Mr Li Essay

975 Words Aug 10th, 2014 4 Pages
1. As Mr. Li would you pursue blanket approval for facades and slabs? Why?

Yes I believe Mr. Li should definitely pursue this initiative because of the fact that a positive outcome outweighs by far the cost of a 4-month lobbying effort. Mr. Li expects that 80% of Union’s sales will come from HKNA projects, the government is forecasting a 179 block demand for next year alone in which 50% of this demand would require precast materials.

Unicon´s current capacity only sustains 7 blocks per year and accounts for a 35% market share along with 3 more competitors, which gives Unicon´s market leadership, current market production amounts 20 blocks per year and 2 more competitor´s are expected to arrive at year´s end. Having in mind this
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2.What changes do you foresee to Unicon´s operations if the blanket approval is accepted by the HKHA?

By having the blanket initiative approved several factor´s in Unico´s operations will change, avoiding need for approval would enable them to shift from a made to order to a made to stock production in which they will need a demand forecast method and inventory management processes in order to avoid having work inventory built ups, also they need to enhance their current stocking space. Unico´s current operations are full book order operation oriented, but with the new upcoming demand and the blanket initiative approval will definitely test Unico´s ability to adapt their operational capabilities into a bigger and more demandign operation avoiding having idle times to meet this new production volume in operational efficiency. Mr.Li has to prepare their current facility with process technologies that would allow them standardize the process thus allow them to have a competitive production process,

Lead time inventory expansion

3-What steps would you take to increase production of slabs and facades? How would you implement your plan?

To increase production of slabs and facades I would do a pro and con analysis of the most viable options:

1.Expand 5,000 square meters to double capacity-Although this seems to be the best option because of the fact that it would avoid trade-offs in the current product lines and the

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