Management

Prescribed Text Book: Hutt, M. & Speh, T. (2014), Business Marketing Management: B2B, (11th edition),
SouthWestern Cengage Learning
ASSESSMENT TASK INSTRUCTIONS
Number all the answers
For section B aim to write approximately 150 – 200 words
SECTION A: Case Study A
Background and Content:
SUNBRIGHT OUTDOOR FURNITURE, INC. 1
James Cowart started making and selling outdoor furniture in 1984. He built up the business to 300
employees and AU$28 million in sales in 2005. SunBright operates a single factory, where it fabricates and
assembles a wide range of outdoor furniture, including tables, chairs, umbrellas and matching accessories.
SunBright’s major production tasks include extruding the aluminium furniture parts, bending and shaping the
extruded parts, finishing and painting the parts, and then assembling the parts into completed furniture.
Cloth and leather upholstery, glass for tabletops, wood finishing and hardware such as screws and bolts are
purchased from outside vendors.
Running this business was an almost 24-hour-a-day job for Cowart, because manufacturing or sales problems
arose constantly. Cowart seemed to be the only person who could solve them. In 2005, Cowart decided to
hire a general manager to run the manufacturing and sales department so he could have more time for
other interests, including his grandchildren. To his good fortune, he was approached by Eva Rucker, who
offered to invest in the business and grow it from a regional manufacturer to one that sold to major national
retailers.
Rucker had excellent experience in sales and understood manufacturing. After a few months of getting to
know each other, Cowart sold Rucker 25 per cent of the business and installed her as general manager.
Cowart retained for himself the position of president. Although he would not be at work full-time, he would
retain final authority on major decisions.
After just two months, Rucker started adding salespeople, with the goal of doubling the sales force in one
year to reach new regional and national retail accounts. As sales began to increase, she also hired additional
support staff, including a purchasing agent, two furniture designers and an accountant. By the end of
Rucker’s first year, SunBright was carried by three national retail chains on a trial basis. However, new
problems started to surface. SunBright was missing the delivery dates promised by sales reps and a few
orders had been returned for not meeting quality standards. With the consolidation of retail stores into
fewer chains, the national retailers had the power to demand high quality, low prices and rapid delivery from
SunBright or they would order outdoor furniture from other suppliers.
At the end of her first year, Rucker was struggling to improve operations to meet the demands of national
retailers, but with little success. She invited a consultant to evaluate SunBright’s operations. The consultant’s
report contained the following elements.
– Cooperation among departments is minimal or nonexistent. For example, the purchasing manager
changed to a new supplier for paint because it saved a few cents per litre. But the paint had to be
applied in a thicker coat to wear as long in outdoor use. The additional labour and paint actually cost
more than the few cents saved in purchasing, and no one in the manufacturing department had
been consulted.
– Salespeople frequently run promotions and promise sales delivery dates that are impossible for
manufacturing to meet. The department head of manufacturing emphasises that it takes time to
work out the bugs when introducing new products or increasing production levels.

Page 2 of 9
– The accounting department reports that productivity for the plant is low. Equipment utilisation is too
low. The operation is not lean enough to make acceptable profits.
– The financial controller reports that inventory is too high. Too much capital is tied up in raw
materials. Too much capital is also tied up in excessive in-process inventory waiting at machines to
be finished and processed for delivery to customers.
– Salespeople want to use the Internet to publicise SunBright product information and to make
routine sales, freeing them to call on new customers. This approach would entail hiring people who
could design and manage a sophisticated SunBright web page.
Eva Rucker discussed these six issues with the consultant and agreed with the report’s findings. She met with
Jim Cowart to report the findings and ask for his support and financial resources to make corrections. Cowart
listened to the presentation and then said he had some other things to attend to. ‘I don’t think it’s as serious
as you say,’ he told Rucker, ‘but you can have a meeting with the department heads if you want to discuss it
with them. Remember that our production problems are no worse than our competitors’ issues. You don’t
have to fix everything overnight. Things worked pretty well before we started to grow so fast, and I’m sure
they’ll work well again’.

Assessment Tasks:
Answer all questions below.
Q1. Which of the problems outlined by the consultant do you consider the highest priority? Second
priority? Why?
Q2. If you were the consultant, what types of information systems would you recommend for SunBright?
Explain your reasons

Q3. If you were James Cowart, how would you have responded to the report from Eva Rucker? If you
were Rucker, what would you do now?

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