The Die And Mold Industry

Published Date: 02 Nov 2017

CHAPTER 1

INTRODUCTION

Background

The die and mold industry serves as a backbone for manufacturing concerns through delivering tooling for different manufacturing processes such as injection molding, die casting, forging and sheet metal forming. Dies and molds are utilized to manufacture discrete parts to "Near Net Shape" (NNS) prior to machining and grinding to assembly ready tolerances [3].

Trojans is one of the leading service providers in the engineering sector for both the corporate as well as defense sector. Its manufacturing facility with the name of PIC technologies is located in Hattar Industrial Estate. It is equipped with number of modern equipments such as CNC Machines, CNC Electric Discharge Machine, Conventional Machine Tools, Sheet metal fabrication etc. Beside PIC technologies is the only ISO 9001:2008 certified investment casting facility in Pakistan, for which this facility is known all over Pakistan.

Investment casting process is one of the most advance forms of a casting technique as well as one of the most complex one. The process starts with wax patterns which are produced through injecting semi liquid wax into a metals die. Wax patterns are then dipped in slurry of fused silica, which results in a ceramic shell. The wax patterns are melted out of these shells and liquid metal poured in to produce the final product. The key factor in controlling this process is the quality of wax patterns, which is dependent on two factors, i:e., quality of wax and dimensional control and exactness of die for producing these wax patterns.

As a policy, Trojans do not manufacture the die for the part. Therefore, the client has to provide or arrange the die for the product it desires to get manufactured through investment casting process. This policy while removing certain process hurdles also repelled many potential clients. So back in 2008, it was decided to enhance in house capabilities and self indigenize in the die making process. However, after three years, in spite of much efforts and investment this new engineering product is yet to see the light.

Developing a new engineering product is a challenging task, especially when the technological advancements are faster than ever and the technology behind the product itself is changing at a rapid rate. Therefore, the process of a new engineering product development requires a structured approach, both in the planning phase as well as development and implementation stage to ensure that the goals are met and vision of the top management of the company is realized.

Development of dies and molds is a new product for PIC Technologies. The vision behind this product is to not only facilitate the existing investment casting process but also to develop such expertise that the company is able to provide dies and molds to other manufacturing industries. Therefore, developing expertise in this area will open new markets as well as consolidate on the existing ones.

Problem Statement

Existing technological capabilities of PIC technologies are sufficient to practically implement the idea of manufacturing dies & molds. In spite of this, due to lack of planning as well as technological and management issues duly explained in later chapters, the first die is yet to be manufactured. Close analysis of the existing work environment reveals lack of any proper structure or a planning process which is to be followed for any new initiative or a product.

Keeping above in view, it is imperative to revisit the existing work flow, and incorporate a strategic planning approach towards the new engineering product development process of the organization. This approach will lay down the basic guidelines for a system and procedures that will allow establishing proper checks and balances while at the planning, development and implementation phase. This will allow the management to better control the work flow and take right corrective and preventive steps.

Research Aim and Objectives

This research is designed to identify the issues related to new engineering product development at one of the companies working in the Small and Medium Enterprise (SME) i:e., PIC Technologies. After realizing all these issues, we will formulate a strategic planning model that works within the given structure and parameters, and once implemented will ultimately streamline the new engineering product development process.

Research Aim

This research aims to investigate the reasons behind failure to successfully develop new product and apply a strategic planning model within the existing structure with an aim to plug in the leaks in the system. Different Strategic Planning models will be studied and appropriate model will be customized and implemented in the existing structure of the organization.

Research Objectives

The top most objective of this research is to develop and customize a strategic planning model for a new engineering product development process. This objective is further divided into following specific objectives, achieving the following objective will result in achieving the main objective;

To critically analyze the existing work structure of PIC Technologies.

To study in depth different strategic planning models available in the literature as well as those implemented and customized by different organizations worldwide.

To study the dynamics of a new engineering product, and how the latest advancements in technology has changed the way new product is conceived and developed.

As part of SWOT Analysis, conduct an internal and external analysis to present realistic facts and figures, so that the top management is better informed to make the right decision.

Conduct an external analysis through a questionnaire based survey to answer following questions.

What are the existing technological capabilities of the die industry and whether it is aligned with modern advancements or not.

What is the level of self-indigenization of die maker, i:e from designing to manufacturing how much work is done in house and how much is outsourced.

What is the existing capacity of the industry in terms of number of dies produced per year, size of dies etc.,

What are the major challenges and problems being faced by the industry

Based on the Literature review, internal and external analysis and data gathered through industrial questionnaire devise and implement a strategic planning model for any new engineering product development.

Recommendations to properly and effectively implement the strategic planning model so preempt problems to take preemptive actions.

Scope of Research

The scope of research will be restricted to a strategic planning modeling for a new engineering product development, with development of dies and molds for a PIC Technologies as a reference. As part of SWOT Analysis, external and internal analysis will be done. Internal analysis will be carried out through analyzing the existing structure of the organization and identifying strength and weaknesses. External analysis will be conducted through a questionnaire based survey among the die and mold manufacturers in Pakistan. In addition, dynamics of new engineering product development will also be discussed and incorporated into the strategic planning model. Research will conclude by proposing recommendations for implementing the devised strategic planning model in its true letter and spirit.

Research Design & Structure

The research is designed to do an in-depth study of PIC technologies and study the existing infrastructure. The literature review would be extensively cover topics related to strategic planning, development, new engineering product development and die & mold industry in general. On the basis of ideas discussed in the literature review, the research would be structured and conducted. The areas that need special focus would be highlighted and weaknesses would be pointed out. Feedback from different people from the industry would provide the basis for studying existing infrastructure. In the end, recommendations would be given and a model would be developed.

Research Work Significance

This research is very significant with regards to development of a new product for any company working in the SME sector. It would also point out some problems which are often similar for most of the companies working in the SME sector, which hinder the growth of the industry despite the potential. As the research would be applicable to almost all of the companies categorized in the SME, therefore the guidelines proposed in this research can be formed as the basis of any system being to be implemented for new engineering product development.

Thesis Structure

The first chapter of this research has provided the basic background to the whole study. This chapter has discussed the problem in detail and approach that is going to be adopted in order to find a solution to the problem. The importance and scope of this research has also been discussed in this chapter.

The second chapter is related to literature review, discussing the concepts of strategic planning and modeling, development of products in an industrial unit and the details about die and mold industry and its various products.

The third chapter would cover the concepts of strategic planning and modeling, where different models would be studied in detail. The next chapter would give a detailed study of the ideas behind the development of a new product.

The fifth chapter will be based on a feedback from people in the industry which would help in understanding the ground realities and problems at PIC technologies. A model would be suggested in the next chapter while the last chapter would cover the recommendations and conclusion in detail.

CHAPTER 2

LITERATURE REVIEW

Literature review will be focused on following three key aspects of the research and each will be discussed in depth later in the chapter.

Strategic Planning & Modeling

New Product Development

Die & Mold industry

Strategic Planning

Strategy related terms have been used in the academic as well as corporate sector for quite some time. The word "strategy" itself is an ancient word. It comes from the Greek strategos, referring to a military general and combining stratos (the army) and ago (to lead) [Reference]. However, professionals and academicians from around the globe define strategic planning differently. Some of these definitions are discussed below;

Definitions of Strategic Planning:

There are number of strategic planning definitions available in the literature. Some of the most common definitions taken from various sources are as under;

Process by which the guiding members of an organization envision its future and develop the necessary procedures and operations to achieve that future [1].

Setting a clear set of objectives and mobilizing resources to achieve them [2].

Approach taken that will affect the overall direction of the organization and will establish the organization’s future environment [Reference].

Strategy is the way an organization seeks to achieve its vision and mission. It is a forward looking statement about an organization’s planned use of resources and deployment capabilities [Reference].

According to Porter (1996), "strategy is the creation of a unique and valuable position involving a different set of activities, requiring tradeoffs in competing, to choose what not to do and involving creating 'fit' among the company's activities [Reference].

The decisions taken over time by top managers, which, when understood as a whole, reveal the goals they are seeking and the means used to reach these goals. Such a definition of strategy is different from common business use of the term in that it does not refer to an explicit plan. In fact, by my definition strategy may be implicit as well as explicit [6].

The determination of the basic long term goals and objectives of an enterprise, and the adoption of courses of action and the allocation of resources necessary for carrying out these goals [7]

The pattern of objectives, purposes or goals, and the major policies and plans for achieving these goals, stated in such a way as to define what business the company is in or should be in and the kind of company it is or should be [8]

What determines the framework of a firm’s business activities and provides guidelines for coordinating activities so that the firm can cope with and influence the changing environment. Strategy articulates the firm’s preferred environment and the type of organization it is striving to become [9]

Mintzberg defines strategy as a combination of 5 Ps [10], which is further summarized by Zarkesh (2006) as under [11];

Strategy as a plan: It means the direction or course of action for the future.

Strategy as a pattern: Refers to the course of action an organization has followed over the past. In this view strategy means consistency in behavior.

Strategy as a position: It means the place in the environment where resources are concentrated. Or a company’s act to locate a popular product in a popular market.

Strategy as a perspective: It is an organization’s fundamental way of doing things. In contrast with the third P that looks out (i.e. environment) in perspective it looks in (i.e. inside the organization).

Strategy as a ploy: A specific "maneuver" intended to outwit an opponent or competitor.

The main reason to list down these definitions is to simply demonstrate that each of the above can be interpreted differently. For example, sixth definition seems to suggest that strategy can only be understood after the event, and is revealed by studying what management actually did. According to the seventh definition, strategy is a proactive process where long term goals are determined before the event and resources deployed accordingly. Whereas the eight definition portrays strategy as a pattern of objectives which define what the company is and intends to be in a broad sense.

Such diverse perspectives and opinions on strategic planning reveal how different individuals perceive strategic planning. A different perspective on strategy can be derived from economics: the forces of competition ensure that, on average, successful companies are those which, by chance or otherwise, choose the most effective strategies [2]. Therefore, it is natural that successful companies would tend to exhibit various characteristics of strategic planning contained in the definitions, such as identification of objectives, plans and guidelines for dealing with the unexpected and effective allocation of resources. Since many companies have a record of success stretching over decades, it is reasonable to conclude that there is scope for distilling lessons from their experience and formalizing these into a set of generally applicable principles.

George A Steiner has defined strategic planning in his book in which he has diverted from general concepts and abstract ideas. Rather, he has tried to present a more substantial definition of the concept of strategic planning. Planning is defined by him as something that caters the future consequences of current decisions. It is a process where the present and future have a cause and effect relationship. It also deals with the alternative courses of action that become available to an organization in the future. Current decisions actually help to shape these alternative courses in the future.

Strategic Planning is also a process which starts from vision and mission statement and finishes with the determining the programs that need to be completed. It is also a philosophy, which means it involves a lot of thinking and intellectual exercise. There is a premises to the plans on which everything is built which is then implemented. After the implementation, the whole thing is reviewed and evaluated to measure the degree of success. This is what the strategic planning exercise actually is, contrary to the vague ideas and concepts. [18]

Need for Strategic Planning

Peter Drucker said, "If you want to know what the future is, be a part of its development" (Haas, 2006, p. 72).

Over the past couple of decades, a revolutionary shift has occurred in the way new businesses work. Some of the factors that have resulted in this shift include;

Growth and importance of the internet

Globalization of trade

Consolidation of many industries

The growing importance of the environmental movement

Concern about the limitations of natural resources.

Furthermore, McKinsey & Co (2006) reveals that seven of the ten companies with the largest growth in share value over the past decade did not exist twenty years ago [1].

In today`s competitive environment, managers and engineers are constantly facing uncertain situation in which to make decisions and operate accordingly. Although, the conventional role of an engineer i:e., designing, developing and manufacturing; is important and significant, but now it has been extended to various other key functions within an organization such as identifying the product to be developed, the schedule and resources required, and the goal of satisfying the customer [12].

The idea behind strategic planning for any organization is not just to ensure that the organization will remain financially sound and be able to maintain its reserves. Rather it is a structured approach of projecting where an organization expects to be in next five, ten, or fifteen years and how it will get there.

Experiences of consultants have shown that most planning processes carried out by organizations are poorly conceptualized and even more poorly executed. Furthermore this experience has also shown strong resistance to planning in most organizations and that it is rarely creative when it is done and, moreover, is largely tactical rather than strategic in nature [1].

The reason that most planning processes result in poorly planned long-range; rather than strategic plans is that most of them are based on the assumption that future can be derived from the present situation. For example, an organization may plan based on the assumption of an existing nine percent growth rate which when compounded over the next five years will result in increase in revenues. However there is a basic flaw in this thinking approach; that it is assumed that no significant changes will occur in external & internal environment over the next five years. A genuine strategic plan should involve an effort to consider a variety of futures and develop options for meeting each of these futures [1].

In this modern era, there should be no doubt that strategic planning is critical to the success of any organization. However, a survey conducted by McKinsey & Co. (2006) reports that less than half of the almost eight hundred business executives who responded to its online survey were satisfied with the manner in which their organizations conducted strategic planning. And, although three - quarters of these executives indicated that their organizations engaged in strategic planning, less than a quarter of these executives reported that their organizations used the results of the planning process in making important organizational decisions [Reference of McKinsey].

Also in this survey, executives raised following concerns about the strategic making process;

Manner in which their organizations communicated their strategies to those not involved in the process

How they executed the strategy

How they aligned the organization to the plan

How they measured performance against this strategy

Finally the executives made two major suggestions for improving their organizations strategic planning process

To improve the company’s alignment with the strategic plan

To develop methods for monitoring the company’s progress in implementing the strategic plan.

The above discussion can be safely concluded that a strategic planning process within an organization is eminent in order for its development and growth.

Hierarchy of strategy

It is important to note that strategic planning process is not only required at the top level of an organization. In a broader perspective a hierarchical view of a strategy at three different levels are briefly discussed below [13].

Corporate strategy is the set of explicit or implicit decision rules that determines what business a firm will be in and not be in, and how it will allocate resources among them.

Business strategy is how a firm develops and sustains a competitive advantage within an industry.

Functional Strategy is the set of decisions made in marketing, operations, finance, research and development, and human resources that supports the business strategy

Prerequisites of a Working Plan

A working plan has certain pre-requisites that help in the successful implementation. Therefore, in every strategic plan, where the purpose is to organize and manage the present conditions and practices in order to achieve success in the future, certain things must be ensured. The spirit of strategic planning includes the following.

Simplicity

Written principles

Clear ideas without any vague concepts

The ground realities must form the basis of any strategy

Time must be allotted in order to see the success or failure of a plan. Things must not be rushed which may cause problems. [17]

These pre-requisites are quite clear and simple to understand. For any strategy planning process these things should be considered before putting everything on the paper. The management of present to get to a foreseeable future is something that is the basic objective of all planners. It must be clarified whether a particular plan is to achieve some short-term objectives or long-term objectives. For long-term objectives, time is very important. In the beginning the strategy might not be able to bear any fruits but the results are only visible if the policy is allowed to settle, which might take considerable amount of time.

Advantages and Disadvantages

Many businessmen would believe that strategy planning is an exercise of futility which is meant for big organizations only. Others would think that it is an academic approach which brings not fruits as the realities are always different from the plans drawn on the paper. Therefore, they would believe that it is a time wasting exercise and it is better to get to the main point. However, there are many important aspects regarding a business that are covered during the strategy planning exercise. Some of these advantages are as follows. [15]

Strategy Planning helps a businessman to produce something of value for the market by making better use of the time and supplies.

The ideas of strategy planning are understood by everyone involved in a business and the crisis management becomes easy as everyone is able to relate to the same rules.

Strategy Planning is a way to develop better means of communication. Rather than moving haphazardly, a plan makes it much easier to communicate with all the stakeholders, including the buyers, sellers and investors.

It is basically a tool to manage everything properly which is related to one’s business. Therefore, it makes the job of a manager much easier as it often defines roles and responsibilities in a business. [16]

Any discussion of strategy inevitably ends on a knife edge. For every advantage associated with strategy, there is an associated drawback or disadvantage [14]:

Strategy sets direction

Advantage: The main role of strategy is to chart the course of an organization in order for it to sail cohesively through its environment.

Disadvantage: Strategic direction can also serve as a set of blinders to hide potential dangers. Setting out on a predetermined course in unknown waters is the perfect way to sail into an iceberg. While direction is important, sometimes it is better to move slowly, a little bit at a time, looking carefully but not too far ahead, as well as to each side, so that behavior can be shifted at a moment's notice.

Strategy focuses effort

Advantage: Strategy promotes coordination of activity. Without strategy to focus effort, chaos can ensue as people pull in a variety of different directions.

Disadvantage: "Groupthink" arises when effort is too carefully focused. There may be no peripheral vision, to open other possibilities. A given strategy can become too heavily embedded in the fabric of the organization.

Strategy defines the organization

Advantage: Strategy provides people with a shorthand way to understand their organization and to distinguish it from others. Strategy provides meaning, plus a convenient way to comprehend what the organization does.

Disadvantage: To define an organization too sharply may also mean define it too simply, sometimes to the point of stereotyping, so that the rich complexity of the system is lost.

"Strategy provides consistency."

Advantage: Strategy is needed to reduce ambiguity and provide order. In this sense, a strategy is like a theory: a cognitive structure to simplify and explain the world, and thereby facilitate action.

Disadvantage: Ralph Waldo Emerson said that "A foolish consistency is the hobgoblin of little minds". Creativity thrives on inconsistency by finding new combinations of hitherto separate phenomena. It has to be realized that every strategy, like every theory, is a simplification that necessarily distorts reality. Strategies and theories are not reality themselves, only representations (or abstractions) of reality in the minds of people. No one has ever touched or seen a strategy. This means that every strategy can have a misrepresenting or distorting effect. That is the price of having a strategy.

Basic Strategic Planning Process

The basic process of strategic planning is quite linear in nature as illustrated in the diagram below.

Vision, Mission and Values

Vision is very important before formulating a strategy. It tells you what to do regarding your business and how to do it. It is the basis of all planning and devising a strategy. It also gives you context regarding your decision-making. It is important to keep everyone keep interested and motivated and it also provides a base to measure the output of the workforce. So, the importance of these three elements cannot be neglected in terms of strategy planning.

A mission is an outcome of vision, which is more concrete and tangible in nature. It flows directly out of a vision. If someone wants to help the poor and needy, it would be one’s vision and the mission would be to enlist volunteers to carry out the task of providing help. A mission of an organization is visible through its mission statement which is a comprised of certain components as shown in the figure below. The most important part of a mission statement is realizing who the customer for an organization is. Afterwards, the needs and requirements of a customer are determined, which basically suggests what the organization is going to create for the market. The customer is located in the market and his needs and requirements are catered. All this combines to give a mission statement for an organization.

After determining the vision and the mission statement, the organizations sort out certain values and a value system which transforms into the culture of an organization. All this is an important part of the first step of strategic planning.

External and Internal Analysis

The direction of a business is provided by the vision and mission statement defines the direction. The next step is formulation of a strategy and analysis is the basic part of formulation. The external analysis is very important as it gives you an idea about the market, the demographics of the society, your competitors and everything you need to know about the surroundings of your business.

The internal analysis is a study of an organization’s strengths and weaknesses and everything about the internal environment. Combined with the strengths and weaknesses, from the internal analysis, and the threats and opportunities, from the external analysis, a strategy can be formulated.

Strategy

The strategy is formulated using SWOT analysis, which is a product of research conducted during the second phase of strategic planning. The threats can be overcome using the strengths of an organization and weaknesses can be dealt with using the opportunities in the market. Therefore, the strategic plans are chalked out from the analysis and research.

Tactics:

Tactics are an important part of strategic planning as it provides the action to fulfill the mission within the framework of the value system of an organization. Tactical layout is laid down after the formulation of strategy. Different methods are defined and adopted in order to complete a business plan. In the end, a successful strategic planning exercise is always carried out with sound tactical knowledge and implementation of that knowledge. [1]

Processes and Mechanisms of Strategic Planning [1][2]

Although the model of strategy planning is quite simple in nature but the processes and mechanisms involved in the model make it a complex study which involves highly trained professionals who have knowledge of every little details regarding the organization.

Collecting Background Information: The background information is important before undertaking any project and is a vital part of planning process. The information provides the basis on which the actions are determined. It gives the idea of the present, which is then managed to get to some futuristic and advanced goals.

A Planning Workshop: There are certain questions that need to be answered during a planning workshop. It is fundamental for any organization to realize where they stand and how did they manage to be at that position. Afterwards, it must be realized where the organization is going and where it must be going. In the end, in order to achieve that position, the executives and managers must suggest ways in order to achieve that position in the future. This gives the situation, the momentum, the direction, the desired direction and the strategic plan of an organization. These questions are raised during different phases of a planning workshop. [3]

Assimilating Information in form of a Workbook: All the information gathered in the planning workshop is collected in the form of a workbook. The purpose is to present everything in clear and logical form so that everyone understands the current position and the things that need to be changed in order to achieve certain goals.

Second Planning Workshop: After the first workshop and the assimilation of ideas in written workbook form, it is important to have another workshop. The purpose of this step is to come up with a mission statement that is coherent with the ideas presented in the first phases. Goals are also defined which gives an idea of what organization needs to be doing and things that need changing. Clear objectives are formulated in order to achieve goals. This is what the strategic plan looks like in any organization in general, i.e. translation of mission statement and goals in workable, practical and effective objectives.

Formation of a Committee: A committee must be created in the second planning workshop with the members who have clear ideas about the working of the organization. The purpose of this committee is to oversee and administer the working of the whole system. If there are certain deviations from the plan, it is the job of the committee to point out the flaws and set things straight. Therefore, it is better to have a permanent committee with maybe some flexibility in the nomination of members, so that everyone has a clear about the strategic plan of the organization.

Contents of a Planning Document

Philosophy Statement: Philosophy Statement is the same as the mission statement of an organization. It defines the philosophy which determines the tasks undertaken by the organization and means to undertake such tasks.

Needs Assessment: Assessment of needs is clearly given in a planning document. It gives the idea of the specified goals of an organization.

Goals of the Association: Goals of association or organization are also an important part of the planning document. Without clearly defined goals, an organization has nothing to work for.

Objectives of the Association: Objectives of the association in the planning document comprise certain things including the list of things that are needed by the organization, the output or the end-product and the means to achieve those end-products. All these things need to be mentioned so that they are religiously followed, which forms a part of basic strategic planning.

Establish Program Alternatives: Costs of conducting the program are clearly laid down in the planning document or workbook. This includes the time required, the requirement of human and non-human capital and funds required to undertake the program. The time needs to be sorted out so that it must be understood whether a certain program is long-term or short-term in nature.

Programs are also discussed, which is nothing more than a set of instructions to fulfill an objective or need which has been stated in the document.

Limitations and constraints are also elaborated upon in the planning document. It states the things that work in favor of the organization and that work against the organization. People working for the organization must be well aware of all the things, including money and time limitations, so that they stay within the limits and do not exceed. Rules and regulations must be defined on the basis of values of an organization. This determines the culture of an organization.

There are many types of constraints which can create problems. Therefore, all these types must be included in the planning document so that the workforce and planning committee is well aware of the problems they are dealing with and they might face in the future. An alternative must be mentioned in case of the fact that constraints are causing hindrance in the program. The limitations are social, technological, administrative, legal, political and economic in nature. The planning workbook must contain ideas to overcome any limitation at any stage of the program.

The development of a program is hindered and delayed by many things which must be considered while preparing a planning workbook. These forces are outside the organization or they may be internal forces. The external forces include political pressure groups and other interest groups. The internal forces are the workers and administrative hierarchy of an organization. All these problems must be pre-empt and anticipated in a strategic planning document.

There are many programs that need running and it is the job of planning executives to come up with the best suitable system with definite program priorities and alternatives. Action plan is carried out which is actually the sequence in which all the programs must be considered. In the end, the mechanisms to evaluate the programs must be suggested which is a way to measure the growth and without which the organization would be unable to measure its overall performance in relation to the fulfillment of its goals and objectives.[1] [2] [3] [4]

Strategic Planning Practices employed by successful Organizations:

Clearinghouse’s 1996 strategy study discusses some of the strategic planning processes employed by organizations to better compete in a global competitive environment. The same is summarized as under [3R].

Stretch goals & drive strategic out-of-the-box thinking. While different organizations use different parameters, all of the best practice companies set targets that required a shift from business as usual.

Their planning processes are evolving and flexible. A "continuous improvement" philosophy guides the planning-process design.

Communication of the strategic plan is a formal and significant element of the process and it is viewed as a measure of quality planning.

Planners emphasize action plans and strategic thinking. Planners expect strategic thinking to take place primarily at the business unit level.

The planners' distinction between strategic planning and business planning is increasingly blurred. As the cycle time between strategic plans shortens, business planning is done within the context of a strong corporate vision or culture, even if a corporate strategy is not articulated.

The role of strategic planning as a key element in the management system is explicitly recognized through strong links to other elements of the management system (e.g., strong human resources and organizational structures).

Documentation of strategic thinking is stressed.

A single core competence or capability is not the driver of strategic planning. Instead, the basis for competitive advantage and new business development is based on diverse competencies.

Approaches to planning processes and planning system designs vary greatly. Although approaches vary, the framework of issue and option generation, prioritization, review and feedback continues to have universal relevance.4

Modeling Approach to Strategic Planning

The models of strategy planning are very common and they are generalized for small, medium and large scale organizations. These models have been followed extensively throughout the years, with slight modifications. [1]

Model A:

Prepare the assignment

Defining the scope of the plan

Defining the end-results sought through different plans

Determining the development stages of a plan

Job demarcation

Timing of the completion of each job

Informational requests

Build up key inputs

Past history of the plans is determined

Major trends in the environment and surrounding atmosphere are studied

Opportunities and threats are determined

Strengths and weaknesses of the organization are assessed.

Sales forecasts of present products are designed

Mangers pass their judgments based on their experiences

Alternative actions are realized and determined

Main objectives for the organization are determined

Sales objectives

Profit-making objectives

Product development objectives

Manpower and personnel management objectives

Strategies and policies for different aspects are realized and formulated

Marketing strategies and policies

Product strategies and policies

Financial strategies and policies

Personnel strategies and policies

Price-setting strategies and policies

Technological innovation strategies and policies

Medium-Range plans are formulated in great detail, covering even the minute aspect of the strategy

The decisions which are required to be made urgently are also determined and implemented

Performance is monitored

The whole system is reprocessed on annual basis to oversee the development and to make new decisions

Model B:

Defining the organization that the executives want

Current customers are analyzed in detail for marketing purposes. Following are the important aspects of customer analysis.

Who are the customers?

How the customers need to be classified?

Why do different classes of customers buy the product? Will the attitude of customers change? How can the attitudes be exploited?

How the other segments of the society can be targeted in order to include in the customer base?

Analyzing the industry or organization in detail

Trends are monitored

Pacesetters, innovators and leaders are determined

Competition with other similar industries is determined and realized

The potential for profit-making is determined

Opportunities and threats to the organization are determined

Strengths and weaknesses of the organization are determined

Different strategies are identified

Alternatives are evaluated

Objectives and purposes are developed

Plans are laid down to fulfill different strategies and plans

Contingency plans are developed for unforeseen events as a part of crisis management

Budgetary preparations are made according to different plans

Annual review is done in order to ensure the smooth-running of affairs

Model C:

Practical understanding of strategic planning is developed in general and for a small-scale business in particular through different means.

Literature available on the subject is extensively studied

Management consultants are hired in order to assist in the process of strategic planning

Professional seminars are organized where different people from the relevant field are invited to deliver lectures and share their experiences

Other companies undergoing strategic planning are visited in order to provide impetus to the employees

Identification of WOTS UP

Weaknesses

Opportunities

Threats

Strengths

Underlying Planning in order to deal with the four elements

Strategies are identified to exploit opportunities to undermine the threats to the organization

Identified strategies are evaluated and selected

Major aims of the organization are laid down, including

Mission statement

Purposes and philosophical leaning

Specific objectives which are to be achieved on long term basis

Sales

Profits

Share in the market

Other plans associated with the product are designed

Manpower

Financing

Facilities

Performance is monitored on regular basis

Annual performance review and restructuring of strategy

Model D: In this model a few questions are answered and the strategy is prepared on the basis of these answers.

Where do we stand?

Organization’s values, drives and mission

Monetary situation of the organization

Competition in the market and current standing among the competitors

Acceptability of the product based on its reliability

Market supplied at the moment

What we want to achieve?

Preliminary or initial restructuring of aims

Strategic alternatives to fulfill these aspirations

Evaluation of alternatives keeping in view the strengths and weaknesses of the organization, the constraints and hurdles being faced and the momentum currently driving the work of the organization

Can we get there?

Current impetus and thrust of the organization

Requirements of the organization

Requirements of the people

Requirements of the facility

Financial requirements

Which strategies will be required to achieve which objective? Determining task specific plans and strategies

Keeping in mind the philosophy of the organization and its values and cultures, different strategies and aims are evaluated side by side, again and again, in order to conclude what needs to be done

Conclusion on choice of specific aims

Conclusion on choice of specific strategies to fulfill such aims

Which decisions must not be delayed in order to achieve those goals?

Short-term budgetary preparations

Short-term changes in organization structure

Short-term managerial decisions and actions

Monitoring of performance

Annual review

These are four general models which are often followed by different companies undergoing the process of strategic planning. There are certain similarities and differences in the model, which are purely based on the type of decisions required at a certain stage by the organization.

Plan A is typical of an organization that is undergoing a restructuring plan and trying to introduce a new product, which probably has some financial implications but does not need effort to make its way into the market. Therefore, a customer analysis is not required, rather only financial implications are studied in great detail.

On the other hand, the Model B is important where an organization is thinking about introducing a product which is already available in the market. It is also suitable in cases where a company is thinking about expanding its scope by getting more customers. This is done through extensive research covering all the current customers of the organization. Competitors are also studied in detail. Segments of the society are studied with a clear focus on the segments which use a product. Strategies are laid down in order to expand the use of product targeting the new segments of the society.

The Model C is workable in different general conditions and it is a typical model of strategic planning. This model starts with developing the understanding of strategic planning and the plans are made after such understanding is developed at all levels in the organization. Afterwards, the strengths, weaknesses, opportunities and threats are studied in order to focus the strategy accordingly. The strengths and opportunities are combined to form a strategy which undermines the weaknesses of the organization and avoids all the threats. The market analysis is important because the opportunities and threats are external factors, whereas the strengths and weaknesses are factors internal to an organization.

The Model D is also a model applicable to general situations. It starts with answering certain questions which are brought on the table whenever a company or an organization is rethinking the strategic planning. One important question in this model is asking whether the organization has the potential to achieve certain objectives. Therefore, apart from the external analysis and research, internal research is equally important in the process of strategic planning.

Commonalities between the Models

There are certain things that are common in all models, although they appear in different formats in different models. The most important thing is conducting a research before strategy planning in order to achieve certain aims. The research is conducted in order to know the customers, their wants and needs, and to determine the reasons which compel them to buy the product. The research is also helpful in understanding the market. It gives an idea about the competitors in the market and the factors which may constrain the growth of the organization. The research also gives a general idea about the organization and its internal problems. All this material is extremely helpful in preparing the final arrangements to carry out certain plans.

Another important thing which is found in all models is the philosophy and mission statement of an organization. Every company has a philosophy which determines its culture and its values. The final objectives and aims are always coherent with these values of an organization. The means to achieve those objectives is in congruence with the organizational culture as well. Anything that is not in harmony with the values of an organization would be rejected automatically during the planning stage.

The SWOT analysis is a model that helps many managers to draft a plan on the basis of strengths, weaknesses, opportunities and threats. It is usually done using a SWOT matrix which looks like this.

Strengths

Weaknesses

Opportunities

Threats

The strengths and opportunities are used to evaluate a strategy which may exploit the situation in the market. The weaknesses are overcome using the opportunities in the market. The threats are reduced using the strengths, and finally a strategy is developed to bypass the weaknesses and threats to the organization. This is a system that is adopted by a number of managers involved in the process of decision-making.

Monitoring of performance is also common among the four models discussed above. This is also done through conducting research at intermediate stages. This research is important in determining the level of development and progress made by the organization with respect to different plans. Monitoring is very important for all organization undergoing changes. At the planning table, when different decisions are being made, it is very difficult to keep in view different scenarios and exact outcomes. Monitoring helps in determining whether there is a certain degree of diversion in carrying out a plan.

Alternate strategies are also formulated in the beginning. After monitoring, if there is a problem in the overall progress of the task, the alternate strategies are brought in to overcome those problems. Formulation of alternate strategies is an important part of crisis management. Every organization, at some point, faces a crisis situation, which must be resolved in order to ensure the smooth-running of affairs. The alternates available to the managers often are helpful in overcoming such situations.

The resource allocation is another thing common in different models. The resources include financial resources, human capital, time allotted to different tasks etc. Every action of an organization has some implication on given resources. So, if an organization is looking to expand, there are going to be some changes in the available resources, which would need to be adjusted. Therefore, every strategic planning exercise undergoes this process before the finalization of plans.

In the end, another thing common in all models is the annual review. At the end of the year, the strategies adopted must be reviewed and the whole process must the repeated on the basis of that review. The annual review tells the managers whether the organization is ahead in carrying out certain plans or lagging behind the schedule. Accordingly, a new strategy is formulated, where more time and money is allocated to areas which are lagging, taking it out of those areas which are going in advance to their allocated time table. Annual review also gives a chance to the companies to discover new trends in the market, and they can shift their strategies accordingly. In short, no planning strategy can be allowed to run un-monitored and it is pivotal for the success of any organization to review its working at different intervals.

Therefore, the models of strategic planning have a lot of things in common which certain changes depending on the nature of tasks. These are applicable for all types of businesses as well, including small-scale business, medium-scale business and large-scale businesses.

CHAPTER 3

COMPANY INTRODUCTION & OBJECTIVES

As stated previously, strategic planning is dependent on variety of factors and every organization plans for the future depending on its own working environment and objectives. Thus it is important to understand the existing state of affairs of the company in order to streamline its operations for the future. In this section, we will briefly cover the main business activities of Trojans which will help critically analyze the dynamics of launching a new engineering product.

MISSION STATEMENT

To provide state of the art engineering solutions and continue to be one window solution provider that enables our clients to create and sustain a competitive advantage.

INTRODUCTION

Trojans while focusing on System Automation has groomed itself as a leading engineering solution provider for Defense, Corporate and Educational Sector. It is one of the few private organizations that have indulged in indigenous Research and Development in High-Tech Engineering and have been catering the needs of private as well as defense sector. The activities at Trojans are mainly divided in to four categories;

Production Facility – PIC (Precision Investment Casting) Technologies

In house Research & Development

Marketing and after sales support of strategic principal and partners

Trojans head office is located in Islamabad and maintains three regional offices in Karachi, Lahore, Multan and residents Sales executives in eight different cities across the country and sister concern PIC technology is located at Hattar Industrial estate. It is home to more than two hundred full time dedicated employees engaged at various levels and in their designated departments.

Brief description of individual business units are as under;

Production Facility

Trojans manufacturing unit by the name of Precision Investment Casting (PIC) Technologies (Pvt.) Ltd was established in 1994 in Hattar Industrial Estate, District Haripur. There are very few investment casting facilities being established in Pakistan and PIC Technologies is the only ISO: 9001 Certified Investment Casting Company in Pakistan Offering following major facilities for the satisfaction of its core clients.

Investment Casting

Cold Box Process

Conventional Machining

Sand Casting (cold box process)

Powder Coating

Sheet Metal Working

Conventional Welding

CNC Machining

Wet Lab Testing

Sand Blasting

CAD/CAM

The types of alloys that are casted in this facility are;

SR #

TYPE OF ALLOYS

1

Stainless Steel – CF8, CF8M, CF3, CF3M, CN7M (Alloy 20), Ca 15, CA40 etc.

2

Nickel & Cobalt based Super Alloys – Monel, Incloy, Haste Alloy B & C, Stellite

3

Low Alloy Steels.

4

Low & Medium Carbon Steel, WC8 grade.

5

Copper Base Alloy (Brass, Bronze, Gun Metal)

6

Made to-order alloy as per customer requirement

Weight & Size of Casting;

PARAMETERS

SPECIFICATIONS

Weight

10 grams to 40 kg single piece.

Size

Up to 350 mm dia.

Angular Tolerance

+  1º

Surface Finish (As Cast)

3.0 to 6.0 Ra u m.

Linear Tolerance

+ 0.12 mm per 25 mm.

Flatness

+ 0.2 mm per 25 mm

Overall Tolerance

+ 0.24 mm per 25 mm

Radius & Fillet

Min. 0.5 mm

Wall Thickness

Min. 2 mm depending upon size Configuration & Alloy Selection.

Machining Allowance

0.5 to 2.0 mm on machinable surface.

In House Research & Development

Trojans are one of the few firms in private sector who have been engaged in house research and development in engineering field, our Special projects department has come with an Advance Voice Management System, C41 Consoles, BMS system, Static Pop Up Targets and several unique projects are in last stages of development. Trojans has also some of the land mark Turnkey projects like Advance Armored Research and Development Complex to its credit.

Marketing And After Sales Support of strategic principal and partner products

The company has been assisting its customers over the last 15 years to achieve specific business goals, such as bringing more innovative products to market faster and maximizing productivity, by streamlining the whole design through to manufacturing process. This is done through providing technologically advanced integrated solutions for design & manufacturing for industrial and engineering products, in collaboration with its foreign principals and strategic technological partners.

In this business unit, the main product offerings are as under.

SR #

PRODUCTS

Categories

1

PRO/ENGINEER

3D CAD/CAM/CAID/CAE Software

2

MATHCAD

Engineering Calculation & Documentation

3

ARBORTEXT

Technical Documentation & Publishing Software

4

E3 SERIES

Electrical Circuit Design & Harnessing Software

5

CADSTAR

Printed Circuit board Design, Manufacturing & Simulation Software

6

MAGMA

Casting Simulation Software

7

VERICUT

CNC Machine programming simulation

8

POLYWORKS

Reverse Engineering & Quality Control Software

9

GEOMAGIC

Reverse Engineering & Quality Control Software

10

WINDCHILL

Product Lifecycle Management Solution

11

FARO

Portable CMMs & 3D Scanners

12

STRATASYS

Rapid Prototyping & 3D Printing

13

NEXCOM

Industrial Computing Solution

14

CYCLONE

Automated Investment Casting Solution

15

MK MINI

Vacuum Casting Machine

16

MACHINE TOOLS

Both Conventional as well as CNC Machine tools

FACTORY ORGANIZATIONAL STRUCTURE:

It is important to understand the organizational structure of the factory because it will be easy to comprehend the product development capabilities at the factory. There is one factory manager who manages the activities of around 20~22 people in the premises. The factory manager reports directly to the Executive Director at the headquarters in Islamabad. Following is the list of number of people associated with different departments in the factory.

7 in Investment Casting

4 in Sheet Metal Workshop

2 in Conventional Machining Section

2 in Powder Coating and Surface Treatment

2 in CNC Machining and EDM Machining

2 people in the admin

Factory has no established marketing department and most of the revenue is generated through already established customer base or through referrals. The engineering department is located at the head office Islamabad and all the activities related to engineering; which also include product development; is being done in Islamabad.

CHAPTER 4

IMPLEMENTATION STRATEGY OF THE PLANNING MODEL

Four strategic planning models have been discussed in the literature review, which closely relates to the scope of this research. Among those models, Model B seems more appropriate for an organization like Trojans and especially for implementing a new engineering product. In this chapter we will utilize the guidelines discussed in the literature review and will practically implement this model step by step.

Defining the organization that the executives want:

PIC Technologies, the manufacturing unit of Trojans, strives to provide its clientele state of the art investment casting products. Management of the company desires that it should provide complete turnkey investment casting solution to its customers. The only missing link in realizing this desire is the failure to provide services at the development stage of Dies and Molds which is the preliminary step of investment casting process. Thus company at the present is not in a position to provide complete turnkey services, but the management desires that it should. Therefore there is clarity among the executives of the company that PIC technologies should self-indigenize in all of the processes required in investment casting technique, and efforts should be made to realize this vision. At this stage the organization has been clearly defined and the objectives have been clearly communicated to all the stake holders.

Defining Customers:

Current customers are mostly those who are interested in manufacturing their products through investment casting technique. However, the preliminary step is to have a die manufactured for that product and that at present is the responsibility of the customers, which certainly limits the customer base due to obvious reasons. As it is the desire of any company to expand its customer base and same is the case with PIC Technologies. Therefore if die manufacturing services are provided in house, then the customer base would definitely increase.

It should also be mentioned that Die & Molds is a product not only used in the investment casting technique but also in other manufacturing techniques such as high pressure die casting, low pressure die casting, forging etc. Therefore customer base can be redefined to not only those requiring services in the investment casting technique but also including those who just want to get a good quality die manufactured.

Therefore, if company self-indigenize in the die and mold manufacturing technique, than customer base can be defined as those requiring complete turnkey investment casting solution as well as to those requiring only a good quality die to be ultimately used in other manufacturing techniques. Hence at this stage the customers have been clearly identified.

Analyzing the organization:

Once the objectives has been clearly identified by the management, it is time to analyze your own organization and to evaluate how much your existing strength aligns with the ultimate objectives you have for your organization. The following aspects are discussed as part of the internal analysis of the organization

Organization structure

Human resource

Technological capabilities

Organization structure

As discussed in the previous chapter, there are two main business units of the company. One business unit is its own manufacturing facility with the name of PIC Technologies while the other unit works directly under the parent company i:e., Trojans. This unique organization structure often leads to overlapping of departments.

For example, die manufacturing, is a specialized skill which requires a strong engineering department, continuously engaged in extensive R&D activities as well as to counter various routine technical issues. The existing engineering department of the company is located in Islamabad which primarily deals with activities related to principle companies’ products, with additional responsibilities with the manufacturing facility. While this facilitates the engineering department to focus more on principle products, the activities related to its own manufacturing facility are often neglected. This problem is further exacerbated due to mechanical design iterations which is natural phenomenon, and it is difficult to cope with this phenomenon due to lack of proper communication channel between the engineering department with the shop floor.

Same is the case with Business Development, Sales & Marketing department. There exists one such department located at Islamabad dealing primarily with the products related to foreign principle companies. While sales generated from the manufacturing department are mostly through regular investment casting products to already established customer base.

Human Resource

As the engineering department is located in Islamabad, naturally it’s emphasize is more on products related to foreign principle companies. Therefore, skill set required for the personnel working in the engineering department is more oriented towards application engineering. While the responsibilities related to R&D; especially with reference to manufacturing facility; are more considered to be additional responsibility rather than one of the primary responsibility. Therefore the engineering department lacks personnel specializing in product development, more so in die and mold designing as well as manufacturing.

Furthermore, the existing skill set of CNC Machine operators is limited to operating CNC Machining centers only. Although Electric Discharge Machines are available, but in order to have them fully operational, CNC machine operators will have to be appropriately trained.

However, the overall technical expertise, excluding to the ones related to EDM Machining, are good. This assessment is based on following parameters;

Level of understanding of basic jobs to be performed

Level of individual technical expertise of as per their work requirements

Ability to address routine problems and technical faults

Ability to adapt to changes as per the requirement of a new product

On all these counts, the factory manager rates most of the personnel working in the facility satisfactory. So it can be safely concluded that the human resource available at