Spin Toys Finding a manufacturer for E-Chargers Case Study Solution
Context:
In 1994, three graduates Anton Rabie, Ben Varadi and Ronen Harary established a company in Toronto Canada in 1994. It currently has two offices one in Canada and one in Hong Kong. In 1995, they launched a product named Spin Master Dragon Stick which was the defining moment of their career. Eventually, they named their company as Spin Master. After the Dragon Sticks, Spin Master launched various innovative products which also proved to be very beneficial for the enterprise. The company has seen a rapid increase in its operations, revenue and profits from 1994 to 1999; the benefits are increased from $0.5 million to $45.8 million, and Spin Master is ranked at number ten as the most profitable companies in Canada.
Involvement:
Initially, there were only three business partners, the three graduates who were involved in the firm. Later there were many individuals and companies associated with the Spin Masters such as the suppliers, customers’ upper management, and general employees, National government authorities, foreign government officials and the overall society as well.
The federal government was involved because of the size of the Spin Master and the profits it generates. Spin Master is in the tenth spot in the Canada’s most profitable companies so it might be subjected to high taxes. Furthermore Spin Master has also another office located in Hong Kong, the government of Hong Kong is also a stakeholder in Spin Master. Finally, the general members of society are also stakeholders of Spin Master because the general population is sometimes very critical about the manufacturers of toys because many toy companies make toys which can be unethical or bring some negativity to the children of society.
Key Players:
According to Mendelow’s matrix of stakeholder analysis, the stakeholders who have high interest in the operations of the company and possess great power are called as key players. Organizations may have to pay some close attention to the claims of key players because they have an enormous impact on the company.
In the case of Spin Master, there can be many key players such as the customers and competitors of Spin Master. The management can also be classified as key players if it has high power over the organization.
The customers have an enormous impact on the policies and operations of the organization; Spin Master should have to design the strategies in such a manner that it takes into account every legitimate claim of the stakeholders.
Also, competitors also have a high interest in the policies of Spin Master; the case study suggests that opponents play a vital role for Spin Master in designing its strategy, Spin Master wants to launch E-chargers in the market before its competitors, so it has to opt for the approach which pushes Spin Masters ahead from its competitors.
The governments usually have a high power which can affect the operations of the company, but the government does not display a lot of interest unless the organization is huge. It is mentioned in the case study that Spin Master is one of the most successful organizations in Canada and is ranked at number ten on that list; this fact makes it very possible that the government of Canada is more interested in Spin Master due to the profits and taxes it generates.
It is frequently seen that parents are often critical of the types of toys in which their children are interested, many parents want their kids to play with toys that bring some positivity in them. If the parents found some unethical and negative aspect in the toys of Spin Master, they can straight away force their kids to stop purchasing toys of Spin Master.
What has happened?
Spin Master has previously manufactured their toys from different manufacturers in China. Spin Master is already operating as the manufacturers of low technology toys, but now Spin Master is considering launching the high-tech and high-quality toy airplanes.
Problem:
The great success of Air Hogs in the toy airplane market forced the management of Spin Master to examine the production of such items. Spin Master finalized the idea to produce the Air Hogs into a new innovative way which they termed as E-Chargers, which will be driven by electricity and can fly up to ninety meters which is considered to be quite high. However, the biggest problem is the manufacturing of the E-Chargers. There are many producers that manufacture the toys of Spin Masters. The original manufacturer of the toys of Spin Master is the Kin Seng, but Kin Seng is currently working in full capacity and does not have further resources to carry on the production of E-Chargers. So, Spin Master does not want to consider Kin Seng as a potential supplier for E-Chargers.
Finding the qualified and affordable provider is always such a critical task for Spin Master. It is expected that the demand for E-Chargers will be at its peak from March to mid-May.To avail this lucrative opportunity, it is essential for Spin Master to deliver the E-Chargers to the customers before late Decembers. It seems to be quite difficult to achieve the necessary production level from the suppliers because there is a small time in meeting this deadline. Furthermore, the main competitor of Spin Master will also launch their product shortly which is quite similar to E-Chargers; it is vital for Spin Masters to begin the production of E-Chargers before the launching of the product by competitors to avail the advantage of the first comer in this segment.
For the successful working of the E-Chargers, it is necessary that E-Charger only weighs 17 grams if it is more than 17 grams, it will not work and will not be able to fly properly. E-Chargers seems to be quite sensitive, the threat of the failure of the product is higher because the supplier which usually produces the toys are operating at full capacity. The new supplier may do not have the required expertise to build the complex product accurately.
Spin Toys Finding a manufacturer for E-Chargers Harvard Case Solution & Analysis
Possible Options:
There are three possible actions for Spin Master to cope with this situation, the first is choosing Wai Lung and the other one is WahShing, and Spin Master can choose both the suppliers simultaneously..................
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