Barton’s Market Share
The market share of Barton Company is going on a downward trend due to stiff competition from the Japanese rivals. Back in the year 1985, the company was the king of this industry, but now, her rivals are dominating the industry. Primarily, the company needs to assess the situation and identify the reasons that enhanced its success in the previous decades.
Hage and Hage argue that once the underlying factors have been established, they should be documented and adjusted for them to be useful in this day and age (48). Back then, when the company enjoyed a bigger market share there were other companies in the industry, which means that competition started from the day Barton was reinstated.
From the look of things, Barton Company focused on high-end customers and the Japanese rival has been able to capitalize on this vacuum. In every industry, the low-income earners outweigh high-income earners, but Barton does not realize this. The Japanese rival has been able to develop engine models that are pocket friendly, which has made the customers who were once loyal to Barton to shift camp. Moreover, the engines Barton makes are perceived to be less durable compared to those made by other companies.
In addition, Barton’s engines take too long before they get started – this is one of the reasons that caused the market share of Barton to decline. According to Acharya and Richardson, the company would have been able to realize this problem early enough before the situation deteriorated (140). This would have been achieved by interacting with the customers directly with the purpose of prompting them to give their opinions regarding the products.
Similarly, it seems that Barton was reluctant to respond to demands of the market and the Japanese company used this weakness to increase its market share. It is also certain that Barton does not emphasize on the importance of renovation. This argument is evidenced by the company’s product design, which has not been upgraded since the founder implemented it.
On the other hand, the founder of Barton concentrated on building working relationships with the employees while at the same time ignoring the customers. The company’s market share would not have declined if the founder had interacted with the customers (Burns 1).
Therefore, Barton Company should focus on value addition for it to cope with the competition. Hanft points out that the company should capitalize on durability because it is the major attribute most likely to attract more customers. Once the drastic measures have been put in place, the company should employ an appropriate marketing strategy; this can be done by using the media to market its products.
Responding to Lawsuit
Mr. Alvarez has already filed a lawsuit against Barton Company, and Ms. Payne should not ignore it. Ignorance would give the plaintiff an upper hand in the case, but an official response will create room for the defense team to object the allegations. In the mean time, Ms. Payne should contact the victim and seek to settle the matter out of court.
It is possible to convince the victim to withdraw his charges for a consideration, which is less costly than the penalty that would be imposed on the company if found guilty. In case this approach fails to bear any fruits, then Ms, Payne should contract a lawyer to represent the company.
In light of this, Ms. Payne should employ approaches that can prevent future occurrence of this incidence. Chua suggests that the company should establish an employment policy that portrays Barton as an equal opportunity employer (1). In future, employees should be hired according to merit.
If the allegations made by Mr. Alvarez are true, then this malpractice is a contributing factor to the company’s declining performance. Employees who are less skilled are least likely to be innovative and thus, the candidates applying for jobs in the company should be vetted to justify their qualifications.
If there are any job openings in the company, they should be filled indiscriminately. This means that the adjacent communities should be given an equal opportunity. This will help in boosting the company’s reputation. Perhaps this malpractice has driven many customers away because they cannot relate with an organization if it ignores their interests. Ms. Payne should therefore use her position as an administrator to get to the truth of the matter by conducting interviews on the ground – this just for setting the records straight.
10-Horse Power Engine
The design of the power engine should be revised to give it a more appealing look. More efforts should be diverted towards improving the model by making it unique in the market. Customers prefer items that are more convenience to use and that is why the engine has been loosing the speculated sale.
Barton Company should look at the features incorporated by other engine manufacturers in the industry and improve them for the sake of assisting the company remains put. If the company does not respond positively to the competition, then it risks elimination from the market. This suggests that another company would assimilate Barton. Alternatively, the company can re-brand itself to make sure it is able to penetrate the market (Hagel, Seely, & Davison 2010).
Additionally, the engineers at Barton should introduce a new technology that’s yet to be utilized by the competitors. Any company in this industry that would want to use the innovations made by Barton should apply for a license. However, the cost of the engine should not be increased and thus, the company should look for ways of recovering the money spent on innovation. The company should also consider cutting back on the cost of production by negotiating for price slash with its suppliers.
Building Relationship with Bull
Bull has worked at Barton for more than two decades. He started from a very humble beginning and his continued stay has earned him the promotion. However, he sees Ms. Payne as a threat to his career. Bull does not think that Payne’s management style is realistic. He feels that Ms. Payne is crossing the boundary and that is why Payne should seek an audience with him to set the record straight.
The two persons do not know each other well because they have been communicating through an intermediary, that is Bill, but since he is no more, they have to work out their differences.
Bull is a very influential person among the mechanics and therefore, he can insight them to sabotage the efforts of Ms. Payne. She should make an effort of explaining why change is necessary at this point. Ms. Payne should handle the matter with a lot of care so that employees do not feel insecure and opt to look for employment elsewhere.
The employees should be assembled for the purposes of communication because Bull cannot be trusted to convey the information. Bull can create confusion by distorting the information and that is why the information regarding the need for change should be conveyed directly.
Moreover, Ms. Payne can get the support of the workers in the company by establishing a working relationship with them. This initiative entails having both formal and non-formal chats with them. This will strengthen the bond between her and them and will make them feel appreciated.
She should find out why Bull has remained in the company for so long and apply the same logic to the other employees. Ms. Payne should seek Bull’s opinion because he has been in the industry for long. She should also get to the ground to understand the possible challenges that could be influencing the employees to resist change.
Measuring Barton’s Financial Performance and Position
Ms. Payne should assess the financial performance of Barton by referring to the financial records of the last three years. The statements will help her understand the path the company is taking. She should evaluate the company’s cash flows, which have been on the decline: $1,196,000 in 1999 to $654,000 in 2001. This means that more money has been ejected from the enterprise, which amounts to loss.
The net profit margin can also be used to tell whether the company is making considerable profit. This can be achieved by subtracting the expenses from the sales. The revenue earned should be higher than the initial amount that was pumped into the business. The company should find ways of cutting back on its debt because it has been on the upward trend for the last three years. This is because more money will be used to clear the debt and thus, the operating capital may be squandered.
Alternatively, Ms. Payne can understand the financial position of the company by calling upon a certified accountant to help her analyze the records. Through the financial expert’s assistance, she should be able to identify any faulty trends and come up with solutions for remedying them.
The company’s financial health can be assessed by looking at the balance sheet. This will help in understanding the wealth that is owned by the enterprise. In fact, Barton’s wealth has been on the decline and this has been evidenced by the value of its assets, which has dropped drastically: from $66,164,000 in 1999 to $62,708,000 in 2001.
Assessing Barton’s Weaknesses and Strengths
The strengths and weaknesses of Barton can be understood by looking at its history. Bill, the company’s founder was very good in motivating employees. He was able to do this by sending them holiday greetings and helping them educate their children. His predecessor should follow this legacy.
Back then, when Bill was still alive, the sales were very high as opposed to now. Ms. Payne should consider having a round-table meeting with all the employees regardless of their rank in the company. Once assembled, everyone should be requested to highlight on the weaknesses and the strengths of the company.
During the meeting, the entire team should look out for opportunities and threats. The good thing about brainstorming is that one is able to get a wide pool of suggestions because people have different opinions. For instance, the other manufacturers are a threat to Barton’s growth because they have acquired her market share.
Therefore, the company should come up with strategies of recovering the lost market share. In addition, the company has not been able to meet customer needs and that has caused it to be stereotyped. Customers want engines that can start faster and last longer so that they can work efficiently. Barton has many resources, which is its stronghold in the market. These resources should be used to work on the weaknesses by transforming them into tangible strengths.
Works Cited
Acharya, Viral and Richardson Matthew. Restoring Financial Stability: How to Repair a Failed System. Hoboken, NJ: John Wiley & Sons, 2009. Print.
Burns, Kevin. How to Protect Your Market Share. 2010. Web.
Chua, Celestine. 9 Useful Strategies to Dealing with Difficult People at Work. 2009. Web.
Hage, Jerald and Jerry Hage. Restoring the Innovative Edge: Driving the Evolution of Science. Stanford, California: Stanford University Press, 2011. Print.
Hagel III, John, Brown Seely, and Davison Lang. “The Best Way to Measure Company Performance.” Harvard Business Review. 2010. Web.
Hanft, Adam. To Grow or To Steal. 2005. Web.