IB Business Management SL 1.4.1 Internal and External Stakeholders Questions

Appendix 1: Order/manufacture/delivery process. Step 1: Customer wants product. Step 2a: Customer completes online template, or Step 2b: Customer contacts RDM for help. Step 3: Engineer reviews request, sometimes contacting customer. Step 4: Engineer inputs design into system. Step 5: Accounting and marketing determine price to customer. Step 6: Salesperson confirms purchase. Step 7a: Designs go to the shop floor, where robots configure tooling; Step 7b: designs go to robots, which get and load raw materials. Step 8: Order is manufactured. Step 9: Order is delivered.

Today, RDM is highly automated, though this situation was not always the case. For decades, RDM employed a large unionized labour force, mass produced stoves and sold its product to wholesalers. Because of globalization and fi erce competition from Asian manufacturers, which had lower cost structures, in the early 2000s Jan determined that European manufacturers would have to lower costs. Automation, while requiring signifi cant capital expenditures, lowers costs in the long run. In addition, digitized communication between robots allowed RDM to be responsive to customers’ requirements. As RDM improved its automation processes and integrated cloud computing, mobile devices, big data, artifi cial intelligence and three-dimensional (3D) printing, its ability to customize products improved dramatically regardless of the size of the order. This integration of technologies also meant that RDM was not restricted to manufacturing healthcare devices. Rather, it could easily retool to manufacture other products when opportunities arose. For example, one large medical customer asked RDM to manufacture 500 customized aluminium water bottles. Customization included special design features of the bottles themselves as well as their colour and fi nish. The customer wanted to give one bottle to each of its employees. With its highly automated processes, RDM could quickly and inexpensively produce the bottles, with diff erent coloured bottles for the diff erent divisions of the company and with each employee’s name on his or her own bottle. The success of the order for water bottles was such that several executives at RDM encouraged Jan to make the manufacture of customized aluminium water bottles a distinct division of the company. RDM’s relationship with stakeholders was profoundly changed by the move to automation. In the 1970s, RDM employed roughly 500 workers, making it the largest single employer in Lobjanec. In 2019, the business employs 117 people, only a small number of whom are involved in manufacturing. Further, most of those involved in manufacturing are not skilled manual labourers but highly trained engineers and computer experts who manage the automated process. Their attitudes, aspirations and motivations diff er signifi cantly from the workers who survived the Second World War and had worked under the Communist regime. With this reduction in, and transformation of, RDM’s labour force, the company no longer has the level of local infl uence that it formerly had. The vocational school no longer liaises with RDM regarding the required skills of workers. Now, with the free movement of labour throughout the European Union, RDM recruits engineers from universities across Europe.