plantk ceramics an indonesian opportunity case study tk ceramics an indo

Case Study:
TK Ceramics: an Indonesian opportunity
Tim Bortolli, Kate Johnson and Renee Nguyen were approaching exhaustion at their second straight 12-hour day of meetings. Tim and Kate were joint owners of TK Ceramics, a small business they started together after leaving university. TK Ceramics had grown to become Victorias largest importer of European ceramic tiles, now operating from a 4500-sqm warehouse in Port Melbourne, with 70 staff. Renee holds the newly created title of General Manager of HR; the title reflecting the impending growth of the company.
The long days of meetings were due to the immense amount of planning required to put in place the next phase of the companys growth. TK Ceramics had enjoyed a lot of success in importing tiles from Italy; the European styles, designs and colours translating well to the culturally diverse Melbourne market. Rather than sell to the public, TK Ceramics sold wholesale to bathroom stores all over Victoria, and collaborated with a few exclusive architects who worked with high-end renovations. Twenty-two field sales representatives continuously worked their large retail customer base, and a further 28 staff worked in the warehouse unpacking, checking and shelving incoming stock, as well as preparing shipments for the companys delivery fleet four times a day. Another 20 staff worked in the office, in roles such as customer service, finance, accounts and administration.
However, a year ago, Kate had been on a sabbatical in Jakarta Raya, Indonesia, taking a motorcycle tour with her partner. While taking a back-roads tour one day, she had come across a small tile factory that produced plain standard tiles, and, not being able to fully disengage from work, asked to meet the owner.
Kate spoke with the owner, Alatas, all afternoon, toured his facilities and made a promise to be in touch as soon as she returned home. She was very excited about the opportunity to develop a new supplier. While sales of European tiles were still strong, they were expensive, and they had to carry a lot of stock to cater to the wide variety of tastes in Melbourne.
Alatas factory represented a chance to supply tiles to the mass market new home building companies, commercial installers, hospitals, shopping centres and so on, where design was less important than price and functionality.
Tim and Kate decided to go for it, and met with their bank and business advisers to plan the expansion, and hired Renee to develop and execute the HRM strategies. They decided to launch the new business stream through a new, wholly owned retail network, a radical departure from their existing business model. In addition, they were going to create a new brand for their shops. They had decided to maintain their current business and its relationships under the identity of TK Ceramics. They had, however, adopted the strategy of multiple presences and were determined that their new business stream wouldnt dilute the existing one.
Renee was now immersed in the HRP to execute this strategy. She needed to design a structure which clearly separated both supplier and customer-facing staff into the separate streams, but could also make use of the existing warehouse infrastructure for both.
Further, she had a mission-critical task to complete before anything else. All ceramic tiles sold in Australia must meet strict Australian Standards ISO 13006: 1998 for Definitions, Classification, Characteristics and Marking (the product standard), and ISO 10545 Test Methods.
Preliminary investigations of the product produced by Alatas factory showed that while the
tiles were generally good, there was too much variation in size, surface finish and strength to consistently meet the standards. Testing each batch in Australia and rejecting non-compliant tiles was too expensive and wasteful. The quality control had to take place in Jakarta Raya. Alatas was very happy to do this, as the new deal with Tim and Kate would result in a near- doubling of his output.
However, Tim, Kate and Renee had concerns that the expert human capital required to design, implement and monitor the quality procedures in Alatas factory werent available in Indonesia. They had just decided to recruit and send an Australian expert to Indonesia to embed into the factory for a year, to ensure that there were no problems with standards compliance and wastage at the Australian end.
Tim hadnt needed to do this before. Most of the Italian tiles they imported were already tested and compliant with the strict EU standards, and Tims Italian heritage and language skills made communicating their needs to suppliers in Italy with phone calls and an occasional visit very effective.
Renees list of jobs was growing rapidly. Not only did she have to prepare to staff the seven presence strategy. She also needed to find just the right person to send to Jakarta Raya. Source:
Prepared by Stephen Turner, Murdoch University, Perth.
1 What is the best process to redesign the internally facing and customer-facing jobs?
2 What are the advantages and disadvantages for drawing at least some of the shop
workers from existing staff?
3 How would you create job descriptions and person descriptions for jobs in the shops that do not yet exist?
4 Do the field sales representatives have similar key skills and abilities requirements to those that may be needed for the shop staff? Discuss.

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