A/S Business Homework for 27th February

A/S Business Homework for Monday 27^th February: Just Desserts Ltd

Just Desserts Ltd manufactures a range of luxury desserts in Chester. The business was established by Martha Barnes and is famous for its traditionally-made products such as bread and butter pudding. The company’s slogan, ‘Desserts like granny made’, emphasises its image of tradition and quality. Over recent years, the company has extended its range of products based on its ongoing programme of primary market research

Initially, the company grew slowly. However, over the past two to three years it has won contracts to supply Marks & Spencer, Booths and Waitrose with its products. Each retailer is supplied with its own exclusive range of desserts (to suit their individual needs) and this has increased the complexity of the factory’s operations. The factory’s production levels and workforce have expanded since winning the new contracts.

Expansion has meant that the company’s labour force has increased from 70 in 2014 to 110 in 2015. As a result, average spans of control in the company have widened and some managers are over-worked. Martha is reluctant to delegate authority, preferring to make most decisions with the support of two senior employees. The design of junior employees’ jobs means that they make little or no contribution to decision-making.
In 2014, the company manufactured 5.95 million desserts; in 2015, this figure rose to 8.47 million. This increase in production has meant that existing suppliers are unable to provide all Just Dessert Ltd’s needs and it has had to seek a new supplier for ingredients who can offer high quality products. Martha is keen to sign a contract with a large supplier in the South of England rather than with a much smaller, local supplier.
Just Desserts Ltd’s cash position has weakened since 2014, therefore, Martha has postponed a number of training events that employees were to attend. One of the senior managers has questioned this decision, but Martha is inflexible. “We are growing quickly, and therefore, we must manage our cash carefully. I agree our existing employees’ skills are an important part of our success but recruiting the right people is the best way to improve the effectiveness of Just Desserts Ltd’s workforce.”
1.Calculate the change in labour productivity in Just Dessert’s Ltd’s Chester factory between 2014 and 2015. [6]

2. Martha believes that ‘…recruiting the right people is the best way to improve the productivity of Just Desserts Ltd’s workforce’. Do you agree with her? Justify your view. [12]