Unit: Efficiency & Cost of Production
Due Date: Fri, 8/321/18
Deliverable Length: Primary Task: 400-600 words
Primary Discussion Response is due by Friday (11:59:59pm Central), Peer Responses are due by Tuesday (11:59:59pm Central).Primary Task Response: Within the Discussion Board area, write 400-600 words that respond to the following questions with your thoughts, ideas, and comments. This will be the foundation for future discussions by your classmates. Be substantive and clear, and use examples to reinforce your ideas:Additional Information: Because the decision about relocating manufacturing operations to the United States is so important, the board of directors at AutoEdge continues to systematically discuss every aspect of the situation. The following week, CEO Lester Scholl meets you for coffee to discuss next week’s board meeting.”I’m hearing good things about you,” he says. “Ingrid and George tell me you’ve been very responsive and helpful.””That’s good to hear,” you say. “I’ve enjoyed working with them.””We’re both busy, so I’ll get right to the point,” he says. “One of the main objectives of any business is to be efficient. Without efficiency, the company is essentially losing money. Am I right?” “Absolutely,” you say.”What must AutoEdge do,” he says, “to obtain economies of scale with production? How do we know that it has achieved economies of scale? Conversely, how do we know if it is achieving diseconomies of scale?” “That’s a good question,” you say. “I can understand why you ask.”But before you can respond, Lester’s cell phone rings. After a minute, he ends the call and stands.”I have to get back to the office to handle an emergency,” he says. “Would you send me an e-mail with an answer to my questions, please?””No problem,” you say. “I’ll get it to you before I leave work this afternoon.””I appreciate it,” he says. “Thanks.”Responses to Other Students: Respond to at least 2 of your fellow classmates with at least a 100-word reply about their Primary Task Response regarding items you found to be compelling and enlightening. To help you with your discussion, please consider the following questions:What did you learn from your classmate’s posting? What additional questions do you have after reading the posting? What clarification do you need regarding the posting? What differences or similarities do you see between your posting and other classmates’ postings? The materials found in the M.U.S.E. may help you with this assignment. Additional information is also provided in the Lessons from Experience series found at the following link: SWOT Analysis
This course uses the CTU Professional Learning Model™ (CTU PLM) to teach students with hands-on, industry-related, problem-solving experiences that model the professional environment and encourage achievements that lead to student and employer success. The CTU PLM is founded on the idea that students learn best by working on real-world, professional projects related to their chosen career fields. By working this way, students develop the expertise to apply conceptual knowledge to get effective results. Through professional learning, students experience the complexity of real-world problems and learn to select an appropriate approach to a problem that has more than one solution. This method of learning is called Problem-Based Learning (PBL). PBL assumes that you will master content while solving a meaningful problem in each assignment. Throughout the course, you will work with a scenario in which some basic, background information is provided about a company. (This information could apply to any company that provides products or services of this sort in general.) You have a role in the scenario; that is, you are part of the story. The dialogue in each assignment presents the problem that must be solved. It is up to you to respond to the problem and submit a deliverable that will be graded. Refer to the following scenario as you progress through the PBL process. Problem-Based Learning (PBL) Scenario: AutoEdgeAutoEdge is a leading national automotive supply company located in Detroit, Michigan. Founded by Jonathan McAlister in 1976, the company specializes in engines and transmission parts and has been supplying products to the three largest U.S.-based automakers for over 30 years. AutoEdge’s name is known by customers and leaders in the automotive industry for quality, dependability, and reliable products. In fact, despite the extra cost that is added to the automobiles, consumers appreciate the AutoEdge brand name and often make purchases because of it. In 2005, AutoEdge’s board of directors decided that the company needed to make some drastic changes because of the high cost of labor, rigid American regulations, and increased competition from other engine and transmission part suppliers. Their solution was to gradually close all manufacturing operations in Detroit and begin outsourcing to a well-known factory in South Korea. The board reasoned that this change would allow the company to compete with the growing industry, meet the automotive manufacturing demands, and increase company profits. Some board members were skeptical about the move, however, because AutoEdge had built a reputation for high-quality, detailed craftsmanship, and they feared that transitioning the manufacturing operations overseas would cause quality to diminish. For the next 5 years, this strategy proved successful. The company showed signs of financial growth and company profit.However, in 2010, the company was found guilty of supplying products that failed quality tests. As a result, millions of automobiles had to be recalled. The recall was highly publicized, and the issue of poor quality products impacted negatively on American automotive companies. AutoEdge’s $51 per-share stock has fallen to $4 per share, and brand acceptance has come under scrutiny among even its most loyal customers. Although some economists blame these negative effects on the products, others believe that it had to do with the termination of AutoEdge’s Chief Executive Officer, Fred McFadden. Lester Scholl, Chairman of the Board of Directors, has called an emergency meeting to discuss AutoEdge’s short-term and long-term strategies. Among other things, they need to discuss the possibility of continuing production overseas or returning it to the United States. Lester and others on the board are well-known for being financially conservative and risk-averse. Because the American economy is experiencing high unemployment, low interest rates, low GDP, and low inflation, it might be sensible to make the change. To some extent, they believe that these macroeconomic factors can be used to their advantage. They realize the immediate challenges such as the brand damage, the growing competition, and the financial challenges the company is facing require immediate action. A new strategy must be formulated quickly to save the company from bankruptcy.You have been hired by AutoEdge’s board of directors as a research analyst. Primarily, your job is to list and describe some of the legal, cultural, financial, and economic factors that AutoEdge needs to consider when deciding to either stay in South Korea or return to the United States. Because Fred McFadden was recently terminated, you will work directly with the board until a new CEO is named.