One of the more obvious challenges that the company faced was drying time increased in the summer. Due to hot and humid summer days Earth Buddy production director Ben Varadi had to confront the challenge of drying time taking an excess time of two hours. Due to this challenge work in process may be impacted negatively, which causes an increase in production time and overall efficiency standards will decrease. Another challenge that effected production was the vague direction given to Varadi by the co-owners regarding how much product he should allow to be produced. The challenge for Varadi was to only produce enough to keep up with sales, since the company could not afford to carry a large inventory.
Some of the other problems include the lack of employees in the filling, molding and painting stages, which is limiting the number of units that could be produced. Another problem that the company is facing is its production bottleneck. Seiger Marketing had already moved and expanded its Earth Buddy division’s factory and warehouse twice in two months. Even so, current production levels were straining the physical limits of its latest factory.
To address the challenge of increased dry time in the summer, the company should implement temperature-controlled rooms. This would enable the company to move forward with production in full force without the two-hour delays caused by hot weather. The stability in dry time would make it easier to predict all year around helping control inventory and costs. By not having to worry about the additional two-hour dry time in the summer, Earth Buddy can minimize wait time, while maximizing production. The temperature-controlled rooms can also have another positive effect that will help production and dry time. With many of the modern temperature and humidity control systems the general five hour dry time can be cut down to three to four hours, enabling two batches to be dried in one day. Given the known eight-hour shifts, twice as many Earth Buddy’s can be dried in one workday.
The issue of the co-owners Anton Rabie and Ronnen Harary being uncertain about the company’s direction will have serious negative consequences in the future, unless they become more involved and more certain as to the direction they would like to lead the company. It is apparent that Ben Varadi is concerned about the production direction, yet the only response he is getting from the co-owners is to “Remain flexible. We could get an order for 100,000 units, but if the order doesn’t arrive, we would have to put the workforce on hold. We can’t afford to carry large inventories.” The uncertainty amongst the two owners can drive the business to the ground. The fact that Rabie and Harary want the best of both worlds, to…