HYPOTHETICAL PROPOSAL FOR ESTABLISHING AN ORGANIZATION FOR OPERATIONS

 

HYPOTHETICAL PROPOSAL FOR ESTABLISHING AN ORGANIZATION FOR OPERATIONS

"PRODUCTION - BUSINESS - SERVICES"

I/ INTRODUCTION

First of all, the look at a current context of industry organizations around the world today:

The global economic situation is changing too rapidly, and as a result some industries are growing quickly while others are contracting (reducing the scale of operations, including staffing).

Therefore, layoffs in large organizations often occur with the purpose of streamlining the organization.

The reason is that the organizational structure has developed in line with long-term strategy and for some other special reasons. It is no longer suitable for the current economic situation.

II/ ORGANIZATIONAL STRUCTURE

In my opinion, it should not be organized into separate departments. The organization’s operations must be based on mutual understanding and communication so that the overall work runs smoothly.

And the most important thing is: Avoid creating multiple centers of power and factionalism. The structure should be Lean - Compact - Effective.

There should only be a department directly under the Director (no Deputy Director position).

It may be named the General Affairs Department or given another name depending on the industry organization.

The heads of the departments are all members of the Standing Council, operating based on the Delphi method and simultaneously submitting the voting results for decision-making issues to the Director.

Therefore, all issues that arise are to be resolved by the Standing Council before being submitted to the Director.

The General Affairs Department includes the following units:

1/ Administrative - Organizational Unit:

In addition to handling clerical and archival work and tracking attendance for indirect labors, the important task is to design training programs for employees and workers.

Receive staffing needs from the departments, submit them to the Standing Council for approval, and announce recruitment.

In particular, the Head of the Unit must also serve as the Director’s Secretary.

2/ Finance - Accounting Unit:

In addition to accounting management tasks, it must also coordinate with the planning unit (production and distribution) to calculate cost prices and prepare financial plans (monthly - quarterly - annual). Warehouse release and receipt orders must be confirmed by the head of accounting.

3/ Planning - Statistics - Sales Unit:

Prepare production and service distribution plans according to orders. Production or distribution orders must be accompanied by the relevant order. Warehouse release and receipt orders must also have the approval signature of the Accounting Unit.

The Statistics Team must monitor all generated data, compare it with the plan, and report daily.

DETAILED DUTIES OF THE UNITS

1. ADMINISTRATIVE - ORGANIZATIONAL UNIT

• Record and issue documents: When issuing a document, keep one copy and send an email to the Department Heads to notify them.
• Receive daily attendance reports from indirect labor and production workshops.
• Implement training plans for employees and workers to improve skill levels and technical proficiency. Organize periodic skill tests to motivate workers’ advancement; indirect employees are encouraged to continue learning to improve their qualifications and may apply for higher positions when needed.
• Regarding recruitment of workers and employees: when the application meets the requirements, notify the requesting department and schedule an interview.
• The Director’s Secretary must monitor the progress of all departments and report to the Director by email at the end of each day. Receive feedback and arrange the proposed work schedule for the Director (15 minutes before the workday begins), while also reminding departments that are not keeping up with progress.
• The Security Team is directly under the Administrative Unit and may use a timeclock or electronic card system to report daily to the supervising unit.

2.      ACCOUNTING - FINANCE UNIT

• Receipts and expenditures must be accompanied by clear and compliant original documents.
• The cost of products and services must fully reflect all expenses, including depreciation.
• Coordinate with relevant departments to determine raw material norms and management costs per unit of product or service.
• Submit to the Director for approval the direct reward rate for employees when raw material norms are saved; the remaining portion is allocated to the production stage to reduce product cost.
• Before profit distribution, the depreciation reserve and accumulated reserve must be fully secured, along with the training fund and the fund for innovation and new product research (at a reasonable ratio in each stage).
• The Logistics Team is directly under the Accounting Unit (it is advisable to sign monthly, quarterly, or annual transport contracts. It is not recommended to establish a separate transport team, as it wastes resources).

3.      PLANNING - STATISTICS - SALES UNIT

• Monitor the implementation of the approved plan. If any changes arise outside the plan, the Standing Council must be convened to make adjustments. If the adjustment is minor and does not significantly affect the main plan, the Council may decide on the revision without submitting it to the Director.
• The raw material purchasing team must procure goods according to the contract standards, avoiding situations in which receiving staff take commissions and accept materials that do not meet standards, causing production losses or unusable inventory and creating phantom stock. Do not rush to speculate on the market; buying raw materials before having a contract can cause losses when prices fall.
• Product development and improvement: Costs must be commensurate with the effectiveness achieved, and the department’s critique and self-critique meetings must be useful for management and for improving productivity or product quality. Therefore, the costs of after-hours meetings and the research team must be covered by the product improvement and development fund.
• The logistics team is monitored by one person; transport contracts must closely follow the plan, with clear responsibility and compensation for violations.

Important points to note before operations begin:

• If capital is contributed by shareholders, the fixed capital and working capital must be clearly defined, along with any required withdrawal period.
• Establish an accumulated reserve and regular repair fund (if there are fixed assets), a product improvement and development fund, an immediate reward fund, and a doubtful-debt reserve fund (which may be 5% or more).
• The cost of products or services must include all contributing factors in full. Annual depreciation must decrease according to the recovered proportion.
• Profit distribution depends on the nature of the industry organization, with priority given to reserving funds in the item noted in the second bullet point above.

                                                                                                        Issued by Louis Nguyen

                                                                                                                 dated 5/14/2026

 

Quality Improvement and Cost Reduction in Product Development

The journey towards improving product quality and reducing production costs can be challenging and often met with skepticism. However, a strategic approach can yield remarkable results, offering a pathway to enhanced competitiveness and consumer satisfaction.

Current Scenario Analysis

Observations

The article (A Few Conceptual Of Management Effectively By Some Different Standpoint) published in 2016 highlighted the importance of improving quality and reducing prices to stay competitive. Despite initial reluctance from many, recent trends indicate a shift, with some domestic consumer products compromising on quality to compete in the market. Notably, this trend is not prevalent in the export-oriented market.

Global Market Influences

The global market dynamics have influenced a reevaluation of quality and pricing strategies. While the previous article primarily focused on effective management, the necessity to address the interplay between price, quality, and market demand has become evident.

Strategies for Enhancing Product Quality

Ongoing Innovation

Internal innovation and quality enhancement through dedicated research efforts involving foremen, technical staff, and experienced workers can significantly bolster product quality without substantial upfront investment.

Collaboration for Quality Improvement

University Partnerships

Collaboration with universities for research and development, as successfully demonstrated by Taiwan-China, can enable effective quality enhancement at a reasonable cost. This entails establishing an innovation fund from annual profits.

Efficient Cost Reduction Methods

Labor Productivity

Increasing labor productivity can lead to reduced production costs, provided the quality standards are maintained. Rewarding production line workers for increased productivity is a viable approach.

Optimizing Resource Utilization

Raw Material Efficiency

Encouraging production employees to adhere to raw material saving norms, with direct bonuses linked to achieved savings, can be a valuable avenue for cost reduction.

Proactively engaging with consumers, particularly through direct interactions at dealers and stores, provides indispensable insights that can drive demand stimulation. This aligns with the long-term benefits of prioritizing consumer satisfaction.

Long-Term Business Development

Strategic Priorities

Emphasizing product quality and production cost optimization aligns with long-term business sustainability, ensuring a robust market presence and consumer loyalty.

 

QUALITY IMPROVEMENT PRODUCT AND CUTTING PRICE OF PRODUCTION COSTS ACCORDING TO SOME REFFERENCES TO SUGGEST

    In the article (A Few Conceptual Of Management Effectively By Some Different Standpoint), it was issued at 2016. While I was during mentioned to improve quality and cutting prices of product to compete.

 

Almost everyone thinks the matter to my mention is unreasonable.

 

The present in time, I realized that there are some domestic consumer products has cut a few quality standards to compete (I am eliminate to any export products). I don’t thing almost domestic manufactures and services are manage and development in this direction.

The previous article has an overall content of management effectively. Consequently, I did  not delve out the matters of price and quality.

    After a lot of  to consider this the matters.

I'm suggest to some feasible options to increase product quality, concurrently to lower producing cost. 

        Firstly, I want to mention the issue of product quality.

Of course, I do not to discuss to any new investment. Be course of any large capital to borrow or to mobilize it's a high risk for more.

 

    - A priority in this option is an innovation and quality improvement  from the department internal of Business.

 

We can be able to encourage some foremen, technical staffs and some high skill experiences worker to join the research group to work from overtime.

 

Of course, businesses should be pay of a income to encourage to theirs intellectually for the research of Business to ask.

The matter mentioned-above will be reduced costs more than borrowing.

 

    - Another option is to contract of research to the matters with a some universities for a reasonable fees (Taiwan-China has been successful this model effectively).

 

Businesses should be able to establish the fund of innovation and improving quality from annual profit theirs. 

 

        The next mention is cutting prices of producing. The priority is in building competitive prices.

 

    - First of all, we discuss to the issue of labor productivity:

 

In theory, the more labor productivity increases to impact of the production costs to decrease.

 The problem here is, how to encourage workers directly to increase productivity, while still maintaining quality standards of products.

 For the surplus of output due to increase labor productivity.

 

I will be proposed to reward to workers from 20 to 25 percent on the production line.

 

The remaining 75 to 80 percent of the difference due to increase productivity is use to reduce production costs.

    - The second issue I want to mention is encouraging production workers to save raw material norms.

Because, in the norm is always to allow of loss rate depending on each type of product.

 

I also recommend giving a direct bonus to workers of 15 to 20 percent of this savings value. And the remaining value due to saving raw materials is also a factor in reducing product costs.

 

I think most business can be usual to ignore these two items I mentioned-above.

 

The product costing department must link with some relevant departments and submit it to superior leaders to decide.

    Finally, if you want to maintain and developing your business.

 

I would like to seriously consider two issues of product quality and production cost.

Every Business knows that respect for consumers will be to bring for a long-term benefits.

To solve the problem of product quality in the direction of stimulating consumers to demand.

I recommend all manager should be to leave theirs desk to go down to some dealers and stores to listen to consumers feedback from distribution channels. 

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