DAP Case analysis
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Transcript of DAP Case analysis
30 min presentation – with attitude!
ALL subjects included
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Info:
- 4th of 9 competitors on the market (western auto and just in time automotive before it)- 9% Return of Capital (ROT)- Western auto -> Higher value with technology -> Higher price
Problems:
- No more product in the last 3 years- Concentrated on cost -> No technology upgrades -> Increasing downtime -> No flexibility ->
Produce to stock- MANUFACTURING:
o RAW material income -> Lower the costs -> Supplier pipelineo Process improvements -> NO MORE COST CUTTINGo NO AGILITY -> Customer needso DOWNTIMES -> PREVENTIVE maintainance -> Premium price for being agile
- DISTRIBUTION:o Infrastructure tools -> NO capital investments?????o Department is large and geographically dispersedo No formal communication within department -> Training maybe????
- MARKETING AND SALES:o Distribution improvement to gain customer intimacyo 69% of the customers bring the 90% of profit -> ALL THE direct and wholesale want
products IN TIME AND ON SPEC -> Spec means the exact product that means communication -> In time: Communication WITHOUT mistakes
o Focus on long term and risk-free -> Maintaining???- Research and development:
o Not enough marketing -> They do not spend enough time to realize what are the values for the customers they develop
o GOOD EMPLOYEEs (no need to change)
SCENARIO:
- MINIMUM 12% Return On Capital Employed -> Bigger growth rate than industry’so cooperate among departments, quality improvement, cmmunication with parent
companyo Cooperation -> Quality -> Customer intimate -> Grow o They try:
top-line revenue increase to 50% through innovation and customer relationships
65% old asset Need 90% utilization of NEW ASSETS -> Lower expenses