Malaysia Dairy Industries Private Limited Essays

Malaysia Dairy Industries Private Limited Essays Malaysia Dairy Industries Private Limited Essay Malaysia Dairy Industries Private Limited Essay Malaysia Dairy Industries Private Limited (MDI) began in 1963 as a joint venture between a Singapore entrepreneur, Mr. Thio Keng Poon and the Australian Dairy Produce Board. Five years later, the company became a locally owned entity after Mr. Thio and his family bought over the Australian interest in the company. MDI become the first manufacturer of evaporated milk and cultured milk in Singapore and Malaysia. Besides, it also the first to produce 100% fruit juice in both countries. Later, the company also became the first to install an Alfa-Laval UHT Steritherm plant in Asia. In 1994, MDI received the ISO 9002 certificate for Quality Management System in Production and Installation. Over the last decade, MDI has seen a tremendous growth in demand for its perishable products. Demands for pasteurised products have increased form 50,000 litres per month to more than 1.3 million litres per month today. At the same time, Vitagen has become so popular among peoples especially children, that lead MDI has had to expand production capacity to meet the growing demands. Therefore, a trend of continued growth leading well into the next century is expected. As MDI prepares to this growth, it has already built a 5-storey extension to its headquarters to provide greater capacity and scope for manufacturing in the future. While Malaysia Milk Sdn Bhd, its Malaysian subsidiary has also completed its sophisticated new building to meet the needs of the Malaysian consumers. Today, MDI manufactures as many as 21 various product lines, which under the brand Marigold include sweetened condensed milk, evaporated milk, cultured milk, full cream milk powder, pasteurised milk, high calcium milk, long-life milk, fruit juices, yoghurts, and dessert etc. (see appendix for the overview of products). Besides, MDIs research and development laboratory has always played an important role in MDI and especially so in the last few years in order to manufacture products that meet its high standards. In todays environment, companies are operating in an uncertain and turbulent environment, especially due to the US war that will be launch soon. The firms will experiences very high uncertainty while external environmental factors change rapidly. This is because the firms do not have sufficient information about environmental factors to understand and predict environmental needs and changes. Moreover, It will reduce the planning horizon because if the firm operates in an uncertain environment, its management is unlikely to develop plans for more than a few years ahead as they accept that will be subject to large margins of error. Thus, MDI must respond by designing its firm to adapt to the external environment and to influence that environment. The external environment for any organisation includes all elements existing outside the boundary of the organisation that have the potential to affect the organisation, which are the Political, Economic, Social cultural and Technological. Political The political dimension that affects MDI includes government regulations at the local, state, and federal levels as well as political activities designed to influence company behaviour. For the entire product, which produce by the MDI shall in all other aspects comply with the requirements of the legislation that currently enforced in Malaysia i.e. The Food Act 1983 and Food Regulations 1985 which set product standards and particular labelling requirements for milk and milk based products. Each product may by arrangement with a recognised certification body, be marked with the certification mark of that body, provided the product conforms to the requirements of this Malaysian Standard. On the other hand, dairy imports such as milk powder, cheese and butter are required to be certified halal by the Malaysian religious authority, for direct consumption and usage as ingredients for further processing. An import license, issued by the Department of Veterinary Services and Ministry of Int ernational Trade and Industry is necessary for consignments of dairy products entering into Malaysia. Economic The economic represent the general economic health of the country or region in which the organization operates. With the uncertainties over the economy in 2001 and 2002 which due to the war on terrorism since last year, there was softness in demand of dairy product in the local dairy market. The environment today became more turbulent as the terrorism happens everywhere such as the explosion that take place in the Bali in Indonesia, and the Philippine city of Zamboanga. (See appendix about more current issue) Besides, US president was declared to launch war with the Iraq. If this situation takes place, it will mainly affect our economic growth, especially in the Asian countries because the economic problems in US have had a significant impact on the Asian countries as well as the stock market. The world dairy raw material prices will increase due to the inflation of the countries. The dairy product price will therefore increase due to the high cost of raw material. The consumer purch asing power also affect here that the demand of the milk product will be reduces. The consumer may go for select the substitute product which was cheaper than the milk product e.g. soya bean. The unemployment may also take place due to the downturn of economic. Social Cultural The social cultural dimension of the general environment represents the demographic characteristics as well as the norms, customs and value of the general population. In order to meet the consumer satisfaction, MDI have to consider needs of the consumer based on their attitude, taste, age, and the family size. For instance, for the milk it self, it should aimed at various sections of the market i.e. pregnant women, breast feeding mothers, toddlers, children, adolescents, slimmers, active adults, pensioners. For example, a fruit yogurt in Thailand emphasizes health and low calories and is targeted at young women; in Europe, a drinking yogurt in a bright container and featuring a cartoon character on the packaging is aimed at children; elsewhere, a drinking yogurt fortified with vitamins is aimed at active women between the ages of 30 and 40. In this respect, it often seems as if a product is available for every age and occasion. On the other hand, the family also one of the factors affects the producing of milk product. For example, standard packaging of milk in litre and half-litre containers, is well adapted to home consumption, but not well adapted to competing with soft drinks sold from vending machines. For this market, the size of the packaging needs to change (often to between 200 and 350 ml) to encourage sales of milk products, such as flavored milk and chilled coffee, which can compete with soft drinks. Technological Technological dimension includes scientific and technological advancements in a specific industry as well as in society at large. This factor will also affect MDI since the company is using new technology equipment to develop their innovative products. With unceasingly introducing of new technology will be able to develop the innovative products with high quality and high standards. Globalisation means an adherence to universal business principles and practices, which are recognized, respected and understood by the regional and global corporate communities. It is regardless of goods and services that flow across international borders and across vast oceans with few impediments. This also a process which tends to increase the interdependence between national economies. Global markets could offer greater opportunity for people to tap into more and larger markets around the world. It means that they can have access to more capital flows, technology, cheaper imports, and larger export markets. It can be seen, as a movement towards the formation of a single market for goods and services, in which there is no discrimination based on the geographical origin of producers and consumers. Rules of business are changing rapidly and if management is not sensitive to change, their business will be severely affected. Therefore, to survive in the market place, management will h ave no choice but to quickly adapt to continuous changes of globalisation to remain competitive. Opportunity and Threat Today the will to constantly upgrade and to stay at the frontier of the industry remain the key to the companys vision. To meet the challenges ahead, MDI is focusing on the vision which will cover every aspect of business, involving every member of its staff and at every level of the company. Thus, such vision and the principles such as ISO, HACCP become the guiding lights that will plot the companys course in the future. The opportunity to take part in the emerging global economy will also comes to the company. The company will not only establish himself in Malaysia and Singapore but also in other Asia countries such as Thailand, Indonesia, China, Vietnam, and Myanmar etc. However, over recent months, there had been increasing concern over the global economic slowdown, which was most clearly seen in the US and to a lesser extent, in Europe and some countries in Asia. Apparently, the events of Sept 11 had a significant impact on the global business activities. Foreign direct investment worldwide has declined by nearly 50%, indicating a lack of consumer and investor in the light of growing uncertainties in the global business and geo-political environment. This may become one of the threats to MDI in developing its global business. The company also face tough challenge in competitive environment because the competition in the global market is intense, with several major producers vying for the market share. In order to help the company understand their competitive advantage or disadvantage relative to competitors, and to give an informed basis for developing future strategies to sustain or establish advantage over competitors, competitor analysis of the following are necessary here. Competitor Analysis Porter argue that competition in an industry is determined by its basic underlying economic structure, which are the following five force models: * Rivalry among existing competitors The competitor strategic would be one of the main factors to influence the business of MDI. Competitors such as Dutch Lady Milk Industries, Premier Milk/FN Dairies, Nestle Products, New Zealand Milk Products and the Dumex (Malaysia) are constantly coming up with their own market promotional programs by introducing new and improved products and innovative packaging, in order to gain and maintain their market share. These companies often conduct product demonstrations and conduct sampling in shopping complexes and supermarkets. * Threat of new entrants The second model is the barrier to entry the industry. Where barriers to entry are high, the new entrants are likely to be deterred. While the low barriers generally mean that the responses will be slower and offering more opportunity. The barriers to entry the dairy industry are consider medium. The main barrier that the new entrant face would be the creation of strong brands of the competitors such as Nestle and Dutch Lady. * The bargaining power of suppliers This means the behaviour of supplier and their relative power which can squeeze industry profits. This power may affect MDI as most of the raw materials to produce the dairy products are imported from the foreign country such as Australia, Europe and US. Such countries are playing a major player in the world trade of dairy product and they may attempted to dominant the price of the raw material e.g. raises their price to the industry and hence take over part of the profit for themselves. * The bargaining power of buyers Buyers use their power to trade around the industry participant to gain lower prices or improvement to product quality will also affect profitability of MDI. The high standard of milk product that produced by MDI normally offers a lower price compare to other competitors and thus attract more consumer to buy it, for example the low fat of HL milk. * The threat of product substitutes The substitute products which bring the same need to satisfy consumer will bring down the purchases power of the milk product especially when the price move upwards. For example, when the price of the pasteurised milk move up, the customer may look for soya milk which is more cheaper and healthy than the pasteurised milk. In order to tackle the challenges and competitive environment and to expand the company business to the global market, planning consider the main action to MDI to decide where the company to be in the future and how to get it. In fact, the organization such as Shell, IBM, Royal LaPaige, Mazda and United Way have been undertaken a strategic planning exercise each year for reviewing their missions, goals, and plans to meet environment changes or the expectations of important stakeholders. Thus, planning is an important fundamental action for every organization to achieve their goals. There are four main stages in the planning process, which are the following. Establishing Objectives For planning purpose, it is necessary for MDI to define the companys objectives as to provide a sense of direction. The companys objectives are important because company exist for a purpose and such objectives define and state that purpose. Strategic or long-range planning therefore begins with the specification of the objectives towards which future operations should be directed. The attainment of objective also aimed to create the source of motivation and commitment among the employees because the companys goal will facilitate employees identification with the organisation and help motivate them by reducing uncertainty and clarifying what they should accomplish. The first objective that MDI should define is the mission of the company, which describes the broad purpose and its reason for existence, the nature of business and the customers it seek and satisfy. For instance, the business scope of MDI is manufacturing of dairy products. Meanwhile the purpose of the company is to improve the growing demands of the dairy products towards global economy. Another important objective which relate to the organisation as a whole is the corporate objectives. They are normally measurable and are expressed in financial terms such as desired profits or sales levels, return on capital employed, rate of growth or market share. It is important that senior managers of MDI understand clearly where their company is going and why and how their own role contributes to the attainment of corporate objectives. Once the overall objective of the company have been established they must be broken down into subsidiary objectives relating to areas such as product range, market segmentation, customer service etc. Identify Potential Strategies The following stage to the above is to identify a range of possible course of action or strategies that might enable the objectives of MDI to be achieved. Prior to developing strategies, it is necessary to undertake a strategic analysis to better understand the organisations present strategic situation. This involves SWOT analysis of MDI that assess companys strengths and weakness, opportunity and threats in relation to the internal and environmental factors. Once we understand the SWOT of the company, we will be able to identify alternative strategies for the company. The following are some of the strategic that MDI could be use. * Cost leadership This strategy is the aim at being the lowest cost producer in the industry. A firm that bases its competitive strategy on overall cost leadership must construct the most efficient facilities and obtain the largest share market so that its cost per unit is lowest in the industry. It has the ability to lower price in time of severe price competition and provides a cushion to defend profit levels against competitors. Therefore, experience with building the product is very important such as process of production, delivery and service, which lead to further their cost reductions. To bring the cost to the lowest, MDI have to reduce the import of the dairy raw material form foreign country and examining alternatives suppliers who will give the lowest price of ingredients to the company. MDI also can reduce costs through supporting research into new technologies, and using new technology to improve product value, and increasing productivity, and thus bring down the cost. Besides, the company also can use the incentive pay system in order to motivate worker to produce more of the dairy product.

The Hindenburg Disaster

The Hindenburg Disaster The Hindenburg marked the beginning and the end of transatlantic airships. This 804-foot dirigible filled with over 7 million cubic feet of hydrogen was a crowning achievement of its age. Never before or since has a larger aircraft taken flight. However, the explosion of the Hindenburg changed the landscape for lighter-than-air crafts forever. The Hindenburg is Engulfed in Flames   On May 6, 1937, the Hindenburg carrying 61 crew and 36 passengers arrived hours behind schedule at Lakehurst Naval Air Station in New Jersey. Inclement weather forced this delay. Buffeted by winds and rain, the craft hovered in the area by most accounts for about an hour. The presence of lightning storms were recorded. The landing of the Hindenburg with these types of conditions was against regulations. However, by the time the Hindenburg began its landing, the weather was clearing up. The Hindenburg seems to have been traveling at a fairly fast speed for its landing and for some reason, the Captain attempted a high landing, being winched to the ground from a height of about 200 feet. Soon after the mooring lines were set, some eyewitnesses reported a blue glow on top of the Hindenburg followed by a flame towards the tail section of the craft. The flame was almost simultaneously succeeded by an explosion that quickly engulfed the craft causing it to crash into the ground killing 36 p eople. Spectators watched in horror as passengers and crew were burned alive or jumped to their deaths. As Herb Morrison announced for the radio, Its burst into flames.... Get out of the way, please, oh my, this is terrible...Oh, the humanity and all the passengers. The day after this horrible tragedy occurred, the papers started speculating about the cause of the disaster. Up until this incident, the German Zeppelins had been safe and highly successful. Many theories were talked about and investigated: sabotage, mechanical failure, hydrogen explosions, lightning or even the possibility that it was shot from the sky. On the next page, discover the major theories of what happened on this fateful day in May.   The Commerce Department and the Navy led the investigations into the Hindenburg disaster. However, the Federal Bureau of Investigation also looked into the matter even though it technically had no jurisdiction. President FDR had asked all governmental agencies to cooperate in the investigation. The FBI files released about the incident through the Freedom of Information Act are available online. You must download Adobe Acrobat to read the files. Theories of Sabotage The theories of sabotage began to surface immediately. People believed that maybe the Hindenburg had been sabotaged to harm Hitlers Nazi regime. The sabotage theories centered on a bomb of some sort being placed aboard the Hindenburg and later detonated or some other sort of sabotage performed by someone on board. Commander Rosendahl of the Department of Commerce believed that sabotage was the culprit. (See p. 98 of Part I of the FBI documents.) According to a Memorandum to the Director of the FBI dated May 11, 1937, when Captain Anton Wittemann, the third in command of the Hindenburg, was questioned after the tragedy he said that Captain Max Pruss, Captain Ernst Lehmann and he had been warned of a possible incident. He was told by the FBI Special Agents not to speak of the warning to anyone. (See p. 80 of Part I of the FBI documents.) There is no indication that his claims were ever looked into, and no other evidence arose to support the idea of sabotage. Possible Mechanical Failure Some people pointed to a possible mechanical failure. Many of the ground crew later interviewed in the investigation indicated that the Hindenburg was coming in too fast. They believed that the airship was thrown into a full reverse to slow the craft. (See p. 43 of Part I of the FBI documents.) The speculation arose that this may have caused a mechanical failure which sparked a fire causing the hydrogen to explode. This theory is supported by the fire at the tail section of the craft but not much else. The Zeppelins had a great track record, and there is little other evidence to support this speculation. Was It Shot From the Sky?   The next theory, and probably the most outlandish, involves the dirigible being shot from the sky. The investigation focused on reports of a pair of tracks found near the back of the airfield in a restricted area. However, there were numerous people on hand to watch the amazing event of the Hindenburg landing so these footprints could have been made by anyone. In fact, the Navy had caught a couple of boys who had sneaked into the airfield from that direction. There were also reports of farmers shooting at other dirigibles because they passed over their farms. Some people even claimed that joy seekers shot down the Hindenburg. (See p. 80 of Part I of the FBI documents.) Most people dismissed these accusations as nonsense, and the formal investigation never substantiated the theory that the Hindenburg was shot from the sky. Hydrogen and the Hindenburg Explosion The theory that gained the most popularity and became the most widely accepted involved the hydrogen on the Hindenburg. Hydrogen is a highly flammable gas, and most people believed that something caused the hydrogen to spark, thus causing the explosion and fire. At the beginning of the investigation, the idea arose that the drop lines carried static electricity back up to the airship which caused the explosion. However, the chief of the ground crew denied this claim by the fact that the mooring lines were not conductors of static electricity. (See p. 39 of Part I of the FBI documents.) More credible was the idea that the blue arc seen at the tail of the airship just before it burst into flames was lightning and caused the detonation of the hydrogen. This theory was substantiated by the presence of the lightning storms reported in the area. The hydrogen explosion theory became accepted as the reason for the explosion and led to the end of commercial lighter-than-air flight and the stalling of hydrogen as a reliable fuel. Many people pointed to the flammability of the hydrogen and questioned why helium was not used in the craft. It is interesting to note that a similar event happened to a helium dirigible the year before. So what really caused the end of the Hindenburg? Addison Bain, a retired NASA engineer and hydrogen expert, believes he has the correct answer. He states that while hydrogen might have contributed to the fire, it was not the culprit. To prove this, he points to several pieces of evidence: The Hindenburg did not explode but burned in numerous directions.The airship remained afloat for several seconds after the fire began. Some people report it did not crash for 32 seconds.Fabric pieces fell to the ground on fire.The fire was not characteristic of a hydrogen fire. In fact, hydrogen makes no visible flames.There were no reported leaks; the hydrogen was laced with garlic to give off an odor for easy detection. After years of exhaustive traveling and research, Bain uncovered what he believes is the answer to the Hindenburg mystery. His research shows that the Hindenburgs skin was covered with the extremely flammable cellulose nitrate or cellulose acetate, added to help with rigidity and aerodynamics. The skin was also coated with flecks of aluminum, a component of rocket fuel, to reflect sunlight and keep the hydrogen from heating and expanding. It had the further benefit of combating wear and tear from the elements. Bain claims these substances, although necessary at the time of construction, directly led to the disaster of the Hindenburg. The substances caught fire from an electric spark that caused the skin to burn. At this point, the hydrogen became the fuel to the already existing fire. Therefore, the real culprit was the skin of the dirigible. The ironic point to this story is that the German Zeppelin makers knew this back in 1937. A handwritten letter in the Zeppelin Archive states, The actual cause of the fire was the extreme easy flammability of the covering material brought about by discharges of an electrostatic nature.