The Sweetooth Candy Company was founded in London, England in October 1939. The recent British declaration of war on Germany posed as an opportunity in disguise for Forastero and Trinitario Sweetooth. It was this ambitious couple that reasoned military troops consuming bland rations could benefit from a sweet treat at the end of their meal. Thus, the Sweetooths founded a Candy Company which aimed to raise troop morale while turning a profit at the same time.
After securing contracts from the British government for Sweetooth Candy Company to be the sole supplier of chocolate dessert candies to the entire British Royal Forces, the Sweetooths opened a factory in the suburbs of London. The Sweetooths had been saving for some time, which made possible the purchase of production equipment that involved large fixed capital costs with only limited financing from local banks. Within 6 weeks, Sweetooth had received its first shipment of cocoa and was ready to commence production. The goal was to make small, individually wrapped candies which could be distributed along with food rations. The factory opened on November 27th, 1939 with 18 employees who were capable of producing more than 1,250 chocolate candies per day. This was enough to meet the company’s contractual obligations as well as satisfy local demand.
Sweetooth Candy Company sources its cocoa powder from Africa through an intermediary in Brussels, Belgium. In its early years, Sweetooth’s production of chocolate candies was limited to the amount of cocoa, butter, and milk it could purchase. Wartime rationing made it difficult for Sweetooth to produce any extra candy for retail sale. After the war, however, conditions began to stabilize and the company began to expand its operations. Never outsourcing production, Sweetooth to this day still produces chocolates in its original factory outside of London, and although the production machinery has changed a few times, the Sweetooth secret recipe never has.
Efficiencies discovered through the use of production and operations management combined with state-of-the-art advances in chocolate-producing technology have allowed Sweetooth’s daily candy production to rise to 80,000 pieces (10,000 pieces per hour). Once the British market for Sweetooth’s candy became saturated in the early 1960s, the company began exporting candy to foreign markets in an attempt to continue expanding operations.
Today, Brussels is the largest export market for Sweetooth’s chocolate candies, which have maintained their small, rectangular shape. The material used for wrapping the candies, however, has changed throughout the years from what was originally paper to what is now a more foil-like casing. Sweetooth, in adopting a new wrapping material, did not replace the machines used in wrapping the candy. As a result, the foil material can sometimes slip on the conveyer belt inside the wrapping machine. This results in about 1% of Sweetooth’s candies having a loose wrapping. Because Brussels is such a large consumer of Sweetooth chocolates, the company must send shipments of the candies in bulk to Belgian regional distributors.
These bulk shipments, sent via ship and truck, are not particularly delicate modes of transportation, and as a result the candy can sometimes rattle around during shipping. This, added to an already imperfect wrapping process, causes the 1% of poorly wrapped candies to undergo an alteration of taste that has, as of late, begun to bother end consumers in the Belgian market. Six Sigma Consulting intends to investigate this matter, and make appropriate determinations regarding the steps that Sweetooth should take in order to get its contracts and client relationships back in line.
Saturday, February 7, 2009
Executive Summary
Sustainable growth through innovation, excellent customer service, and attention to detail.
The Sweetooth Candy Company was founded in 1939 in the suburbs of London, England. The company began producing chocolates for the British military soldiers fighting in World War II. Since that time, Sweetooth has grown its operations and market saturation. In a factory with machines that once produced 1,250 chocolate candies per day, Sweetooth has stepped up production and operations to allow for the production of more than 10,000 candies per hour.
This now sizable operation requires precision execution in order to function properly at all times and fabricate products that meet rigorous demands and particular expectations. Yet still, not all machines and processes at Sweetooth can operate flawless at all times.
Lately, consumers have begun to receive chocolates with loose wrappings and altered tastes. Complaints have filtered back through distribution channels to Mrs. Sweetooth, the chocolate factory’s senior manager. Mrs. Sweetooth understands that no production process can be entirely without faults all the time, but because of the complaints she’s received, Mrs. Sweetooth is concerned that the error rate of her company’s operations may be too high. Mrs. Sweetooth is not a Production and Operations Management (aka Operations Science) expert, and as such has contracted the services of our company, Six Sigma Consulting, LLP.
Our team of POM experts visited the Sweetooth factory and collected data from operations as well as from employees. Our team determined that the answers to a few essential questions needed to be uncovered in order to determine the appropriate course of action for Sweetooth.
First, are the chocolate-making machines producing candies with specifications that meet certain criteria? This will determine whether the Sweetooth processes are in statistical control or not. Next, does the wrapping process do a satisfactory job of keeping candies tightly sealed until being opened by end consumers? Lastly, an analysis of the cookie-making operations of Nadisco must be performed to determine the accuracy of Nadisco’s product claims.
Data from sampling has allowed our team to determine the average thickness of candies produced, the upper and lower control limits for both the means and ranges of the data, and the Six Sigma spread for individual pieces of candy. Our analysis indicates that the candy-making process for Sweetooth is in statistical control and does not need to be stopped. The data also show the wrapping process to be generally satisfactory. In one sample there were outlying data that hinted at a problem with wrapping, but because this occurrence was infrequent on nonrecurring in nature, we suggest the company simply keeps an eye on the wrapping process in the future. As a note, however, the very particular distributor who will accept their order only if 1% or fewer of the candies is badly wrapped, poses a problem for Sweetooth. Sampling data and subsequent calculations indicate that the risk of shipment rejection for Sweetooth is roughly 26.42%. This number is far too high, and Sweetooth should be wary of these odds.
With regard to the analysis of the cookie operations, Nadisco’s claim of 1,000 chocolate chips per box of cookies is not met. Not only that, the company’s mixing process seems to be flawed to the extent that it could be affecting the distribution of chips in the cookies themselves. Six Sigma Consulting’s recommendations for Nadisco, with regard to this matter, is to either add more chips to the mixing process, or improve the mixing process itself. The former option would actually improve Sweetooth’s bottom line because more chocolate would need to be purchased. The latter option would assure that average number of chips per cookie is much more consistent. With this kind of consistency, fewer chocolate chips would be needed to assure the 1,000 chips-per-box guarantee. Either way, implementing one of these two options should assure improved results at Nadisco.
Taking into account all the data collection and analysis performed by our team, the manufacturing processes of both Sweetooth and Nadisco can be streamlined and made more accurate for better future performance in the production of chocolate chips and cookies. As a result, customer satisfaction should increase, and subsequently lead to increased demand for both products.
The Sweetooth Candy Company was founded in 1939 in the suburbs of London, England. The company began producing chocolates for the British military soldiers fighting in World War II. Since that time, Sweetooth has grown its operations and market saturation. In a factory with machines that once produced 1,250 chocolate candies per day, Sweetooth has stepped up production and operations to allow for the production of more than 10,000 candies per hour.
This now sizable operation requires precision execution in order to function properly at all times and fabricate products that meet rigorous demands and particular expectations. Yet still, not all machines and processes at Sweetooth can operate flawless at all times.
Lately, consumers have begun to receive chocolates with loose wrappings and altered tastes. Complaints have filtered back through distribution channels to Mrs. Sweetooth, the chocolate factory’s senior manager. Mrs. Sweetooth understands that no production process can be entirely without faults all the time, but because of the complaints she’s received, Mrs. Sweetooth is concerned that the error rate of her company’s operations may be too high. Mrs. Sweetooth is not a Production and Operations Management (aka Operations Science) expert, and as such has contracted the services of our company, Six Sigma Consulting, LLP.
Our team of POM experts visited the Sweetooth factory and collected data from operations as well as from employees. Our team determined that the answers to a few essential questions needed to be uncovered in order to determine the appropriate course of action for Sweetooth.
First, are the chocolate-making machines producing candies with specifications that meet certain criteria? This will determine whether the Sweetooth processes are in statistical control or not. Next, does the wrapping process do a satisfactory job of keeping candies tightly sealed until being opened by end consumers? Lastly, an analysis of the cookie-making operations of Nadisco must be performed to determine the accuracy of Nadisco’s product claims.
Data from sampling has allowed our team to determine the average thickness of candies produced, the upper and lower control limits for both the means and ranges of the data, and the Six Sigma spread for individual pieces of candy. Our analysis indicates that the candy-making process for Sweetooth is in statistical control and does not need to be stopped. The data also show the wrapping process to be generally satisfactory. In one sample there were outlying data that hinted at a problem with wrapping, but because this occurrence was infrequent on nonrecurring in nature, we suggest the company simply keeps an eye on the wrapping process in the future. As a note, however, the very particular distributor who will accept their order only if 1% or fewer of the candies is badly wrapped, poses a problem for Sweetooth. Sampling data and subsequent calculations indicate that the risk of shipment rejection for Sweetooth is roughly 26.42%. This number is far too high, and Sweetooth should be wary of these odds.
With regard to the analysis of the cookie operations, Nadisco’s claim of 1,000 chocolate chips per box of cookies is not met. Not only that, the company’s mixing process seems to be flawed to the extent that it could be affecting the distribution of chips in the cookies themselves. Six Sigma Consulting’s recommendations for Nadisco, with regard to this matter, is to either add more chips to the mixing process, or improve the mixing process itself. The former option would actually improve Sweetooth’s bottom line because more chocolate would need to be purchased. The latter option would assure that average number of chips per cookie is much more consistent. With this kind of consistency, fewer chocolate chips would be needed to assure the 1,000 chips-per-box guarantee. Either way, implementing one of these two options should assure improved results at Nadisco.
Taking into account all the data collection and analysis performed by our team, the manufacturing processes of both Sweetooth and Nadisco can be streamlined and made more accurate for better future performance in the production of chocolate chips and cookies. As a result, customer satisfaction should increase, and subsequently lead to increased demand for both products.
Conclusions and Recommendations
It’s time to invest in the future of the shining star of the Middle East: The United Arab Emirates.
The UAE is an emerging market full of opportunities. In a land immersed in culture, expatriates from across the globe outnumber locals 4-to-1. The government not only allowed this to happen—it encouraged the phenomenon by creating business laws so favorable to FDI and industry that foreign investors simply could not resist. The UAE has become a hub for international finance, and its GDP and population continue to soar. A larger population brings with it larger demand, and it is this major growth opportunity that M.E.L.F. intends to capitalize on. Startup costs for a business in the UAE are a pittance compared to the amount of capital it would take to establish a similar business in a developed economy. Developed economies have mature industries that maintain a stranglehold on competition. The UAE on the other hand, is still developing. Its population is presently growing at more than 6% each year, and that’s only a fraction of the yearly nominal GDP growth. The fact of the matter is that companies everywhere are seizing the opportunity to do establish businesses in a country that is overwhelmingly welcome to foreign investment. The government of UAE charges no taxes to businesses, allows 100% foreign ownership of companies based solely in the UAE, and allows full repatriation of all earnings. The UAE government can afford to take this approach because as businesses move in, the infrastructure of the country experiences an enhancement. This might imply that companies looking to establish a business in the UAE need to aid in this process, but even that assumption is practically untrue. Booming business in the UAE has led to the construction of thousands of buildings which can be rented for just about any desired purpose. The beauty of the M.E.L.F. proposal is that all the facilities required to do start a factory, warehouse goods, and set up an office can be rented on a yearly basis for very reasonable rates. Should the business do exceedingly well in its first few years of operations, building a permanent, privately owned complex to move or expand operating activities to is quite easily feasible.
The UAE is an emerging market full of opportunities. In a land immersed in culture, expatriates from across the globe outnumber locals 4-to-1. The government not only allowed this to happen—it encouraged the phenomenon by creating business laws so favorable to FDI and industry that foreign investors simply could not resist. The UAE has become a hub for international finance, and its GDP and population continue to soar. A larger population brings with it larger demand, and it is this major growth opportunity that M.E.L.F. intends to capitalize on. Startup costs for a business in the UAE are a pittance compared to the amount of capital it would take to establish a similar business in a developed economy. Developed economies have mature industries that maintain a stranglehold on competition. The UAE on the other hand, is still developing. Its population is presently growing at more than 6% each year, and that’s only a fraction of the yearly nominal GDP growth. The fact of the matter is that companies everywhere are seizing the opportunity to do establish businesses in a country that is overwhelmingly welcome to foreign investment. The government of UAE charges no taxes to businesses, allows 100% foreign ownership of companies based solely in the UAE, and allows full repatriation of all earnings. The UAE government can afford to take this approach because as businesses move in, the infrastructure of the country experiences an enhancement. This might imply that companies looking to establish a business in the UAE need to aid in this process, but even that assumption is practically untrue. Booming business in the UAE has led to the construction of thousands of buildings which can be rented for just about any desired purpose. The beauty of the M.E.L.F. proposal is that all the facilities required to do start a factory, warehouse goods, and set up an office can be rented on a yearly basis for very reasonable rates. Should the business do exceedingly well in its first few years of operations, building a permanent, privately owned complex to move or expand operating activities to is quite easily feasible.
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