2nd Assignment-TQM (1)

8/3/2019 2nd Assignment-TQM (1)

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TOPIC OF THE STUDY

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KAIZEN IS AN IMPORTANT PHILOSOPHY USED IN

CONTINUOUS QUALITY IMPROVEMENT PROCESS. DISCUSS THIS APPROACH

BY STUDYING THE MANUFACTURING SECTOR

This Japanese word has been associated with many Lean Manufacturing techniques and more specifically the Toyota Production

System. In Japanese this word is pronounced 'kaizen'. KAI means 'change' or 'the action to correct' while ZEN means 'good'. So quite

literally Kaizen means a change for good or an action to correct something to make it better. The Chinese translation is extremely

similar. The only addition is that the Chinese translation adds a component of "benefit" to the definition of the word. In this regard the

term Kaizen refers to good changes that not only benefits the business but also the society. In the Chinese translation it is assumed

that one of these two parties cannot possibly benefit at the other party's expense. Therefore the Kaizen changes are to be mutually

beneficial to all or they are not true to the Kaizen methodology.

THE KAIZEN STRATEGY

In English the term Kaizen and the workplace strategy referred to as Continuous Process Improvement are often used

interchangeably. Like many of its complementary partners, Kaizen aims to improve productivity in the work place by minimizing and

eliminating waste. Waste in the workplace is defined as activities that add cost but do not add value. More specifically Kaizen tries to

eliminate this waste not simply by picking it out and ridding the production line of individual components, but rather by creating a

standardized "better way" of operating.

This "better way" of operating involves many elements, five of which are mentioned specifically. They are: teamwork, personal

discipline, improved morale, quality circles, and suggestions for improvement. These founding principles demonstrate well just how

different Kaizen strategies are from other less personal lean manufacturing methods. When executed correctly, Kaizen not only

improves productivity, but it also humanizes the workplace, eliminates overly hard work (both mental and physical), and teaches

employees of all positions how to identify and create solutions for everyday problems or inefficiencies that they may encounter. Smal

changes made by individuals are meant to build a long term transformation.

Naturally, there needs to be order as far as what types of changes are implemented on a large scale, and therefore brainstorming

groups are often guided through the Kaizen process by a supervisor of some sort. Nurturing such a culture where continuous

improvement is a way of life will lead to innovations yielded from a pool of contributors much larger than any room of board room

executives or management team. In this atmosphere of small changes and experimentation, employees are not discouraged by other

more common managerial strategies that involve a type of "command and control" mentality. Every member of the company has a

voice through which they can express their ideas not only for how their own job can be improved, but alsofor how the company as a

whole can make improvements to eliminate those procedures that are not needed.

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It is sometimes difficult to implement a new method, especially one that may be as drastically different as Kaizen may be for some

organizations. So it may be simpler to start the implementation process by first following these three steps:

1. RE-ALIGN THE FOCUS OF MANAGERIAL TECHNIQUES:-In Kaizen, the worker is attributed

with much of the credit as far as contribution for continual improvement methods are concerned. The idea is that when Kaizen

methods are implemented correctly, the worker see that benefits of having a job that is more productive, less physically demanding

(and ultimately safe) and more efficient. The worker is an actively contributing member of a support group that is working towards

making the work day more pleasant and rewarding.

2. IMPROVE EQUIPMENT:-Your next focus, after your employees, should be on your equipment and how you can

improve it. Changing machine layout and installing devices to improve their function are just a few suggestions.

3.CREATE A PLAN:-Continuous improvement doesn't just happen, you have to have a plan. It is unlikely that improving

procedures will have a long term effect if there is no plan by which they can be measured and identified.

THE KAIZEN WAY OF THINKING / MANAGING

The Kaizen way of thinking is not something that comes naturally to all managers. Kaizen is unique in that it focuses on both

maintenance and improvement at the same time, two concepts that some would assume are contradictory in ways. What Kaizen

methods suggest that may help to clear up this misunderstanding is that the maintenance aspect of the thinking style pertains to the

standards that are currently being upheld by management and the maintenance of technological and operating standards. Obviously, if

there are no policies or rules for these sorts of standards, they will need to be established before they can be maintained. The term

standard operating procedures (SOP) is one that is frequently used when Kaizen methods are being explained so it is important to

understand what exactly these SOP's are for your company or production line.

Improvement is also central to the Kaizen way of thinking and managing. Once standard operating procedures are in place, it is

management's job to work towards the revising and improvement of those standard practices. Very gradually, higher and higher

standards are set for the company (obviously at a pace that does not deplete the company of its resources or its employees of their

energy and enthusiasm). Improvement and innovation go hand in hand. Innovative ideas are constantly needed if the company is to

achieve levels of productivity, quality and efficiency on a continually improving basis. Kaizen is unique in that improvement and

innovation are recognized as features that are gradual and will not necessarily yield drastic improvements, nor are such drastic

improvements a benefit to the company. It is the coordinated and continuous efforts of all the employees in an organization that can

truly change that organization for the better. Managerial attitudes towards this coordinated effort of all employees can be either

instrumental or detrimental in the overall result of the application of the Kaizen methods. How an organization meets and masters

change, or in other words, their attitude towards this new way of thinking will quickly reveal whether or not Kaizen is right for your

company

The term Quality management has a specific meaning within many business sectors. This specific definition, which does not aim to

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assure 'good quality' by the more general definition (but rather to ensure that an organisation or product is consistent), can be

considered to have four main components: quality planning, quality control, quality assurance and quality improvement. Quality

management is focused not only on product/service quality, but also the means to achieve it. Quality management therefore uses

quality assurance and control of processes as well as products to achieve more consistent quality.

QUALITY MANAGEMENT EVOLUTION

Quality management is a recent phenomenon. Advanced civilizations that supported the arts and crafts allowed clients to choose

goods meeting higher quality standards than normal goods. In societies where art responsibilities of a master craftsman (and similarly

for artists) was to lead their studio, train and supervise the on, the importance of craftsmen was diminished as mass production and

repetitive work practices were instituted. The aim was to produce large numbers of the same goods. The first proponent in the US for

this approach was Eli Whitney who proposed (interchangeable) parts manufacture for muskets, hence producing the identical

components and creating a musket assembly line. The next step forward was promoted by several people including Frederick

Winslow Taylor a mechanical engineer who sought to improve industrial efficiency. He is sometimes called "the father of scientific

management." He was one of the intellectual leaders of the Efficiency Movement and part of his approach laid a further foundation

for quality management, including aspects like standardization and adopting improved practices. Henry Ford also was important in

bringing process and quality management practices into operation in his assembly lines. In Germany, Karl Friedrich Benz, often

called the inventor of the motor car, was pursuing similar assembly and production practices, although real mass production was

properly initiated in Volkswagen after World War II.

From this period onwards, North American companies focused predominantly upon production against lower cost with increased

efficiency. Walter A. Shewhart made a major step in the evolution towards quality management by creating a method for quality

control for production, using statistical methods, first proposed in 1924. This became the foundation for his ongoing work on

statistical quality control. W. Edwards Deming later applied statistical process control methods in the United States during World War

II, thereby successfully improving quality in the manufacture of munitions and other strategically important products. Quality

leadership from a national perspective has changed over the past five to six decades. After the second world war, Japan decided to

make quality improvement a national imperative as part of rebuilding their economy, and sought the help of Shewhart, Deming

and Juran, amongst others. W. Edwards Deming championed Shewhart's ideas in Japan from 1950 onwards. He is probably best

known for his management philosophy establishing quality, productivity, and competitive position. He has formulated 14 points of

attention for managers, which are a high level abstraction of many of his deep insights. They should be interpreted by learning and

understanding the deeper insights and include:

Break down barriers between departments

Management should learn their responsibilities, and take on leadership

Improve constantly

Institute a programme of education and self-improvement

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In the 1950s and 1960s, Japanese goods were synonymous with cheapness and low quality, but over time their quality initiatives

began to be successful, with Japan achieving very high levels of quality in products from the 1970s onward. For example, Japanese

cars regularly top the J.D. Power customer satisfaction ratings. In the 1980s Deming was asked by Ford Motor Company to start a

quality initiative after they realized that they were falling behind Japanese manufacturers. A number of highly successful quality

initiatives have been invented by the Japanese (see for example on this page: Taguchi, QFD, Toyota Production System. Many of the

methods not only provide techniques but also have associated quality culture (i.e. people factors). These methods are now adopted by

the same western countries that decades earlier derided Japanese methods.

In the 1950s and 1960s, Japanese goods were synonymous with cheapness and low quality, but over time their quality initiatives

began to be successful, with Japan achieving very high levels of quality in products from the 1970s onward. For example, Japanese

cars regularly top the J.D. Power customer satisfaction ratings. In the 1980s Deming was asked by Ford Motor Company to start a

quality initiative after they realized that they were falling behind Japanese manufacturers. A number of highly successful quality

initiatives have been invented by the Japanese (see for example on this page: Taguchi, QFD, Toyota Production System. Many of the

methods not only provide techniques but also have associated quality culture (i.e. people factors). These methods are now adopted by

the same western countries that decades earlier derided Japanese methods.

PRINCIPLES

Quality management adopts a number of management principles that can be used by top management to guide their organizations

towards improved performance. The principles include:

CUSTOMER FOCUS

Since the organizations depend on their customers, therefore they should understand current and future customer needs, should meet

customer requirements and try to exceed the expectations of customers. An organization attains customer focus when all people in the

organization know both the internal and external customers and also what customer requirements must be met to ensure that both the

internal and external customers are satisfied.

LEADERSHIP

Leaders of an organization establish unity of purpose and direction of it. They should go for creation and maintenance of such an

internal environment, in which people can become fully involved in achieving the organization's quality objective.

INVOLVEMENT OF PEOPLE

People at all levels of an organization are the essence of it. Their complete involvement enables their abilities to be used for the

benefit of the organization.

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PROCESS APPROACH

The desired result can be achieved when activities and related resources are managed in an organization as process.

SYSTEM APPROACH TO MANAGEMENT

An organization's effectiveness and efficiency in achieving its quality objectives are contributed by identifying, understanding and

managing all interrelated processes as a system.

CONTINUAL IMPROVEMENT

One of the permanent quality objectives of an organization should be the continual improvement of its overall performance.

FACTUAL APPROACH TO DECISION MAKING

Effective decisions are always based on the data analysis and information.

MUTUALLY BENEFICIAL SUPPLIER RELATIONSHIPS

Since an organization and its suppliers are interdependent, therefore a mutually beneficial relationship between them increases the

ability of both to add value. These eight principles form the basis for the quality management system standard ISO 9001:2008.

QUALITY IMPROVEMENT

There are many methods for quality improvement. These cover product improvement, process improvement and people based

improvement. In the following list are methods of quality management and techniques that incorporate and drive quality

improvement:

1. ISO 9004:2008 - guidelines for performance improvement.

2. ISO 15504-4: 2005 - information technology - process assessment -

Part 4: Guidance on use for process improvement and process capability determination.

3. QFD - quality function deployment, also known as the house of quality approach.

4. Kaizen - Q5(~, Japanese for change for the better; the common English term is continuous improvement.

5. Zero Defect Program -- created by NEC Corporation of Japan,based upon statistical process control and one o

the inputs for the inventors of Six Sigma.

6. Six Sigma - 60, Six Sigma combines established methods such as statistical process control, design o

experiments and failure mode and effects analysis (FMEA) in an overall framework.

7. PDCA - plan, do, check, act cycle for quality control purposes. (Six Sigma's DMAIC method (define, measur

analyze, improve, control) may be viewed as a particular implementation of this.)

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8. Quality circle - a group (people oriented) approach to improvement.

9. Taguchi methods - statistical oriented methods including quality robustness, quality loss function, and targe

specifications.

10. The Toyota Production System - reworked in the west into lean manufacturing.

11. Kansei Engineering - an approach that focuses on capturing customer emotional feedback about products to driv

improvement.

12. TQM - total quality management is a management strategy aimed at embedding awareness of quality in a

organizational processes. First promoted in Japan with the Deming prize which was adopted and adapted in USA as the Malcolm

Baldrige National Quality Award and in Europe as the European Foundation for Quality Management award (each with their own

variations).

13. TRIZ - meaning "theory of inventive problem solving"

14. BPR - business process reengineering, a management approach aiming at 'clean slate' improvements (That ignoring existing practices).

15. OQM - Object-oriented Quality Management, a model for quality management.

Proponents of each approach have sought to improve them as well as apply them for small, medium and large gains. Simple one is

Process Approach, which forms the basis of ISO 9001 :2008 Quality Management System standard, duly driven from the 'Eight

principles of Quality management', process approach being one of them. Thareja writes about the mechanism and benefits: "The

process (proficiency) may be limited in words, but not in its applicability. While it fulfills the criteria of all-round gains: in terms of

the competencies augmented by the participants; the organisation seeks newer directions to the business success, the individual brand

image of both the people and the organisation, in turn, goes up. The competencies which were hitherto rated as being smaller are

better recognized and now acclaimed to be more potent and fruitful". The more complex Quality improvement tools are tailored for

enterprise types not originally targeted. For example, Six Sigma was designed for manufacturing but has spread to service enterprises

Each of these approaches and methods has met with success but also with failures.

Some of the common differentiators between success and failure include commitment, knowledge and expertise to guide

improvement, scope of change/improvement desired (Big Bang type changes tend to fail more often compared to smaller changes)

and adaption to enterprise cultures. For example, quality circles do not work well in every enterprise (and are even discouraged by

some managers), and relatively few TQM-participating enterprises have won the national quality awards.

There have been well publicized failures of BPR, as well as Six Sigma. Enterprises therefore need to consider carefully which quality

improvement methods to adopt, and certainly should not adopt all those listed here. It is important not to underestimate the people

factors, such as culture, in selecting a quality improvement approach. Any improvement (change) takes time to implement, gain

acceptance and stabilize as accepted practice. Improvement must allow pauses between implementing new changes so that the change

is stabilized and assessed as a real improvement, before the next improvement is made (hence continual improvement, not continuous

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improvement). Improvements that change the culture take longer as they have to overcome greater resistance to change. It is easier

and often more effective to work within the existing cultural boundaries and make small improvements (that is Kaizen)

than to make major transformational changes. Use of Kaizen in Japan was a major reason for the creation of Japanese industrial and

economic strength.

On the other hand, transformational change works best when an enterprise faces a crisis and needs to make major changes in order to

survive. In Japan, the land of Kaizen, Carlos Ghosn led a transformational change at Nissan Motor Company which was in a financial

and operational crisis. Well organized quality improvement programs take all these factors into account when selecting the quality

improvement methods.

QUALITY STANDARDS

The International Organization for Standardization (ISO) created the Quality Management System (QMS) standards in 1987. They

were the ISO 9000:1987 series of standards cornprisinq ISO 9001:1987, ISO 9002:1987 and ISO 9003: 1987; which were applicablein different types of industries, based on the type of activity or process: designing, production or service delivery. The standards are

reviewed every few years by the International Organization for Standardization. The version in 1994 was called the ISO 9000: 1994

series; consisting of the ISO 9001:1994, 9002:1994 and 9003:1994 versions. The last major revision was in the year 2008 and the

series was called ISO 9000:2000 series. The ISO 9002 and 9003 standards were integrated into one single certifiable standard: ISO

9001:2008. After December 2003, organizations holding ISO 9002 or 9003 standards had to complete a transition to the new standard

ISO released a minor revision, ISO 9001:2008 on 14 October 2008. It contains no new requirements. Many of the changes were to

improve consistency in grammar, facilitating translation of the standard into other languages for use by over 950,000 certified

organisations in the 175 countries (as at Dec 2007) that use the standard. The ISO 9004:2009 document gives guidelines for

performance improvement over and above the basic standard (ISO 9001:2000). This standard provides a measurement framework for

improved quality management, similar to and based upon the measurement framework for process assessment. The Quality

Management System standards created by ISO are meant to certify the processes and the system of an organization, not the product or

service itself. ISO 9000 standards do not certify the quality of the product or service.

In 2005 the International Organization for Standardization released a standard, ISO 22000, meant for the food industry. This standard

covers the values and principles of ISO 9000 and the HACCP standards. It gives one single integrated standard for the food industry

and is expected to become more popular in the coming years in such industry. ISO has also released standards for other industries. For

example Technical Standard TS 16949 defines requirements in addition to those in ISO 9001:2008 specifically for the automotive

industry. ISO has a number of standards that support quality management. One group describes processes (including ISO 12207 &

ISO 15288) and another describes process assessment and improvement ISO 15504. The Software Engineering Institute has its own

process assessment and improvement methods, called CMMi (Capability Maturity Model- integrated) and IDEAL respectively.

QUALITY SOFTWARE

The software used to track the three main components of quality management through the use of databases and/or charting

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applications.

QUALITY TERMS

Quality Improvement can be distinguished from Quality Control in that Quality Improvement is the purposeful change of aprocess to improve the reliability of achieving an outcome.

Quality Control is the ongoing effort to maintain the integrity of a process to maintain the reliability of achieving an

outcome.

QualityAssurance is the planned or systematic actions necessary to provide enough confidence that a product or service will

satisfy the given requirements.

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CASE STUDY

PLAY WOOD TOYS

It is a partnership small business, established by five partners - Haroon Chaudhry, Muhammad Zeeshan Yaqoob, Muneeb Arshad

Zoeed Arshad and Moazim Hussain of manufacturing unique and specialized educational wooden toys, aside from providing fun,

pleasure it is fostering creativity and sharing and providing the children with hours of entertainment. These toys engage the child's

imagination and creativity. These toys are made for the children of age between 4 to 7years, and in keeping the point of view of the

parents about what they want for their children. These toys can be dangerous to young children, especially children under three years

of age. These toys are not for infants, toddlers and all children who still mouth objects. Children can play with these toys at every

location: the nursery, car, daycare, school, babysitter's, grandparent's house, etc....

PLAY WOOD is making toys, for 4-7 years old kids, by keeping in mind the following:

Toys should be safe for the specific age group (4-9years)

Toys should be easy to clean

Toys should be easy to handle

Children can get as much fun and pleasure from playing with shoeboxes, car keys and saucepans as they can but they can provide

harm to them, PLAY WOOD is developed with a purpose to provide children something which can improve their learning skills

along with providing fun and pleasure and can be trusted by parents. This small business is started with little money, the founders

used their own savings but as the business grows bank loan would be a source of finance. Encouraged by the desire of parents to push

their children to learn things at ever younger ages, educational aids are being targeted at ever-younger audiences by this small

business. Most of the money lavished on toys for very young children was spent on products claiming to increase their intelligence or

enhance specific motor or cognitive skills. Parents who hope to boost the IQ levels of their kids; this business is developed to help

them out. This business is contributing to the economic growth by introducing new products. The jobs created by this small business

are meant for carpenter and the painter. It has no factories and all its toys are made on contract by outside suppliers which give the

flexibility to change its designs quickly.

Other than the manufacturing of the toys all other tasks are being played by the owner themselves, they may find themselves working

12-hr days week in and week out they may function as a financial planner, personnel manager even the owners themselves provide the

carpenter with the wood and the painter with the paints but as the business grows number of employees will go on increasing. PLAY

WOOD is meant for manufacturing specialized toys for 4 t07 years' old school going children so it can compete successfully against

rivals. There is huge potential for the wooden toys in the Pakistan; a big part of the potential market is still un-served. PLAY WOOD

is making educational toys for children between 4-7 years of age and in Pakistan after every 10 seconds a child is turning in to 4-6.

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RESEARCH ANALYSIS

To start the small business of making and selling wooden toys the first most important task is to analyze what type of wooden toys are

required by the children and what kind of interests children have so that we come to what styles and what designs the wooden toys

should have to attract huge volumes of the customers. The partners come to know that there is a lot of potential in Lahore market for

this particular segment so the partners of PLAY WOOD went to 2 toy shops, located in the Moon Market from where children

belonging to middle class of Allama iqbal town mostly buy toys, and these shops have toys ranging from Rs 50 to Rs4050 including

wooden, plastic, paper toys and most of them are those which can run only with batteries and electricity so they came to know that

majority of children (both boys and girls) are attracted by colorful toys but parents only make the purchases of those toys which they

think would not break up and of reasonable prices. Retailers told the partners that educational toys are mostly purchased by the

schools but parents mostly buy such toys which are related to sports like for their baby boys they small wooden bats, wooden hockey

wooden cars and wooden horses etc. The light weight wooden toys which have alphabets over them with colorful and beautiful

pictures painted over them have always been a part of the attraction of the school going children.

SITUATION MARKET ANALYSIS

It is observed that toy industry of Pakistan isn't in a good condition especially the wooden toy industry. However the local toy industry

is progressing in a positive direction and creating a new trend in the children of Pakistan to play with wooden! plastic toy rather than

playing with electronic toys. According to SMEDA (Small and Medium Enterprise Development Authority) the Pakistani government

is to trying to provide a plate form to coordinate with the all efforts and utilize the small toys industry of Pakistan becouse there is a

significant export potential particularly to Central Asian Republics and Dubai, our government need to help out these small industry in

order to get the maximum benefits out of it. Now our government realizes that non- electronic and semi-electronic toys industry can

make a great contribution to Pakistan's GDP. BOI (board of Investment) Holds the views that "The export sales of toys from Pakistan

can be improved with the recent efforts of government such as providing assistance to local manufacturers so that they should be able

to improve their capabilities such as; product range, product quality, price, order size assortment, delivery time, total quality control,

management system, and marketing activities."

On the other hand The Pakistani child does not get enough toys. It is known that toys of certain types contribute to mental

development such as educational toys that is why Toy factories are established by the state and their products sold cheap at subsidized

rates or given free to the children of poor parents and government is also providing some subsidies to privately owned toy companies

in Pakistan. Most of the education toys are imported from China and Thailand but these imports are still unable to meet the given

requirement of toys of Pakistan plus a great portion of reserves is invested on it. That is why government is supporting the local toy

industry of Pakistan to not just the local requirement but also export the non electronic and semi - electronic toys. The statistics of

Pakistan's population and the proportion of 0-4 and 5-9 children in it are shown down. Now days the wooden toys are demanded

domestically by some fast food restaurant and school, the parent want to buy such type toys for their children which are less in cost

and which should also be helping to improve their children's intellectual abilities and their child should enjoy it for long ime.

MANAGEMENT PLAN

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The five partners came up with an idea of making wooden toys, which should be unique of its kind, which should sell in the market of

Lahore for its first years because there is a lot of potential in Lahore market for this particular segment.

VISION STATEMENT

"To be a most preferred company for our customers that best satisfies their requirements."

MISSION STATEMENT

"Our Mission is to provide the wooden toy trough the median of direct marketing with the combine use of latest technology, Classic

Wood is socially responsible company which provides the opportunity for enrichment and growth of its employees. While maintaining

the sufficient profitability"

FUTURE SUCCESS

The company will be making all the efforts to make its toy one the best and one the favorite toys in Lahore and the company expects

it's all the members to contribute in the achievement of the company's long term objectives and goals.

KSF (KEY SUCCESS FACTORS)

The key success factors are those factors which can lead any company to success. We have categories our KSF's in two basic Factors.

PERSONAL PROCESS OF ENTREPRENEURS

1) Idea of product

2) Intellectual, managing and communication skills of entrepreneurs

3) Education

There are three most important factors under the personal process; these are the factors which will be brought in

to the business entrepreneurs. The idea of starting up a business to satisfy the given need of customers can be

our primary success factor, so we need focus that our this factor and it should be given priority upon both of the

other success factors, means we will have to come up with new ideas when even there is need for it in the

market.

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BUSINESS PROCESS OF VENTURE

1) Product 2) Marketing 3) Distribution 4) Maintenance of Accounts

MARKET ANALYSIS: It is observed that toy industry of Pakistan isn't in a good condition especially the wooden toy industry.

However the local toy industry is progressing in a positive direction and creating a new trend in the children of Pakistan to play with

wooden/ plastic toy rather than playing with electronic toys. According to SMEDA (Small and Medium Enterprise Development

Authority) the Pakistani government is to trying to provide a plate form to coordinate with the all efforts and utilize the small toys

industry of Pakistan becouse there is a significant export potential particularly to Central Asian Republics and Dubai, our government

need to help out these small industry in order to get the maximum benefits out of it. Now our government realizes that non- electronic

and semi-electronic toys industry can make a great contribution to Pakistan's GDP. 801 (board of Investment) Holds the views that

"The export sales of toys from Pakistan can be improved with the recent efforts of government such as providing assistance to local

manufacturers so that they should be able to improve their capabilities such as; product range, product quality, price, order size

assortment, delivery time, total quality control, management system, and marketing activities." Potential for Toy Business in Pakistan

Market size Growth: There is huge potential for the wooden toy in the Pakistan; a big part of the potential market is still un-served.

PLAY WOOD is making educational toys for children between 4-7 years and in Pakistan after every 10 seconds a child is turning in

to 4-7. These figures are telling that there is big targeting market which needs to be served. The proper segmentation and right

identification of customers who have to enough discretionary income can help to attain good profitable and long term sustainability of

the business and customer satisfaction.

MARKET SEGMENTATION

Age children of age between 4-7years---Gender both boys and girls

TARGET MARKET

Our targeted market segment is middle- middle upper and off course the upper as well. Measured by purchasing power. We can see

that our business has a market of 30 million to be targeted. Punjabis constitute 58 percent of it. If we just examine the schools in our

society. We will come to know that now days the wooden educational toys are demanded by the schools, because they children learn

more while playing with toys. According to the information officer of Resource Academia she said "Children (Aged 4-7) learn more

with the help of toy rather than studying from books and they don't remember it for long time, teachers have to repeat again and again

the same lesson, but thanks to today's some good educational toys our this problem solved". This statement shows that teachers of the

schools do realize they need toy for make the students learn with fun. So our customer can be schools as well and there are 14,748

primary schools reported in the FBS (Federal Bureau of Statistics). Obviously we can't target all of the school, but schools can also be

our primary customers.

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OPPORTUNITIES IN THE INTERNATIONAL MARKET

The market is posing the tremendous opportunities for wooden toys, and also there are export opportunities to E.U (European Union)

and U.S.A. According to Zenoxe (a wooden toy company in china) only less than 20% of the world population (between 4-6) isenjoying wooden toys so there is still a great potential for exports on the global level.

MARKETING MIX

Target market

Product

Place

Promotion

Price

Product Idea

Brand

After Sale Service

Promotion

PRODUCT

PLAY WOOD is producing wooden toys which are educational, improving the learning and an intellectual skill of the kids, attractive

colorful, doesnt having sharp edges, children can handle them without any difficulty. The toys are made of a special kind of woodnamely "Processed PINE" which is processed in Malaysia it is water prove (in Pakistan it is known as Lasani Wood). These wooden

toys are made for children of age between 4-7years. PLAY WOOD is making toys for both baby girls and baby boys. The pictures on

the toys are made colorful by painting them with vegetable oil based paints, these paints cant be rubbed off and don't provide any

poisonous harm if the child puts the toy into his/her mouthThe toys made by our company are basically meant for providing fun,

pleasure to the child and make the child able to learn something. The Quality and the product safety is not compromised at any cost

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the paint which is used on the toy for pictures and alphabet is vegetable oil paint which isn't harmful for human use even if it is

Swallowed by the child while playing and it can last for a long time on the product, to beautify it

PACKAGING

The wooden toys of PLAY WOOD are wrapped in beautifully designed packs over which the picture of the toy along with the brand

name is printed. The packing material is durable and it will not be wasted after taking the toy once out of it. Wood sun is packed in a

blue colored pack; the size of the pack is according to the size of the wood sun.

QUALITY

PLAY WOOD do not compromise the Quality and the product safety at any cost, the paint used on the toys for pictures and alphabets

are vegetable oil bases paint which are not harmful for human use even, and it can last for a long time on the product, to beautify it

PRICE

Our organization's main purpose is to establish good reputation in our customers mind and provide them best possible services at the

competitive and affordable price. For at least first year company will just charge 10% profit of total cost of the product. Consumer

buys the product only if the perceived value is equal or greater than perceived price (1.1). For the first year company will try to

increase the perceived value of product and will provide the product on the less than perceived price for consumer for this company

can reduces it profit by less 20% if needed and will try to develop a good reputation in he consumer's mind Perceived Value Perceived

price

PRICING

PLAYWOOD is a for- profit-organization having goal to get maximum profit. But in the beginning the price of our toys is relatively

less and we aim to provide our customers maximum satisfaction at low prices.

DIRECT MARKETING

Inbeginning the company will adopt face to face communication route, the owners will go to the toy shops, schools, fast food

restaurants and to make them aware of their wooden toys by showing them the catalogue, telling them the benefits which the children

can get from their toys by comparing with other toys available in the market. As the target customers are the middle class of Lahore,

to position the toys, the owners adopt the way of direct marketing.

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Documents

2nd Assignment-TQM (1)