Enhance College of Technology

Enhance Professional Training Pty Ltd

ABN: 821 6587 1572 RTO: 41531 CRICOS: 03587K
2/35 Manilla Street, East Brisbane, Queensland 4169 Australia
Phone: 07 3895 8393 email: [email protected]

Assessment 1 - Written Report

Student Name Student ID Number

Unit Start Date Unit End Date

Assessment Due Date Date Submitted

This cover sheet is to be completed by the student and assessor and used as a record to
determine student competency in this assessment task

The assessment process and tasks were fully explained. Yes / No

I am aware of which evidence will be collected and how. Yes / No

I am aware of my right to appeal an assessment decision. Yes / No

I am aware that I can locate the RTO’s Complaints and Appeals Policy and Procedure on Yes / No
their website at (insert website address)

I have discussed any additional educational support or reasonable adjustments I require in

order to undertake this assessment with the Student Support Services Officer and Trainer /
Yes / No
Assessor, (if applicable). e.g. Student Handbook and Access and Equity Policy (insert
website address)

I have access to all required resources? Yes / No

Cheating & Plagiarism Declaration

Student Declaration: In accordance with the RTO’s Plagiarism Policy, I hereby acknowledge by signing this
declaration that I have not cheated or plagiarised any work regarding the assessment tasks undertaken in this
unit of competency except where the work has been correctly acknowledged.

NOTE: Student must sign this prior to submitting their assessments to the assessor

Date
Signature _____ / ______ / 20______
:

Assessment Results
Satisfactory or Not Yet Satisfactory
(Please circle the assessment result for this task)

Feedback to Student - Please provide general feedback on the Student’s performance

Student Declaration: - I verify that the work completed is my own Assessor Declaration: - I verify that I have adequately explained and
and that I was adequately informed of the assessment process prior negotiated the assessment tasks with the student prior to commencing
to commencing this assessment task. assessment.

Student Name: Assessor’s Name:

Student Signature Date Assessor Signature Date

Page 1 of 14
BSB61015 Advanced Diploma of Leadership and Management
Unit: BSBMGT608 – Manage Innovation and Continuous Improvement
Document Version: 1 Updated: 6Nov19 Source: S.L.S.8.8
 Enhance College of Technology
Enhance Professional Training Pty Ltd
ABN: 821 6587 1572 RTO: 41531 CRICOS: 03587K
2/35 Manilla Street, East Brisbane, Queensland 4169 Australia
Phone: 07 3895 8393 email: [email protected]

Student Guide for Written Assessment

Instructions Instructions to include, but not limited to:

1. Student will be assessed in a classroom environment.
2. Ensure the student is aware of the assessment requirements at the commencement
of the unit
3. The students are required to work alone to answer questions.
4. The questions are aimed at testing the student’s knowledge of managing innovation
and continuous improvement.
5. This written assessment comprising of questions that need to be answered in a
report format using the provided business scenario.
6. The student is required to complete the written assessment for this unit of
competency. To complete this task, the student will need to answer i-iii and the 6
questions in this written assessment in your own words in either handwriting or
generated Word document.
7. The student answers should be recorded in the student written assessment
question booklet.
8. After the student has successfully completed the written assessment, they must
present it to the Trainer/Assessor for correction.
9. The student will receive up to two (2) attempts at this assessment task. Should the
1st attempt be Not Yet Satisfactory (NYS), the Trainer/Assessor will provide
feedback and will arrange a date for the student 2 nd attempt. If the student 2nd
attempt is Not Yet Satisfactory (NYS), or the student fail to attend of date scheduled
for the 2nd attempt, the student will receive an overall unsatisfactory result for this
assessment task.
10. In special circumstances this written assessment may be delivered as an oral
assessment in which the assessor shall mark the assessment and identify the
assessment was presented orally

Task/s to be The tasks you will be observed undertaking are:

assessed
- a written report submitted within agreed timeframe.

- reference to, and application of, quality management and continuous improvement
theories in review strategy
- reference to and application of sustainability practices in review strategy
- analytical skills to identify improvement opportunities
- demonstration of creativity skills to think laterally and identify improvement
opportunities.

Oral Questioning During the assessment your assessor will ask you oral questions that will address the
knowledge aspects of the unit of competency. You will respond orally, and your assessor
may record your response or use your response to determine sufficient under pinning
knowledge.
Topics will include:
- outline cost-benefit analysis methods
- describe creativity and innovation theories and concepts
- list organisational learning principles
- identify quality management and continuous improvement theories
- describe relevant risk management concepts
- outline relevant sustainability practices.
Time allowed On average, the Assessment should take 5-6 hours to complete
Page 2 of 14
BSB61015 Advanced Diploma of Leadership and Management
Unit: BSBMGT608 – Manage Innovation and Continuous Improvement
Document Version: 1 Updated: 6Nov19 Source: S.L.S.8.8
 Enhance College of Technology
Enhance Professional Training Pty Ltd
ABN: 821 6587 1572 RTO: 41531 CRICOS: 03587K
2/35 Manilla Street, East Brisbane, Queensland 4169 Australia
Phone: 07 3895 8393 email: [email protected]

Location Assessment will be completed in a classroom under the supervision of a trainer/assessor.

Decision making To achieve a satisfactory outcome, you must be able to: -

rules
 outline cost-benefit analysis methods
 describe creativity and innovation theories and concepts
 list organisational learning principles
 identify quality management and continuous improvement theories
 describe relevant risk management concepts
 outline relevant sustainability practices.
Expected answers to oral questions are indicative of the correct answer.
Your assessor will be looking for the following in this assessment task: -
You must develop a marketing plan for specific applications that follows workplace
procedures to meet required outcomes. This includes:
- Review programs, systems and processes
 Establish strategies to monitor and evaluate performance and sustainability of key systems and
processes
 Undertake detailed analyses of supply chains, and operational, product and service delivery
systems
 Identify performance measures, and assessment tools and techniques, and evaluate their
effectiveness
 Analyse performance reports and variance from plans for key result areas of the organisation
 Identify and analyse changing trends and opportunities relevant to the organisation
 Seek advice from specialists, where appropriate, to identify technology and electronic
commerce opportunities
- Develop options for continuous improvement
 Brief groups on performance improvement strategies and innovation as an essential element
of competition
 Foster creative climate and organisational learning by promoting interaction within and
between work groups
 Encourage, test and recognise new ideas and entrepreneurial behaviour where successful
 Accept failure of an idea during trialling and recognise, celebrate and embed success into
systems
 Undertake risk management and cost-benefit analysis for each option or idea approved for
trial
 Approve innovations through agreed organisational processes
- Implement innovative processes
 Promote continuous improvement and sustainability as essential to doing business
 Address the impact of change and consequences for people and implement transition plans
 Ensure objectives, timeframes, measures and communication plans are in place to manage
implementation
 Implement contingency plans in the event of non-performance
 Follow up failure by prompt investigation and analysis of causes and manage emerging
challenges and opportunities effectively
 Ensure that learnings from activities are captured and managed to inform future work
 Regularly evaluate continuous improvement systems and processes
 Communicate costs and benefits of innovations and improvements to relevant groups and
individuals
Performance The assessment methods must be by direct observation of tasks on required skills and
Observation knowledge to ensure correct interpretation and application. Your Assessor will observe you
Criteria for on the following observations:
Assessment Task
Page 3 of 14
BSB61015 Advanced Diploma of Leadership and Management
Unit: BSBMGT608 – Manage Innovation and Continuous Improvement
Document Version: 1 Updated: 6Nov19 Source: S.L.S.8.8
 Enhance College of Technology
Enhance Professional Training Pty Ltd
ABN: 821 6587 1572 RTO: 41531 CRICOS: 03587K
2/35 Manilla Street, East Brisbane, Queensland 4169 Australia
Phone: 07 3895 8393 email: [email protected]
 analyse and evaluate systems and performance in key areas of the organisation and
identify opportunities for improvement, seeking advice from experts as appropriate
 promote the value of creativity, innovation and sustainability and recognise successes
 support the testing and trialling of new ideas and undertake risk management and
cost-benefit analysis for options
 plan for and implement improvements using organisation’s processes for approvals,
project management and change management
 facilitate effective contributions to and communications about continuous
improvement and innovation
 capture insights, experiences and ideas for improvements and incorporate them into
the organisation’s knowledge management systems and future planning.
Assessment Assessors must satisfy NVR/AQTF assessor requirements. 
conditions
Competency is to be assessed in the workplace or a simulated environment that accurately
reflects performance in a real workplace setting. 
Assessment must include direct observation of tasks. 
Where assessment of competency includes third-party evidence, individuals must provide
evidence that links them to the leadership or management of organisational change that the
student has performed.
Assessors must verify performance evidence through questioning on skills and knowledge
to ensure correct interpretation and application. 

Resources required The following equipment will be made available to students:

- Simulated or workplace documentation and resources
- Office equipment, materials and software packages (such as laptops, WiFi,
Microsoft Suite)
- Case studies to examine or real workplace situations to analyze

Results/Re-  Your Assessor will grade as either S – Satisfactory or NYS – Not Yet Satisfactory
assessment for the assessment. In all cases your Assessor will provide you with feedback.
 Only when all assessment tasks have been graded as S – Satisfactory you will be
deemed C – Competent in the final result of the unit of competency; if you do not
satisfactorily complete all the assessment tasks you will be deemed NYC – Not Yet
Competent.
 If the evidence is graded as NYS – Not Yet Satisfactory you will be required to re-
submit the evidence. In this case, you will be provided with clear and constructive
feedback based on the assessment decision so that they can improve your skills /
knowledge prior to reassessment.
 Where a ‘NYS – Not Yet Satisfactory’ judgement is made, you will be given
guidance on steps to take to improve your performance and provided the
opportunity to resubmit evidence to demonstrate competence. The assessor will
determine and discuss the reasons for NYS – Not Yet Satisfactory on any of the
criteria and will assess you through a different method of assessment e.g.
verbal/oral questioning, problem solving exercises.

Reasonable Assessor may adjust assessment conditions (as required) to suit workplace objectives
Adjustment provided that the integrity of the task is maintained.

Page 4 of 14
BSB61015 Advanced Diploma of Leadership and Management
Unit: BSBMGT608 – Manage Innovation and Continuous Improvement
Document Version: 1 Updated: 6Nov19 Source: S.L.S.8.8
Enhance College of Technology
Enhance Professional Training Pty Ltd
ABN: 821 6587 1572 RTO: 41531 CRICOS: 03587K
2/35 Manilla Street, East Brisbane, Queensland 4169 Australia
Phone: 07 3895 8393 email: [email protected]

Assessment 1 – Written Report

Based on the case study provided, you will write a report in which you outline a performance and
sustainability review strategy, evaluate the strategy, analyse performance reports and trends, and
describe how you would seek advice from specialists to identify technological solutions.

You must complete:

- a written report submitted within agreed timeframe.

You will be assessed on your abilities to perform the following:

- reference to, and application of, quality management and continuous improvement theories in
review strategy
- reference to and application of sustainability practices in review strategy
- analytical skills to identify improvement opportunities
- demonstration of creativity skills to think laterally and identify improvement opportunities.

Page 5 of 14
BSB61015 Advanced Diploma of Leadership and Management
Unit: BSBMGT608 – Manage Innovation and Continuous Improvement
Document Version: 1 Updated: 6Nov19 Source: S.L.S.8.8
Enhance College of Technology
Enhance Professional Training Pty Ltd
ABN: 821 6587 1572 RTO: 41531 CRICOS: 03587K
2/35 Manilla Street, East Brisbane, Queensland 4169 Australia
Phone: 07 3895 8393 email: [email protected]

Review Programs, Systems and Processes

Did the Student Perform the Following: S NYS Comments

Submit a written report?

Submit report in agreed timeframe?

Establish strategies to monitor and evaluate performance

and sustainability for key systems and processes

Develop performance measures, assessment tools and

techniques to evaluate the performance and sustainability
of key systems and processes?

Evaluate effectiveness of review strategy?

Analyse performance reports?

Identify trends?

Analyse the company for strengths, for weaknesses, and

to identify opportunities?

Identify appropriate sources of information and

assistance?

Page 6 of 14
BSB61015 Advanced Diploma of Leadership and Management
Unit: BSBMGT608 – Manage Innovation and Continuous Improvement
Document Version: 1 Updated: 6Nov19 Source: S.L.S.8.8
Enhance College of Technology
Enhance Professional Training Pty Ltd
ABN: 821 6587 1572 RTO: 41531 CRICOS: 03587K
2/35 Manilla Street, East Brisbane, Queensland 4169 Australia
Phone: 07 3895 8393 email: [email protected]

Assessment 1 – Written Report Task

To demonstrate the skills and knowledge required to review, evaluate and analyse programs,
systems and processes.

i. Read the case study ‘A. C. Gilbert’ in Appendix 1.

ii. Analyse the information provided and prepare a report addressing the six points in the
table on the following pages.

1. Describe the key systems and processes used by A. C. Gilbert:

a. supply chain
b. operational systems
c. product/service delivery.

2. Analyse the three key systems and processes and develop the elements of
your review strategy. Applying your knowledge of quality management and
continuous improvement theory, develop performance and sustainability
measures, assessment tools and techniques that you would use to evaluate
the effectiveness of the three key systems and processes.
In your report, include if applicable:
a. lists of key result areas (KRAs)
b. lists of key performance indicators (KPIs)
c. a description of performance review processes
d. a sample service level agreement.

3. Using the data provided for results up to 1966, for each of the three key
systems, describe how each of your measures, assessment tools and
techniques would monitor performance. Include specific examples or
hypothetical cases to test the effectiveness of the elements of your review
strategy. Write an evaluation of the effectiveness of your review strategy.
Suggest improvements to your strategy.
Refer to quality management and continuous improvement theory.

4. Using the data provided for results up to 1966, analyse the variances from
plans and targets for the key result areas (KRAs). Include discussion on
performance with regards to:
a. quality – design/manufacturing

Page 7 of 14
BSB61015 Advanced Diploma of Leadership and Management
Unit: BSBMGT608 – Manage Innovation and Continuous Improvement
Document Version: 1 Updated: 6Nov19 Source: S.L.S.8.8
Enhance College of Technology
Enhance Professional Training Pty Ltd
ABN: 821 6587 1572 RTO: 41531 CRICOS: 03587K
2/35 Manilla Street, East Brisbane, Queensland 4169 Australia
Phone: 07 3895 8393 email: [email protected]

b. sales
c. profit
d. supply chain performance (delivery)
e. business growth – staff and management performance and/or turnover.
5. Analyse trends relevant to the organisation. What trends did A. C. Gilbert fail
to identify in the late 1950s?
Consider the strengths and weaknesses of the A. C. Gilbert Company prior to
1960. Analyse the following in your report:
a. market share
b. reputation
c. stability
d. profit
e. sales
f. ability to adapt to change
g. customer service standards

h. innovation
i. employee performance
j. production and manufacturing.

Apply creativity skills to identify missed opportunities to improve business

performance. Describe at least one missed opportunity in detail. Include an
action plan for implementing the improvement in your report.

6. Imagine the company did not close in 1967 and has somehow managed to
continue operations until today. Discuss the possible use of advice from
specialists. What specialists could be consulted to advise on and identify new
technology or electronic commerce opportunities? Consider:
a. internal – engineers, production staff, manufacturing staff, sales
personnel, human resources personnel
b. external – marketing consultants, advertising experts, engineers or
designers, IT consultants.

iii. Submit your report to your assessor as per the specifications below. Ensure you keep a
copy of all work submitted for your records.

Page 8 of 14
BSB61015 Advanced Diploma of Leadership and Management
Unit: BSBMGT608 – Manage Innovation and Continuous Improvement
Document Version: 1 Updated: 6Nov19 Source: S.L.S.8.8
Enhance College of Technology
Enhance Professional Training Pty Ltd
ABN: 821 6587 1572 RTO: 41531 CRICOS: 03587K
2/35 Manilla Street, East Brisbane, Queensland 4169 Australia
Phone: 07 3895 8393 email: [email protected]

Business Scenario
A.C Gilbert
History 1909–1961
Alfred Carlton Gilbert was an inventor and a toy manufacturer who invented the Erector engineering
set. His original company, The Mysto Manufacturing Company, was founded in 1909 to manufacture
the Erector set. In 1916, Mysto became the A. C. Gilbert Company and gained a reputation for
producing quality toys.

By the 1950s, A. C. Gilbert was one of the leading toymakers in the United States, with annual sales
regularly topping $17 million. This was an outstanding achievement for a relatively small company.

In 1961, A. C. Gilbert, Senior, died, leaving the company in the hands of his son, A. C. Junior. At the
time A. C. Junior took over the firm, the company was established as a traditional, reliable and
profitable manufacturer of educational toys.

Product lines and rationale

A. C. Gilbert produced train sets, but their most popular lines were chemistry sets, microscopes and
their best seller, the Meccano-like Erector engineering sets that had been popular with children for
more than 50 years.

A. C. Gilbert toys were not cheap. They were high quality, solidly crafted and made to endure. Parts
and packaging were designed to last for many years, with the Erector set packaged in long-lasting
metal boxes. The focus was on educational toys, primarily aimed at boys rather than girls. The
company had a limited range, but what they did manufacture was top-quality and highly regarded.

Systems and processes

A. C. Gilbert was a small company. The following models demonstrate the systems and processes in
place.

Sales Team Distribution Retailers

Take orders from Arrange for Sell the toys

customers delivery of goods directly to end
to purchaser user
using contract
transport

Page 9 of 14
BSB61015 Advanced Diploma of Leadership and Management
Unit: BSBMGT608 – Manage Innovation and Continuous Improvement
Document Version: 1 Updated: 6Nov19 Source: S.L.S.8.8
Enhance College of Technology
Enhance Professional Training Pty Ltd
ABN: 821 6587 1572 RTO: 41531 CRICOS: 03587K
2/35 Manilla Street, East Brisbane, Queensland 4169 Australia
Phone: 07 3895 8393 email: [email protected]

Design
Toys are designed by a small group of designers who develop the concepts
for the products.

Planning
The planning department translates the concepts into designs and determines
resource requirements, including raw materials. Planning also projects sales
and develops production plans for each product, timeframes for production
runs and scheduling of production runs.

Purchasing
Information gained from planning stage used to purchase raw materials for
products and packaging from suppliers.

Manufacturing
Produces and packages toys for distribution.

Distribution
Delivers packaged toys to the warehouse for storage.

Page 10 of 14
BSB61015 Advanced Diploma of Leadership and Management
Unit: BSBMGT608 – Manage Innovation and Continuous Improvement
Document Version: 1 Updated: 6Nov19 Source: S.L.S.8.8
Enhance College of Technology
Enhance Professional Training Pty Ltd
ABN: 821 6587 1572 RTO: 41531 CRICOS: 03587K
2/35 Manilla Street, East Brisbane, Queensland 4169 Australia
Phone: 07 3895 8393 email: [email protected]
Note: These flow charts have been included for assessment purposes only, and may not accurately reflect the
actual processes in place at A. C. Gilbert.

History 1961–1967
As the 1950s moved into the 1960s, there were huge cultural changes across the world. The fifties
were a very traditional era of family values and morals, conservative and staid. Then came the
‘swinging sixties’. The sixties were a time of rapid change both technologically and culturally. Old-
fashioned values gave way to new moral freedoms.

Where the fifties represented solidarity and familiarity, the sixties embraced change. Everything was
bolder, brighter and more daring. A new young president and rising social activism by youth saw
changes in clothing, music and interests. Young people rebelled against the values of their parents
and embraced a more fast-paced, exciting and riskier lifestyle.

Changes to the toy industry

Cultural changes had a huge impact in western toy markets. Barbie and Action Man became ‘must
have’ toys. Girls moved away from baby dolls and cots and wanted dolls that were more grown up,
modern and trendy. They wanted dolls they could dress in the latest fashions and who had exciting
‘careers’, boyfriends and cars of their own. Boys were moving away from the traditional train sets
and towards exciting new slot-car racing sets and action figures from popular movies and television
shows.

Traditionally, toy advertising had been done via magazine promotions, but the sixties brought in a
new phenomenon: television advertising. A hugely powerful medium, TV advertising became
increasingly ‘hard sell’, with toys heavily promoted, especially in the lead up to Christmas. Children
wanted the latest and greatest toys that they saw in these advertisements, and they put pressure on
their parents to buy, which their parents did.

Retailing of toys during this period reflected a shift in retailing in general. Small, specialty retailers
with experienced and knowledgeable staff were going out of business, replaced by large discount
stores catering for the mass market. The goal of this type of retailer was to turn over stock. Heavily
advertised lines were in demand, and that is what they would stock. Cheap was in, and giant
retailers were after a quick profit from easily saleable, inexpensive products. They weren’t interested
in catering to a niche market by stocking more expensive, harder to shift lines.

Packaging was bright and colourful in order to attract children growing up in a world of colour TV,
hypercolour clothing and visual stimulation provided by the swinging sixties.

Effects on A. C. Gilbert
As a small, traditional company, A. C. Gilbert was slow to react to these changes. It may have been
that they were not aware of the changes or were overly confident that their good name and
reputation were sufficient to continue trading as before. The consequences of this short-sightedness
soon became apparent.

1961 (figures approximate)

L/Y Sales Actual sales Difference Profit
$12.6 million $11.5 million ($1.1 million) $20,011.00

This drop in sales was also reflected in a fall in the share price of the company.

Page 11 of 14
BSB61015 Advanced Diploma of Leadership and Management
Unit: BSBMGT608 – Manage Innovation and Continuous Improvement
Document Version: 1 Updated: 6Nov19 Source: S.L.S.8.8
Enhance College of Technology
Enhance Professional Training Pty Ltd
ABN: 821 6587 1572 RTO: 41531 CRICOS: 03587K
2/35 Manilla Street, East Brisbane, Queensland 4169 Australia
Phone: 07 3895 8393 email: [email protected]
Outcomes
As a result of the falling profits and share price, the company became attractive to an opportunistic
businessman, Jack Wrather. Jack Wrather was an independent television producer who had made
his money producing the popular programs ‘Lassie’ and ‘The Lone Ranger’. Jack Wrather wanted to
purchase a successful business and felt that in
A. C. Gilbert, he had the opportunity to use his knowledge of popular entertainment and apply it to
the production of toys. He purchased 52% of A. C. Gilbert for $4 million and immediately set about
making his mark on the company. A. C. Junior stayed on as Chairman but his influence was minimal.

Actions taken by Jack Wrather

● Set a goal to achieve sales of $20 million in 1963.

● Replaced the top A. C. Gilbert executives with his own people.

● Initiated a massive advertising campaign.

● Increased sales staff by 50%.

● Instructed sales staff to adopt an aggressive sales approach.

● Introduced 50 new toy lines, raising the lines to 307.

● Changed the focus from traditional boys' toys to ranges for pre-school children,
and dolls and other toys aimed at girls between the ages of 6 and 14.
● Spent $1 million on changing the packaging for all lines to brighter, more
colourful boxes.

Performance report

Year Sales Difference from Profit/loss

previous year
1961 $11.5 million ($1.1 million) $20,011.00
1962 $10.9 million ($600,000.00) ($281,000.00)
1963 $10.7 million ($200.000.00) ($5.7 million)

1964 $11.4 million $700,000.00 ($2.6 million)

1965 $14.9 million $3.5 million ($2.9 million)

1966 $12.9 million ($2 million) ($12,872,000.00)

1967 A. C. Gilbert closed (1909–1967)

Key milestones
1962:

● Jack Wrather purchased 52% of A. C. Gilbert.

● Replaced existing executives with his own people.

● Increased sales staff by 50%.

● Implemented extensive television advertising.

Page 12 of 14
BSB61015 Advanced Diploma of Leadership and Management
Unit: BSBMGT608 – Manage Innovation and Continuous Improvement
Document Version: 1 Updated: 6Nov19 Source: S.L.S.8.8
Enhance College of Technology
Enhance Professional Training Pty Ltd
ABN: 821 6587 1572 RTO: 41531 CRICOS: 03587K
2/35 Manilla Street, East Brisbane, Queensland 4169 Australia
Phone: 07 3895 8393 email: [email protected]
● Set an organisational goal to achieve sales of $20 million for 1963.

● Company recorded a loss of $281,000.00.

● Introduced 50 new lines in less than 12 months, using existing engineers and production
departments who lacked training and experience in the new product range.
● Repackaged existing lines at a cost of $1 million.

1963:

● Sales and profits down on previous year.

● Anticipated drop in profits due to expansion and cost of establishing new lines.

● Sales fell short of expectations.

● Decline in quality of toys – feedback indicated products poorly made and designed (dolls did not
even come with a change of clothing).
● New range perceived by customers as poor quality and overpriced – not value for money nor
attractive to the target market.

1964:

● Jack Wrather fired most of the top management team he had hired two years previously.

● Crisis management led to multiple changes and dramatic measures being taken and then changed
– often one measure contradicting the previous.
● Jack Wrather hired new CEO – Isaacson.

● Isaacson fired the entire sales team.

● Isaacson made huge cutbacks in spending.

● Sales were channelled through independent manufacturer’s reps, which was cheaper than
maintaining an in-house sales force.
● Long-standing relationships soured as the independent reps worked on commission and pushed
sales, with no interest in maintaining or building relationships with customers.

● A. C. Gilbert had built its success on personal service and building relationships – that was
destroyed within 12 months.
● A. C. Gilbert Junior died and is replaced as Chairman by Jack Wrather. Isaacson assumes the
role of President.
● Prior to Christmas, many of the previous year’s failed products were deleted and 20 new items
introduced.
● Reduced the price of core lines such as the Erector set from $75 to $20, but quality also
impacted – cardboard box instead of metal boxes, and brittle parts instead of sturdy, long-
lasting parts.
● Sales increased and there was some degree of optimism.

1965:
Page 13 of 14
BSB61015 Advanced Diploma of Leadership and Management
Unit: BSBMGT608 – Manage Innovation and Continuous Improvement
Document Version: 1 Updated: 6Nov19 Source: S.L.S.8.8
Enhance College of Technology
Enhance Professional Training Pty Ltd
ABN: 821 6587 1572 RTO: 41531 CRICOS: 03587K
2/35 Manilla Street, East Brisbane, Queensland 4169 Australia
Phone: 07 3895 8393 email: [email protected]
● Sought to capitalise on popular crazes such as James Bond and The Man from U.N.C.L.E. by
introducing action figures for Christmas.
● Due to internal strife and staff cutbacks, the new lines were not delivered to the stores until after
Christmas.
● Operated on a skeleton workforce.

● Due to lack of staff, A. C. Gilbert was unable to implement changes or introduce new lines quickly
enough to capitalise on trends.

1966

● Increased advertising spending to $3 million.

● Introduced point-of-purchase display products supplied to dealers free of charge.

● Borrowed $6.25 million, granted on the event that the company made a profit in 1996.

● Company made a loss of $12,872,000.00.

1967

● February – A. C. Gilbert closed its doors after 58 years.

Note: This case study is a true story. You may wish to read more about this organisation or to
conduct additional research online.

Reference material

● Tibballs, G., 1999, Business blunders, ‘A. C. Gilbert: Toy Story’, Robinson Publishing Ltd, pp. 43.

Page 14 of 14
BSB61015 Advanced Diploma of Leadership and Management
Unit: BSBMGT608 – Manage Innovation and Continuous Improvement
Document Version: 1 Updated: 6Nov19 Source: S.L.S.8.8