Operations processes are at the heart of Crayola, the Easton, Pennsylvania, maker of crayons, markers, and paints loved by children of all ages around the world. Since 1903, the company has been taking wax, dyes, and other raw materials and turning them into a colorful array of products sold through an extensive network of distributors and retailers such as Walmart and Target stores. Each day, the company produces 13 million crayons, 2 million markers, 500,000 jars of paint, 170,000 pounds of modeling compounds, and 22,000 Silly Putty© eggs from its three manufacturing plants. Crayola derives much of its own inspiration and creativity by asking, "What would a kid do?"-especially when focusing on innovation. Not that kids have the knowledge to create complex systems and operational processes. Rather, the question leads to creative solutions by freeing employees to think about the company's competitive priorities in new ways. In the supply chain, the company maintains five "pillars" of operational leadership. These pillars focus attention on differentiating the company on

(1) Innovation,

(2) Sustainability,

(3) Agility and resilience,

(4) Cost,

(5) Quality and ethical responsibility. 

The company has a history of innovation. They were the first to introduce an art education program called Dream-Makers into the nation's elementary schools. Washable markers and crayons also were firsts for the industry and continue to be best-sellers for the company. Recently, the language on crayon paper packaging changed to include three languages-French, English, and Spanish-instead of one. This change alone saved $400,000 in paper and printing costs, since the packaging could now be used across multiple markets. In the area of sustainability, Crayola built a solar farm on a 20-acre site adjacent to its manufacturing plant in Easton. The farm produces enough energy to completely run the plant as well as the headquarters building nearby.
The 850 million colored pencils produced each year only use reforested wood, with one tree planted for every tree harvested. Sourcing for paraffin wax used in crayons recently moved from Louisiana to western Pennsylvania, saving 5,000 barrels of oil annually related to wax transportation. All plastic components are made with recycled plastics. And any excess wax from the production of crayons is reintroduced into the manufacturing process so no waste is produced.
The company is aggressively pursuing new markets outside the United States. China's market of children ages 0 to 14 is larger than all the other global markets combined, with more than half the world's child population. Yet only 14 percent of the company's total sales come from international markets. So, particular attention is being devoted to growing the company's manufacturing and distribution presences there. As you can imagine, this means operations managers must think about how to grow the current supply chain beyond the boundaries of existing domestic and international borders if additional expansion is to occur.

QUESTIONS

1. Map Crayola's five pillars of operational leadership to the competitive priorities in Table 1.3.

Table 1.3

2. Create an assessment of Crayola's competitive priorities as it relates to their plans to expand to Asia.
3. Which of the competitive priorities might present the biggest challenge to Crayola as it expands internationally?

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Crayola A HALLMARK COMPANY CO Crayola, headquartered in Pennsylvania, has become a leader in its industry by focusing on operational excellence and innovation.