Introduction:

This report has the objective to review, evaluate and analyse programs, systems and process
from the A. C. Gilbert company. In the following pages, it is outlined a performance and
sustainability review strategy with the strategy evaluation, and analyse performance reports and
trends. Furthermore, this report has also the internal and external specialists advice to identify
technological solutions.

a. Describe the key systems and processes used by A. C. Gilbert:

A.C. Gilbert was a small company which provided manufactured train sets, chemistry sets and
the best-sellers: Meccano-like Erector engineering sets.

1) Supply chain: Supply chain represent the procurement, acquisition and distribution
activities of a company. Within a supply chain, these activities are viewed as linked and reliant
on one another to produce the final outcome. A.C. Gilbert supply chain includes an acquisition
of raw material, systems and process and sales delivery.

2) Operational systems:

As shown in the diagram on page 9 of the Appendix the operational system includes:

1. Design: Toys are designed by a small group of designers who develop the concepts for the
products

2. Planning: The planning department translates the concepts into designs and determines
resource requirements, including raw materials. Planning also projects sales and develops
production plans for each product, timeframes for production runs and scheduling of production
runs.

3. Purchasing: Information gained from planning stage used to purchase raw materials for
products and packaging from suppliers.

4. Manufacturing: Produces and packages toys for distribution.

5. Distribution: Delivers packaged toys to the warehouse for storage.

3) Product/service delivery.

1. Sales team: Take orders from customers

2. Distribution: Arrange for delivery of goods to the purchaser using contract transport

3. Retailers: Sell the toys directly to end user.

 b. Analyse the three key systems and processes and review strategy:

Operational KRAs KPIs Assessment tools Performance and

Systems and techniques sustainability measures

Design Priorize the employee Quality, Key performance Focus the agenda
activities indicators (KPI)
Productivity Align the timeline
Make value added decisions KPI, Performance
reviews Perspective
Clarify roles of department Material
or individual Management Service level
agreements
Focus on results

Planning Reduce on-hand inventory Delivery on Key performance Align the timeline
to the lowest feasible levels time indicators (KPI)
Ratio Analysis
Reduce materials costs to Quality Performance
the lowest levels consistent reviews Fiscal ratios
with quality objectives Purchasing
cost Service level
Develop statistic methods to agreements
estimate future material Suppliers
requirements rating

Manufacture Customer Satisfaction Material Key performance Aligning employee’s

Management indicators (KPI) daily actions with
KPI strategic concern aims
Good working conditions Performance
reviews Documenting single
Order direction public presentation to
Merchandise development. KPI Service level back up compensation
agreements
Productivity Set up focal point for
KPI accomplishment
development and
acquisition activity
Quality KPI

Design strategy:

Do a research and find out what are the latest’s trends in the world of design in order to create
design oriented business opportunities. In the toy’s field is necessary to know all about colour
combinations, the latest materials and styling details.
The Sample of Service Level Agreement is attached in this email.

d. Analyse the variances from plans and targets for the key result areas (KRAs) – use
the data provided for results up to 1966 the case study on page 9.

Performance areas Planned Achieved Reasons

Quality – Introduced 50 new toy Decline in quality of Due W deficiency of staff.
design/manufacturing lines, raising the lines playthings – feedback A. C. Gilbert is unable to
to 307. indicated merchandises implement alterations or
made and designed present new lines rapidly
Changed the focus plenty to capitalise 1966
from traditional boys'
toys to ranges for pre-
school children,
and dolls and other toys
aimed at girls between
the ages of 6 and 14.

Sales Increased gross Gross sales and net Isaacson fired the full gross
revenues staff by 50 % incomes down on old revenues squad in 1964.
. twelvemonth. Gross
saless fell abruptly of
Instructed sales staff to outlooks.
adopt an aggressive
sales approach. Company made a loss
of $ 12. 872. 000. 00

Profit Set an organisational Sales and profit are less Due W deficiency of staff.
end to accomplish than previous year: A. C. Gilbert is unable to
gross revenues of $ 20 $10.7 million (sales) and implement alterations or
million for 1963. $5.7 million (profit). present new lines rapidly
plenty to capitalise on
tendencies.
Supply chain Isaacson makes Gross sales are Due to internal discord and
(delivery) immense cutbacks in channelled through staff cutbacks. the new
disbursement. independent lines were non delivered to
manufacturer’s reps. the shops until after
which was cheaper than Christmas in 1965.
keeping an in-house
gross revenues force. Due to lack of staff, A. C.
Gilbert was unable to
implement changes or
introduce new lines quickly
enough to capitalise on
trends.

Business growth – Jack Wrather replaced Company made a loss

staff and executives with his of $ 12. 872. 000. 00.
management main people. Due W deficiency of staff.
performance A. C. Gilbert is unable to
Increased gross implement alterations or
 revenues staff by 50 % present new lines rapidly
plenty to capitalise on
Jack Wrather hires new tendencies.
CEO – Isaacson.
Isaacson fires the full
gross revenues squad.

Discuss trends relevant to the organisation. What trends did A. C. Gilbert fail to identify in
the late 1950s?

Consider the strengths and weaknesses of the A. C. Gilbert Company prior to 1960.

Areas Strengths Weaknesses Missed Suggested

Opportunities improvements
Market share Strategic acquisitions Specialized products-
like that of ‘Mechano’ limited range
and American Flyer to
enter into the structural Changing trends They should have
toys and toy trains The drop in sales during done a market
market. the early 60’s was also research and
reflected in a fall in the follow the 60’s
share price of the trends.
company.

Reputation Good reputation in the Poor management lead Investment in

market place to lack of performance Lack of Market research,
and consequently less investment in adapting to new
Was one of the largest respect in the toy innovation and design, materials
and oldest toy market. new trends. trends.
companies in the world.
Stabillity The fad toys change at Investment in
Strong brand name and a relatively fast pace in Couldn’t predict Market research,
stable until the early this market and this the future in hiring
60’s. poses a continuous changes and 60’s marketing
threat. trends. analysts and
adapting to new
design, materials
trends.
Profit Small company but The drop in sales was
profitable. also reflected in less Couldn’t predict Adapting to new
profit. the future markets, investing
1961: $20,011.00 changes and in television ads
The other toys follow the 60’s and other medias.
companies invested in trends.
new products, materials
and packing following
the new trends.
Sales The sales team was The specialized Couldn’t predict Changing trends,
responsible to take products- limited range the future adapting to new
order from costumers and lack of marketing changes and markets, investing
and build Strong investment decreased follow 60’s trends. in television ads
relationships. the sales. and other medias.

The sales were stable

before the 60’s.
Missed the Change the
No evidence of Poor management crisis opportunity to material quality
strenghts in this area. and ability to adapt to enter new and recreating the

Ability to
adapt to
change
Customer A. C. Gilbert had built its
service success on personal
standards service and building
strong relationships with
their costumers.
Innovation Before the 60’s the
company had innovated
the toy Market.
A. C. Gilbert produced
train sets, but their most
popular lines were
chemistry sets,
microscopes and their
bestseller, the Meccano-
like Erector engineering
sets, popular with
children for more than
50 years.
Employee Strong reputation and
performance relationship with
costumers.
Familiar company with
trusted people.
 Discuss the possible use of advice from specialists. What specialists could be
consulted to advise on and identify new technology or electronic commerce
opportunities?
Specialist
Internal: Human Resource Personnel
External: Marketing Analyst
Conclusion:
The A. C. Gilbert Company was very proud of its innovative toys during the 50’s and a large
number of its loyal costumers due to the high quality of product materials and strong reputation.
change. markets around package.
the world; develop
new toy focused Invest in
in a larger target marketing and
Market and invest developing
in marketing. employees
leadership skills.
Lack of training and Opportunity to Invest in proper
planning for new invest in proper training and
costumer needs. training and developing
developing employees
employees leadership skills
leadership skills
Focus on past sucess, Opportunity to Invest in proper
not future goals. build strong brand training and
name in the US developing
Lack of training and market and employee
adapting to new market expand to their leadership skills.
trends verticals in the
toys category Adapting to new
markets, investing
Opportunity to in television ads
invest in and other medias.
techonology and
marketing.
The competition Lack of training Invest in proper
invested in more and planning training and
agressive approach and developing
worked commission Lack of focused employees
based. leadership as it leadership skills.
was a family-run
business
Advise
Recrute new designers to follow the 60’
trendsandnotonlyadaptthecompanystoy’sbests
ellersbutalsocreatecompetitivetoysto compete
with the Barbie and Action Man.
Invest in market research, SWOT analysis,
marketing in television and social media.
The 60’s changed the economy, cultural and Market needs, the children at this time have
access to TV ad sand are influenced by trendy toys with colourful clothes and impressive
‘careers’. As a small, traditional company, A. C. Gilbert was slow to react to these changes.

After A. C. Gilbert death, an opportunistic businessman purchased 52% of A. C. Gilbert for $4

million and immediately set about making his mark on the company. A. C. Junior stayed on as
Chairman but his influence was minimal.

But if the owner had invested in market research and listened specialists advice from Human
Resources Personnel and Marketing Analysts the future could be different and the company
could continue its operations until today.