Ateneo de Davao University

Jacinto St., Davao City

Submitted by:
MAGIS 6
Bangayan, Demimoore
Capricho, Mylene
Cahar, Nor Fatimah
Dalguntas, Daria Luce
Espinoza, Kathleen Wyeth
Ramos, Manolito Chosen II
BSA-4B

Submitted to:
Dr. Jorge Yap

I. Company Background and Profile

PYLGREEN FRAMES

Years ago, the current owners husband was engaged into photography
which had led to his fascination in framing. This gave him the idea of forming a
framing business which is now managed by his wife, Mayla B. Gumban.
The first business location was established in Ponciano Street, Davao
City. They operated there for 11 years before they transferred in Ramon
Magsaysay Avenue due to the insufficiency of the working area.
For 17 years, the firm had led the professional one-stop framing business
in Davao City, and for the years to come, it continues the tradition of preserving
your memories endlessly.
The business offers quality framing, excellent service and sophisticated
excellence. Pyl Green Frames has been providing customers with superior
quality frames for the value of their money and as well as time.

VISION:
To be the no. 1 in the framing business, by delivering quality frames and
other PYLGreen products, by giving the joy of reminiscing the memories which
are frames with a vision of bringing lightness to the heart.

MISSION:
1. Optimistic outlook in any given situation is required.
2. Quality is the outmost concern: QUALITY of work, presentation, service,
etc. In everything you do, put your heart into it.
3. Customer service will be forever valued.
4. After sales, service and support is the right of follow-up.
5. Focus on right Sourcing, Research and Development to come up with
premium and high quality products.
6. Train people to be updated, confident and competitive in their respective
fields.
7. Satisfy the needs of the customer, depending on his value formation, i.e.
lifestyle, preferences.
8. Niche Marketing, Market Segmentation.

II. Findings and Observations

A. Strategy
PYLGreen Frames continues to be one of Davaos best one-stop framing
business due to its numerous partnerships with well-known Photo Studios inside
and outside the city. Such technique enables them to acquire a larger percentage
of customers. The entity incurs lower cost in terms of selling expenses,
particularly with advertising and delivery expense because the burden to market
their product has been transferred to the photo studios considering that the
studios end product usually includes frames. The entity has been doing well in
minimizing their cost of production thus giving them a satisfactory amount of
return. They have been able to find a supplier from Manila that offers quality predesigned frames at an affordable price which is beneficial to the entity.
PYLGreen. Framing even though it is said to be a continuously growing business
have several issues and things to improve with their operations. It has been
observed that the business have a difficult time on meeting or delivering
customer demands on or before the promised due time. This occurs during peak
seasons like on March or April where a lot of customers are asking for their

graduation photos to be framed. PYLGreen encounters a problem because of

two reasons: delivery time of supplies and limited skilled workers. The entity
should never compromise due dates as promised because nobody wants delays.
B. Products and Services Design
PYLGreen Frames is a supplier and manufacturer of frames in DavaoCity.
They sell ready-made frames as well as customized frames in which customers
may choose the materials, dimensions, and design of the frame. As a supplier,
they provide frames to their clients who are mostly engaged in photography
services.
Their frames come in various sizes. The sizes available are the following:

3R (3.5 x

5)
4R ( 4 x 6)

5R (5 x 7)
8 x 10
8.5 x 11
A4

8 x 12
10 x 15
11 x 14
12 x 18

Core Competency, Product Development

For more than 15 years, PYLGreen Frames has been providing its

customers with superior quality frames for the value of their time and money. The
business survived for more than 15 years in the market. Truly, it cannot survive if
the business was not managed properly and if it does not have its core
competency.

PYLGreens core competency is a mixture of their quality framing,

excellent service, and sophisticated elegance of their frames. This has kept them
going throughout the 15 years as a supplier and manufacturer of frames in
Davao City.

As a manufacturer of frames, PYLGreen purchases raw materials

from their suppliers in Manila. These contract manufacturers supply the

necessary materials in making their frames. They purchase raw materials such
as frame moldings, wood, glass, screws, and other essential materials needed in
making the frames. The frame moldings that they purchase comes in various
colors and designs already engraved/incorporated into it. These moldings arrive
in lengths and it will be shaped and handcrafted by their experienced and highly
trained professional framers. After the process of making the frames these will be
delivered to their clients and the others will be displayed in their main store.

The customer may choose the type of frame molding that he or she

wants. In this case, he or she just have to state to the store assistant the
specifications of the frame that he or she wants, which would include the type of
frame molding, the dimensions, and other specifications that he or she prefers.

Afterwards, the framer will work on the order of the customer, and once it is done,
it will be ready for pick-up or delivery to the customer.

Other Observations

PYLGreens product primarily revolves on frames. They sell various

types of frames. However, since the world now is progressing, changing, and
becoming even more technological these days, we consider the following
changes:

There is a need to improve the design of their frames such as allowing

customer customization to suit it more with the customers preferences.

There is a need to change or improve the companys operations
particularly in dealing with customers orders, such as building an online
website wherein customers can conveniently choose the type of frame,

the dimensions, and have it delivered to them hassle-free.

The need to find a manufacturer which is within Davao City area to
address certain problems regarding stocks during high peak seasons.

C. Strategic Capacity Design

Since PYLGreen frames has been operating for more than 15 years

already, its competencies in capacity management have been proven both in

inputs and outputs. PYLGreen frames is a medium-sized business conducting
intermediate range capacity planning specifically by month. They order supplies
and materials in Manila through email and receive it through shipment. Given the
fact that there is already a relationship built between PYLGreen frames and its
suppliers, communication and transactions flow systematic and orderly.

PYLGreen frames offers both product and service to their

customers. They sell frames in different sizes and few paintings displayed on the
walls of their store. They use 60% of the space to display they frames and 40%
for the cashiers table, proprietors office and craftsmen workshop.

The management knew that the amount of resource inputs

available relative to output requirements over a particular period of time so they

assure that they will not experience out of stock inventory at the same time carry
excess inventory. They monitor their inventory through manual system which they
used from the beginning and eventually became a convenient way of recording
their inventories. As previously stated, the entity maintains to be medium-sized
business and employs 2 saleslady and 4 craftsmen. The sole proprietor said that
they did not expand since the nature of their business is not to provide a
necessity considering the rise of smartphones and social media where people
can post photos and save photos through the internet. Nevertheless, their peak
season is March due to graduations where photos, certificates, awards etc. are
put into frames. The space of their facility, tools and workers can do their work
substantially and provide quality products. Based on our observation the
workshop of the craftsmen is small.

Capacity utilization

Economies of scale

Capacity Analysis

Maintaining system balance

They used manual system of inventory.

Frequency of capacity additions

When its peak season they order materials once a month. When it is not

once every 2 months.

External sources of operations and supply capacity

They order materals in Manila through shipment.

Determining capacity requirements

They based capacity requirements in their manual system of inventory and

conduct forecasting.

Planning Service Capacity

Since PYLGreen frames offers both product and service, the

management considers demand fluctuations and utilization for it directly impacts

service quality. The demand for frames is not constant there are times when the
craftsmen do not have much work to be done and also there are times there is a
lot of work to be done, thus; the management who manages the capacity assures
they have loyal customers like photo studios that will give a guaranteed
transaction with PYLGreen frames. To maximize their assets they target bulky
orders and purchases from businesses or institutions like schools, hospitals,
restaurants etc. and they make sure they provide assurance in their service
through effective communication and smooth dealings with their customers.
Universities usually avail frames to be displayed in their corridors or offices. Their
experiences before made them efficient in the delivery speed and effective in
delivery reliability. Some discrepancies cannot be prevented but they resort to
communication in solving the problems they encounter. Thus, relationship with
customers plays an advantageous part in the success and continued operation of
PYLGreen frames.

III. Areas of Improvement

1. Inadequate space

We have observed in the company store that the craftsmen work in

a very limited space. Thus, the limited working area makes it difficult for the

craftsmen to work efficiently. In our estimation 70% of the store area is utilized for
display of frames and of the cashier. Inside the working place is where the tools,
woods, glasses and other materials used for making frame are placed and stored
including the finished items.

2. Uncertainty/Risk of low demands of frames in the near future

Pyl Green should assess the uncertainty or risk of low demands of

their frames in the near future, as today's generation is more likely to be

technologically enhanced/advanced. As we have observed, the business itself
(i.e., their process of framing) is already typical in nature which follows the
traditional or oldies way of preserving memories such as photos, portraits,
paintings, cross-stitch, certificates and other souvenir items. As we can see
nowadays, people were attached to the evolution of preserving their memories by
simply sharing their pictures through social media like, Instagram, Twitter,
Snapchat, and Facebook. Also, aside from uploading pictures online, people can
now easily save documents, photos and videos with their computers in just few
clicks away. So as to the modernity, the business of Pyl Green could be
categorized or linked as old-fashioned which in turn dissatisfy the preference of
the people.

3. Inability to meet customers demand on time during peak seasons

IV. Proposed Alternatives

1. Inadequate space

PROs

CONs

PYLGreen

Frames

Suitable

environment
Adequate
working

space and storage

Increase in capacity

should rent another

space

to

accomodate

its

products

to

and

provide

efficient

working

space

Additional fixed cost

Space is not fully
utilized during low
season

Cons

for

employees
PYLGreen

Frames

should

regulate

order acceptance to
avoid

working

Prevention

accumulation
Anticipated

accumulation

of frames to be done
in a time

of

job

This

might

discourage
order

through

advance

notice
Effective

inventory

prospective
customers

who

wants order any time

management

2. Uncertainty/Risk of low demands of frames in the near future

Modify their product

designs
incorporate
the

to
it

with

preferred

modernized designs

today

PROs
It will reduce the risk

CONs
It would wash out

on future demands

the idea of making

due

their designs in a

to

the

generation gap
It will easily capture

traditional

the

or

fully utilized during

more

low season
It will entail certain

attention

encourage
buyers.

way.Space

cost
adopt

as
the

is

they

not

will

modern

ways of designing

Improve

their

It will really attract

their products.
It will entail huge

marketing

strategy

through

some buyers.
It is the easiest way
promote

their

cost

for

the

business.
It is not guaranteed

advertisement, fliers,

to

etc.

designs with a wide

that

range scope.

promotions will boost

having

those

their sales on the

other hand.

3. Inability to meet customers demand on time during peak seasons

PYLGreen
should

Frames

look

for

nearby suppliers for

their materials

PROs
Such alternative will
lessen the delivery
time of supplies.
Finding a reliable
supplier in Davao
can speed up their
production thus they
can meet customers
needs on time.
It will also save up
money because it
eliminates
the
shipping costs and
other
incremental
cost upon delivery of
supplies.

Hire more of skilled

Hiring more workers

CONs
The risk of not
having the same
quality of supplies
from their current
supplier might be
encountered if they
opt to look for new
suppliers. Their edge
against
design
towards
other
framing
entities
might be eliminated.
They need to have a
quality check first
before
entrusting
their supplies to the
new found supplier
which
will
be
impractical
considering they are
too busy and it
requires
enough
time that might be
detrimental to the
entity.
Hiring more workers

workers in order to
cater

rising

demands.

will
fasten
the
production. During
peak season, these
workers
will
contribute greatly to
the delivery reliability
of the firm. More
workers will provide
more outputs. It will
also help the entity
to
improve
their
delivery speed, a
criterion that can be
considered one of
the entitys order
winners.
Hiring
skilled
workers
would
contribute valuable
intangibles for the
business.
For
example, a highly
skilled worker might
help other workers
by teaching these
techniques
and
ideas on how to
create
a
better
product. A skilled
worker
with
leadership
may
influence the entire
production team to
be effective and to
be able to cater the
rising demands of
their products.
A number of skilled
workers will add to
the diversity of ideas

means more salaries

to give. The entity
might face a tradeoff
between
productivity
and
salaries to incur. The
entity cannot fully
maximize the returns
because
of
allocating substantial
amount
to
the
workers.
Hiring in itself might
incur additional cost.
As an entity you
want to hire skilled
workers so you must
conduct screenings
and interview or
even assessment of
the
newly
hired
workers which will
consume so much
time.
The
marginal
product they might
produce
might
decrease because
the
tools
for
production might not
get even with its
ratio to the number
of workers. More
workers need more
equipment so that
there will be a
constant increase on
production. To buy
new equipment will
again incur more

which is beneficial in
terms of improving
the quality of the
products. They can
contribute innovative
ideas and unique
designs that would
be considered an
order wining criterion
for the entity.
Hiring workers that
are competent will
also save training
costs. Such workers
assure the quality of
products they can
produce. The cost of
hiring will be of little
value compared to
the benefit they bring
to the business.

cost.

V. Solutions Selected

Upon weighing the pros and cons of the different alternatives

concerning the improvement of the business operations of PYLGreen Frames,

the members of the group have decided on two solutions that can address its
most immediate problems which were also chosen among those presented in
part IV of this study.

The problems that needed to be more carefully looked upon are the following:

1) the inability to meet the customers demand on time during peak

season; and

2) the risk on future demands.

The inability to meet the customers demands on time proposes a

threat to PYLGreens speed delivery and reliability reliance. This can cause
customer dissatisfaction and a possible loss on future profits. Thus, the group
has decided that PYLGreen should hire more skilled workers instead of the other
proposed alternative which is to find a new supplier within the Davao City area.
More products will be completed in a shorter span of time and would reduce, if
not eliminate, delays on demand. The group rejected the second alternative
because it may be difficult for the business to look for another supplier in Davao
and might cause only unnecessary additional expenses.

In addition, the age of modern technology creates a risk on future

demands on frames since this generation is more inclined to taking pictures and
posting them on social media. Traditional frames remain traditional as the
preference of society continually shifts toward modernity. In order to address this
problem, it would be best if PYLGreen would modify some of their products
suitable for modern interior design since modernity does not only thrive in the
technology that people use, but also in other areas such as the architectural
design of homes and buildings. With a more minimalistic and modern artistic
designs, the risk on future demands due to generation gap would be reduced.