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Strategic Management and Machine Shop

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Case Study:

Bennett 's Machine Shop, Inc

DATE: 09th December 2010

Introduction to the case:

His entrepreneurial spirit drove him to leave a stable career and convert his part-time engine reconditioning business into a full-time endeavor. He moved from a shack next to his trailer home to a small hut that he rented for one month. After renting the hut he moved to a stall in a service station. With neither a business name nor a business license, Pat had little control over parts and profit. When the opportunity came to rent a larger space from a garage owner Pat took it. Here his business continued to grow and there was a need for him to hire a helper. Although he was in the business of engine reconditioning, he hired a premed …show more content…

There is also inadequate space to store parts and tools. Work areas are cluttered creating difficulty when trying to find the tools to perform the job.

• There is no specialized HR department due to which there is abundance of inefficient hiring, training, and retention practices.

• There are no clear work schedules in place and it is presumed that the employees are satisfied with the limited benefits being offered offers; this has contributed to the dysfunction.

• There is also the absence of a systematic plan of operations. Just giving an employee a few pointers is an example of this. These issues have an effect on the employees abilities to do their job and ultimately has a negative effect on the value creation process.

• Presented issues led to the closing of his new shop after 14 months and the mismanagement of the Boeing contract. Proper negotiations with Boeing may have led to a situation where Pat Bennett had more control.

• Shop has poor financial management. Almost every asset that Pat owns is financed by debt. He did not plan nor seek the advice of a professional when he began his business; he assumed that debt financing was the route to pursue. He did not place any value on having a competent firm to manage his finances.

• The owner also likes to spend money excessively on high quality of life items. The

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