Executive Summary
In January of the year 2009, the Preston plant was manufacturing sustainable paper product, yet
it was not a fine year for the plant. Though there was a huge mass production, the plant had
made a loss of $ 10 million in that year. In October of the year 2008, Tom was made the COO.
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Table of content
1. Introduction ………………………………………………………………. 4
1.1 Significant events ………………………………………………………… 4
1.2 Plant being brought under control……………………………………….4
1.3 Strategic consequences of improvements……………………………….. 5
1.4 Strategic benefits of bringing plant under control………………………5
Recommendations……………………………………………………………..6
References………………………………………………………………………8
1.5
4
Introduction
The Preston plant was founded in Vancouver, Preston. It manufactured coated papers for
specialized printing uses resulting to the most of the plant’s production. It used top notch coating
machines that produced précised coatings that were to be exerted in rolls of paper. Coated rolls
were cut into standard sizes after the coating process was done. By January 2009, the plant was
producing an acceptable product however it was not a good year since the plant had made a loss
of around 10 million dollars. In October 2008, Tom Branton was appointed COO of the plant.
1.1 Significant events
There are significant events that made the plant survive. In the spring of 2009, a new paper was
manufactured so that it could supply the next new generation of printers. This was request by
Hewlett Packard, the project was called Viper project. The other event was that the plant was
obtained by the Rendall Group which was disappointed at the findings. There were two year
losses and the curl issue disapprovals. They made it clear that the plant was to be shut down if
the plant did not get back at its feet.
1.2 Plant being brought under control
The COO, Tom Branton then set a task of bringing the plant under control, they first decided to
go back to monitoring systems set during the rectification of the curl problem, which was back in
2008 where HP’s staff had noticed a problem. Hewlett Packward (customer) had raise some
queries that the papers were curling which the suspected was low humidity though no customers
had come up with the same. The HP staff was the one who noticed. The plant’s production
personnel worked to separate the problem’s cause over the next 8 months. They enhanced
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systems that detect the processing measurements. The quality increased, the productivity was
improving and the process was finally under control. The measures were effective the plant still
did make losses. Various production teams started holding daily review meetings and some ‘first
pass analysis. They also brought all three shifts together monthly so that they would be on the
same page. It also enabled them to look at the overall data and debate the implication of the data.
The other factor by laying off some of the employees, however difficult it was mandatory. They
also eliminated the unquestionable shut-down laws which indicated when a line stopped when
they suspected that there was a problem in the operation quality. In May 2009 they had to get rid
of 64 jumbo rolls of not specified product which was over $400,000 of product destroyed at
once. This happened because the production personnel had been afraid of shutting down the line.
This was the problem or they had tweaked the line when it was still operation in order to get rid
of the flaw. Previously the operators couldn’t stop the process, and if they did the management
would pressure them into doing it not knowing the repercussions.
1.3 Strategic consequences of improvements
Gaining control of the process helped in cutting cost by reducing number of employees and
deduction of salaries. The reviewing of the data improved the prospects of developing new
products as the deficits were revealed. As the plant was doing good, they received more business
which meant they needed a steady supply, hence maintaining a good rapport with their suppliers.
Organization and problem-solving tools facilitated in establishing the much needed work force
hence retaining necessary and best staff.
The strategic improvements meant that quality tools were established. It also brought about
clarity and removes the complexity of the processes. Even though there was damage the
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management was back on its feet by the end of December, 2009 where it began gaining profits.
By 2010, Preson had HP’s approval. HP requested Preson to establish a new product- ‘heavy
weight’ paper. Later the plant was awarded the heavy weight ink-jet paper contract. Rendall did
not close the plant as profit margins were rising.
1.4 Strategic benefits of bringing plant under control
The changes that Preson underwent were fundamental and resulted to the plant gaining control of
the plant. This brought a lot of benefits to the plant. The benefits that were strategic include it
improved quality, building statistical process control. The operators and management became a
team and all became part of the process and the project. Secondly, they got to work on new
products. This was accomplished because of the new processes that were established and new
ideas that the plant acquired throughout this process of reestablishing its quality performance.
The other one was the reduction of costs which was through laying of staff by understanding it
brings about clarity. Understanding to what an appropriate level of operating costs should be also
reduced cost. Evaluating what a perfect plant looked like and the minimum employees to run it
also made things clearly and eventually reduced the cost. As Tom Brinton stated ‘having
someone working with the suppliers so that we can guarantee to give production good material
and take that problem out of the equation saves people as well.
Recommendations
I would recommend the company to continue with a regular communication with their
companies. To continue working as a team between the process and management teams, that if
they work as separate entities there will always be a communication barrier. In future that they
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would take to mind in standardization of each and every process however small so as to avoid
the loss of time to manage the already injuries. I would recommend that they continue cutting
cost however the process. I would recommend the plant to continue taking critics positively as it
facilitated the improved their operations as was with HP. I would recommend moving forward to
expand and make new products so that they could increase the profit margins.
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