Individual Case 1: Scharffen Berger
1. What are your conclusions regarding the proposed ball mill? As Jim Harris, would you proceed with the implementation of that change? How would you do so?
The Proposed addition of the ball mill machine to the current production process has to be carefully vetted before making any decisions. To properly understand this change it is good to first view the problem from the 10,000 foot level. This is going to the very core of Scharffen Berger's strategic plan. Is their goal to grow revenue and expand the products offered or do they want to stay a small specialty boutique chocolate producer. Based on the case information I believe that Mr. Steinberg and Mr. Scharffenberger primary focus is to maintain the artisanal quality of the chocolate. This means that growing the business can't come at the expense of a lessor quality product.
At the 10,000 foot strategic level I can logically see three routes to meet the growth demands and maintain the desired quality.
The first route is to try and find efficiency improvements in the current process. This could be adding another shift or maybe investigating 3rd party suppliers. Jim Harris has already investigated this route and made several changes that increased the monthly production rate.
The second route would be to not change the current production process but instead increase capacity using the same methods. This would involve purchasing more of the same equipment and expanding the current facilities. This could be achieved by either moving to a new location or dividing the production process into two facilities (such as do the washing, roasting, and winnower at another site).
Jim Harris has reservations about the second approach because he feels they can get more "bang for your buck" by following a...