Root Cause Analysis of Precision Engineering Works (PEW) - PPMP20009

This report presents a root cause analysis of Precision Engineering Works (PEW), a company in the telecommunications industry facing declining profitability. The analysis identifies increased market competition and higher product prices as primary causes. The report details the company's challenges, including loss of consumer base and employee attrition. It explores the competitive landscape, highlighting the emergence of new suppliers and their impact on PEW's market share and pricing strategies. A continuous improvement plan is proposed, focusing on addressing these issues through strategic business and management approaches. The report offers insights into the actions required to mitigate the challenges faced by PEW and improve its market position. The analysis utilizes tools to identify the root causes of the problem and provides suggestions for improving the company's business performance.

Root Cause Analysis of PEW

INTRODUCTION
Precision Engineering Works is an organization or the company which manufactures the
equipment used in the telecommunication industry. The company is operating for 30 years and is
a known name in the industry (Arcidiacono,Costantino & Yang, 2016). The client of this company
are renowned names in the telecommunication industry. However, it has been seen that the
company is losing the consumer base and as a result the profit percentage has been decreased to
45%. There are certain factors for the happening of the situation (Mkhaimer, Arafeh & Sakhrieh,
2017).

ROOT CAUSE ANALYSIS
The problem of the Pew is the decrease of the profitability of the selling. Regarding this there are
two causes has been identified. The supply of the equipment for the telecommunication industry
is an emerging field of the business (Svensson et al.,2015). In this context, many organizations
are investing money for this business (Perry III et al.,2016). Naturally the numbers of the
competitor of the business is growing and the Pew is facing serious challenges in the competitive
market (Mkhaimer, Arafeh & Sakhrieh, 2017). Apart form that the prices of the products made by
the Pew is relatively high compared to the products of the other company.

Continuous improvement plan:
Identified problem:
The problem is the decrease in the profitability of the PEW. The causes have been identified through
the root cause analysis (Furterer, 2016). It has been found out that the decrease in the sale of the
products is caused by high price of the products.

The number of competitors in the market has been
increased and the price of the products of the PEW is
higher compared to the other products made by the
other company. It can be said from the above
discussion that the cause s for the happening of the
problem is the increase in the number in the
organizations selling the same products to the
consumers and the smart pricing strategy of the other
companies. Certain mitigation plan have been
proposed in order to resolve the issues in the PEW. In
order to do this the action plan has been discussed in
the paper along with the strategy for the business and
the management. It can be said with the proper

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