HUMAN RESOURCES SERVICES: Solving Root-cause Employee Relations Issues in U.S. Multicultural Company

HUMAN RESOURCE SERVICES:

Solving Root-cause Employee Relations Issues in U.S. Multicultural Company

HUMAN RESOURCE SERVICES: Solving Root-cause Employee Relations Issues

BACKGROUND

A mid-west U.S. private equity firm retained EWA to address problems in two recently-acquired portfolio holdings with complementary lines of analytical testing equipment products. Along with their U.S. locations, one of the companies had a plant in China, the other in Vietnam.

EWA was asked to conduct an Organization Assessment to validate the issues and their causes, and provide solutions to resolve them.

HUMAN RESOURCE SERVICES: Solving Root-cause Employee Relations Issues

APPROACH

Step 1

Data collection, analysis and recommendations

Performed the Organizational Assessment by conducting 3 group interviews to obtain information in the context of their Core Values, and to get input on what managers perceived as conditions on the floor:

    • Top Management
    • Middle Management
    • First line managers
    • Conducted individual interviews with members of a representative stratified sample of hourly employees
    • EWA team members also made many plant tours to see employees at work and observe their interactions with managers and fellow employees.
Step 2

Implement recommended actions

    • EWA prepared a report to management that included recommendations for improvements. EWA reviewed the report and recommendations with management to get agreement on specific steps and priorities.
    • After joint review, EWA finalized a roadmap for improvement. In addition, EWA helped management establish metrics to measure change in hard issues (productivity, financial results), and soft issues (employee relations, complaints).
Step 3

Measure near-term, mid-term and long-term results

Short Term

    • Reset all branding to new company
    • Improve top down and upward communications
    • Establish and reinforce formal recognition programs
    • Accelerated start to develop more effective supervisory skills

Mid Term

    • Expand ESL classes to improve facility communications and foster better team work
    • Resolve lingering transition issues
    • Improve retention of new hires
    • Develop HR systems
    • Continue to develop more effective supervisory skills
    • Identify and rectify any internal equity issues
    • Develop a meaningful Safety program with accountability

Long Term

    • Study ways to adapt effectively to changes in workforce and labor market demographics
    • Develop innovative approaches to recruiting sources
    • Continue supervisory training and bench strength development
HUMAN RESOURCE SERVICES: Solving Root-cause Employee Relations Issues

RESULTS

Based on the data we gathered, EWA recommended short-term, mid-term and long-term tactics and strategies to address the issues.

    • Created a “One Company/One Culture” environment using the PE firm’s Corporate Core Values as a framework.
    • Suggested resolutions to employee relations issues.
    • Gained consensus with Executive Management on issues, priorities and next steps.
    • Developed metrics to measure progress and to guide clear and open communications.
    • Facilitated implementing solutions to enhance employee cooperation, engagement and participation.
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Establishing Manufacturing & Sourcing in Vietnam

Webinar:

Establishing Manufacturing & Sourcing in Vietnam

Establishing Manufacturing & Sourcing in Vietnam

About The Webinar


Who Should Watch?

Executives of US companies who are facing manufacturing, contract manufacturing or sourcing challenges in China or other countries

Executives of US companies expanding Southeast Asian operational and supply chain capabilities to better service customers


US companies are establishing or relocating to Vietnam for a number of reasons, not the least is diversification from China. Vietnam has become a preferred destination as China labor costs and geopolitical concerns increase, and as US/China tariffs remain.

Vietnam has a significant manufacturing base, which was traditionally focused on textiles, apparel, and furniture.

Vietnam has increased their manufacturing capabilities and are now major producers of consumer electronics, telecom equipment, machinery and auto parts. Samsung produces a third of their total output in Vietnam and is the country’s largest exporter.

East West Associates’ speakers addressed these questions, including:

    • Why – and How – are US companies developing manufacturing, contract manufacturing & sourcing capabilities in Vietnam?
    • What industry sectors are finding sourcing & manufacturing success in Vietnam?
    • What are the advantages of Vietnam as compared to the other ASEAN Countries?
    • What financial & operational incentives does the Vietnamese government provide to US companies to establish operations on leased or owned facilities?
    • How should our investment strategy be designed to best meet the Vietnamese Investment goals?
    • How does Vietnam compare to China & Thailand? Lease rates? Building costs? What are the relative advantages of Vietnamese Business Park options?
    • Can you summarize the Vietnamese/US trade relations and tariff policies?

Our speakers briefly presented two recent case studies:

    • How a Minnesota-based manufacturing client established a Vietnamese contract manufacturing arrangement to diversify from China and service the US market
    • Key experiences of a Michigan-based automotive manufacturing plant for an operational and supply chain audit
Establishing Manufacturing & Sourcing in Vietnam

Speakers

Mark Plum | Director, East West Associates
  • Former President of Briggs & Stratton Asia (NYSE: BGG)
  • VP Sales & Marketing, American Standard Thailand & American Standard China
    Establishing Manufacturing & Sourcing in Vietnam

    Presentation

    Jacob Miller | Director, East West Associates (Vietnam)
    • Former Operations Engineer for Caterpillar
    • Focus in Supply Chain development, procrurement process improvements and facility establishment
    • Currently based in Ho Chi Minh
    Establishing Manufacturing & Sourcing in Vietnam

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    GLOBAL FOOTPRINT SERVICES: GLOBAL EXPANSION (ASEAN)

    GLOBAL FOOTPRINT SERVICES:

    GLOBAL EXPANSION (ASEAN)

    GLOBAL FOOTPRINT SERVICES: GLOBAL EXPANSION

    BACKGROUND

    Global firm needed to increase China/Asia manufacturing capacity. EWA was engaged to develop and implement an Asian Manufacturing Footprint Strategy to drive long-term profitability.

    GLOBAL FOOTPRINT SERVICES: GLOBAL EXPANSION

    APPROACH

    Step 1

    Identifying the expansion criteria

    • Company analysis
      • Expansion criteria: labor supply/costs, government incentives, inflation rates, availability of raw materials, transport & export logistics, supply chain vendor availability
    Step 2

    An in-depth comparative analysis of 6 selected countries

    • Philippines, Malaysia, Indonesia, Vietnam, Thailand & China
      • Expansion recommendation: Thailand
    Step 3

    On the ground interaction

      • Negotiated conditions for property purchase & property management (waste removal, perimeter security, etc.)
      • Negotiated investment incentives with Secretary General of Royal Thailand Board of Investment
      • Qualified local Thai vendors to support the company’s manufacturing location
      • Met with local legal and accounting firms to identify the necessary criteria for establishing a business entity
    Step 4

    Hands-on implementation

      • Property was purchased and all pre-construction permits/licenses/registrations were acquired by October 2017
      • Plant designs, construction budget/timeline & all construction partner contracts were finalized in November 2017
      • Plant construction and equipment installation began in January 2018 and was completed in April 2019
      • Identification and recruitment of supply chain, distribution & logistics partners was completed in February/March 2019
    GLOBAL FOOTPRINT SERVICES: GLOBAL EXPANSION

    RESULTS

    Government Incentives

        • 8 year tax holiday from CIT, 50% tax reduction for an additional 5 years

    Cost Reduction

        • $22.0M tax savings over 10 years
        • $4.3M annual labor savings after 5 years
        • $1.8M annual material savings after 5 years
        • $120/unit average freight savings

    Company Growth

        • 42% increase in sales over 5 years
        • 53% increase in revenue over 5 years

     

    Company Forecast

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    GLOBAL FOOTPRINT SERVICES: SITE SELECTION

    GLOBAL FOOTPRINT SERVICES:

    SITE SELECTION

    GLOBAL FOOTPRINT SERVICES: SITE SELECTION

    BACKGROUND

    A German-owned chemical company with an ageing facility was being pressured by local authorities to relocate to an “official” chemical processing zone, as part of the Chinese government’s initiative to combat industrial pollution. EWA was engaged to conduct a comprehensive site selection process and provide the client with quantified site recommendations.

    GLOBAL FOOTPRINT SERVICES: SITE SELECTION

    APPROACH

    Create functional definition of plant

      • Purpose for expansion, customers, supply chain, products, capital equipment, etc.
      • Definition of the site requirements & specifications:
      • Size of plant, land requirements, structural requirements, utilities and consumption, logistics, labor force requirements, ground compaction, water table, number of employees, manufacturing space, office space, employee facilities, etc.

    Analysis of company performance influencers

      • Logistics, location of customer base, location of suppliers, location of business partners, freight & transportation costs, current property costs, current operational costs, government incentives, etc.
    Step 3

    On the ground interaction

      • Identification of 7 business/chemical parks for further exploration based upon site & company criteria
      • Personal site visits, face-to-face negotiations, meetings with other companies located in the individual business parks & interaction with local government officials
      • Tours with company executives
      • Negotiations and confirmations of land price and tax incentives
      • Analysis of the impact on startup and operational costs
    Step 4

    Recommendation

      • Provided 3 qualified location options with full analysis
    GLOBAL FOOTPRINT SERVICES: SITE SELECTION

    RESULTS

      • Significant tax and land incentives were attained by EWA negotiations
      • Client approved EWA recommendation and final negotiations are currently in process.
      • Client has engaged EWA in the role of “Owners Representative” for follow-on activities including coordinating design and overseeing construction
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    Supply Chain Over-Dependence on China Negatively Affecting Valuations

    WEBINAR:

    Supply Chain Over-Dependence on China Negatively Affecting Valuations

    Supply Chain Over-Dependence on China Negatively Affecting Valuations

    About the Webinar

    Development of a key element of a strong exit preparation – an evidence-backed explanation of why the asset is a great investment opportunity.

      • Why the business is a strong asset.
      • How it’s going to improve (the upside for the next owner).
      • Why it’s strategically beneficial.

    Is proving to be a major challenge at a time when it is needed most for 3 reasons:

      • The heightened awareness of the need for risk diversification in supply chains
      • The heightened awareness of companies’ current over-dependency on China in supply chains
      • Many PE firms & companies are uncertain about making changes to supply chains, due to the current volatility of the global business environment (Source: McKinsey)

    This webinar discusses how companies can diversify into Mexico, Asia and Central Eastern Europe.

      • Business Environments and Product Concentrations
      • Sourcing & Procurement Consideration in these countries
      • Explanation of country evaluation & selection process
      • Explanation of identification & qualification of suppliers
    Supply Chain Over-Dependence on China Negatively Affecting Valuations

    Speakers

    Mark Plum | Director, East West Associates
    • Former President of Briggs & Stratton Asia (NYSE: BGG)
    • VP Sales & Marketing, American Standard Thailand & American Standard China
    Dan McLeod | Director, East West Associates
    • Former Director Asia Pacific Operations- Ashland Specialty Ingredients
    • General Manager-Eaton Corporation (SE Asia)
    • Director of Asia Pacific Manufacturing and Supply Chain-Hercules
    Supply Chain Over-Dependence on China Negatively Affecting Valuations

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    Supply Chain Over-Dependence on China Negatively Affecting Valuations

    Presentation

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