Case Study Question:

Fun Bros Pte Ltd (FB) is conducting a reorganisation of its divisions within the company. Management is looking at a plan to ensure greater monitoring and control over the use of resources, activities and operating costs of the business. The group finance department has identified a number of corporate strategic objectives. These are as follows:

- Increasing growth rates in numbers of new customer sign-ups

- Enhancing the return of investment from companys capital expenditures

- Sending employees for training courses

- Improving customer satisfaction levels

- Improving staff motivation levels

- Enhancing employee rate of productivity

- Reducing the rates of internal failure costs

- Shortening product development timings

- Implementing greater numbers of employee suggestions

- Cutting down on non-essential overheads

- Improving the rate of return from new product launches

- Providing more information to employees, regarding the companys product portfolio.

The group finance department has proposed the use of the Balanced Score Card system as a tool for performance measurement.

Management had been surprised at the rising quality issues at its plants. These issues had caused large amounts of returns by customers. Some of the criticisms have also reached the press.

Required: Discuss the potential impact of the rising amounts of quality issues at the companys plants.