Case Scenario:
Shirts Inc. has been making small quantities of polo shirts for many years. The shirts are customized and very high quality and premium priced. Currently, the the shirts are produced in one factory in Wisconsin and sold in only three locations in the U.S.: Madison and Milwaukee, Wisconsin, and Chicago, Illinois. Production is 10,000 shirts per year, and prices range from $75 - $200 per shirt. The demand for these shirts has increased significantly in the U.S. In addition, as the U.S. dollar falls, there is now demand for the shirts in Great Britain and France. Shirts Inc. just hired a new young marketing manager who is eager to expand and has been talking about the potential of a much larger market, particularly if the company adds a line of non-customized shirts that would still be relatively high quality, but could be sold for around $25. The marketing manager has been talking about the potential in the Asian market as well. The company will have to invest in production equipment to meet any increased demand.
Answer the following questions about Shirts Inc. Be sure to state clearly any assumptions you make about the organization as part of the description of factors to consider and state the reasons for including each factor. Use organizational structure language and theory in your response.
1) In deciding whether or not to produce larger quantities, what factors should this organization consider?
2) What additional factors should be considered if the company decides to expand to Great Britain, France, and possibly Asia?
3) What are your specific recommendations for Shirts Inc. What should the company do?
Demonstrate mastery of organizational theory and design concepts in this specific situation. Apply the principles of organizational theory in the analysis.