Discuss two topics with Pars Food ltd

Pars Food Limited

Pars Food Limited is one of the market leaders in the UK frozen food industry, employing approximately 400 staff and operating from different production facilities within the UK. A privately owned company (Ltd.), Pars Food was founded in 1950 by John Clapham whose sons, David and Darren are directors within the company. At a corporate strategic level the board of directors consists of six main shareholders; John is the major shareholder and Managing Director, his sons are also directors and between them they hold 40% of shares. There are three further shareholders, also directors, who control the other 60% of shares within the company. Pars Food Ltd. generates annual sales turnover in excess of £150m. Their product range includes pizzas, snacks, ready-made meals, soft drinks and desserts, although their main revenue streams come from potato based product ranges.

Their products are sold direct to restaurants and also to supermarkets throughout the UK. Pars Food Ltd. also own and operate their own distribution and  transportation division with 40 lorries / trucks  in different sizes, which provide general freight, distribution and warehousing services across UK. The headquarters of the company is based in Bradford. The manufacturing, operation, sales and marketing facilities are located in Hull. All manufacturing operations including the supply of raw materials, production, storage and delivery operate out of the Hull site.

Pars Food Ltd. has a number of Core Values and a Code of Conduct which underpins their actions, decisions, behaviour and strategy. Their philosophy “Pars Food, It’s All Good” is significant as it has shaped the culture of the organisation.

Core Values

To work every day to make our customers and consumers SMILE

To value continuous improvement in our people, our products and our business

To cherish the “Can Do” spirit; Trying but failing is okay, failing to try is not

To dare to be different; New ideas, innovation and differentiation matter

To value teamwork and the sharing of ideas

To win market by market, and create advantage by leveraging our global scale

To believe that honesty, integrity and fair dealings are integral to our success – good ethics is good business

To recognise  the diversity of our environment and care about our staff, their families and their local community

To have pride in our heritage and our reputation as a  family business

Code of Conduct

The Code of Conduct explains the standards of behaviour that the organisation expects from all of its employees. It demonstrates their commitment to lawful and ethical conduct across their business and throughout all their decisions. Pars Food Ltd. is very proud of their reputation within the industry which has been developed for more than 60 years. They constantly strive to ensure that business is conducted in the manner of their founders with honesty, integrity and fairness. By adhering to this Code of Conduct the business has been able to grow and innovate successfully. They believe strongly in the principle of ethical business to allow them to achieve their goals in an increasingly competitive marketplace in ways that build trust and respect.

Strategy and Vision
Their business strategy is designed to drive sustainable, profitable growth. The vision is to grow Pars Food Ltd. by producing products that their customers love whilst contributing to the wellbeing of all stakeholders. This will be achieved through the commitment of their talented workforce who have a significant stake within the organisation and who are actually creating their future, today.
Aligned Organisation – Their employees are the heart and soul of their strategy. They develop people as leaders at all levels of the organisation and support them as they pursue the possibilities that will deliver on their vision. They never lose sight of what’s unique and important to each of their customers and consumers, but they act as one on common priorities and coach each other on what is missing to make a possibility a reality.
Competitive advantage and differentiation – Delivering good food made with an attention to quality and safety at good value to their customers and consumers around the world is their path to growth. Their supply chain is transforming to become a model of resiliency with the capacity to serve their customers from anywhere they are located. Standing out from the pack is no easy feat, but Pars Food Ltd. aims to do just that by investing more than ever before in science, technology and market insights to develop further innovative products that serve a particular need in society (niche market) or that simply satisfy a craving for good food.
Value–added Products – Their aim is to be more global and attract more customers from Europe. In order to do this they must be more innovative and develop a platform of globally attractive food products that can leverage their knowledge in retail and foodservice and their supply network.
To summarise, their strategy is built on their philosophy of “Pars Food, It’s All Good”. They believe that with the right staff producing excellent food products from good ingredients which their customers enjoy they will be able to grow the business for the future.

Products
Pars Food Ltd. is the UK largest manufacturer of frozen potato products, but their product range does not stop with potatoes or frozen French fries. They also offer hundreds of other products, including appetizers, pizzas, frozen vegetables, beverages, ready-made meals and desserts which are found in many restaurants and food retailers.
Customers
Foodservice: The Pars brand can be found in the most challenging of kitchens. They supply quality frozen food products to quick service restaurant chains, as well as casual and fine dining rooms, institutional and catering customers. All products have to meet the uncompromising specifications of their customers.
Retail: Their convenience foods appear on grocery shelves in almost every retail store throughout the UK. Their products are prepared simply with wholesome ingredients made by conscientious, well trained staff that care about delivering quality in every box, every bag and every bite.
They deliver directly to restaurants, retailers and also some wholesalers in the UK. They plan to expand their market to other European countries and increase the number of customers including restaurants, wholesalers and retailers.
Suppliers
Pars Food Ltd. uses a number of different suppliers within its business including:
•    raw material suppliers (e.g. potatoes which are grown and supplied by UK farmers),
•    ingredient suppliers,
•    equipment suppliers,
•    “Soho Transport” , a 3rd party logistics (3PL) company who deliver potatoes to the Hull processing plant, and finally
•    Consultancy and training organisations to provide some advisory and staff development services.

Long Term Objectives
1-    Establish the company as a public corporation (PLC) within next five years.
2-    Increase market share by expanding their market to Europe.
3-    Reduce operation costs by minimising waste and cost of poor quality.
4-    Improve the quality of both products and services to achieve excellent customer satisfaction and zero customer complaint.
5-    Increase product range
6-    Invest further in staff, equipment and storage.
7-    Become more environmentally and ethically sustainable.
Short Term Objectives between 1st Oct 2012 and 31st March 2013
1-    Add the authentic and luxury new product as “Pars Chilli Pepper Cheese Nuggets” in 1 kg bags to their product range.
2-    Add the value pack of the “Pars Seasoned Twisters” in 1 kg bags to their product range.
3-    Buy some specialist potato transport lorries to reduce their reliance on outsourcing.
4-    Implement Total Quality Management (TQM), a culture of continuous quality improvement in the company to involve everybody in quality and customer satisfaction throughout the organisation.
5-    Get accredited by ISO9001 for standardisation in service and production
6-    Purchase a new cutting machine to be used to manufacture the Twisters with value of £300,000.
7-    Increase the number of full time staff on the shopfloor (operations) and in the sales and marketing department by a further 25. Increase the number of part time staff on the shop floor (operations) and in “in-bound” transport by a further 30.
8-    Reduce the environmental impact and improve the health and safety of staff.
9-    Find new sources of finance for the purchase of additional equipment and to build additional storage facilities.
10-    Promote lean and agile operation
Operations

The key operational activities in Pars Food Ltd. are sourcing, purchasing, manufacturing, packaging, storage, transport, sales and marketing, administration, finance and accounting. The purchasing department deals with farms, Soho transport, raw materials and equipment suppliers. The manufacturing, packaging, storage and transport department has 10 different production lines, working 24 hour shifts with 280 full time and 20 part-time employees. Most of the production line capacity is used to manufacture frozen chips but other products are also produced in the same factory.

The Production manager is Jack Holmes, a young engineer who has been employed by the company for two years. He is an ambitious manager who had three years previous experience of working as a production engineer in a ready-made meal food manufacturer in Scotland. His main duty is to manage the production and packaging teams. A simple flow diagram below illustrates the supply chain and manufacturing process of material involved in producing frozen chips.

The company is currently outsourcing all of its raw material through outside transport and is considering using its own transport for sourcing the potato in the future. The board of directors is really concerned with quality, cost and reliability in its supply chain network from the initial sourcing of the material to final delivery of the goods to customers. The level of rejection in quality inspection and quality check for frozen chips is high and they would like to reduce this.
Jane Williams is a food technologist who is in charge of quality control in the company. She is a young graduate from university with just two years experience of research flow whilst working at a laboratory for “Kraft Food” in the USA. Pars Food Ltd. would also like to improve their performance in JIT (Just in Time) delivery and increase their agility in their delivery to customers. Craig Calpin, an experienced logistics manager of 25 years, leads a team of 50 warehouse and transport employees. He is constantly complaining about the lack of capacity in freezers for all products and the monthly report for the last few months indicated a high level of fluctuation of stock in storage. There has been a surplus of “Stake Cut Chips” (thick cut), suitable for “Fish & Chips” shops and restaurants, left in the storage for more than 2 months with very low selling opportunity. Craig has also asked for a detailed assessment to be conducted prior to building the new proposed storage for products so that it can be aligned with potential future production and sales volume.
A further issue in the whole operation process is a lack of standard procedures in the organisation which makes standardisation across the company difficult.  Maintenance costs of outdated machinery have also increased. Marian Holmes, a senior office manager with 20 years experience has been faced with staffing problems due to the increase in administration as she only has 5 staff.
The purchasing activities, including buying, negotiating and supplier selection, are led by two of the directors who have five senior experienced buyers working with them. Their responsibilities are to find appropriate suppliers, deal and negotiate with them, liaise with the production, marketing and finance departments and finally to identify alternative supply sources globally.

Marketing

The sales and marketing team consists of 20 people who are managed by Philip Jones, the marketing and sales manager. The employees are involved in telesales, advertising, website design and six of the team are regional marketing executives. The marketing department’s main ambitious objective is to increase their market share within Europe, especially northern European countries, within the next two years.  They have already been working with quality management and the production team to develop five new products for the future. They have just launched the “Pars Chilli Pepper Cheese Nuggets” and “Pars Seasoned Twisters” to appeal to two different segments within the snack market, the former to appeal to a basic market and the latter a more luxury market segment.

The department have asked for additional funding to support their plans and also an increase in their budget for advertising and new product development. They have recently spent £50,000 on advertising these two new products and have asked for a further £100,000 advertising budget for next year.

The marketing team is also working on developing new software as part of their Customer Relationship Management (CRM) policy. This will store all possible information from customers including their personal details, their shopping habits, any feedback they have previously given regarding Par Foods’ products and even identify products which customers are currently not buying with a view to using this information in future marketing campaigns and promotions.

The company would also like to conduct research into the organic food market as a possible future growth area. They first need to investigate the wider implications of this both from a legal and an economic perspective. Before they enter this market it is necessary to identify potential / actual risks and benefits of the strategy for their business and the wider environment. (Social, Economic, Environmental, Technological).

Human Resources

The HR department consists of five people including Zoe Robertson, the human resource manager who is the head of the team responsible for recruitment, performance management, personal development and training, staff payroll and health and safety of staff. This department has been instructed by the board of directors to reassess current HR practise and procedures and implement a new HR strategy to ensure that the company can meet its objectives.

The department needs to recruit some operational consultants  for TQM and ISO9001 implementation for production lines.
Zoe has already interviewed some internal candidates and is looking to advertise to attract further potential external candidates for interview.

The department is also considering implementing a number of staff development and training courses. These include:
•    ISO9001 training for all senior managers and line managers.
•    Food hygiene training for all production staff
•    Customer service training for the administration, sales and marketing teams.

It is hoped that these training initiatives would improve the efficiently and effectiveness of all staff within the organisation and thus improve customer satisfaction and profitability. The department is also concerned about the well-being of its employees and wants to review its health and safety policy and generate new health and safety risk assessment criteria for all production staff to follow with a view to improving safety within the workplace.

Finance

The finance department consists of six people involved in accounting, financial monitoring, performance measurement, taxation and anything related to money and cash flow. Keith Stevenson, the finance manager is investigating into possible sources of finance to the build the new storage facilities and also to purchase some new equipment and machinery for the production line. The board of directors has asked him to find the best possible source of finance for the company taking into consideration the current situation of the business.

The total estimated costs are detailed below:

Item    Proposed Costs
Land Purchase    £1,500,000
New Storage Facilities    £800,000
New Equipment and machinery    £600,000

A recent performance measurement and cash flow analysis indicated that although, the business is in a satisfactory position, net profit is very low and there are concerns that their current poor financial performance may affect the ability of company to go ahead with its projects. Therefore, it is vital for the company to find appropriate and reliable sources of finance, which also align with objectives and strategy of the company.

The company wants to be financially viable both now and in the future. In order to fund their future plans they are looking for sources of finance which are flexible and cost effective. They wish to avoid at any cost the need to down size or make redundancies.

Module Title:    Business Processes and Systems

Instructions on Assessment:

Pars Food ltd

Two questions set

Candidates should answer only TWO questions.

•    Each question represents 25% of your final module mark.
•    Each question has a maximum word count of 1000 words.
•    Each question should be presented as an academic essay using appropriate referencing throughout.
•    Each essay should refer to material presented in the Pars Food Limited case study.
•    Students should use lecture notes, material from the core text book and other recommended readings or other sources (preferably academic journal articles) to support their answer.

All questions have been designed based on topics covered in lectures from semester one and require candidates to integrate their knowledge and understanding of all of the business processes.

Note – It is strongly recommended to refer to “academic writing” and “referencing” guidelines before starting to answer the questions, as appropriate referencing is expected in answering the questions.

Task 1 (Max 1000 words):

Describe how the introduction and implementation of Total Quality Management (TQM) and ISO9000 may impact on the performance of Pars Food Ltd.

You are required to look at lecture notes and other sources (such as textbooks and journal articles) to describe how TQM and ISO9000 can help Pars Food to achieve their long term objectives as stated in the case study. You are advised to identify and apply the key benefits and limitations of these two quality improvement practices with specific reference to the human resource, marketing and finance functions within Pars.

Task 2 (Max 1000 words):

Describe the relationship between Pars’ marketing strategy and its operational sustainability.

You are required to look at lecture notes and other sources (such as textbooks and journal articles) to describe how Pars’ marketing strategy (including the 4 Ps) and its environmental, economic and social sustainability effect each other. You are also advised to discuss how the wider environment (i.e. environmental, social and economic) may impact on Pars’ marketing strategy.

Note – You must answer TWO of the above questions. As a minimum you are expected to refer to lecture notes, seminar notes and chapters of the core text book to demonstrate understanding. Better students will use additional sources such as other text books and journal articles.

All work should be referenced correctly using the APA style. (For further detail, please refer to the generic assessment brief, referencing guidelines and seminar sessions.)

Further guidance relating to the detail of the above will be provided in seminars and on Blackboard for this module.

Word limits and penalties for assignments

If the assignment is within +10% of the stated word limit no penalty will apply.

The word count is to be declared on the front page of your assignment and the assignment cover sheet.  The word count does not include:

•    Title and Contents page    •    Reference list    •    Appendices    •    Appropriate tables, figures and illustrations
•    Glossary    •    Bibliography    •    Quotes from interviews and focus groups.

Please note, in text citations [e.g. (Smith, 2011)] and direct secondary quotations [e.g. “dib-dab nonsense analysis” (Smith, 2011 p.123)] are INCLUDED in the word count.

If this word count is falsified, students are reminded that under ARNA page 30 Section 3.4 this will be regarded as academic misconduct.

If the word limit of the full assignment exceeds the +10% limit, 10% of the mark provisionally awarded to the assignment will be deducted.  For example: if the assignment is worth 70 marks but is above the word limit by more than 10%, a penalty of 7 marks will be imposed, giving a final mark of 63.

Students are advised that they may be asked to submit an electronic version of their assignment.

Time limits and penalties for presentations

The time allocated for the presentation must be adhered to.  At the end of this time, the presentation will be stopped and will be marked based on what has been delivered within the time limit.

Assessment Criteria (NBS)

Module Specific Assessment Criteria

Trait    0 – 29    30 – 39    40 – 49    50 – 59    60 – 69    70 – 79    80 – 100
Knowledge and Understanding    Unable to grasp concepts and focus on questions, irrelevant to the concept     Some elements of knowledge apparent but question/s inadequately addressed.  Poor link to the literature and practice    Basic knowledge-and understanding of subject shown. Basic level of link to literature and practice, enough focus on elements of question, evidence of understanding the concept      Work is relevant, however, confusion shown at times. Evidence of understanding business management concept, evidence of integration of business functions, evidence of link to literature and practice in appropriate level     The knowledge base is judged sound and relevant. Good evidence of understanding business management concept, good evidence of integration of business functions, good evidence of link to literature and practice in appropriate level     Thorough knowledge and understanding demonstrated.  Excellent evidence of understanding business management concept, excellent evidence of integration of business functions, excellent evidence of link to literature and practice in appropriate level    Exceptional comprehension of knowledge demonstrated. Outstanding evidence of understanding business management concept, outstanding evidence of integration of business functions, outstanding evidence of link to literature and practice in appropriate level
Structure and Alignment    Often inarticulate and can be incomprehensible.    Poor structure.  Content often irrelevant.    Work can lack focus, and is prone to unsubstantiated assertion or logic.      Over reliance on description rather than analysis.  Perhaps some evidence of unstructured argument or illogical reasoning.    Material is well presented and organised.  Occasionally, conclusions are reached on the basis of insufficient information.    Fluent and focused.  Shows ability to contextualise knowledge and sustain a relevant argument or logical reasoning.      Sophisticated skill shown in formation of relevant argument or analytical reasoning.

Note:     For those assessments or partial assessments based on calculation, multiple choice etc.  Marks will be gained on an accumulative basis.  In these cases, marks allocated to each section will be made clear.

Students must retain an electronic copy of this assignment and it must be made available within 24 hours of them requesting it be submitted.

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