company to grow. They are completely capable of accommodating the growing number of forecasted demands. If the new strategy is implemented successfully, it will help Unicon to become the leader in the market of pre-fabricated concrete product and develop a strong relationship with partners to better work towards the projects with HKHA and other general contractors.

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