Andrew Corporation Progress as a Company - Paper Example

2021-08-01 06:34:40
7 pages
1835 words
University/College: 
George Washington University
Type of paper: 
Business plan
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Andrew Corporation is recognized as one of the formerly independent manufacturers that are working with hardware for network communication. The company is viewed to have been founded by victor Andrew with the company being built in 1947 at Orland Park. It is amazing how the company has been supporting clients from thirty-five countries across regions like Americas, Asia Pacific and Europe with the company settling its manufacturing plants in as many as twelve countries with a large number of employees ranging to over four thousand five hundred individuals. About the company progress and its past performance, Andrews is identified to have entered the low tech market with Able as its first product to be launched in the market, with the company owning up to sixteen percent of the market at every year-end.

Additionally, during the second year, Andrew corporation made a serious improvement, and the company made a huge investment in development and research and came up with four powerful and new products such as Arctic, Angel, Animal, and Ark. Basically, according to the performance of the company, this is identified as one of the worse decision that Andrew Corporation made since the company was not able to effectively manage its resources, the resources were poorly distributed from almost an absent return on investment. During this period, the annual sale fell to eighty-seven percent making the company record a loss of eight million. However, by the end of the third year, through its effective sales and marketing process, Ark and Angel, the company and two other products were able to pursue a smaller segment of the high tech market. Even though during this period the demand for this product went high, the resources acted as a limiting factor, and it didnt provide an allowance to produce the demanded quantity.

In achieving a competitive edge and even working hard to achieve the specific market target, Andrew company has been working seriously hard to meet the existing requirement. In working hard to combat the decline of business, Andrew company took a c compulsory loan that was resourceful in combating the decline of the business; the company took its first emergency loan of $7.7 million that was used in the restructuring of the company. This involved the increase in investments that made in development and research, increasing sales budget, increasing marketing as well as technological advancement and human resources in Animal and Ark, while on the other side phasing out Able which was, Andrews low tech product. Technically, the reshuffling of such resources, in the long run, lead to the end of the two products, which is Arctic in year eight and Angel in year seven . this took place so to ensure that resources were effectively utilized and invested into sales and production of its resourceful products.

However, through such strategy that was adopted by Andrews corporation, success has been the result making the company proceed with such approach. Comparatively, the ability of production increase capacity allowed Andrews company to maximize its market share by working hard to meet the existing customer demands. This was put in place to increase the annual sales in the fifth year by 17% profit and 29% market share. Taking a keen look at the animals production capacity, the company experienced a tremendous increase from the fourth year to an increase of 355 in the eighth year with a 7.5n level of automation. It is also identified that, other than sales increase, Andrews corporation made a strategic plan of reducing materials cost of its products. Significantly, a reduction was also experienced in the Ables material cost by a total amount of 41% in the eighth year to $ 7.38 when a comparison is made to the fourth year which recorded $ 12.56, while Arks material cost is falling to $17.06 in the fourth year.

II. Current Situation

In the financial performance of Andrews corporation, it is not wrong to conclude that an efficient allocation of resources was integral in bringing Andrews profit to $ 4.3 million for the seventh year with total sales of $60 million. Additionally, the company through their financial performance indicated that they were able to pay off its emergency loan and could now occupy thirteen percent of the market with a continuous growth and enlargement of its market share.

SWOT Analysis

Being that Andrews corporation subsidiaries are in Switzerland, Canada, Sweden, Mexico, South Africa, Brazil, Germany, Spain, Russia and Finland, China, France, and Italy, The company has extended their scientific communication inc and the Kintec Corp to in the future acquire the organization of Antenna. Additionally, Andrew company gained momentum to acquire North Carolina Satellite dish, Smithfield and Channel Masters Smithfield factory intellectual property, equipment and inventory and up to $ eighteen million deal. This was one of the calculative moves through after sometimes, Andrew Corporation was able to file a bankruptcy protection.

Strengths

Strategies

Andrew Corporation is recognized to be one of the leading international suppliers of systems, equipment, and various services and that is important in facilitating communication. The company has shown great strategies for achieving long-term growth by building on the major strengths such as customer orientation, market leadership, global presence, productivity, breadth of product line and financial strength. It's unique how Andrew company is achieving a long-term goal of generating $ 500 million in its annual revenue from its current business. This has strength in managing their financial activities and the general marketing strategies that have been put in place to govern the company.

Strategic decision making

The outstanding growth that Andrews has shown is that through proper management, a continuous growth which was resulted from the strategic business decision in relocating its resources after a poor start is shown in their financial performance. Technically, by the sixth year, the company emergencys loan was a totaling up to fifty-eight million. Additionally, this year is also identified to be the first time in four years that the company recorded a total profit of $1.7 million. It is also significant to monitor and measure Andrews performance through serious improvement that the company has made in their financial performance. On top, the company now can pay off its emergency loan by the seventh year with sales are now building of up to $ 1.9 million and 3.2% increase from the sixth year and profit was going up to $2.7 million and 160.3%.

The fact is that in the eighth year, Andrews stock price is at $10.75per share with the existing earning per share rounding to $1.80 which is one of the highest experience that the company has been seeing in the 2nd year of the company. Conclusively, all the good results, market performance, improved market share and good financial performance, it is important to note that the company is moving in the right direction and its a sign of portability.

Product

Through product differentiation and various products offered by Andrews corporation, the company id quick in adapting to changes in the market by continuously investing in development and research section. While it may have one of the best performing products in the market, the companys product is capable of competing with their price without making any compromises on their reliability size and performance.

B. Weakness:

a. Not the best in the market

Conducting a comparison to other companies in the industry, Andrew is identified not be having the best performance nor even the most desired size that the market is demanding. Through such a negative performance record, this is not placing Andrews product on the list of the best product, neither the most valued product, which can only be improved through investments in the TQM and R$D sectors without being able to drive up the price drastically.

Low workforce Productivity

In every company, the general performance is identified by the productivity and event the general performance of the existing workforce. As compared to other companies in the workforce, Andrew company is viewed to be having the highest turnover rate of about 9.6% with one of the lowest productivity index. It is significant to note that insufficient investment is made in the department of human resource, this is making the company maximize their productivity level which will in the result lead to an increase in the capacity of production with limited errors.

C: Opportunities

Cost

Andrew company made a serious investment in the Total quality management sector which the result leads to decrease administrative, labor cost and material cost. Additionally, automation improvement which was adopted in most factories leads to a reduction of cost related to human labor.

Product mix changes

Basically, by the eighth year, Able which is recognized as the oldest product of Andrews company, actually reached its peak and the product will be no longer irrelevant. Such situation calls for an end to the life cycle of the product, while on the other side, continuous innovation is the best strategy to be adopted in this case.By doing so Ark and Animal will remain relevant. Additionally, if in case the company will make a continuous improvement in its growth, then the company can reinvest the cash to be part of the new product.

Threats

Market changes

One of the looming threats is instability in the market, and a political and technological change is increasing the material costs which in the future will impact the margin of the company.

Competitors

In the global market where technological advancement is becoming the key indicators of competition, it is important to note that if Andrews is not capable of remaining competitive and even relevant in the market, then the company will experience loss.

III Future of Andrews Company

As the company is continuing to develop and grow, it is important to consider noting a close attention to its star product that is Ark and Animal. The special analysis will focus specifically on production to maximize the production of the two products while making continuous improvement to surpass competitors and meet the market demands. In the long run, Andrew corporation will no longer be included Able in their product assortment. Through implementing such a strategy, the company will be allowed to allocate the available resources into making improvement in the performance of its workforce as well as the improvement of total quality management. With the company goal in its tenth year to meet an increased productivity of up to index 115.0%, and a particular focus of by 50% and 10% respectively. As the company makes technological advancement, an opportunity will be created to offer the best in the market, while at the same time staying focus and remaining relevant to the current market performance.

Legal, Ethical and Social Challenges

Every business should work on ensuring that ethical, legal and social factors when it comes to managing the overall performance of an organization are considered. One of the greatest challenges that Andrews is facing was maintaining a sustainable business model that not only focused on social responsibility and financial sustainability. On the other hand, Andrew corporation needs to make greater consideration in taking care of their investors, stakeholders as well as employees and individuals. Considering ethics and legal matters that are governing the business and the whole environment, the Utilitarian approach is important when it comes to making emphasis on assessing outcomes, consequences and situation...

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