Author: gintarea301s12

Catastrophic Forecasting: Planning for the Unpredictable

Posted on by gintarea301s12

Just a few weeks into 2009, Clif Bar & Company, as well as a large number of other food corporations, announced a recall of their products due to contamination of an ingredient in them: peanuts.  The peanuts may have contained salmonella.

It may seem strange that a disease caused by bacteria found in animal intestines could contaminate peanuts, but there are actually many possible sources for salmonella contamination of plant products, including fertilizer containing animal feces for the crops, or a handler’s failure to wash his hands after using the bathroom.  In this instance, the problem lay with the peanut supplier, Peanut Corporation of America, based in Georgia.  This massive peanut factory distributed peanut products all over the country, from schools to Clif Bars to Kellogg’s, so the effects of the contamination were far-reaching.  All told, over 3,000 products from 130 companies had to be recalled.

The recall personally affected me because I love Clif Bars and eat them frequently – more or less daily.  For weeks I was unable to purchase and consume my beloved (and healthy) treat.

It is harder to see how the recall affected Clif Bar & Co’s bottom line.  Being a private company, they don’t have to release financial information, and I wasn’t able to find sales volume, revenue or profit numbers in their annual reports.  Also, just a year later, the company was named the number one hottest brand by Forbes magazine, beating out such giants as Google, Apple, Disney and Facebook.  So whatever setback there was, it was only temporary.

Nevertheless, it goes without saying that having your products off the shelves for several weeks will hurt your revenue.  For a lesser company, such a hit might have spelled the end for them.  So how can a company plan for such an unexpected drop in sales?  Or should they not even bother, and just hope such a freak occurrence doesn’t happen to them?

According to Retail-Analytics.com, short life-cycle products should most certainly include projections for unexpected events like “freak weather and competitor attacks.”  Their list doesn’t include product recalls, but for a company that sells food products containing over 70% organic ingredients, it’s probably a good idea to do so.

Probably more important, however, is how the company responds to the recall.  About.com, a subsidiary of the New York Times, wrote an article detailing the ways a company can effectively handle an organic product recall.  Their main point is that it’s vital to have a protocol and disaster team in place to handle just such an event.  Based on Clif Bar & Co’s press releases, decision to voluntarily recall products as soon as news of the contamination broke without even knowing if their particular products were affected, and honest communication with the public, it seems as if they did have such a system in place, and their reputation did not suffer at all.

Sources:

http://www.retail-analytics.com/index.php?mode=view&id=1269&cat=3

http://www.clifbar.com/uploads/default/ClifBar_AA2010.pdf

Working without a Boss: A Dream that Became a Nightmare

Posted on by gintarea301s12

Almost everyone complains about their manager at some point, and many believe they could do their boss’ job better.  Some even wonder what their manager does all day, and think the company would run more smoothly as well as have a lot less personnel expenses if they just rid themselves of most management, because they do not need someone to babysit them in order to get work done.  How many of you have had similar thoughts?  While this idea might be tempting to some, I have actually been in a situation in which a company was temporarily without management, and let me tell you, it was a terrible experience for everyone involved.

Several years ago when I was working at Red Roof Inn during a summer break from school, the current manager was being transferred to a somewhat nearby location, and before a replacement was found, someone in corporate decided that she could somehow handle the responsibility of managing both locations at the same time, while almost never actually being present at the location where I worked.  At first this seemed like a blessing, as I would no longer have the manager constantly watching over me, criticizing little details about how I answered the phone or organized the guest registry.  And for a while, it was.

Very quickly, however, the incredible freedom of working without management became unbearable.  There was no planning.  The ten critical decisions of management are not called “critical” for nothing.  Supplies did not get ordered on time and sometimes not at all.  We ran out of extra towels and blankets to give to people that requested them.  Housekeeping ran out of cleaning supplies and the head housekeeper had to leave work one day to purchase them on her own and get reimbursed later.  Air conditioners were not maintained and stopped producing cool air.  Weeks went by before the supposed manager hired someone to fix them, and there was a heat wave.  I remember having to wear the uniform pants and long-sleeved shirt and sweating in the office while standing still.  If I had to go outside and up the stairs to the supply room, I would come back literally drenched and dripping with sweat.  Worst of all, though, was inadequate scheduling and the lack of accountability that many of my coworkers abused.

At a Red Roof Inn, if you work the front desk for the evening or overnight shift, you are the only employee on the premises for most of your time there.  If your replacement comes late, or worse, not at all, you have to remain at work.  I worked the 3-11pm shift.  More times than I care to remember, I ended up working from 3pm-7am.  Usually this was due to the fact that the people hired to work overnight were unreliable and never really experienced repercussions for not showing up.  But one time, someone that had actually quit the week before was scheduled to come in after me.  Guess who ended up covering that shift.

So while it might seem like a dream to be without a manager, the reality is that a business cannot function without proper management.  If you have been in a similar situation or just dream of your manager disappearing one day, do you think you and your coworkers would be responsible or thoughtful enough to pick up the slack?  Even if every employee was reliable and hardworking, someone still needs to make decisions and plan for the big picture.