Eurasia International: "Total Quality Management In The Shipping Industry" by Ali Farhoomand, The Asia Case Research Centre (The University of Hong Kong)

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Problem Definition:

Eurasia International is wholly owned subsidiary with a mandate to operate as a competitive third party ship manager. It provides suite of services that covers end-to-end solution for the shipping industry. The key factors for success are cost efficiency, high quality and personalised service. The Ship management company should be managing cost more efficiently than the owner of ship.

The key issue highlighted by the case report confronting Eurasia International is to maintain the necessary HR focus while controlling the ship's cost structure, staying in tune with customer requirements and anticipating the competition. The Strategic Issue identified for the firm is to sustain creating value for shareholders, customers and human resources in the rapidly evolving shipping industry. Therefore a recommendation and implementation plan is generated to confront the strategic issue after carrying out an in-depth analysis and evaluation of alternatives against certain criteria of leveraging key strengths, mitigating/overcoming key impediments and exploiting key opportunities.


A SWOT (Strength, Weakness, Opportunity and Threat) analysis (see Appendix 1) highlights the current situation of Eurasia International. Certain key strengths are:

1. Well established parent company: Schulte Group can help Eurasia generate economies of scale, without going for a merger, thereby being cost competitive and also provide personalized services.

2. Wide range of services: either package or individually.

3. Low employee turnover ratio

Certain impediments have also been identified that needs to be overcome or can be mitigated. The key one is increased competition for limited size of pie: third party managed ships are just 10% or 5000 at the turn of the century and there has been only a small increase in the size of the world fleet since 1999.

(For details; see Appendix 1).

Decision Criteria:

The criteria for formulation and evaluation of alternatives are following:

1. Image Enhancement: The...