The case study on the multinational brand Nestle, which occurs to be an FMCG international large displays the techniques and well-designed plans of the corporation whereby it tries to shift its photo from a meals organization to that of a diet fitness and welfare company. The motto of the enterprise has been that of correct food. The top existence has similarly prolonged the place the corporation appears ahead to coming into the area of fitness. And vitamin merchandise that will embody merchandise such as baby food, and weight loss plan food. And additionally that of healthcare products.
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In the process, we see that the business enterprise in its system of diversification of its merchandise has additionally at instances failed to attain its targets. However, the customary shape of the enterprise occurs to be massive and adequate to assist the enterprise in holding. Its function as the main healthcare enterprise in the world with some of the most mentioned and profitable brands.
Main Essay:
The case study reveals the well-calculated plans of the company Nestle. Where it had made conscious efforts that would change its very image in the market. It has been reflected through the case study that the then ongoing image where Nestle happened to be a leading brand worldwide in the field of food products looked forward to entering the field of healthcare food products and also dominating the market in the coming period. Hence Nestle soon embarked upon a marketing strategy through which it could extensively change its image. And develop an image of a nutrition, health, and welfare fostering company through the tool of its products.
Hence quite Nestle set forward to take up various measures to effect the same. In the process, Nestle did and tried several different tactics to achieve the same. It changed the composition of its products by eliminating excess sugar and salts and fats and by incorporating more healthier nutrients into its products. Once again we also see that Nestle embarked upon a method or business pattern of a large number of acquisitions. Through these acquisitions, Nestle tried to buy over certain reputed names in the healthcare product industry and enter the arena on a global scale. It made some very huge investments in the process of these mergers and acquisitions.
Essay Part 01:
In this context, one point that can mention could have been a pressing concern for the company. Especially during the years that immediately preceded the financial crisis era. The case study reveals that in the year 2005 Nestle did make drive the market for healthcare products and nutrition food. Which was when the company had to make some huge investments. However as even mentioned by the experts the company could not expect any immediate returns or profits from these investments. The company had to struggle considerably to push the volume of its sales. And face stiff competition from the already existing big layers of the said industry.
Another point that happens to be an addition to the mentioned point is that in the effort of being a world player in the NHW segment the company did make huge and well-diversified investments. This also could have posed a challenge to the company, especially during the recession period. We also see that as mentioned by the then CEO Bulcke, maintaining the company’s position in those challenging times happened to be quite critical. In those times we see that the company had taken a strategy that tried to maintain. Its market index also increases the sales and business volume as far as possible.
Essay Part 02:
We do see that in the strive of being a world-renowned NHW segment company and of changing the brand image of the company. The management of the company had invested heavily in various measures of entering the industry of NHW and of fortifying its market position in the company in the said industry segment. In comparison, the same not as aggressive stance stood taken by the company in boosting its sales vigor. And taking equally dynamic marketing endeavors. As result, we see that the company even failed to achieve its said initial targets. Which it had set for itself when it entered the NHW sector.
Once again we also see that the company at least to some extent did digress away from it. Its path of being an NHW company when it also bought some fast food chains. This the company said was a calculated measure. Since it could not do away with the strategy of being a diversified company. However, the company did induce certain health measures into the fast food items. And did incorporate some healthy items into the menu preparations.
It can say that the mission of the company happened to be of providing its customers with good taste and a healthy lifestyle through its products. To implement the same to an excelled level and to make a mark in the market in the long run the company did embark. This journey of entering the health and nutrition products. In doing so we see that the company stood faced with a series of advantages that arose. Its strengths and also disadvantages arose from its weaknesses. In the following part of the discussion we take a look at both of the considerations:
Advantages:
The company that is Nestle happens to be a big name. Which ensures that the brand already has an acknowledgment in the market. And the consumers or the retailers do not need to be brief regarding the profile of the company. This facet was a particular strength of the company that enabled a certain percentage of market penetration.
The company had enough capital power which could enable the company to indulge in strategies of acquisition and elaborate R&D endeavors.
Nestle was already in the food industry, which gave it considerable leverage.
Disadvantages:
The company went into a very elaborate process and method of acquisition and mergers. Which ate into a considerable amount of its financial resources of the company. This could have posed a challenge during the financial crunch period.
Nestle in its strive to be a world leader in the arena of the NHW sector did not put enough stress on the marketing part. Which led to the loss of target achievement.
It did pose a contradictory figure when the brand bought over fast food item chains. It helped its critics criticize its image as an NHW company.
Finale:
Quite surely the strategy of Nestle to enter the NHW sector was a well-tailored plan that will yield high returns in the future, nevertheless, a more profit-oriented endeavor could have helped the company overcome the revenue issues that did surface during its transition phase.
Suggestion:
It could recommend to the company that the brand instead of trying various products in the NHW field could single out a more streamlined array of products on which the company will try to concentrate during its initial period of entering the NHW industry or market segment. This would also help the company streamline its marketing procedure and the company can adopt more aggressive marketing endeavors that will help the company achieve better sales volumes. With time these returns could again be profitably used in the R&D endeavors that will help the company come up with better and improved brands and also at the same point establish itself as a global, market leader.
Review of the financial fraud case of Wanfu Biotechnology: A case study of CPA audit failures in listed companies – The main business of Wanfu Shengke (Hunan) Agricultural Development Co., Ltd. is the research and development, production, and sales of rice intensive processing products. Discussion on Impact of Big Data Analysis on CPA Audit.
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The company stood successfully listed on the Growth Enterprise Market in 2011. But it stood exposed to a financial fraud scandal in just one year. In 2012, when the CSRC inspected the company. It found that the prepaid account balance in the company’s financial statement data was very high. Which stood suspected financial fraud. Therefore, the CSRC decided to file a case for inspection in September, and the exchange suspends trading of the company’s stock for one month. Later, Wanfu Shengke admitted to financial fraud and temporarily suspended trading for the second time on May 16, 2013.
Analysis of the fraudulent methods of Wanfu Biotechnology
“One-stop” fraud mode, strong systematic
Wanfu Shengke made virtual purchases, production, and sales, and forged corresponding credentials. The non-real-money fraud mode adopts by the post-listing financial fraud. A huge amount of prepaid accounts existed fabricated. The “one-stop” fraud process is to first transfer the funds in one’s account to scattered personal accounts using prepayment, which is ostensibly the prepayment for the purchase of grain, and then the fictitious income, and pass the money in these personal accounts through the company. The sales revenue stands transferred back to the company’s account. And the free funds complete the extracorporeal circulation to achieve the purpose of inflating sales revenue and increasing profits. A series of pipelined frauds are enough to reflect its systematic fraud.
Fictitious cash flow, strong concealment
Its free funds change ways in cardiopulmonary bypass. It stands shown as a prepayment of a large amount of money. Which stands divided into several pieces of funds when the payment stands returned to avoid the attention of the auditors. At the same time, to avoid inconsistency between personal and corporate accounts, Wanfu Biotechnology also took the risk of smuggling the business seals of several banks and forging bank receipts. Investigators also spent a lot of time checking bank receipts and found fake bank receipts. This shows that the fraud exists hidden and realistic, and it is relatively difficult to find the problem directly.
Adopting the cost backward calculation system, the overall balance of the financial statements
According to the principle of income and cost ratio, Wanfu Biotechnology adopts the cost-back calculation system. The financial staff reversely calculates the company’s cost according to the fictitious income to achieve a balance between production and sales. Not only that, many of Wanfu Biotechnology’s businesses are true and false. True numbers also have false numbers. And based solely on the financial statements calculated backward. It is impossible to see the tricks and find out the problem of fraud.
Reasons and faults in the case study of CPA audit failures
In addition to Wanfu Shengke’s fraudulent methods, certified public accountants also have many mistakes in the audit business. Such as the following:
The analysis program is not in place
First of all, as a rice processing enterprise. Wanfu Biotechnology has an abnormally high gross profit margin and low inventory turnover rate. In the analysis of the upstream and downstream industry chains. It can be found that the upstream purchase price increases. While the downstream product sales price decreases. , the gross profit margin is very stable strangely.
Sponsors and accountants may fail to find abnormal gross profit margins. And can easily conclude that the company’s business is normal and gross profit margins are no problem; not only that. Auditors also did not maintain proper professional prudence for the abnormally high prepaid accounts and gave due consideration. Some are concerned, see through the lies of their raw material supply, and conduct further audits on the above anomalies. Thereby identifying and assessing the risk of material misstatement.
Lack of confirmation and supervision procedures
Auditors must implement corresponding procedures based on the principle of relevance, clarify work requirements, and ensure the quality of practice. However, later investigations found that Zhonglei and its certified public accountants did not make any judgments about the bank deposits and account receivable of Wanfu Biotechnology at the end of 2008 and 2009.
Correspondence to the balance of the payment was carried out, and the corresponding alternative audit procedures were not implemented. Due to the lack of bank deposit confirmation and accounts receivable confirmation procedures, the certified public accountants contacted by Zhonglei failed to detect Wanfu Shengke’s fraud and completed the fact of fictitious income through the extracorporeal circulation of its funds.
Even in the implementation of the confirmation procedure. The firm did not perform well and did not control the implementation process of the confirmation. Some of the replies even had the signature and seal of the person who was not asked to inquire about the letter. The above-mentioned procedural defects and carelessness were the important reasons for the failure of the audit.
There is no “ground gas”, and the verification of the bank’s running water is ignored
The certified public accountant failed to start with the details, especially the original documents. Such as bank receipts and other original documents to find the issuer’s financial abnormality. Many companies’ fraudulent methods are not flawless. It was the auditors who were careless, ignored some details, and passed over the subtleties. The bank balance deposits and bank receipts with high authenticity were passed over, allowing them to forge.
Thoughts and Suggestions for the case study of CPA audit failures
Design, implement, and maintain necessary internal controls
The realization of the “one-stop” fraud reflects the excessive concentration of power in Chinese enterprises. Gong Yongfu and his wife Yang Ronghua hold 80.38% of Wanfu Biotechnology, and the equity is highly concentrated. It is like a mom-and-pop shop and lacks perfect internal control. Defects in the company’s governance structure are a major driving force behind the realization of Wanfu Shengke’s financial fraud. Therefore, enterprises should design and implement necessary internal control, strengthen corporate governance, and change the situation of excessive concentration of power.
Certified public accountants should abide by and strengthen professional ethics
As far as auditing business is concerned, a certified public accountant must be independent of the audited entity and be in the public interest. A certified public accountant with good professional ethics can abide by professional ethics requirements, maintain corresponding professional doubts, and reasonably use professional judgments.
In Wanfu Shengke’s audit, the firm’s upstream and downstream verification found signs of false transactions, but did not conduct further audits, but issued an unqualified opinion, which is obviously against professional ethics. Secondly, auditors should not blindly listen to the information provided by the audited enterprises but should conduct audits in strict accordance with the procedures and collect evidence from different information channels, to effectively prevent and reduce the risks brought by the audit.
Strengthen supervision and management of intermediary agencies and local governments
Because intermediaries are subject to the business entrusting party, to continue to receive high remuneration from the entrusting party, many intermediary agencies have lost their independence, and illegal operations have contributed to financial fraud and harmed the interests of investors and the public. Therefore, the China Securities Regulatory Commission should improve relevant laws and regulations, introduce and improve the corresponding civil compensation system, clarify rights and responsibilities, and increase the cost of violations.
All sectors of society should also work with relevant government departments to build a reputation mechanism for intermediaries. At the same time, overcome the local government’s use of the number and “performance” of locally listed companies as its “performance”, and increase the punishment of government officials for illegal “green light” behaviors of listed companies.
A case study of CPA audit failures in listed companies; Photo by Chris Ensminger on Unsplash.
The automobile company Volkswagen and Porsche Case Study with PDF for Corporate Merger; The German Dr. Ing. H. C. F. Porsche (Porsche) automobile manufacturer specializes in sports cars and a new line of all-terrain vehicles. In the mid-2000s, Porsche stood recognized as a leading global brand for its consistent quality and cultural icon status with models including the 911, the Boxster, and the Cayenne.
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The company achieved strong financial performance cementing Porsche’s market dominance. Porsche’s operating profit increased from 1,204 million in 2002 to 1,832 million in 2006, representing a growth rate of 52.1%. The net profit of the company also increased to 1,368 million in 2006, an increase of 74.8% over 2005. One of the central elements of Porsche’s business model is its low manufacturing depth; which means that it does not have huge centralized production plants. Many building processes stand outsourced while Porsche concentrates on its core competencies of development, engine production, quality control, and sale of vehicles. This allows Porsche to keep trim and agile in the luxury market. Volkswagen AG is a manufacturer of passenger and commercial vehicles.
The group markets its vehicles under the following brands; Volkswagen passenger cars, Audi, Skoda, SEAT, Bentley, Scania, and Volkswagen commercial vehicles. A strong brand portfolio enables Volkswagen to provide a competitive advantage over its peers. Leading market position enhanced the brand image of the group and held investors’ confidence. In 2007, the group increased the number of vehicles delivered to customers to 6.2 million, corresponding to a 9.8% share of the world passenger car market. However, rising raw material prices threaten the margins of the group by increasing its operating costs.
What are the reasons Porsche takeover Volkswagen?
The Underlying Reasons Why Porsche Attempted to Takeover Volkswagen;
With the protection of Germany’s 1960 “VW Law” that long shielded Volkswagen from takeover, no matter how poorly it performed. VW’s 174,000 workers exerted a huge influence over management through their Labor Union; which focused on protecting jobs at the expense of efficiency. The German state, with its 20% share, typically sided with labor over the years; because they were reluctant to restructure VW’s inefficient operations and eliminate jobs.
With governing bodies that cared more for jobs than future growth, VW became increasingly inefficient and entered the 21st century with a bloated workforce, the highest manufacturing costs, and the shortest workweek [32 hours] in the global automotive industry. Evidence of just how unruly VW had become erupted in a 2005 scandal when evidence stood revealed millions of dollars in funds granted by management to bribe union leaders for their support.
The funds stood used to pay for pleasure trips, parties, and others. After being carried for many news cycles, several managers have pleaded guilty to paying off labor officials and have been fined. In the mid-2000s, VW was palpably vulnerable, but why a takeover bid? Why would the world’s most profitable automaker sink billions into mass-market VW with its debilitating cost structure, strong unions, and weak profits?
A closer look reveals that Porsche moved to take VW for their technology development and keep access to a production ally. In effect, though Porsche was financially stronger, it needed VW more than VW needed Porsche. Only about 20% of what makes a Porsche a Porsche-largely the engine and transmission stands made by Porsche workers. The rest exists outsourced, mainly to VW. Porsche co-developed the Cayenne with Volkswagen, sharing parts, production, and development costs.
More reasons;
The joint development and outsourced production help fuel Porsche’s profits by keeping its fixed costs and capital investments low. In addition, the planned integration of Porsche into Volkswagen and the associated, closer cooperation will realize significant synergies on both the income and the cost side. Both companies could focus on finding synergies for such items as electronic architectures and engineering work on future vehicle circuitry platforms and common parts such as air conditioning.
For Volkswagen, the merger benefits are clear — protection against a hostile takeover. It may also get a lift from Porsche’s image and well-regarded management. VW needs help. With profits of 484 million on sales of 55.4 billion in the first half of calendar 2005, VW’s profit margin is less than 1%. Volkswagen has 15 times the annual revenue of Porsche-but Porsche’s profit margins are seven times bigger than VW’s.
VW was a gold mine for Porsche as they envisioned the future demand for products designed by Porsche but co-produced by Volkswagen. Porsche focused on a particular type of luxury product and VW ran stables of brands producing across many segments. With the threat of materials costs shooting through the roof; Porsche was looking for ways to turn threats into opportunities and garner some serious market power. VW was a goldmine. The only thing that Porsche would have to do was dig day and night.
Strategy to Gain Control;
Porsche utilized pure financial leverage combined with speculation to attempt to gain control over VW. All of these actions existed not done in complete secrecy; but, the information fed to the public was a time in a very strategic way. On the open market Porsche accumulated shares in VW and accompanied; these actions with simple and believable statements that they were merely trying to secure VW as a partner company in the development of different platforms of cars.
Porsche made statements to the effect that they existed not interested in owning VW; but, merely had a vested interest in the continued cooperation of the two companies for joint ventures. Simultaneously and not so publicly Porsche bought options on VW stock by paying a fee to be able to purchase VW shares at a given price sometime in the future. These types of transactions are extremely common in financial markets; however, the extent to which Porsche did this was tremendous.
In the end, they had accumulated these options to such an extent that they had the right to purchase nearly every free share on the market. Before this information was public, it had little effect on the share prices. However, when Porsche went public with this information, market forces went to work. The financial institutions that had sold these options to Porsche had done so “short” meaning they did not own the shares.
More control;
When these institutions learned of the situation they realized that Porsche would exercise these options to attain 75% of VW; and, they would force to buy VE shares on the open market and sell them to Porsche at the lower agreed price. This resulted in the institutions rushing to purchase all available shares to minimize their losses when Porsche exercised the options. The accumulation of the options and the resulting profits from exercising; these options certainly emboldened Porsche to press for an ever-larger stake in VW.
With stable financing in place, Porsche could have essentially bought 75% of VW; with the government owning 20%, and only 5% of the share would be public. Stable financing and overall economic conditions that existed during the final push for shares severely stressed the financial capabilities of Porsche. As a result, the hostile takeover attempt has morphed into a merger offer. Additionally, the legal battle with the state of Lower Saxony continues. The VW law continues to be an obstacle to the voting right of all other shareholders.
Impact of the Attempted Take-Over on Stock Prices;
The most striking result comes from a comparison of the two company’s stock prices at the beginning of this period and the ending relationship in stock value on a percentage basis. The most divergent area in October of 2006 was the direct result of the secretive accumulation of options on VW stock by Porsche. As stated above the announcement by Porsche that essentially has claims to all the remaining VW shares on the open market sent investment banks scrambling.
These investment banks were the ones that were short VW shares; and, essentially could have the options put at them resulting in huge losses. The attempt to cover all the outstanding options drove the share price of VW through the proverbial roof. As it stands on June 25, 2010, the share price of Porsche is 36.04$ as compared to a share price of 94.04$ on September 3, 2008, the earliest date available on Yahoo Finance.
This represents a 62% decline in the value of the company. During the same period, VW shares have gone from 199.52$ to 79.01. In essence, this merger has been completed although outstanding issues remain. During this attempted takeover now turned merger over 50% of the market value of the two companies has been lost.
Initial Merger Proposal and the Final Outcome;
The saga of the Porsche-VW merger began with an attempt by Porsche to secure production agreements with VW by acquiring a 31% share, which, along with the government’s 20% share, would make VW unassailable by threats from outside interests. Whether or not this was the actual intent of Porsche or a disguised initial play to gain control of VW is unknown; but soon after, Porsche began a run to obtain up to 75% of VW, ending up with 51%.
Having gained control, Porsche still faced three obstacles:
Germany’s prevailing “VW Law,” limits any shareholder’s voting rights to 20%, regardless of the number of shares they own.
a large amount of debt they shouldered in the acquisition process, and.
suspicions about the foul play during an options deal on VW stock where Porsche made millions.
One of these obstacles was overcome when the European Commission ordered Germany to repeal the VW Law because it restricted the free flow of capital, but the debt proved to be overwhelming, in part due to the recession and the difficulty firms faced obtaining capital at reasonable rates, and Porsche was forced to turn to VW for help. This was the beginning of the final merger process, which, as of today, is still incomplete due, in part, to lingering suspicions about the options deal.
Although not set in stone, as it stands, VW owns 49.9% of Porsche while Porsche owns 53% of VW, Qatar Holding owns 10% of Porsche and 17% of VW and the government of Lower Saxony retains its 20% of VW. The Piech and Porsche families, the founders of both companies, own about 40% of the merged company and Porsche’s CEO and CFO, the guys who engineered the options deal and the takeover bid, and who turned Porsche into a profitable company in the first place, have resigned.
Costs and Benefits for both Volkswagen and Porsche;
Highlight both Costs and Benefits for both Firms under the Proposed Merger;
The benefits of the merger are that VW’s operating profit is expected to increase by 700 million euros a year, Porsche engineering may boost the appeal of VW’s more expensive models, and the “platform” system of cutting costs by using standard parts for multiple car models will be expanded as Porsche lines are integrated into VW’s stable. Another benefit, which may not be a benefit so much as a bragging right; is that an expansion of VW brings it that much closer to becoming the world’s biggest carmaker.
Finally, and although not directly tied to the merger an issue; that gained additional attention from it, is the EU-ordered repeal of the VW Law. Porsche’s former boss, Wiedeking, was looking forward to changing VW’s culture from a socialized, semi-protected concern to a capital-efficient machine-like Porsche, and if VW does indeed become more competitive in the global market as a result of the merger or the repeal of the law they could see an increase in profits.
Part 01;
In contrast to the more speculative nature of the merger’s benefits are its costs. At the top of the list is the debt load acquired by both companies during the process, particularly Porsche; which racked up 12 billion when it was buying VW stock. During the merger, Porsche has been losing billions due to costs associated with combining with VW. In the second half of 2009, Porsche’s net income dropped by 83% and is planning to raise 5 billion through stock issuance.
Porsche’s exposure in the options lawsuit has expanded to nearly 2 billion. For its part, VW is paying 3.9 billion for 49.9% of Porsche and is selling 135 million preferred shares in the next few years to cover some of the cost. Meanwhile, both VW and Porsche seem to be counting on increasing sales in Brazil and China to cover those debts.
Secondly, there is the tension created by putting the competing brands of Audi; Bentley, Porsche, Bugatti, and Lamborghini under the same, corporate umbrella; a move that should naturally result in a reduction in the number of models offered and price increases in the luxury car market.
Finally, there is also the issue of management to consider. Porsche was the world’s most profitable, small carmaker when the process began; and its initial steps to acquire VW shares were motivated by that company’s weakness. Now with the merger, the new company is larger and more debt-ridden; and VW’s leadership will be taking over Porsche rather than the other way around. In essence, a larger, weaker company has absorbed a smaller, stronger one; and while Porsche seemed to have a strategy of turning VW into a more cost-efficient and profitable company; VW is merging with Porsche only because it can, or must.
Part 02;
On paper, with its 53% share of VW, Porsche seems to have control, since VW only owns 49.9% of Porsche. However, Bloomberg is reporting that “Volkswagen AG considers naming Matthias Mueller; its chief product strategist, to run the sports-car maker (Porsche)”; which is a strong indication that VW is calling the shots and supports the frequent descriptions of VW’s “reverse take-over”. However, the reality is that the ownership of the two companies is so closely tied; that it is easier just to say they remain under the control of the Piech and Porsche families; with large portions held by Lower Saxony and Qatar.
There are so few shares left available that VW’s ordinary shares might remove from the German stock exchange. As previously stated, we don’t believe that the merger was particularly worthwhile because the costs involved outweigh the benefits. Certainly, the 2008 recession exasperated the cost involved because Porsche’s access to cheap capital became harder to come by. It racked up more debt acquiring VW stock than it would have a year or two earlier. In this sense, Porsche choose a poor time to embark on an aggressive, financial maneuver; and VW, who performed their own “reverse take-over” later on, did so in the same environment.
Part 03;
New car sales were down globally in 2008; and the general reduction in sales should’ve affected both companies equally, making it a moot point. Although it isn’t explicitly mentioned, Porsche should’ve suffered more in the recession; because they only sell luxury products, a category of goods that is very elastic about income levels. VW, in contrast, has a wider variety of products, including more affordable cars; which might help to keep them afloat as sales of their many luxury brands fall off.
Rising oil prices shouldn’t be that important to VW or Porsche. Owners of luxury cars that sell for more than 100,000 don’t blink if the cost of gasoline goes up; so, Porsche sales should unaffected. VW’s luxury models should also see the same effect. However, VW should see a short-term drop-off in sales of their affordable, high consumption models like their SUVs; but partially make up for that drop-off in increased sales of more fuel-efficient models; although those tend to have smaller profit margins.
Volkswagen and Porsche Case Study for Corporate Merger PDF
Volkswagen Scandal Diesel Case Study Solution with Assignments Essay; In the dynamic of the year 2015, the scandal about diesel cheating damaged the image of the Volkswagen Company. The harmful and mortal effects of nitrogen oxide; which is a pollutant found in car exhaust have led the Environmental Protection Agency (EPA) to tighten emission run at the forefront of the attention paid to conservation and saving the green. The dealing out agreed to pursue quick-term needs forgetting the prospects of the company. Discuss the environmental implications of the scandal.
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The leadership of the company made an unchangeable gamble bearing in mind the stakeholder’s trust and resources. The Diesel emissions scandal, The cheat was in origin taking into consideration the stringent measures initiated by the EPA. These stringent events are necessary after the nitrogen gas emitted is harmful to human health and results in diseases such as asthma, premature death, bronchitis, and respiratory and cardiovascular. The Volkswagen Company’s reputation existed deeply damaged by the scandal leading to low revenue and supplementary effects including ham it taking place suites. For more reference in the version to Volkswagen as a matter and how they are roomy, let a see at our Volkswagen SWOT Analysis. Conclude with a discussion of the future of Volkswagen.
Introduction to the Volkswagen Scandal;
Introduce the Volkswagen scandal and its effects. Over the last few decades, there has been great concern regarding the sustainability and conservation of the environment. Environmental pollution and globalization have become the concern of most environmental protection agencies. The harmful and mortal effects of nitrogen oxide; which stands as a pollutant found in car exhaust have led the Environmental Protection Agency (EPA) to tighten emission control considering the attention paid to conservation and saving the green. These concerns have made the EPA constantly announce restrictions for standard emissions for all types of vehicles the sports cars, heavy-duty trucks, automobiles, and other types of cars. These stringent measures are necessary considering that nitrogen gas emitted is harmful to human health and results in diseases such as asthma, premature death, bronchitis, and respiratory and cardiovascular.
The scandal reflects corporate misbehavior on the part of Volkswagen. The automakers manufacturing fuel-efficient diesel cars in the United States faced hardships due to these new stringent emission regulations. Volkswagen is among the automobile makers in the United States market that were new stringent regulations. However, in the year 2015, the EPA announced that Volkswagen was a diesel dupe following its strategy to deceive the emission test. Volkswagen managed to deceive the test by showing less emission in its engines than what the engine emitted in the real sense. Therefore, this essay stands aimed at analyzing the extent to which this issue of diesel dupe has ruined its reputation of Volkswagen.
Analysis;
In light of the discovery of the diesel dupe Volkswagen in 2015; the mechanism aimed to alter the detection of nitrogen oxide gas in Volkswagen diesel engines. The test of the emission of nitrogen oxide in the lab was thirty-five times more on the road hence endangering the lives of the people. The leadership of Volkswagen decided to take a shortcut in the production of their internationally recognized brand. This rigging scandal has had a bad reputation for Volkswagen leading to a series of consequences for its direct and indirect stakeholders.
The impact of the Volkswagen Scandal;
In the previous year before the rigging scandal, Volkswagen was among the leading automobile producer in the automobile industry just second after Toyota Company. However, Volkswagen’s admission of guilt in the scandal had a series of effects on it and its operations and the company. The scandal severely damaged the company’s reputation in the automobile industry. Building a reputation in the business world takes time but destroying it is often fast; therefore, this has led to the Volkswagen Company bringing in three public relations company companies to help manage the crisis from Germany, Britain, and the United States. The implications of this deceit by Volkswagen leave the company in a bad condition considering; that it has to deal with different regulations since the company is an international brand.
The Role of the Managers;
Good leadership has three pillars that support it which are commitment, character, and competencies. Therefore, if any of these three values is not present; then there are bound to be problems for the stakeholders, the manager, and the entire organization. In any organization, corporate social responsibility and sustainability have proven too challenging. This follows as managers exist faced with the challenge of the tradeoff between the long and short-term decisions. This tradeoff often poses decisions between the survival of the business; and its annual compensation, between long-term environmental factors and quarterly profits, and between short-term and long-term goals.
Business schools must learn a better way to teach students about these tradeoffs and ways of handling them not ignore them. Resilience is key to financial sustainability. Therefore, business is capable of surviving natural disasters or financial crisis. Moreover, the manager’s relationship with the employees, the environment, and the community result in resilience. Therefore, it is important that businesses not work against the institutions that enable their long-term success. However, the antithesis of sustainability is what the Volkswagen Company showed in 2015 through diesel dupe.
Others role;
It does not make any sense for the managers of Volkswagen to create; this shortcut and be comfortable thinking it would lead to long-term success. The deception played on the consumers and the regulators compromised the long-term needs and success of the company despite achieving the short-term needs. The decision the managers made regarding the tradeoff between short and long-term existed surely misguided. Volkswagen stands as a company surrounded by competent staff and the managers exist well educated and have vast experience in the industry. Therefore, tabling an argument that there was a shortage of expertise would be wrong and misguided. The strong desire of the managers to succeed at whatever cost is what brought this predicament to the company.
They did everything with a sense of urgency and approached the challenges faced by the company with passion and vigor. The decisions these managers made, it is a case of failure in leadership. Research has concluded that drive, temperance, courage, humanity, collaboration, humility, integrity, accountability, justice, transcendence, and judgment are all qualities of a good leader and must all work together since using overusing one trait may result in liability. These traits are essential considering they enable a leader to think things through before making a decision. Moreover, the trait of justice helps in knowing the importance of giving back to the society; that ensures the success of the business and not harming them like in the case of Volkswagen.
Threatening People’s Health;
In case the scandal regarding the cheat device would not occur; sixty people would have died a premature death in the United States alone by the end of 2016 due to the additional pollution the Volkswagen cars produce. The 428,000 Volkswagen and Audi diesel cars manufactured produced more nitrogen oxide gas forty times more; than the standard allowed by the Clean Air Act in the period between 2008 and 2015. Researchers have concluded that every six years the cars Volkswagen and Audi produce an excess of about 36.7 million kg of nitrogen oxide; which is very bad for the environment and the health of human beings considering diseases like cardiovascular diseases; and other respiratory diseases that exist caused by this emission.
Moreover, the research also stated that sixty people between the age of 10-20 exist endangered by these emissions. Additionally, the effects of these emissions would result in the United States spending about $450 million on people over six years in the period between 2008 and 2015. There would be 140 premature deaths in the event Volkswagen failed to recall vehicles manufactured from 2015 onwards. Moreover, the Volkswagen diesel cars would cost about $840 million in health costs. Finally, acid rains exist caused as a result of nitrogen oxide production in the atmosphere; which leads to the destruction of property, and natural resources and badly affects the health of humans.
Drop-in Volkswagen Sale;
Bad reputation ruins businesses beyond recovery. Just as expected, Volkswagen faced a severe decline in revenue since the Volkswagen scandal of diesel. The scandal resulted in customers switching to its competitors disabling the sales of Volkswagen vehicles. For the first time since the year 2002, Volkswagen sales plunged throughout the world due to a bad reputation. Furthermore, the scandal affected every aspect of the Volkswagen brand considering even the share values slumped. The slump in share value started declining immediately after the scandal stood revealed resulting in a one-third drop. The decline in revenue stood expected considering no one wants to associate with a company facing a scandal and no customers would buy products that cause health problems.
Recommendations – Lessons learned from the Volkswagen Scandal;
The culture and structure of an organization are key to its success. The business environment is very different from the practices in the past. Employees are the engines, which move an organization; hence, failure to treat them ethically could result in grave consequences. Increasing the morale of employees is vital to the achievement of tasks and productivity in an ethical manner. There is no hierarchy in value-based practices and employees work in small groups that enhance productivity. Moreover, democracy stands promoted considering the employees report issues and concerns to their superiors resulting in high productivity within the organization.
From the actions of Volkswagen regarding the scandal of diesel; it is evident that the company resorted to shortcuts due to the stringent measures imposed by the EPA. Therefore, it is the role of the EPA to ensure the automobile industry does adequate research and finds alternative technology; which does not affect the environment; moreover, the EPA body has the mandate to ease its stringent measures.
Other things;
The EPA body must ensure it offers adequate support to the automobile makers and introduces a more feasible standard to the automobile makers to avoid companies from taking such actions as Volkswagen. The value-based approach is vital in the management of employees hence it should embrace by organizations. The EPA also must provide programs, which support the endeavors of the automobile makers. Volkswagen Company can regain its reputation back but that will not be easy. The first thing the company must do is do overhaul its leadership and bring in new faces.
Moreover, there needs to be a fresh start therefore, the person must also be new. After clearing the personnel and the leadership, there should be constant apologies to its customers. Afterward, the company needs to spend more money buying back the cars and fixing the problems to meet the standards of the EPA. The process of recovery will take time fixing the court cases and getting back in the good graces of people. However, spending time and money and ensuring no more mistakes is the only way the company will recover from this hit.
Conclusion;
In light of the Volkswagen scandal diesel discovery, it is clear it was an act of pure conmanship. The company decided to make profits at the cost of its customers and the environment. This scandal created a complicated situation for the stakeholders of the company. The actions of Volkswagen’s management were unethical to the business world leaving a bad name for the company. The management decided to pursue short-term needs forgetting the prospects of the company. The scandal left the company in a series of cases including a violation of the Clean Air Act and a series of international laws.
The leadership of the company made a complete gamble with the stakeholder’s trust and resources. The company had already established itself worldwide hence such a scandal cost it a huge price considering; that it would take a long time for it to get back to its glory days. The leadership of an organization is vital as it plays a significant role within the organization; and, its decisions may make or break the organization, therefore, in this case, Volkswagen’s leadership made a grave mistake.
Reference; It standsRetrieved from https://www.ukessays.com/assignments/volkswagen-case-study-2021.php?vref=1
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Case Study of Toyota Supply Chain Management PDF, Logistics, and Operations Management Essay; This essay aims to analyze several issues regarding the operations management, logistics, and supply chain of the Toyota Company. The origin of the company comes from the Japanese textile industry. Sakichi Toyoda invented the world’s first automatic loom in 1918. When a problem arose, the machine automatically stopped to prevent damage to the entire facility.
Here is the article to explain, the Toyota Operations Management PDF, Logistics and Supply Chain Management, Case Study with Essay!
This principle of automatic shutdown of the system and to draw attention to the imminent problems suggestively called the Jidoka; they have remained one of the main factors of Toyota Production system to this day. Operations management deals with managing resources like people, information, materials, and technology. In addition, it is important to specify that Operations Management transforms inputs into outputs by creating value of goods and services.
Sakichi’s son – Kiichiro has developed the AA model in 1936 and one year later theToyota Motor Company was born. In the ’90s, the process that includes not only the internal; but, also the external functions that contribute to the supply of a product to the final customer existed known as Toyota Supply Chain Management PDF download. “Toyota aims to connect cars, people, and communities and thereby create a smart mobility society that offers freedom of movement, safety, and excitement for all”.
Managing Quality;
Quality has many meanings for everyone. When a certain product/service meets a customer’s needs it can consider that it was a quality product or service. Organizations that use TQM have several advantages. For example, the customers are more satisfied, the products have higher net quality, the costs are lower, the financial performance is improved, and the quality and innovation are improved. Although Toyota was four consecutive years number one in the world carmaker as stated on bbc.co.uk; “from 2009 has millions of recalled cars due to accelerator pedal, brake, seatbelt and exhaust problems”.
According to express.co.uk, over 2.4 million hybrid cars were recalled by Toyota all over the world of which nearly 55,000 were in the UK. Therefore, the cars are recalled because of the software; because it is possible, for the vehicles to enter a driving mode; that would affect the safety conditions, and the power of the engine will be lost, and it will stop. The recalls are from May 2010 to May 2014, Toyota Auris, from October 2008 to February 2014 was Toyota Prius and from October 2011 until November 2014 was recalled Toyota Prius Plus. Toyota UK told BBC that Brexit without an agreement could temporarily stop its production at the Burnaston plant in Derby.
Examples;
The Japanese producer is one of the largest car manufacturers in the UK. About 150,000 cars existed produced last year only in Burnaston, and 90% of them were for export to the European Union as stated on bbc.co.uk; The Founder of Toyota, Sakichi Toyoda established five main principles: to always be faithful to the duties in the workplace; thus contributing to the good of the company but also to the general good. Be always creative, striving to face the challenges that appear with the times. always be practical and avoid being superficial. Try as much as possible to build a pleasant workplace atmosphere and be friendly with everyone around you.
You must always respect people with different spiritual beliefs and not forget to show gratitude At Toyota; the infrastructure is fast becoming a key instrument in developing; their future with a big step by developing the Toyota Mirai. More than twenty years ago, Toyota introduced hybrid technology with the first such car- Prius. With the hybrid technology, another innovation came up called Toyota Mirai. Toyota’s fuel cell electric car works on hydrogen gas made from renewable sources and emits only water, having a smaller impact on our planet; but at the same time, it stands made to leave a special impression for every trip. In the UK there are now just eleven gas stations with many more in perspective.
To reduce the impact on the environment, Toyota uses the 4 R’s: Reduce – by using fewer resources will result in less pollution, Reuse – any surplus of materials including parts of an old vehicle, Recycle – materials for helping to make new cars and Recover – minimize the amount of waste. Toyota is a good example of global operations management.
Operations Management;
Toyota Motor Corporation’s operations management (OM) has implemented ten factors for the operations to be more effective. These ten decisions involve different fields of activity and require certain strategic approaches. Design of Goods and Services. Toyota takes into consideration these operations of management with advanced technology and high quality. Some of the company’s investments go to research and development. Because quality is a key factor in the company, Toyota developed a program called Toyota Production System (TPS). This exists used now by many other companies who want to apply Quality Management in their system. The Design of Process and Capacity is the next factor developed by Toyota. In this decision area,
Toyota uses lean production, which exists also incorporated into TPS. The company focuses on both waste minimization and efficiency of capacity utilization. The Location Strategy. The company has extended not just in the United Kingdom but also in China, the United States, Thailand including some countries from Africa and the Middle East. Design and strategy of the model. The design of the model in Toyota’s production plants emphasizes the maximum efficiency of the workflow including the principles of lean manufacturing.
Supply Chain Management;
The company has created its own rules regarding operations management that focus on people respecting others. This call The Toyota Way which exists also integrated into the HR system. Apart from that, Toyota offers different pieces of training based on their Toyota Production System. Supply Chain Management, “Toyota uses lean manufacturing for supply chain management”. Toyota Supply Chain Management PDF Essay, In this strategic decision area of operations management, the company uses automation systems for real-time adjustments in supply chain activity. In this way, Toyota minimizes the bullwhip effect in its supply chain. Inventory Management.
In addressing this strategic decision area of operations management, Toyota minimizes inventory levels through just-in-time inventory management. The aim is to minimize inventory size and its corresponding cost. This inventory management approach stands covered in the Toyota Production System. Scheduling. Toyota follows lean manufacturing principles in its scheduling. The company’s goal for this strategic decision area of operations management is to minimize operating costs. Maintenance. For decades, Toyota developed a network of strategically located facilities to support its global business.
Measures;
The company also has a global HR network that supports flexibility and business resilience. Thus, in this strategic decision area of operations management; Toyota uses its global business reach to ensure optimal and stable productivity. Toyota’s operations management uses productivity measures or criteria based on the area of business considered. For instance, some of these productivity measures are as follows:
Number of product units per time (manufacturing plant productivity)
Revenues per dealership (Toyota dealership productivity)
Number of batch cycles per time (supply chain productivity)
Supply-chain management at Toyota is an element of the company’s operations strategy; which is thoroughly based on the Toyota Production System (TPS) Toyota Production System Toyota’s production system has existed designed to meet the following criteria; Quality – to ensure high quality of the finished product, it must be present at every stage of the process; Cost – costs and wastes must exist kept to a minimum level in every aspect of the business; Delivery – the TPS process is based on the timely delivery of both products and processes TPS is a method that reduces the time between customer orders and vehicles delivery. To achieve this, the entire operation until delivery is done in a single continuous flow. The result is a much higher level of productivity, less time, money, and effort, and better quality.
Just in Time;
Although JIT existed discovered by Henry Ford, just to manage inventory in his company, in the early 20th century; the one who used JIT as a management strategy, was Taiichi Ohno in his company, Toyota Manufacturing Company. The elements of the just-in-time system are being proactive in exposing problems, pulling production based in Kanban; Total Quality Management, elimination of waste, reducing inventory; involving suppliers in the planning process, continuous improvement, improving machinery, and focusing on co-operation.
Capacity planning in any company is part of supply-chain management for that specific company. Toyota’s way of capacity planning is that it strives to eliminate inventory. In achieving this objective Toyota relies heavily on a pull system. Generally, the main objective is continuous improvement. Just in time inventory management allows a company to gain a competitive edge by not having to have a large amount of inventory in their warehouses; but, only to order parts when they need. According to just in time philosophy new material will produce only; when the old stock of that material has finished.
With over 10 years of development experience, General Motors, in 2017, laid the foundation for vehicle-to-vehicle (V2V) communications, a program that could reach Toyota too in the coming period. The Japanese also announced that they intend to develop this V2V technology; as well as that of the vehicle for infrastructure (V2I) in the United States from 2021; with the idea of implementing it to all models by 2025. V2X is another technology that Toyota wants to implement.
More to know;
This is a combination of V2I and V2V based on communication with other traffic participants, like pedestrians or cyclists. Toyota intends to use as well DSRC (Dedicated Short-Range Communications) technology between cars and trucks with the help of wi-fi. In the U.S. the federal communications commission has set aside spectrum in the 5.9 GHz band for connected transportation. Through V2V communications, vehicles can share a range of information about current conditions that can expand the situational awareness of drivers.
For example, if the ABS or stability control of a vehicle detects slippery conditions; it can broadcast a message to alert drivers that are following on the same road so that they can slow down. A car approaching a blind intersection can broadcast its position to cars coming from other directions. As roadside equipment exists deployed, the messages can also receive by traffic management systems or those systems can provide vehicles with alerts about when signals are going to change. An area of the green tourism model that has lately advanced impressively, both in terms of take-up and knowledge of its sustainability features, is the sustainability of supply chains and procurement.
There has been considerable science lately that has existed applied to defining the life cycles of products; to measuring the energy and resources that go into manufacturing and transporting products; as well as the carbon and other GHGs that exist emitted at all stages in the life cycle of a product. The UK government’s Office for Low Emission Vehicles (OLEV) announced the availability of £400 million in funding to assist measures designed to promote uptake of ultra-low emission vehicle technologies such as electric, plug-in hybrid, and hydrogen-fuelled vehicles.
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Case Study of Tesla Supply Chain Management Evaluation Analysis with Essay; Throughout the years, supply chain management has grown to be a significant element of any business to increase; and maintain its competitiveness and customer satisfaction. For companies today, it is critical to commit to the efficiency of the supply chain operation; as well as to develop and implement strategies for improving efficiency and quality. An efficient and optimized supply chain management plan can make a world of a difference in any business, especially in the automobile industry.
Here is the article to explain, the Tesla Supply Chain Management Case Study Evaluation Analysis with Essay!
This is especially true for Tesla Inc., an American automotive company based in California; which lacks the necessary relationship with its narrow supplier base. As a result, Tesla would greatly benefit from a more efficient supply chain management to meet production demands and yield expected profits.
Industry and Customer Value;
In today’s market, automobiles represent the largest manufacturing industry in the United States; with manufacturers and suppliers in the automobile industry generating billions of dollars each year. According to Auto Alliance, “auto manufacturing drives $953 billion in the economy each year through the designing, building, and selling of vehicles. Beyond manufacturing, the industry is also dependent on other companies supplying parts, components and materials, retail services, and vehicle maintenance.
At the top of the U.S. automaker rankings based on sales for 2018, is General Motors with 2,150,320 followed by Toyota’s 1,920,026, Ford Motor Company, FCA, Nissan Motor Co., Honda, Hyundai Kia Auto Group, Subaru Co., Volkswagen, BMW, and Daimler. Although Tesla, also formerly known as Tesla Motors, Inc., ranks amongst the top for innovation and environmental considerations, the company ranks 13thth in automaker rankings and 21st in sales. Despite the challenges in production, Tesla’s $56 billion market capitalization is greater; than many of the well-established automakers in the industry; and, thus, Tesla’s ambition for innovation has resulted in a steady stream of aggressive investors.
In 2003;
Tesla existed incorporated as a business that focused on designing, developing, manufacturing, and selling fully electric vehicles. As a production plan and goal for the company, Tesla’s CEO, Elon Musk, envisions the company building 500,000 cars per year by 2018, and one million cars per year by 2020. To accomplish production goals, the Company continues to expand its product and production strategies; through its corporate structure and global operations that enable production needs.
Unfortunately, Tesla has struggled with production and maintaining a sustained supply chain management, resulting in reduced production, delivery delays, customer dissatisfaction, and lost revenue.
In 2018;
The industry revenues for Tesla were $4.5 billion in Q1, compared to $7.2 in the fourth quarter. Meanwhile, for the first quarter of 2019, Tesla reported a loss of $702 million, or $4.10 a share, after lower than expected delivery volumes, costs, and pricing adjustments to its vehicles. Although Tesla has many major competitors in the automobile industry, product preorders reflect a substantial demand for Tesla products. It should note, however, that the risk to consider is that the demand is for the brand and not cars.
Tesla’s customer base exists focused on millennials who give significance to environmentally friendly initiatives, are tech-savvy, and desire inexpensive luxury cars. Tesla’s story of “saving the planet” with vehicle innovation has created a respectable customer experience, patience to inventors, and profits to the Company. Nevertheless, Tesla faces the challenges and pressure of mass production; while trying to stay ahead of their major competitors, such as Chevrolet Volt EV and Hyundai Ioniq EV.
Challenges;
With hundreds of suppliers across the U.S., Europe, and Asia, Tesla faces challenges in its supply chain. Specifically, challenges related to vehicle’s battery design, and manufacturing automation. A bottleneck Tesla has is the sourcing of raw materials, especially cobalt, the essential metal used in the battery cells derived from the Democratic Republic of Congo. Not only does the sourcing of cobalt create risks of spikes in pricing; but it also creates gaps in supply and production.
Other key manufacturing suppliers for Tesla’s include AGC Automotive (windshields), Brembo (brakes), Fisher Dynamics (power seats), Inteva Products (instrument panel), Modine Manufacturing Co. (battery chiller), Sika (acoustic dampers), Stabilus (liftgate gas spring), and ZF Lenksysteme (power steering mechanism) amongst others. With as many suppliers as Tesla depends on, it is critical for Tesla to establish long-term relationships with suppliers as Tesla mostly works on make-to-order (MTO), and highly relies on its suppliers.
Network Design;
Typically, when selecting suppliers, third-party logistics (3PL) firms, distribution centers, and retail stores, considerations exist given to cost, location, quality, and value; however, Tesla has done business a little differently without full success. While skipping traditional manufacturing steps, Tesla designs manufacture, sells, and services their cars through a vertically integrated supply chain. Tesla’s specialized supply chain focuses on reconfiguring; their Fremont Factory to integrate high levels of robotics automation into various manufacturing processes.
Tesla’s intense usage of automated robotics and integrated supply chain is the major source of value creation for Tesla. The vertically integrated automation system allows Tesla to incorporate the smaller and generally outsourced subsystems into; their manufacturing process to allow for quicker turnaround and shorter product improvement cycles. More importantly, it allows for manufacturing flexibility, process control, and increased tesla supply chain coordination and management. Meanwhile, Tesla’s outbound logistics include warehousing and distribution of their vehicles after manufacturing and assembly operations.
Tesla SWOT Analysis;
While Tesla appears to be a very successful and innovative company a SWOT analysis can provide a deeper insight as to what strengths, weaknesses, opportunities, and threats the company face that can ultimately lead to greater success or even the company’s demise.
Tesla Strengths;
Tesla exists considered a very successful company. This success can exist attributed to the numerous strengths or advantages Tesla possesses. These include the niche or specific section of the market that Tesla has selected to target. This stood accomplished by being the first to sell automated cars. They were able to not only succeed in the sales of greener cars; but, were able to accomplish their greater vision of revolutionizing the driving experience.
Additionally, Tesla has not only focused on electric cars but, has established a recognizable brand name. Tesla has also been able to develop and use cutting-edge technology that has allowed them to create their innovative products. Furthermore, the company also has existed granted government funding. They can obtain billions of dollars for energy management projects under the US Department of energy.
Tesla Weaknesses;
The company also however suffers from many weaknesses. One of these weaknesses is that Tesla has acquired major debt. Despite government funding, Tesla has spent a great portion of its funding towards research and development. Additionally, the company has expanded greatly over the past few years causing even greater debt. Their limited profits and huge debt could lead to difficulty in repaying loans resulting in a more net loss in the future. Furthermore, the company only has one manufacturing plant that has a capacity of 500,000. Making the company limited to this figure and unable to target higher volumes. Additionally, many customers are apprehensive about purchasing these highly expensive futuristic products.
Tesla Opportunities;
Opportunities for the company are that there is a preference for new technology. New technologies such as green vehicles could help show consumers that newer and greener technology is a good investment. Moreover, Tesla has started to expand to parts of western and northern Europe. Along with parts of Asia including China. There exist also government incentives associated with purchasing electric cars. Tesla also purchased the rights from the company Solar city. This will increase the company’s capabilities in energy storage.
Moreover, analysts say that by 2040 54% of all cars sold on the planet will be electric. France’s minister claims that there will be a ban on all fossil fuel usage by 2040. Volvo has also claimed that it will stop the sale of all gas-only vehicles by 2019. A future of mainly electric cars serves as a huge opportunity for Tesla. This is a result of Tesla already being a widely recognizable brand and leader in this type of technology.
Tesla Threats;
Threats that exist associated with Tesla include an increase in the price of raw materials. This can negatively affect the company because materials such as graphite, steel, aluminum, and lithium are subject to global supply and demand. The costs of raw materials increasing cause pressure to increase the prices of Tesla products to make up for the loss in profits associated with the raw material prices increase. Additionally, government regulations can delay production and sales. Tesla may have also been too good at convincing his competition that electronification was the future. GM was able to release its Chevy Bolt months before Tesla’s Model 3.
In short;
Tesla owns it all. To meet order demands, however, Tesla needs to optimize the tesla supply chain network (SCN), management by identifying three top criteria that focus on supply and product manufacturing flow where the value stream of the product includes the raw materials, components, and sub-assemblies, never stop in the production process. These criteria include speed and agile processes for suppliers that can provide faster tooling lead times, raw materials, and parts, as well as having the technological collaboration with the digital supply chain the company promotes to push out updates to existing customers. Furthermore, supply chain coordination strategies, product flows, information flows, and risks mitigation is also critical factors Tesla must consider when selecting suppliers. Supplier relationship management is critical to producing products on time and on budget while reducing the impacts on manufacturing flow management.
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Case Study of Nestle Supply Chain Management PDF Essay with 4 Project; Supply chain management has gained its importance in serving business operations and being part of the strategic management of the business. Its role has stood shifted from being a support department to being the core department of business with strategic importance and role to play in the overall operations of the business. In a modern business world, no organization can sustain itself without having well-established, effective, and efficient nestle supply chain management. The role of vendors along with vendor management with the introduction of information technology is an important consideration for organizations.
Here is the article to explain, the Nestle Supply Chain Management Case Study PDF Essay with 4 Projects!
Nestle Supply Chain Management Case Study PDF download; Now with the increase of strategic importance of supply chain management the service provider is now becoming a partner to the organization, rather than being just the vendor. The factor influencing the competitive advantage of the organization is now having better vendor management and vendor relations in the list. Therefore in the coming years, the importance of supply chain management stands expected to increase with the increase in competition and globalization.
To understand the strategic nestle supply chain management case study pdf, key concepts, and use of information technology to maintain vendor relationships; this report presents one of the leading FMCG companies Nestle. Their products range is wide and the concentration of this report is on the organization’s Pakistan operations. Since Pakistan is part of their global supply chain operations but for their milk products; they have to rely on the local milk suppliers who are not very much educated and well equipped. Therefore managing them is a challenge for the organization; and, the same challenge and its handling is under study in this report. There are some recommendations also given at the end so that improvements can exist made in the local supply chain.
Project Part 01;
Current Supply Chain Strategies in Nestle;
In these lines, I shall be looking at the supply chain management of Nestle Pakistan’s operation and would not be discussing the global supply chain management of the organization. The organization has remarkable production facilities in the country; and, they have also enjoyed a healthy market share for the last few decades. One of the reasons for the success of the organization is its vendor management and intelligent distribution system.
The market in Pakistan stands mostly dependent upon the distribution network and the same has existed managed by the organization in recent years by having excellent relationships with their channel members and logistics. Their distribution network makes sure that every product exists distributed in the required areas at the required time and the demand and supply do not have any gap. Their distribution setup exists synced with their production system therefore they do not have to manage the inventory of the product for a longer period. This strategy has saved the organization on the financial side moreover they have been able to provide the product to the market at demand.
The second side of their nestle supply chain management is their vendor management, they have applied the just-in-time management concept in their raw material procurement and vendors are very well synced with the procurement, and procurement exists synced with the production and other support departments. This just in time management has also saved the organization the inventory management cost of the raw material and they can maintain a very low level of the inventory. Their vendor exists also required to make sure that their raw material reaches the organization on time.
Use of IT to Maintain Vendor Relationships;
Information technology is serving organizations to manage their business operations in different ways; the same concept can also exist applied to manage vendor relationships with Nestle Pakistan’s operations.
The organization can design a procurement network that stands integrated with the various departments of the organization. And the procurement department can have information technology-based applications that also integrate with the systems of the vendors and exist automated. By using this system organizations have the concept of just in time management applied in full spirit and the vendors will also be aware of the production schedules of the organization and they will be able to plan their delivery and their production planning according (Hugos, 2006).
The above-mentioned scenario will make it easy and convenient for the vendors to do business with the organization; and, they will have better relationships with the organization and will continue to do business with them. By having these relationships with the organization they will be able to be partners of the company.
Project Part 02;
The assistance of IT in the Supply Chain;
The use of information technology can assist a great deal in the management of the supply chain in the case of Nestle Pakistan operations. In the global supply chain, nestle is making use of supply chain management tools that exist supported by the latest technology available. These tools can integrate different parts of the supply chain that includes the just-in-time management of raw materials, automation of order generation to vendors and the logistics of raw material from a vendor to the warehouse, and the distribution of the finished goods to the different channels.
Previously all the above-mentioned parts of the supply chain existed disintegrated or in some organizations, these parts stood partially integrated. Now information technology has made it possible and easy to manage all these parts of the supply chain from one terminal and these parts and integrated with more automation. An example of this integration is simple, once the inventory level reaches the pre-defined minimum for the raw material at the production facility, then the order management system which stands connected to the inventory management system, automatically generated orders to the pre-defined vendors. The order receiving systems of vendors stand connected with the procurement systems of the organization.
After the vendor stands intimated, they manage to supply the required stuff and required quantity to the organization’s warehouse; which exists already intimated for the order delivery. All this process exists done via an integrated system which calls ERP. The application of these information technology tools makes the organization able to save their time and management resources and make the vendor the partners of the organization above all this usage of IT bring automation in the processes which is the requirement of production-oriented organizations.
Effectiveness of IT in Management of Supply Chain in Nestle;
When we talk about effectively using the information technology in the Pakistan market with local vendors; we see that our case company has been able to improve a lot in recent years. Since the market of Pakistan is still in the developing phase and modern management; and, information technology practices are yet to exist adapted in this market. Since Nestle for their business requires a team of vendors that can provide timely supplies; therefore they had to work hard to induct the modern practices in their supply chain about the market conditions.
Apart from the current IT tools to help the organization gain the best out of Nestle supply chain management case study pdf; there is a function in which information technology; and, its use can play an important part in the management of the business, and which is still to exist explored. This area is related to the supply chain management of their milk products. For their milk brand which exists called “MILK PAK,” they need to collect the milk from farm and village areas of the market as the milk production stands mostly done in the rural areas of Pakistan.
Their milk collection process exists done on daily basis and it is still on a manual basis. There can be the use of information technology by using this they can maintain the database of their milk vendors which are small, geographically distributed, and dispersed in locations. Moreover, they can also use information technology to locate their collection van using global positioning systems and install trekkers in them so that they can make sure the safety of the milk and the vans.
Project Part 03;
Role of Logistics in Supply Chain;
Logistics has an important role to play in the overall nestle supply chain management of any organization. Logistics are the activities that stand designed to keep the goods or services moving from one destination to the other destination. This movement of goods or services can be related to the raw material needed for a production setup, and its movement would be from vendor premises to the organizational premises this movement can also be related to the movement of the finished good from the organizational production facility to the channel member facility.
In the overall management of the supply chain, the logistics part has its importance. Since the production-oriented business is all about timing. If the raw material is not available to the production facility then the whole production cycle will get disturbed; and, similarly if the finished good exists not reached to the channel members; then they will not be able to distribute it on time and the result will be the complete failure of the business plan.
Consideration for any organization would be to have the logistics set up planned and implemented that is consuming less cost of operations; moreover, which stands integrated with the supply and demand channels of the organization. The ability to design such a logistics setup helps the organization to achieve its supply chain objectives by putting a minimum cost to it. The success of any supply chain management is dependent upon the design of logistics, the smarter the design; which can serve maximum in minimum cost the better the performance of supply chain roles will be. The focus of our case organization is to design a global logistics channel; that can satisfy global business needs at minimum costs. And they have been able to handle this challenge smartly.
Evaluation of Procurement Practices in Nestle;
Procurement practices in Nestle global, as well as Nestle Pakistan, exist streamlined and working on smarter management concepts. It would not be wrong to say that one of the success factors for their profitability in Pakistan is their vendor relations and smart procurement. Nestle Pakistan has to procure different good and services from different kinds of vendor for their operations; these good ranges from the raw material for their finished good; as well as the supplies for the support departments like marketing. The overall philosophy of Nestle Pakistan procurement is to focus on quality as well as business efficiency.
When we talk about the milk production of the case company then we see that the procurement of the milk from different villagers that exist spread across Pakistan is a challenge and the organization has been able to cater to this challenge very well. The important factor in the procurement of raw milk is to make sure that milk is pure, hygienic, and fresh. These things stand made sure by designing a well-established vendor network that is responsible for the procurement of fresh milk upon the above-mentioned properties.
Their procurement department has selected reliable and quality vendors that include small to medium-sized diaries that provide quality milk to the company. Also, Their procurement department makes sure that the milk is fresh, hygienic, and above the standards defined by the organization. Their logistics have made sure that the fresh milk reaches the production facility on daily basis. The same care and quality consciousness have existed practiced in other procurement tasks; and in short, we can say that procurement processes at the organization are of high standards.
Factors for Improvement in Logistics & Procurement;
Several factors are to exist considered when organizations go for reviewing and improving their logistics and procurement. The first factor that is to exist taken care of is the bargaining power of the suppliers. The higher the bargaining power of suppliers the higher will be the requirement for the organization to maintain; and, build good relationships with their suppliers. In industries where such power is with suppliers, organizations have to design their procurement process; which is supplier friendly and encourages the organizations to have good friendly relationships with their vendor; focusing on making them their partners in business and getting the competitive edge out of it.
The second factor which is to exist taken into consideration is the cost factor; the procurement and logistics can be costly to the organization if not designed creatively. The logistics are costly when their inbound and outbound management exists not done in the way to maximize productivity. Therefore when organizations design the procurement and logistics process; they should keep in mind the cost of procuring the goods and services along with the distribution cost of the good should be minimum. These costs include the time and resources costs as well.
Another important consideration is related to the integration of procurement and logistics with the rest of the business operation. Organizations when improving these processes should also make sure that the maximum integration is possible with other departments like production. They should be working on the automation of the processes that should manage by the single hub. This way the costs of operations will be minimum and automation and integration of all the operations will save time and increase efficiency in the business processes. They should also make sure that integration also includes the vendors.
Project Part 04;
Strategy for the Improvement of Supply Chain;
Presented below is a brief overview of the strategy that can exist used to improve the supply chain management of the organization. The focus of the strategy is to improve the supply chain management of Nestle Pakistan’s operations. While reviewing this strategy it should exist kept in mind that Pakistan is a developing country; and, their vendor management and logistics operations are being run on old school management. The mentioned below points are focusing on vendor management and to increase the use of information technology to bring overall improvement.
First of all the organization should work on vendor relationship management; up till now the balance of power was with the organizations in the Pakistani market; but, with the introduction of the global economy and open market more players are entering Pakistan, and now the importance of vendors is increasing. Keeping this view in mind Nestle should be working on increasing the organization and vendor integration and they should exist made business partners. This can exist done via having automation and integration with vendor systems; and simply keeping them motivated to be partners with the organization.
The second improvement which exists required is to start the use of information technology in their supply chain management process. Up till now, the organization is using the information technology internally; but they have to move out and make their vendor also use this tool. One can argue that current vendors are not that advance in using technologies; but, I would say that organizations would have to educate; their vendors and make them part of their organizational process; this way they will be able to achieve a true partnership; with their suppliers and the operations of the supply chain will improve a great deal.
Benefits of Improvement to Business Operations;
The improvements suggested above have different benefits to the organizational business operations, these benefits range from operation to strategic benefits. The first benefit that organizations will have is that; they will have a strategic competitive advantage by partnering with the suppliers of the raw material of their products. The business era is changing the market and now other players are also entering into the same market; now the competitive advantage will be with the organizations; which have a strategic partnership with their suppliers as well. The increases in the competition have also made the suppliers aware of their important role; and, they are also feeling the shifting balance of power. So it will be advisable to make the partnership before others do.
The second improvement is related to the use of information technology in supply chain management; and, it has many benefits for the organization. First of all the organization will be able to achieve the integration between different departments playing their part in the value chain. Once this exists done it will save time and financial resources to the organization; as the processes will streamline and efficiency will increase. The second benefit of the IT usage will be that vendors and suppliers can also make part of the organizational processes; and with that supply chain, overall and procurement processes in specific will improve. This will again help the organization to get business efficiency.
The third benefit is related to the distribution part of the supply chain, organizations will; with the usage of information technology, have the most streamlined distribution network; when they have partnered with their channel members, and this will also help in the improvement of the business.
Overcoming the Barriers to Change in Improvement Strategy;
Whenever there is a strategic change barriers are always there. These barriers are to be removed with the creation of understanding and delegation. The first process is to make the management understand that; what are the benefits of the new strategy advised for the strategic change in supply change management. Moreover, the management will also be informed about the challenges it has to face; if they do not adopt the required changes in the market. The top management in the first phase will make part of the process; and, the strategic importance of the change will introduce to them.
In the second phase where the top management will already convince about the required change; the middle management will take into confidence at this stage; the vendors will also exist made part of the process; so that they are aware of their role in the organization. This stage will also be comprising the rough drafts of the change. In this process, all the vendors and relevant departs will encourage to give; their feedback about the suggested changes moreover their suggestions will also note for any improvement.
All this discussion and delegation will create a sense of ownership in management; and, their feedback will make them realize that this is something for their benefit and they will start owing it. Once the ownership is there, the barriers to change will start reducing and fear of the unknown will remove. With this process, the implementation of the strategic change will stand made successful; and finally, the concerned departments will also provide the required training.
Conclusion;
In this report I have discusses various kinds of supply chain strategies; and the use of information technology to improve the supply chain. The organization selected for the analysis was Nestle Pakistan, and their supply chain strategies existed discussed briefly. The organization is having an impressive nestle supply chain management case study pdf; however, they need to concentrate on two dimensions. One solution is the concentration on making the vendors partners of the organization. The second solution is increasing the use of information technology tools to manage vendor relationships.
Case Study of Nestle Supply Chain Management PDF Essay with 4 Project; Image by Minn Ko Aung from Pixabay.
Case Study of the Nike Supply Chain Management with Essay; Nike enjoys a strong brand, well-managed distribution processes, and a compelling product offering. However, with new competitive entrants with better service and lead time, and even fashion brands moving into their market space; supply chain excellence has stood elevated in the past few years and view as a competitive weapon.
Here is the article to explain, the Nike Supply Chain Management Case Study with Essay!
In meeting the major object of improving customer satisfaction; this supply chain transformation focused on the customer – meeting customer product requirements, improving customer relationships, improving requested delivery.
Supply Chain Management approach at Nike;
The major way we see Nike supply chain management meet future needs is through virtual organizations. These will be based on intellectual capital brands, technology, new product development, new channel strategies-with operations activities largely outsourced. The counterpart will be the emergence of powerful supply chain specialists.
We see the rise of such concepts already. Nike, selling $9 billion worth of athletic shoes annually; does so without owning any factories itself, performance, and reducing claims and cancellations to lower inventory holding costs. Focused on actual point-of-sale demand, processes are being transformed from the retail shelf backward, to achieve a leveled flow of product throughout the supply chain. Demand planning processes are also being redesigned from the retail perspective, and “retail reality” is incorporated in product design.
Their delivery precision roadmap includes a playbook of prioritized initiatives, with executive sponsorship, including demand/supply matching, improving sales catalog accuracy, streamlining distribution center operations, and optimizing processes globally. They have also created a governance board that sets the strategies, prioritizes the initiatives, and drives company-wide execution based upon standardized processes and platforms.
Several overarching principles of Nike’s supply chain transformation include:
focus on the vital few prioritize investments aligned with business strategy and return.
simplify end-to-end: drive out waste & complexity from the process first, then enable.
avoid customization: standardize solutions to improve processes.
copy-paste companywide: replicate best practices across business units, regions, and brands.
lead the change: invest in project & transition management.
accelerate the pace: respond quickly to new business needs, and.
deliver business results: finish what we start through business benefits achievement.
Strategy to Nike’s Global Manufacturing;
An important part of Nike’s supply chain management strategy is using several different global manufacturing resources to its advantage. Nike does this for many different reasons. Most importantly, it allows them to take advantage of various economic atmospheres across the world; as well as utilize the industrial strengths of different countries.
Key features for Manufacturing;
Nike’s supply chain strategy heavily emphasizes the use of multiple sourcing partners. As a result, Nike is always shopping for new and more productive manufacturing sites around the world. In this shopping process, Nike is looking for, among other things, inexpensive labor, low import taxes, and high levels of efficiency in the manufacturing process. To maintain these important parts of their strategy, Nike officials are located at all foreign factories.
Challenges to Managing a Global Supply Chain;
Nike has run into several different challenges in its attempts to continue its global manufacturing strategy and supply chain management. One of the major problems was achieving a level of cooperation with foreign manufacturers. An obvious reason for this is the language barrier between Nike officials and foreign workers. However, some issues were more complex than this.
At times, there were significant initial costs relating to updating the technology in the manufacturing facilities. Traveling costs by Nike officials to these foreign locations began to add up; while many countries lacked the infrastructure and accounting capabilities to control costs. Nike has attempted production in Europe as well as multiple locations in Asia.
Nike began producing in Europe because of the trade restrictions existing in China and the level of difficulty to do business in China. However, European manufacturers were never able to reach the efficiency of Asian sites, even when quotas, duties, and manufacturing costs exist considered. This is largely because of Asia’s inexpensive labor.
Overcoming Challenges of Global Optimization;
Nike has been successful in overcoming these problems in several different ways. Nike can utilize a small number of partners that have many positive characteristics including infrastructure, material resources, technical know-how, labor-management, and operational experience. This allows Nike to minimize the risk of losing technology to less reliable subcontractors. Nike has built valuable, long-term relationships with these partners.
These relationships didn’t necessarily ensure the lowest costs, but in return, Nike gained shorter lead times for delivery, increased quality, and the ability to manufacture innovative products. Nike has also come up with a concept to diversify production equally between facilities in five different countries. This way, Nike could easily shift production from one country to another; if political instability or trade restrictions in a certain country caused any problems for them.
Product Design;
Nike has been designing all of its products in-house since it launched its name-branded shoes in 1971. Nike employs 400 people for the design and development of footwear, apparel, and sports equipment located at headquarters in Beaverton, Oregon. Globalization has led Nike to understand that different countries have other performance desires.
Such as in Japan where runners prefer shoes lighter and with a lower profile to the traditional designs made by Nike. As a result, Nike plans on opening a research and design department in Japan. Developing foreign markets may require more than American-based designs to satisfy public expectations resulting in Nike having to consider designing internationally.
Performance;
Nike thrives on a design that is not only cosmetically pleasing but designs that focus on performance. Whether designers are making custom shoes for athletes or the public, high performance is the issue. Striving to lighten, increase responsiveness, fit, support, injury protection, and cushioning are all factors involved in the design process.
Often products stand designed for such athletes as Michael Jordan that focus on improving success on the court. Designers will meet several times a year with Jordan to develop the right design that eventually may exist applied to all of Nike’s shoes to increase performance abroad.
Concept to Prototype;
To proceed to a final prototype, the design must undergo numerous interrogations. The “Concept Review” is a group of managers from various departments who comment on the qualities of the shoe in the design phase. Critical points often reviewed are: meeting marketing expectations, competitive pricing, profitability, performance, applied technology, and does it compete with products at the same price? After approval, the design goes from illustration to a three-dimensional sample.
Creating the sample will exist done either at headquarters or one of the Asian manufacturing sites depending on the design’s complexity. Developing the upper part of the shoe includes a designer working with the engineering group to produce what typically totals over forty pieces. Whereas the bottom of the shoe might stand made of clay or wood but when put together with the upper, will be a three-dimensional representation of the drawing. Some samples can go through up to fifteen design changes with the result of a sample in every color that has existed planned.
Manufacturing;
The manufacturing plant produces a set of samples with the real materials to exist sent back to headquarters for final approval. The approval consists not only of the samples but consideration of the entire seasonal product lines mix, redesigns, and prices.
After approval, the plant begins to commercialize the product for mass production including scaling to all the required sizes and the development of the volume production process. After all the processes have been determined, the manufacturer orders materials needed for production based on Nike’s forecasts.
Order/Inventory Philosophy;
Nike’s order/inventory management system is based on long-term future forecasts. Nike has established a “futures” program that rewards retailers with significant discounts if orders are placed six months in advance. Nike uses these orders as a basis for global demand.
This demand information exists used to set production levels at Nike’s various manufacturing locations worldwide. The manufacturers will produce the demanded quantity of goods and distribute them to the retailers within one month of the expected delivery date.
Order/Inventory Management;
There are many limits and vulnerabilities to this strategy. Nike accepts all “future” orders without considering its manufacturer’s production capacities and promises delivery within one month of the requested delivery date. Nike attempts to remedy this flaw by ordering their manufacturers to produce up to 55% for the anticipated level of goods before any demand information is available and sometimes up to four months in advance of receiving any orders.
They then add to production when the “futures” information becomes available. Unfortunately, if there has been an excess inventory of products produced before the demand information is available, then Nike will have to pay its manufacturers for the goods they produced or partly produced, even though there is no demand for them.
Effectiveness of strategy;
Nike’s current strategy for managing its ordering and inventory is not effective. Long lead times associated with Nike’s order/inventory policies are a major vulnerability to managing demand. Lead time for orders Nike places with its manufacturers is around four months.
In addition, Nike pre-orders four months in advance because its manufacturers cannot meet demand. Nike purposely does not meet the demand for high-end shoes in hopes to encourage customers into newer models. Long lead times, poor forecasts, and unmet demand add great variability to Nike’s supply chain.
Limitations and vulnerability;
The futures program creates significant variance because it requires production to begin ten months in advance. After all, the manufacturer’s capacity cannot meet demand in six months. Variance in the supply chain increases further when retailers are overstocked and permitted by Nike to cancel futures. With all this variance it is likely excess inventory will remain, and not uncommon for Nike to hold excess inventory on freight ships, docked and waiting for the necessary demand.
Additional fluctuations in demand exist increased because designers do not base designs on past sales data. If high-top sneakers were not in demand and designers did not know due to a lack of information, they may develop another high-top sneaker that has no demand thus adding to the cost and overall inefficiency of the supply chain.
Alternative Order/Inventory Strategy;
An alternative to this ineffective strategy would be to establish a POS information system at all retail locations. This would help Nike create accurate short-term forecasts of demand that could exist delivered to manufacturers promptly.
There is also a need for Nike to establish a distribution network that will sustain a predetermined inventory level. This will decrease the bullwhip effect that is inherent in the current supply chain. Nike will have the ability to meet short-term demand with their distribution centers while accepting shipments from their manufacturers.
Information Systems Recommendation;
It would be advantageous for Nike to establish an ERP system to support this new strategy. This effort should stand coupled to integrate their many independent manufacturers into their ERP system. This integration would give Nike more control over the production process and better control of information.
This information control is imperative to the future success of the organization if Nike is to manage the supply chain from the manufacturer to the retailer efficiently. If Nike were able to easily retrieve information from each level of the supply chain in real-time, they would be able to cut costs and streamline their supply chain, and manufacturers could begin production based on POS data gathered by way of the ERP system from retailers. Supply chain integration is the key to the future success of Nike.
Nike Supply Chain Management Case Study Essay; Image by Mohamed Hassan from Pixabay.
Case Study of Asthma UK Nursing Essay; This essay writing as a case study referring to a patient from my practice area. As I will exist reflecting on my practice about the case study; use will stand made of first-person writing where appropriate. Hamill (1999) supports the use of first-person writing in academic essays; such as case studies and suggests it develops self-awareness, reflection, analysis, and critique.
Here is the article to explain, Asthma UK Case Study Nursing Essay!
As this essay exists focused on a specific patient from my practice area; it is important to consider issues of confidentiality. Therefore, neither my practice area nor the patient’s name will exist identified. However, to be able to discuss key issues about the patient; I will refer to their age, gender, and lifestyle, and use a false name to aid the flow of writing.
Introduction to Asthma;
Asthma affects 5.2 million people in the UK; 1.1 million children and 4.1 million adults according to Asthma UK in their 2004 report. However, depending on which report one reads, this number can almost double to 10.1 million. This wide variation of prevalence may exist explained by the different studies; and, reports used to gather the data, and the different inclusion criteria used. There is nevertheless agreement on the fact that the number of cases of asthma is increasing.
Asthma UK (2004) reports a 400,000 increase in the number of adults with asthma in the UK between 2001 and 2004. The rising patterns of asthma prevalence however exist not explained by current knowledge of causes of asthma; but, stand paralleled by increases in other allergic conditions such as eczema and rhinitis.
There is currently no agreed definition of the disease. Widely documented in the literature, however, is the National Heart, Lung and Blood Institute (1992) definition describes it as; “a chronic inflammatory disorder of the airways causing widespread but variable airflow obstruction…Obstruction is often reversible, either spontaneously or with treatment”. The severity of the condition varies significantly from mild intermittent asthma to a distressing disabling condition; which results in time off work or school, disturbed sleep, restriction of social and leisure activities, and anxiety. The main aim of asthma management is to control symptoms, minimize asthma exacerbations and optimize quality of life.
Student Degree;
As a student of the Acute Care Pathway Degree, one of the specific learning outcomes for my pathway is to be able to manage programs of care for patients with chronic diseases. Hyland (1998) states that the Advanced Nurse Practitioner has become a major provider of asthma care in the UK. Watkins, Edwards, and Gastrell (2003) agree, and suggest that currently the management of long-term conditions, including asthma, is a core component of an Advanced Nurse Practitioner’s work.
Therefore I must have an understanding of this condition and be able to review patients effectively using evidence-based guidelines and have the confidence to provide advice on the management of their condition. I aim to improve my understanding and asthma management skills through critically reviewing key issues of patient care as a case study. The key issues I intend to focus on relating to a specific patient are:
Treatment of Asthma in the Emergency Department
Patient education
Patient concordance
Initially, this essay will examine my current practice about asthma management through reflecting on my present level of knowledge and understanding, discussing the level of care I can provide for patients with asthma at the moment. I then intend to give a brief outline of the patient chosen for this study; explaining the reasons for that choice and the rationale behind the key issues highlighted for discussion. A critical review of the key issues will follow using up-to-date evidence-based literature and considering relevant policies. The conclusion will summarise the main points, reflect on what I have learned from; this module, and consider ongoing learning requirements about asthma management.
Reflection on current practice;
At the time of writing, I have so far completed 16 hours in practice; Therefore my first few days in practice existed spent adjusting to this new and very different area of nursing. Nevertheless, I have had the opportunity to observe my mentor assessing patients with asthma and recently have become more involved in the review of these patients, with supervision.
Before starting the course I did feel I had some understanding of the disease process of asthma from working in the Emergency Department, albeit very fundamental, and some basic knowledge of the management. Some of this understanding comes from personal experience but also through my previous experience working in dermatology. Often patients presenting with atopic eczema would also be asthmatic, there is a well-known link between these conditions. Some of the advice given in eczema management, for example, allergen avoidance, will also be relevant in asthma management.
Other things;
Using Benner’s (1984) novice to the expert model I would classify myself at present as an advanced beginner. This is someone who has a marginally acceptable performance with some background experience but who still requires supervision. I feel this accurately describes my current ability in practice asthma management. With supervision, I can undertake an assessment using a template for guidance, check medication usage, check symptoms and carry out peak flow assessment.
However, I still find the array of inhalers confusing and don’t feel confident in interpreting the information gleaned during assessment into planned care within the time constraints of the clinic. When I have the time to reflect on the information and review the guidelines away from the patient I feel more confident. I need however to be able to make the transition from an advanced beginner to a competent practitioner, increasing my level of proficiency to no longer requiring supervision but being aware of my limitations. I feel with more experience in practice and by working through this case study I should be able to achieve this.
The rationale for the choice of the patient and key issues;
Rolfe, Freshwater, and Jasper (2001) suggest that choosing an event or incident to reflect upon or analyze is concerned with anything that happens to us that we want to write about for some reason. It is the significance of the experience within our daily lives which helps us choose one experience over another. Having decided to focus on asthma as the topic for my case study; when I looked back at the patients I had seen with asthma; it was the above episode of care that held the most significance for me.
Pharmacological management;
The pharmacological management of asthma aims to control symptoms, prevent exacerbations and achieve the best possible lung function; while minimizing side effects and long-term sequelae. National clinical guidelines developed in 2003 by the British Thoracic Society (BTS) and Scottish Intercollegiate Guidelines Network (SIGN) existed produced in collaboration with, amongst others, Asthma UK and the Royal College of Physicians of London, and have more recently existed updated in 2005. They exist widely accepted as the ‘Gold Standard’ of evidence-based asthma care for health care professionals working in the UK.
Patient education and concordance;
The issues of education and concordance will exist discussed together as they exist inextricably interlinked. It is difficult for the health professional to achieve concordance with the patient without providing education about their disease and its management. It exists estimated that one-quarter of asthma patients in the UK have a compliance rate of 30% or less. The term compliance in health care has become less fashionable recently due to it implying that a patient is perhaps ineffectual and hasn’t followed the health professionals’ instructions.
Whereas in reality, the reasons for non-compliance are complex and not necessarily the fault of the patient; for example, not existing shown how to use their inhaler device properly. Nevertheless, non-compliance exists thought to contribute to between 18% and 48% of asthma deaths. Concordance exists the term used to describe a negotiated agreement between health professionals and patients about the management of their condition. However, even when concordance seems to have existed achieved a patient still may not adhere to the agreed plan of care for many reasons.
Ensuring patients exist well informed about how their medication works have existed shown to improve adherence and control. They need to be aware of the risks of taking and of not taking their medication. The latter is of particular concern in asthma in that persistent inflammation of the airways may lead to irreversible obstruction. Written personalized asthma action plans have been shown to improve outcomes of care. They reinforce verbal education and set out for patients what to do if their symptoms worsen.
Conclusion;
Asthma is a frequently seen chronic condition in the Emergency Department; and one that Advanced Nurse Practitioners are expected to be involved in the management of. Therefore as an Acute Care Pathway Degree Student, I need to develop my knowledge; and skills in this condition to enable me to provide a high standard of evidence-based care for patients. Throughout this essay, I have endeavored to demonstrate my understanding of asthma, especially about the pharmacological management and issues of education and concordance.
These issues have been discussed and have shown to be interrelated; without achieving concordance, adherence to prescribed medication cannot be achieved and without patient education, concordance cannot be realized. Although I have been unable to discuss all aspects of asthma management due to word limit constraints; my understanding of asthma medications and the use of the stepwise; guidelines have increased significantly to the point where I now feel more confident in practice.
More things;
More recently when seeing patients with asthma I have been able to visualize; which ‘step’ they are on which has helped me to decide whether they are on the correct medication about the severity of their disease. Reviewing the issues of concordance and education has made me realize how important these aspects of management are; however the time needed to address these issues in practice often doesn’t correlate to the time allowed for appointments.
To enable me to become a competent practitioner in asthma management I need to consolidate the increased knowledge I have gained from writing this essay with more experience in practice. I need to increase my knowledge in areas not discussed in this essay, such as non-pharmacological management through self-directed study, and perhaps consider further education through an accredited asthma diploma course, on completion of my degree course.
Case Study of Sexually Transmitted Infection (STI) Facts Medical Essay; In Case study 5, A male, 24 years of age presents to the STI clinic. He complains of a burning and sore sensation upon urination, along with discharge from his penis that has a mucopurulent consistency and is green-yellow. In the preceding two weeks, he has had unprotected sex with numerous partners.
Here is the article to explain, Sexually Transmitted Infection (STI) Facts, Case Study, and Medical Essay!
Laboratory tests; A penile/urethral swab is taken from the male and is inoculated onto NYC agar and chocolate agar. The plates are incubated at 37˚C in CO2 at the clinic and later that evening is transported to the microbiology laboratory. A Gram stain is carried out on a smear of the penile discharge. The patient is also screened for other STI’s and is interviewed about contact tracing his sexual partners.
Results; The following are the results obtained for the organisms growing on the chocolate agar and the organism growing on the NYC agar. Both agars existed incubated in CO2 at 37˚C. Two organisms, A and B, were growing on the chocolate agar. Organism B was growing on both agars. This organism existed identified as Neisseria gonorrhoeae. The preliminary identification of organism A existed not obtained. Neisseria gonorrhoeae is the causative pathogen of gonorrhea, a sexually transmitted infection facts that exist characterized by a pus-filled infection of the surfaces of the mucous membranes of the throat, eye, vagina, and urethra in males and females.
This pathogen can spread through direct sexual contact or vertical transmission from mother to baby during birth. Symptoms of this bacteria in males include painful urination and urethral discharge, while females present with increased vaginal discharge. Usually, females infected with this pathogen present as asymptomatic and are the biggest reservoir of this sexually transmitted infection facts.
Legend:
Catalase: + = positive for the enzyme catalase – bubbles produced.
= negative for the enzyme catalase – no bubbles produced
Oxidase: + = positive for the enzyme oxidase – purple color formed
= negative for the enzyme oxidase – no color formed
Discussion;
From the clinical details given in Case study 5 and from the basic characterization tests; it is evident that the causative pathogen of the patient’s dysuria and penile discharge; and the organism that was growing as organism B on chocolate agar and growing on the NYC agar is Neisseria gonorrhoeae.
Numerous further tests could carry out to confirm this causative pathogen Neisseria gonorrhoeae that the patient in this case study infects with. This pathogen should confirm using two different methods of detection as biochemical; such as the API NH strip for Neisseria and Haemophilus species and molecular and serological testing. Such tests include the Nucleic Acid Hybridization Test (NAAT) that utilizes a DNA probe that exists labeled with a chemiluminescent tag and exists targeted to a region of the 16s rRNA of the Neisseria gonorrhoeae pathogen that mixed with the patient’s sample.
This assay is based on the hybridization of nucleic acids. In the patient’s sample, if the pathogen is present, rRNA released from Neisseria gonorrhoeae will hybridize with the probe DNA. The probe that does not hybridize stands removed. The DNA: RNA hybrids luminescence intensity exists then measured. Samples used for this testing are endocervical and urethral swabs. According to the HPSC, NAAT testing is the standard test for the laboratory detection of Neisseria gonorrhoeae. The enzyme tube test, Gonocheck II can differentiate between the various Neisseria species; such as Neisseria meningitides, Neisseria lactamica, and Neisseria gonorrhea.
Essay Part 01;
Specimens used for this test stand well-isolated colonies from either Modified Thayer Martin or chocolate agars. Enzymes produced by the bacteria act on colorless substrates to produce colored end products. Neisseria meningitidis produces a yellow end product. Neisseria gonorrhoeae produces three enzymes – gammaglutamylaminopeptidase, hydroxyprolyaminopeptidase, and beta-galactosidase and produce a red-pink colored end product, confirming this pathogen (CDC, 2018).
The GeneXpert CT/NG System by Cepheid is a real-time PCR NAAT platform that allows sample preparation, amplification, and detection of Neisseria gonorrhoeae from patient urine samples, male urethral swabs, and female vaginal and endocervical swabs in 90 minutes. The Abbott RealTime CT/NG utilizes RT-PCR and a fluorescent-labeled oligonucleotide probe that allows for the direct, real-time, fluorescent, qualitative detection of the genomic DNA of Neisseria gonorrhoeae and plasmid DNA of Chlamydia trachomatis from patient urine samples, male urethral swabs, and female vaginal and endocervical swabs.
Neisseria gonorrhoeae possesses a wide abundance of virulence factors that enable it to efficiently establish infection; and adapt to its host’s environment, as it did in this patient in the case study. The entry site of this bacteria in males is the urethral cells of the penis and the vagina in females. This pathogen mainly infects the epithelia of the urogenital tract and infects areas; such as the rectal mucosa, pharynx, and conjunctiva less commonly. Neisseria gonorrhoeae, with its repertoire of adhesion molecules, attach to the cuboidal and columnar epithelial cells present in the urethra, pharynx, endocervix, and anorectal region.
Essay Part 02;
Such adherence molecules include pili, porin proteins – Opa and PI, and type IV fimbriae. These adhesion molecules bind to host carcinoembryonic antigen cell adhesion molecules (CEACAM) receptors present on epithelial cells. Once attached to these receptors, the pathogen then rapidly proliferates and spreads up through the urethra in males; and the cervix to the fallopian tubes in females where the infection and healing processes cause fibrosis, blockage, and damage to the tubes. These adhesion molecules can evade existing removed by vaginal discharge or urine.
The pili and fimbriae facilitate attachment to the mucosal epithelium and the pili protein genes possess hypervariable; and constant regions that enable the pathogen to exhibit antigenic variation by recombination of its surface antigens. This proves difficult in developing a vaccine for this bacteria and also for the production of host antibodies; that is only effective for a short duration and so, are not protective against this bacteria. Pili also enable twitching motility that allows the bacteria to ascend the mucous lined surfaces. Porin protein (PI) is responsible for forming pores in the host cell membrane and induces apoptosis in the epithelial cells causing the shed of epithelial cells and fallopian tube damage in females.
Essay Part 03;
However, in a study carried out by using Chang epithelial cells, an anti-apoptotic role of porin proteins existed hypothesized. It existed found that enhancing the survival of epithelial cells of the urethra could allow the bacteria to multiply within an intracellular environment that protects and thus, enhance the colonization of Neisseria gonorrhoeae. PI also allows the bacteria to survive following apoptosis. Neisseria gonorrhoeae also possesses a lipo-oligosaccharide layer (LOS) that exhibits endotoxin activity by inducing inflammation. A pelvic inflammatory disease that can result in fallopian tube infection; and infertility caused by the shedding of the LOS that initiates local inflammatory injury.
The LOS can evade the activation of the complement cascade by concealing itself with host sialic acid, rendering it unrecognizable by the host immune system. Opa proteins present on the surface of Neisseria gonorrhoeae, bind to the CEACAM family of adhesion receptors present on neutrophils, epithelial cells, and B and T lymphocytes, facilitating the activation of the adaptive and innate immune responses upon epithelial cell infection. TNF- α, a cytokine released during the host innate immune response is pro-inflammatory and has a profoundly damaging effect on the host epithelial cells such as the fallopian tubes; This cytokine prompts the production of phospholipases and proteases, inducing excess inflammation and damage.
Essay Part 04;
Neisseria gonorrhoeae contain the enzyme IgA protease at its core. This is responsible for breaking down the host IgA1 antibodies found in mucosal membranes that have an immune function in protecting against infections in the mucous membranes. This bacteria also possess a capsule that allows them to resist opsonization and phagocytosis; as it is similar in composition to that of the connective tissue of the host. Thus, this enables the bacteria to multiply, survive and spread within the host to carry out further infection and damage. All of these virulence factors culminated to initiate infection in the male patient in this case study to cause his burning and sore sensation while urinating and his purulent penile discharge.
If gonorrhea does not treat, disseminated Gonococcal Infection (DGI) occurs. This is due to Neisseria gonorrhoeae spreading systemically to other parts of the body via the bloodstream, causing joint pain and arthritis, and lesions on the skin, and endocarditis may also result from DGI but this is rare. DGI is more common in females due to them more frequently being asymptomatic. Further investigation that could carry out for this patient includes contact tracing all of his previous sexual partners in the past two weeks and notifying them of his infection.
Essay Part 05;
The HPSC international guidelines for gonorrhea infections recommend that all male patients; who have a urethral infection that is symptomatic must notify all of their sexual partners of the previous two weeks or if longer; their last partner This ensures that his previous sexual partners are made aware of his infection; as they too may infect and may not be displaying symptoms (asymptomatic). His previous partners will also undergo a full STI screen to establish whether they infect with gonorrhea or other sexually transmitted infection facts.
Contact tracing reduces transmission of Neisseria gonorrhoeae and its reinfection; while also informing and aiding individuals and healthcare workers in the understanding of the patterns of transmission within communities. In Ireland, gonorrhea is a notifiable disease under the Infectious Disease Regulations as this pathogen can have consequences later in life such as infertility.
In 2017, there were 2249 notified cases of gonorrhea in Ireland; causing it to become the second most commonly encountered STI in Ireland. This pathogen has an incidence rate in Ireland of 47.2 per 100,000 population. However, these figures believe to underestimate as 55% of males and 86% of females suffering from gonorrhea infections are asymptomatic and so, the actual figures believe to be a lot higher.
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