Cooplast Case Study

Register to read the introduction… Since Coloplast has a decentralized organization structure, the new production facility in Hungary posed a challenge and dispute in terms of communication and control since it was far away from the other Danish facilities. The fact that the Danish facilities were decentralized also complicated the documentation of planning and standardization of production systems. This was due to the fact that process operators in Denmark knew how to handle inconsistencies in operation of equipment but this knowledge was not documented in …show more content…
This was a very effective approach since all employees had a chance to give their opinions and hence understand each other better. The management also had a chance of becoming aware of the issues which faced employees and could therefore formulate solutions to the problems. It is important to hold regular forums with employees especially in organizations with decentralized structures in order to become aware of the issues facing them and to maintain control over the different branches or …show more content…
One of the most important benefits of local sourcing is that there is a very low transport cost attributed to local sourcing (Berry, 2006). In the case study, Coloplast placed too much emphasis on the managerial aspect of relocation that local sourcing was overlooked. This had huge repercussions on the business. Importation of materials has been seen to have increased the costs by over 60%. This is a significant increase in cost since it has to be passed to the consumer which may translate to a significant increase in prices. High costs also negatively affect the net profit made by the business. It is the duty of the management at Coloplast as well as other businesses to ensure that purchase costs are kept to a minimum when implementing a new project. This can be achieved through a variety of ways including local