Assume that you are a top executive of an organization.

Now think of a decision that will bring a significant change in your organization. Justify why do you want to take such a decision and how will you implement it.

By:
Name Roll No.
1.Debashish Mondal 2.Alvy Riasat Malik

048

123
3.Sadi Mohammad Ziaul Abedin

128
4.Md. Mafi Ullah

016
5.Md. Zakir Hossain

145
6.Fahim Lodhi

149
7.Md. Mohibbul Islam

007
8.Taj Mohammad Sagar

139
9.Md. Samir Shaker

100

BBA 13th Batch Department of Management Studies University of Dhaka

Supervisor: Md. Salim Bhuiyan Professor Department of Management Studies University of Dhaka
November20, 2007 To, Md. Salim Bhuiyan

Professor Dept. of Management Studies University of Dhaka Sub: Submission of Term paper.

Table of Contents Title Page

i

Letter of transmit
ii

Acknowledgement
iii

Table of Contents
iv

CHAPTER-ONE : INTRODUCTION

1.1 Introduction to our study

4

1.2 Objective of the study

4

1.3 Methodology
5

1.4 Limitations
5

CHAPTER-TWO:

2.1 Overview of the company

7

2.2 vision of the company

7

2.3 Goal of the company

8

2.4 Organ gram of the company

CHAPTER-THREE:

3.1 Analysis of last five years business report 3.2 The major problems of the organization 3.3 Alternative solution 3.4 Evaluating alternative solutions 3.5 Conclusion
9 11 14 17 20

CHAPTER -ONE
2

INTODUCTION

1.1 Introduction to our study:

This term paper is prepared on the basis of decision making process in a particular organization. There are many leather companies who are exporting finished leather products from Bangladesh. We have chosen one of this well known leather product manufacturing and exporting company named Chowdhury Leather Craft Ltd for making our term paper. It is a repudiated leather product exporting company in Bangladesh. It has been exporting leather products with a great success. This company is now one of the best leather companies in Bangladesh. But as the competitors are increasing in this sector Chowdhury Leather Craft Ltd is facing some problems. And as the top executive of this company we are to find out the problems and to find out the best solutions for those problems.

1.2 Objectives of the study:

Have an experience of real life business situations. Representing a companys top management.

Finding out the major problems of an organization.

Finding solutions of those problems according to the process of decision making. Experiencing the process in which different management decisions are made.

1.3 Methodology:
3

2.1 Over view of the company:

Chowdhury Leather Craft Ltd is a leading leather product exporting company in Bangladesh. It is a producer and exporter of 100% finished leather Products. It is a private limited company and it was incorporated in 1997. It has started its venture in 1998 and still exporting leather goods. Its corporate office is in Motijhil and its main factory is situated in Savar. Its registered capital is 200crore taka and now it is running with a capital f 107crore taka. More than 8000 people directly and indirectly work in this organization. Now Chowdhury Leather Craft Ltd is recognized as one of the leading leather company in Bangladesh.

2.2 Vision of the company:

We will be the top leather products exporter in Bangladesh. We will produce and export the finest leather products in Bangladesh and outside Bangladesh. We will be company with qualified professionals, who will work together as a team and serve the company with dignity and the highest integrity. We believe in excellence and will continuously improve our products quality and design. Excellence in everything will be the operative words for our organization.

2.3 Goal of the company:

Produce and export the finest leather products. Achieving every years company objective which is a specific amount of net profit on the basis of the total cost. Spreading our products market in all over the world. Making the company assets double within the next 8 years.

2.4 Organ gram of the Company:

6

CHAPTER-THREE

3.1 Analysis of last five years business reports:

As a exporting company we are exporting finished leather products for last 10 years. Every year company sets a target of net profit which is to be achieved. But last 2 years we found that we were not able to achieve company's target. In the previous years we were very much near to the target but last 2 years we couldn't even go near to the target. Our business report of last five years is given below....

If we see this report we will be able to see that the company's target was to make 14% and 15% net profit on the total cost but were could only make 7.21% and 6.13% net profit on the total cost. When we started to investigate the reasons why we aren't being able to achieve the companys objective we find out many reasons. For the last 2 years we aren't being able to fulfill our buyer's demand that's why they canceled some big orders. Sometimes it is seen that we aren't able to produce enough products in given time. They are also complaining about the quality of our products and the high price of our products. Where technology is improving day by day there we are using the same old technologies and that is the main reason why we are not being able to improve our products quality. Our competitors are using new technologies and by using these new technologies they are improving their products quality. And most of all by using the new technologies they are being able to produce more products at a low cost of production. So they are supplying products at a chief rate. So we are losing our market to them. 8

3.2 The major problems of our organization:

We gathered information from different sources as much as we can and then analyzed all the

reports and information we have found out the major problems of our organization.

High cost of production.

Low production rate

Qualities and designs If we see clearly through these problems, we will be able to find out some problems behind these major problems. These small problems are causing these major problems.

High employee turn over Absenteeism Lack of experience of workers Lack of advanced technology High price of lather Mismanagement of time Lack of motivation Lack of training programs Power supply shortage

HIGH EMPLOYEE TURNOVER:

Employee turnover means employees switch off one company to another company for better facilities. Labor turnover measures the movement of workers in and out of employment with a particular firm. The success of an organization largely depends on the performance of its human resources that means on the performance of its skilled and experienced employees. If skilled and experienced employees of an organization change their company frequently then the effect of this change create a problem with its internal and external people and as a result it is so difficult for an organization to make profit. If a post becomes vacant the activities of management become hampered. And ultimately this effect goes to the production ratr and high cost of production.

ABSENTEEISM:
There is a tendency of being absent in the work place of the workers. Sometimes they come to work place after the work starting time and leave before the work time ends. So absenteeism of workers and employees is another major problem in our company.

TECHNOLOGICAL PROBLEM:
The buyers are raising question about quality of our product. By seeing deeply through the production process, we managed to find out that the technologies we are using are backdated and old. Thats why we cant improve our product quality and design comparing to the other leather companies in Bangladesh. It is one of the main reasons behind low production rate.

Lack of expert workers:

Another major problem is lack of expert workers. Maximum of our workers dont have enough technical knowledge and working knowledge. As a result our production rate is not increasing and we are getting less expert finishing in our products. 10

Time mismanagement:
There is a serious problem of time management in producing products in appropriate time. We are not being able to meet up with the orders of our buyers. Sometimes it is seen that we are asking more time for producing their ordered products.

High price of lather:

Another major problem is high cost of lather. We purchase our raw materials from the local markets and which costs us a huge amount of money. As result our cost of production has increased.

Lack of motivation and training program:

There is serious lacking in motivating the workers so that they can work more efficiently and effectively in their work place. Because of the lacking in motivation the rate of employee turnover is increasing. We also have a poor quality of training facility. So there isnt enough chance of train the workers and make them expert workers.

Power supply shortage:

The power we get in our factories is not sufficient enough for our production. Rapid fluctuation of electricity hampers our productivity a lot. 11

3.3 Alternative solutions:

In decision making process the second step is to find out alternative solutions. As the top executive of the organization its our responsibility to find out the solutions of every obstacle which are in the path of companys objective. So after finding out the problems which are the main reasons why could not achieve companys objectives, we have gathered as much information as we can and analyzed them very carefully. After analyzing all the information, we thought of some alternative solutions and tried to find out their effectiveness and limitations towards the problems we have discovered. And finally we find out the following alternatives.

Reduce high cost of production:

Payment of wages on the basis of Units:

Workers will be paid on the basis of units rather than on the basis of hours. It will reduce absenteeism of workers in the workplace. Most often workers spend time in gossiping, working slowly and carelessly. If wages are paid on the basis of unit, workers wont get enough time to gossip or work slowly. It will also decrease the tendency of workers of leaving workplace before the end of the work time. 12 Purchasing raw materials:

Raw materials of shoes, bags, coats, jackets, lather pants from the local markets and if possible from the raw material producers at a cheap rate so that our high cost of production can be reduced. We also have to be sure about the quality of the raw materials we are purchasing for manufacturing our products. Adoption of advance technologies: We need to change a major part of our machinery. We have decided to buy some new advanced machinery especially computer based machines. To reduce the high cost of production we have thought about some steps as follows: Overtime should be reduced from 2 hours to 1 hour, because in overtime workers are given for each unit of production and that leads to high cost of production. Number of workers should be reduced because there are extra employees comparatively. Good relation must be remained with the raw material producers, so that we can get raw material when needed at a cheap rate. There are many paid holidays in a month and this paid holidays leads to the high cost of production. The workers must be conscious about the high cost of production.

Raise production rate:

Reasonable wages:

13

Reasonable wages will be paid to the workers so that they get motivated and can work efficiently in the workplace and to reduce high turnover. Grading workers: Workers will be graded on the basis of their produced units as average workers, above average workers, below average workers. Above average workers will be given bonus, below average workers will be given training. Separate below average workers from the average workers and above average workers and train them to make them average workers. Training programs: Every worker has to participate in the annual training program. Below average workers will be given extra training. In spite of providing training among the below average workers if they are not able to reach the level of average workers they must be suspended from the organization. Motivation:

Motivation will be provided to encourage the workers on the basis of their needs, so that they can find work enjoyable in their workplace. Above average workers will be given bonus. Providing bonus to the workers on the basis of their production at the end of every month. Employees will be given transport facilities; lunch will be provided at a low cost to the workers and the employees.

Power supply:

We have to increase the number of our generators. Because the electricity govt. provide us is not enough for our production. 14 For improving our production rate we have thought of some extra steps as follows: Workers who will present 100% in a month will be given bonus. The employees who will present less than 80% will be given lower amount of money than their average pay scale. Supervisors should consult with the employees about their problem directly. Efficiency and effectiveness must be remained among the existing workers.

The workers must be attentive to the work so that they can give their best in the workplace.

3.4 Evaluating alternative solutions:

After finding the alternative solutions, evaluating the alternative solutions are the third step of decision making process. In the evaluation process we followed some strategic process such as . Cost benefit analysis SWOT analysis Analytic Hierarchy Process

Strategic planning process - applying the objectives, SWOTs, strategies, programs process Six Thinking Hats - symbolic process for parallel thinking

After finding out the alternative solutions we realized that we might not be appropriate in all the decisions because management always has some limitations of information about the lower level of management and workers. So we need to consult with mid level, lower level managers and work union leaders, because only top management 15

cannot implement a decision, we need active participation of all level managers. Lower level managers and the workers are the people who run all the task of the company, so if the top level management doesnt consult with them in making new decisions the management will not be able to know the reasons of their hesitation. And if they are hesitated about the taken decisions they will not be able to work at their full capacity. They will think the management is only forcing them to do what it wants them to do. As a result it may hamper the existing production rate. So the management needed to take their opinions before making any final decision. So we made a group meeting with the mid level and lower level managers and work unions. In this meeting they freely expressed their opinions. We considered these opinions to evaluate our alternative decisions.

Opinions given by the subordinates:

1. Holidays should not be withdrawn. 2. Attendance of the subordinates will be reduced to 90% from 100% because 100% attendance is not possible on the part of the subordinates. 3. The manager should consult with the subordinates so that any problem can be

solved.

4. Every employee and workers will be given Life insurance facility.

5. Over time must be remained from two hours to four hours.

6. Workers and employees should be given medical facilities.

7. General workers should have pension and retirement fund.

8. Subordinates and workers should have communication channel through which they can consult with the mid and top level management. 16 9. The festival bonus should be given to the workers and the amount of the festival

bonus of the workers and employees should be increased.

10. All salaries and wages should be paid within the third day of the month.]

11. The right to commence worker unions.

Making final decisions:

Making decisions is the most difficult job of a manager. After evaluating all the decisions we have finally taken some decisions which will be very important for the development of our organization.
Final decisions are given below.. 1. Old machines will be changed and new machines will be used. 2. Experienced workers will be employed for high production. 3. Experienced trainers will be employed in the factory so that they can give their best training to the subordinates and workers. 4. Reasonable overtime will be given to them. 5. Proper ventilation and sanitation system will be adopted. 6. There will be only one holiday in a week. 7. Employees will get the pension facility but workers only above 45 years old will get pension facility. 8. Wages and salaries will be paid within the 3rd date of the month. 9. Attendance of subordinates will be reduced from 100% to 95% and 95% attendance will be given rewards and attendance below 90% will be given punishment. 17

10. Wages will be paid on the basis of the units rather than on the basis of hours. 11. Workers will be graded on the basis of their produced units as average workers, above average workers, below average workers. 12. Above average workers will be given bonus and below average workers will be given training. 13. Departmentalization on the basis of functions. 14. Workers and employees should be given medical facilities. 15. Vacant managerial posts will be filled up by promoting the employees within the organization.

Conclusion:
We think the decisions we have made will help us a lot in achieving our company objectives. From now on we will use a management information system. This system will help us implementing our taken decisions. If there is any problem implementing the decisions, it will be detected by the management system and the problem will be treated instantly.