Hey Guys, Business Case Analysis.... Looking for good insights.

**SantaCruzer** · 10-26-2009 12:07 PM

Hey everyone, I've got a case analysis that I'm working on. Looking to see what others can come up with. Do you have any good insights? Looking for analysis, then suggestions. Have fun and enjoy!

Reid's Electronics, Inc

Reid's Electronics Inc. was founded by Reid Harper. Reid had been an electrical engineer with Bell Telephone for fifteen years. Eight years ago, he perfected a new low voltage switching system in his spare time at home. At that time, he set up a booth at a consumer appliance trade show to demonstrate his new switching system. Reid was overwhelmed with the level of interest by various electronic firms who wanted to buy his product.

Since REI was started six years ago, the company has grown from three employees to 170 employees. REI has 120 people in its manufacturing operation (with four supervisors and a production manager), 25 people in marketing (sales, promotion, and customer service under the supervision of a marketing manager), 10 people in accounting and accounts receivable under an office manager, with Reid serving as president and Reid's sister Janice serving as general manager.

The company has had its good times and some setbacks, but for the most part the last six years have been quite a success. However, Reid has recently become more concerned about the impact that growth has had on the people working at REI. His projections indicate that if the firm can secure two major contracts, the REI could have more than 400 employees in less than two years. Additional people will need to be hired for the work to be done in marketing, distribution, and new product development as well as producing the products for order. The planned growth will accentuate a problem that has recently surfaced at REI. As the economy has turned around, a number of the larger firms in the area have been offering REI's personnel generous employment packages to join their firms.

This situation is particularly frustrating because REI has already lost some good people to the other firms. Turnover this past year was nearly 20 percent. This has hurt REI because now that it is trying to staff for growth it has to do replacement hiring as well. Some of REI’s best people have left in the last six months. Reid expects this situation to get worse because quite a few of the people at REI have indicated they are already stressed out from the firm's rapid growth. If things don't get better soon they too could be tempted away by the packages offered by larger firms.

Reid is also concerned that quality seems to be erratic, deadlines are being missed more often, and people are just not suggesting ideas for enhancing performance as much as they used to. It is clear to Reid that the high-energy high-spirit days of the past are not there any more.

Question: Analyze REI's situation. Identify the major issues and recommend avenues for assuring that REI will be in a position from the human resource side that it may be able to achieve its growth objectives.

Thanks in advance!