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Dairy Plant Management Issues Paper #1

DS 421 – Howard Bonnemann

Nicole Jax - 10/15/2014

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GOALS

In order for a facility to be successful there must be goals put into place that are easily understood, have a target implementation date, require additional effort, and that is attainable. These goals should also have an end point in which the employees can measure their success. In this start- up specialty hard cheese facility, I would implement goals that management and employees can be proud of achieving. One of the goals would be to have less than 15 percent of employee turnover after two years. This will be reached by thoroughly interviewing qualified candidates and by making sure that they are happy with their compensation and benefits packages. The cost of a disgruntled employee is great. They may start “milking” the clock, or making simple mistakes, in which costs the company time, therefore money. Doing this will also help the company decrease training and hiring costs. I would also make it a goal to have the employees working consistent hours. Changing employee’s schedules can also be very tiring on the employees especially if the employer is switching them back and forth from days to nights. I would also make sure that there is office support during the shift exchange so that both day and night shift would have the same opportunities to talk to HR and their manager if so needed. This would minimize a lot of problems and would decrease the amount of disgruntled employees.

FINDING THE SITE & CONSTRUCTION

The first step for starting up a facility is finding an optimum location and an excellent contractor to build a sound and safe infrastructure. In shopping around for a good location, I will look for a few different things. I selected a location that has 2.5 million pounds of milk within a 200 mile radius to supply this facility. I also selected this location based on the proximity to a university that can supply my facility to educated employees. This location was also selected for the city’s cooperation of this facility’s future expansion plans, and their willingness to work with us. For construction I will hire a secondary contractor who is in charge of checking the work of the contractor and the contractees to make sure that our company is not being duped. They will make sure that simple things like the drains and gout in the tile is done correctly, and if it isn’t demand that they do it again. I would also look at equipment companies like GEA that provide training and on site presence throughout the start up process.

MILK PROCUREMENT

Planning also needs to be put into place in regards to getting the raw materials for commissioning trials and for when the facility is in full production mode. Securing a stable milk supply is a must. I selected a location that has 2.5 million pounds of milk within a 200 mile radius to supply this facility. This is important because my location will be using at least 1.8 million pounds of milk a day. This is also important to have so much milk so close because transportation costs are very high for this product. Having the milk close will cut down on our transportation costs. Working with the supply chain and dairy farmers in the area is of the upmost importance. Without milk, cheese cannot be made. At this point decisions need to be

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made in regards to whether or not the facility will offer premiums for high quality milk, such as high fat or protein. Since milk transportation is a large cost, I would like to talk to the surrounding dairies about increasing their herd size and the incentives that the company could offer for doing so. This has a great potential to decrease the milk transportation costs in the long run.

HIRING MANAGEMENT & EMPLOYEES

In a start-up facility there needs to be a lot of planning. Good planning will help the process go smoother. Planning needs to be put into all aspects of start-up including construction, hiring, ramp up, etc. This facility is on an 18-month time crunch. This means that this facility needs to be in full production in a year and a half. I will start the hiring process right away so that I can get qualified individuals into my facility to start learning the equipment. During this first round of hiring the contractors will continue to finish up their work on the infrastructure. Within two months I will have qualified individuals that have completed company orientation. I will get these employees through recruiting from other cheese facilities. I will have all of my managerial staff hired in this first round. I will be looking for managers in maintenance, production, quality, finance, supply chain, safety, and HR. I will place dairy industry individuals in the managerial roles while the non-dairy industry individuals will be placed as supervisors. This experienced staff will be crucial to creating and implementing protocols that will lead to this facilities’ success. I will recruit individuals from the surrounding dairy processing facilities and universities to staff this location. That should provide me with an experienced and education group of people to get this facility online by the 18 month deadline. I would also look at equipment companies that provide training and on site presence throughout the start up process. As soon as I have managerial and supervisor roles filled, I will open up Key Operator and General Labor roles to outside sources, such as the Town and County Shopper, online job posting sites, and the state’s Department of Labor. By hiring the Key Operators first, they will be able to receive hands on training with the equipment by the professionals. It is important that they get trained well, as they along with the lead will be responsible for training the new employees. I would like to have all employees staffed by the 17th month so everyone gets at least 1 month of experience under their belt before full production is reached. To start minimizing overtime, I would like to have everyone on their respective shifts by month 12. This will also provide a permanent schedule for employees so that they can start to minimizing their daily drive and they can also start maximizing their vacation time.

EMPLOYEE HANDBOOK

In regards to HR, an employee handbook will need to be drafted and approved as soon as possible. This employee handbook will provide attendance policies, disciplinary actions, and communication protocols to future employees. I will implement an attendance policy that allows employees to be late once without consequence, twice with a written warning in their personal folder, third time with a 12-month probation period in which if they are late or have an

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unexcused absence it will mean termination. This handbook will also outline disciplinary actions in response to employee behavior. For example, 2 days of no call, no show would mean immediate termination. It would also state that behavior such as fighting would lead to immediate termination as well. It will also be written in the handbook the shift hours that they are committed to work. The employees will work from 6 PM to 6 AM and 6 AM to 6 PM. The office employees are expected to work 8 hours a day. I would prefer that they work 8 AM to 4PM. My facility will pay employees for staying at the facility to eat lunch rather than leaving to eat somewhere in the area. This is to provide incentive to build the culture and have the employees get to know each other a little bit better. There will be communication protocols put into place in regards to what is placed in your personal file. Management will provide 30,60, and 90 day reviews which will be placed into their personal file. Disciplinary action conversations and major incidents will be also placed in this file.

COMISSIONING TRIALS, RAMP UP, & FULL PRODUCTION

I would like to set aside month 11-13 for commissioning trials. This will provide 3 months to get the bugs worked out in the system and to ensure that we are producing good product. This will also provide extra training and troubleshooting experience for management and employees. Months 14-17 will be our ramp up period. During this time, every week we will intake 100,000 more pounds of milk than the week before. We will also start producing cheese an additional day every 3 weeks. At the start of month 18 I want the facility to be in full production, to provide a buffer with any unforeseen bugs that may be encountered.