Q. A short business case is given below. You need to identify issues and give suggestion to the management to improve firms performance by bringing some changes in firms structure, systems, technologies, planning, compensation policy, and decision-making processes. No copy-pasting is allowed. If you use any material from any source, mention its reference. Word limit: 500 words. (20 marks)

The Background

Forty years ago, Javed Sharif started a retail pharmacy in Hyderabad. On Fridays, he used to come to Karachi to purchase medicines from the wholesale market as markets were generally off on Fridays in Hyderabad. Medicines were sold at lower prices in Karachi wholesale market than in Hyderabad wholesale market. Thus, he had the advantage to sell medicines at lower prices than other pharmacies in his area. The sales of Javed Medicos started growing consistently.

In 1995, Sharif bought a running shop in the wholesale market of Karachi. He started running that shop by himself while his younger brother took charge of the Hyderabad shop. Later, he started distributing medicines to Hyderabad retailers at wholesale prices. His business of retail, wholesale and distribution grew consistently.

In 2005, he bought a small pharmaceutical manufacturing firm and renamed it Javed Medicos. With his dedicated efforts, the business grew consistently. By 2015, Javed Medicos was manufacturing 150 medicines comprising of tablets, capsules, syrups and injections, ranging from antibiotics to vitamins to cough syrups and other varieties. Javed Sharif was managing the firm as the CEO and had two managers under him: Sales manager and Production manager. He was looking after finance, production, HR, imports and marketing himself through a small team of 10 persons. All goals were set by him and he used to pass instructions to production, sales, finance, purchase and HR staff on a daily basis about what to do.

From 2005 to 2014, the sales grew consistently. It became a medium-sized pharmaceutical company with an annual turnover of over Rs. 300 million. However, situation changed afterwards. Sales growth slowed down in 2015 and in 2016. It didnt grow in 2017. Sharif changed the Sales Manager in January 2018, but the sales didnt grow, rather it started declining slowly during the year. The cost of production started going up consistently further decreasing the firms profits.

He called his two managers and asked them to improve things in their respective departments quickly. Both promised him to do so. However, things did not improve even in 2019.

Finally, he decided to seek professional help. He hired the services of a business graduate and asked him to investigate the matter in different departments of the firm and present the findings.

The Findings

The investigation revealed following the issues:

1. There was high turnover of salesmen in different parts of the country. The sales team was not satisfied with the management and its policies. Their queries were not answered for days and sometimes for weeks.
2. No proper training programs were at place. Appointment letters as well as clearance of departing employees took a lot of time.
3. There was a large sales team which lacked management hierarchy.
4. There were delays in salary disbursement almost every month.
5. Work specialization in the production department was lacking. Anyone could be assigned any duty. However, injections, tablets, syrups, and capsules were manufactured with different machines and required specific skills. Generally, pharmaceutical companies have separate departments for different product types.
6. There was frequent breakdown of machines. Workers were complaining that several machines were very old and outdated and should be replaced with better ones.
7. Employees working in sales as well as production complained about unequal salaries in their departments. No proper appreciation process was at place for good performers. Bonuses and incentives were not related to individual performance.

Your Task

Review the above details and analyze the current state of affairs in the firm. Suggest corrective measures to Mr. Javed Sharif in a short report. Your answer (short report) should include following sections. Marking plan:

• Correct identification and description of issues:
• Logical and practical recommendations for resolving issues:

1. Structure
   1. Issues (cite data/information given in the case above)
   2. Recommendations
2. Compensation and motivation
   1. Issues (cite data/information given in the case above)
   2. Recommendations
3. Leadership and decision making
   1. Issues (cite data/information given in the case above)
   2. Recommendations
4. Planning and communication
   1. Issues (cite data/information given in the case above)
   2. Recommendations
5. Systems, processes and technology
   1. Issues (cite data/information given in the case above)
   2. Recommendations