Red Spot Markets Company Essay Example | Topics and Well Written Essays - 1500 words

Red Spot Markets Company - Essay Example Possibly, a third and more strategic issue is the decision to close down the Providence center and shift all operations to Newburgh. First, we try and understand the impact of the first problem. Shrinkage directly impacts retailer margins since it is a loss of inventory. This is of concern to the senior management. At the operational level, this leads to a different kind of conflict. The DC (Distribution Center) loads cartons in which, as per the delivery note or shipment advice, a specified number of bottles or packs of a particular product is packed. However, when the stores receive the goods and they find shortage, then they report it as short receipts and make a note accordingly. Often, the DC employee states that it is not his problem and blames in-transit loss of goods. For the stores, it is a problem since the shelves would not be fully stacked. Repeated complaints from stores would imply the seriousness of the problem. Yet, managers who seek to address such problems need to d iscuss with DC personnel and with the store teams on these issues. Decisions cannot be taken without consulting both sides. The second problem is handling a dominant employee who seems to exert both a positive and negative influence on his team members. The situation would have been positive if, even in Bigelow’s absence, the DC operated smoothly with very minor lapses due to lack of leadership. But we find clear evidence that he has been able to influence his co-workers to sabotage daily operations because of his unjustified suspension. This kind of negative influence is bound to affect the company in the long run. It shifts the focus from an impartial, unbiased dedication to work to dependence on a single person, who can drive day-to-day activities. For an aggressive DC manager, Bigelow is bound to create problems. He is unlikely to take orders from his superior. In fact, Bigelow has been trying to lord over his superiors. A second problem is that such a leadership (Bigelow ’s) would foster a cover-up of real problems. For instance, if two or three poor performers are there in his team, then Bigelow would try to cover their shortcomings. This would impact worker morale and productivity. A similar attitude of covering up of performance metrics (such as shrinkage) would ensue since we have glimpses of such acts towards the end of the case. The third issue, more strategic in nature, calls for a decision to shut down the DC in Providence and shift to Newburgh. This could have a bigger impact on the company. The first is that there must be a thorough assessment of whether the Newburgh facility can handle the volumes which were earlier managed by the Providence DC. It needs proper computation of DC space, forklift movement space and additional personnel needed to man operations. The second point of concern is the distances which need to be served if all logistics were to be managed from the Newburgh center. Response time may increase leading to empty or partially replenished shelves at the retail stores. This would directly hit the store revenues. The third issue would also lead us to the problem of managing retrenchment or re-allocation of personnel from the Providence DC. Employees with strong roots may resist any attempts to re-locate and they may be willing to give up their jobs. Additionally, this could result in legal problems if any of them decide to sue the company. Plus, there could be talented, good performers at the Providence DC, who may not