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Fairy Food Industries
Engineering Enterpreneurship (RP 52)
Universiti Malaysia Perlis
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1 Introduction
Fairy Food Industries (Fairy) is a company that manufacturing and selling foodstuffs such as cake, biscuits, bread and other pastries. The business was founded in 1983 by two brothers of Tan and they started the business at No. 66, Jalan Ibrahim, Sungai Petani, Kedah with the name of Fairy Hot Bread and Cake House. Their main business includes the manufacturing and distribution of cakes, varies bread sorts, pastries and other foodtuffs’ which it maintained till today.
Fairy Group Corporation Sdn Bhd and Fairy Food Industries Sdn Bhd were incorporated in 1994 as the holding company and production or marketing arms of the group respectively. Overwhelming response by the customers to their products and services encouraged the group to purchase one unit light industry factory building with modern facilities in the Sungai Petani Light Industrial Estate in early 1995. With this development and foreseeing the potential business growth, the production activities of the group was taken over by Fairy Food Industries Sdn Bhd in 1997.
The main outlet for this company is located at Lagenda Heights, Sungai Petani and another two retails outlet was set up at Jalan Duta and Kompleks Tok Arau at Perlis in June 2013. Today, Fairy already have 12 branches and 148 employees and all of their employees are local. There is also 2 bakery café and a drive-thru service in Amanjaya.
Fairy use organizational functional structure type where it is based on the function in the company itself. Start from the Managing Director which is Mr Tan Ah Kiang. Secretary and OSH Coordinator, Mr. Josh Tan Shu Huan. Secretariat, Ms. Amirah Haziyah Ishak. Employer Representative which are Mr. Loo Soon Leong (Product Section), Mr. Mugilan A/L Govindaraju (Food Safety Section), Mdm. Tang Phaik Lee (Financial Section), and Mdm. Ooi Kee Hoon (Purchase Section). Representatives of workers which are Mr. Lee Beng Chong (Sponge Cake Section), Mr. Ang Ngan Seng (Normal Cake and 2kg Cake Section), Mr. Suresh A/L Vengkaptaraman (Maintainanceand Stor Section), Mdm. Rosliza Aripin (Order Cale,
Chocolate and Assorted Cake Section) and Mdm. Bumadevi A/P Marimuthu (Special and Cartoon Cale Section).
Chart 1: Fairy’s Organizational Chart
2 Content
2 Planning
Planning defines where the organization wants to be in the future and how to get there (Daft, 2005). Planning provides a foundation for all organizational activities. In this case, the situation must be analysed and understood and the appropriate goals and actions must be determined in order to take advantage of opportunities and to solve problems. Planning is essential in all organization as it helps the organization to achieve its goals.
Same goes to Fairy Food Industries Sdn Bhd (Fairy). As for the company, their main objective is to secure a position as one of the top producers of foodstuffs in Malaysia. In order to achieve this goal, Fairy had expanding their products to 12 branches in Malaysia especially in northern area at the moment.
Besides, Fairy also focus more on targeted customer in order to achieve the goal and 75% of their customers are Malay. This is because the company had Halal certificate compared to other company in the same industry. The company also have Hazard Analysis Critical Control Point (HACCP) and Good Manufacturing Practice (GMP). This certificates will give more confidence to the customers and the objectives can be achieved.
Fairy also introduced drive-thru service at Amanjaya in order to communicate about their products to targeted customer. In fact, the company is the first bakery that provide drive-thru service. Josh Tan, the Operational Manager of Fairy Food Industries Sdn Bhd said that, the idea of providing the service drive-thru does not gives advantage in profit but the service helps in promoting their products to customer. The idea does not take much time to be realized since the company had plan for about two years.
According to the company, they recently had change strategy. Before this they had rent a lot in mall but the rental expenses cost for RM12, 000 monthly. As the company thinks that this strategy will affect in their expenses, so the company had come with new strategy. Fairy then only rent a shop that only cost for RM3000 to RM4000 per month. This strategy will surely be more relevant since it will cut more cost than before.
Fairy had lots of suppliers whether locally or abroad. For instance, they already had 3 suppliers just for flour. In case the usual supplier cannot make it then they have the substitute. This ensure the production to operate smoothly without any problems.
In case there is new recipe, the recipe then will be practice at factory first. Then all of the kitchen head from all branches will go to R&D Centre to finalize about the new recipe. Once they agreed, all of them will learn about how the new products is make and the new recipe will be practice in all branches.
Fairy is also looking to upgrade the research and development department for its product innovation. In line with the group’s expansion, the company acquired the Enterprise Resource Planning (ERP) software for integrated business management solution from CSB – System International, Germany. The ERP system is to address the procurement, sales and financial accounting.
pastries. Then in the stores, all the chefs will start to make the pastries according to the procedure given by the company. This will result the same end products with the same taste at all Fairy Food stores.
2.2.1 Sudden blackout at the main factory
Sometimes there are frequent electric disturbance in the area of Sungai Petani including in the main area of the factory. The main factory is the most important place of the Fairy chain, because all of its materials or substances are being process first in here, then will be distribute to the other stores. According to the operational manager, he said that the factory can take maximum two hours without electric. If the period is extent more than two hours, the company will call the TNB to send their worker to fix it. This job become easier because the factory had already install a backup supply power to generate the electricity of the factory while waiting for the main electric supply from TNB.
2.2 Non-programmed decision making 2.2.2 The process of opening the new stores
Opening the new store might get a lot of works require to handled. It require company to identify the most strategic location to open in order to attract more customers. Next if the company had the location, it require to handle the rental premises with the PBT (Pihak Berkuasa Tempatan) in the selected area. Then some company might borrowed loan from bank in order to finance the premises. The company also need to concern about all the expense incurred toward opening the new store such as taxes from the PBT or the government.
2.2.2 Group decision making (brainstorming)
Brain storming involving group members to suggest their ideas or alternative courses of action. The brain storming is usually relatively unstructured. The group leader will record the ideas presented on flip chart or marker board. Once the ideas of the group members have been exhausted, the group members then begin the process of evaluating the utility of the different suggestions until all ideas have been presented. In company that our group visited, Fairy Food Industries have use brainstorming on their project that are Drive Thru service in Fairy Amanjaya.
2 Strategic Human Resource Management
Human resource management (HRM) is the overall process of securing people with the proper skills and helping to guide and manage them. Human resource management involves many other parts of overall management including motivation, leadership and communication. Major human resource management activities that help the organization attract, retain and develop the quality and quantity of employees needed to meet organizational goals. The organization’s strategy and goals both influence human resources and are influenced by them. Specialists in human resource management might coordinate and carry out many of the related details in forecasting, recruiting, selecting and training but every manager in an organization is at least indirectly involved in all aspects of human resource management. This study will focus on recruitment, selection, training, performance appraisal and motivation of Fairy Food Industries.
2.3 Recruitment
Recruitment is the process of actively seeking out, finding and hiring candidates for a specific position or job. The recruitment definition includes the entire hiring process from inception to the individual recruit’s integration into the company. Recruitment can occur in a variety of settings, internal recruitment and external recruitment.
2.3.2 Interviews
Besides that, the second method is through interviews. The interview questions for the candidates usually are straightforward questions such as experience and education and sometimes questions that are related to personal characteristics and attitude. The candidate’s attire and handwriting are also taken into account during the interview process. Fairy Food Industries will conduct interviews once every one week and it will be on Monday.
2.3 Training
Training is the process for providing required skills to the employee for doing the job effectively, skilfully and qualitatively. Training of employees is not continuous, but it is periodical and given in specified time. Training is required at every stage of work and for every person at work. To keep oneself updated with the fast changing technologies, concepts, values and environment, training plays a vital role. Training programmes are also necessary in any organisation for improving the quality of work of the employees at all levels.
2.3.3 Orientation
The first step that Fairy Food Industries will take in the process of training is to conduct orientation. It is the formal process of familiarizing new employees with the organization, their jobs and their work units. Briefing on the company’s policies such as safety policy, hygiene policy and environment policy also will be conducted to the new employees.
2.3.3 On-The-Job Training
While the second step in the process of training is through on-the-job training. On- the-job training such as coaching and mentoring by a supervisor and staff meetings usually involves the office’s staffs. For the employees who work in the baking section will be given technical training programs. It provides employees with specialized skills and knowledge in the methods, processes and techniques associated with their jobs. The technical training programs is conducted at the main headquarter of Fairy Food Industries. The training process takes approximately two weeks for the new employees to work perfectly and efficiently.
2.3 Performance Appraisal
Performance appraisal is a systematic approach to evaluating the work of an employee by using oral or written methods to assist and improve the future performance of the assessed individual. Hence, with this performance evaluation can encourage employees to work more diligently, efficiently, and trust to increase the organizational productivity level and ensure that organizational progress is at a brisk level.
According to McGregor (1960) the performance appraisal is often viewed as a form of personnel administration technique, but where it is used for administrative purposes, it is part of a logical management strategy aimed at directing its employees to demonstrate efforts toward achieving organizational goals. Management should inform its employees what they need to do, evaluate their achievement, and reward them accordingly.
There are three performance appraisal methods which is absolute standard, relative standard, and objectives. However, there are only two methods performed by Fairy Food Industries which is absolute standard and relative standard. Absolute standards is that each employee will not be distinguished from each other or in other words no bias term to assess every employee and employee will be judged equally. There are several ways in this method, which is essay writing, critical events and checklists. Based on the interview, we found that Fairy Food Industries only apply critical incidents and checklists methods.
Critical incidents refer to various statements describing the performance of workers in terms of positive or negative behaviour. A qualitative method whereby behavioural traits exhibited by each employee are documented with the aim to evaluate performance as opposed to personality. Since actual behaviours are observed the appraisal is more objective, however negative incidents are more likely to be noticed and remembered compared to positive incidents. In this method, the rater focuses his attention on those key or critical behaviours that make the difference between performing a job in a noteworthy manner (effectively or ineffectively). There are three steps involved in appraising employees using this method.
Firstly, the operating manager or supervisor of Fairy Food Enterprise will list of noteworthy (good or bad) on-the-job behaviour of specific incidents is prepared. Then
worker will be taught processes in manufacturing by more skilled and experienced workers and this person is called “buddy”. After a few months of training, the “buddy” will appraised the new workers based on their quality of work and skill. Then “buddy” will inform and update operation manager about the employee performance. If the employees are good enough to handle the duty on their own, then the “buddy” will keep observe their work from time to time. But if they are still lack of skill, they will be given more effective training.
2.3 Motivating
According to H. W. Bernard in his book Psychology of learning (1965), he expressing motivation is the process of raising retention and controlling interest. In short, motivation is a stimulus that evokes and sustains the individual's interest in achieving certain goals, including changing attitudes, interests and behaviours. It is usually created because of the physiological or psychological needs that arise. Among the motivational interests of an organization is retaining employees, especially skilled workers in the organization, reducing the employee turnover and increasing the worker's achievements and performance and produce productive workers.
The motivational forms given by Fairy to his employees are monetary and nonmonetary motivational. The monetary motivational given by Fairy to their employees such as salary and yearly bonus. Meanwhile, for nonmonetary motivational, every years Fairy will hold an annual dinner and family day for their employees.
3 Conclusion
In a conclusion, our group conclude that Fairy Food Industries is a good company for us completed our assignment. The business founded by two brothers of Tan in 1983 has been successful now.
Fairy Food Industries has plan their idea successfully to achieve their main objectives that are to secure position as one of the top producers of foodstuffs in Malaysia. They have proving their achievement in their objective with have open 12 branches of Fairy Food especially in northern area at Malaysia. Fairy also planned in opening drive- thru service in Amanjaya. Even this plan are not giving profit to them, but they feel great in promoting their product to customer. Now, Fairy Food Industries are looking to upgrade their research and development department for its innovation product.
Fairy Food have using decision making to run up their business. They have programmed decision making and non-programmed decision making. Human Resources Management (HRM) is the overall process of securing people with the proper skills and helping to guide and manage them. HRM has coordinate many aspects in this company such as recruitment, selection, training, performance appraisal and motivation.
What is Human Resource. Employee Training Introduction. Retrieved November 12, 2018 from whatishumanresource/Employee-Training- Introduction
What is Human Resource. What is Performance? Retrieved November 18, 2018 from whatishumanresource/performance-appraisal
Fairy Food Industries
Course: Engineering Enterpreneurship (RP 52)
University: Universiti Malaysia Perlis
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