DEFINE THE PROBLEM IN THE CASE
Shui Fabrics is a joint venture business between an American Company, Rocky River Industries and Shanghai Fabric Ltd. from China. The goal of the company is to produce dye and coat fabric to sell to China and international sportswear manufacturers.The problem in this case is that Ray Betzell, the general manager of a joint venture between Rocky River Industries and Shanghai fabrics is torn between two companies. The general manager from China, Chu Wai, was pleased with the company’s progress in terms of production. He believed that Shui is achieving the right level of profit with its 5% return of investment. On the other hand, Rocky River’s President Paul Danvers wasn’t satisfied with the current annual return. The American side believed a higher ROI of 20% should be realized after acknowledging some of the challenges that are involved operating in China. He also mentioned that greater efficiency and incorporating sophisticated technology would allow Shui to reduce its workforce substantially and in return provide a better ROI The American bosses informed their American counterpart in China that they are considering ending the venture on Shui fabrics unless they change their operations and increase the return of investment to 20%.
SET YOUR OBJECTIVES FOR PROBLEM SOLUTION
The main of objective of this case is to be able to generate ways on how to improve Shui Fabric’s annual return of investement from 5% to 20%.
OUTLINE ALTERNATIVE COURSES OF ACTION
Provide trainings to employees to improve efficiency and utilize strong labor force
Trainings will help workers to be proficient enough in performing their specific tasks. This will also enhance the technical skills of the employees and will eventually improve the productivity of the production line thus increasing ROI for the company.
Decrease the labor cost and improve...