1

EXECUTIVE SUMMARY This report is to study and analyze Bayonnes operation issues, which caused the company a significant loss in October 2011. ubse!uently, all possible solutions for each issue are discussed thoroughly to generate the final recommendation that the president should follow. The first issue Bayonne needs to amend is the wea" corporate culture, which is unsupporti#e and unaligned in different departments. There is an absence of not only a clear #ision statement from the top management, but also sufficient communication to sol#e any une$pected efficiency issues. econdly, customers are unsatisfied with deli#ery ser#ices from Bayonne. The !uantity of orders that are either late or incomplete has been increasing #astly in October. %ast but not least, the !uality of Bayonnes product was one of the main factors for the financial loss in October 2011. The fact that customers re&ected 1.'( of Bayonne products, and )( were found defecti#e * ee +ppendi$ ,B-, respecti#ely, decreased .ross ales, and increased /ost of .oods old. These numerical factors are analyzed in more details below * ee +ppendi$ /+fter a thorough analysis of all factors presented in the Bayonne /ase, it is e#ident that Bayonne should start remodeling the current operation system and identifying a clear #ision statement. ince the company wants to penetrate a new mar"et, Bayonne should increase its operation capacity gi#en the fact that its ability to handle the current #olume of customer orders is !uestionable. +s a result, deli#ery ser#ice should be outsourced. Bayonne will be li"ely able to in#est more capital resources in additional e!uipment and ensure more fre!uent maintenance. INTRODUCTION Bayonne 0ac"aging, 1nc., a sub2chapter corporation founded by 3ands father 45 years earlier, is operating in the pac"aging industry. The top board members were originally formed with family members * ee +ppendi$ )B.a-. The companys main business is to pro#ide its industrial customers with customized and comple$2design pac"aging for promotional materials, software, lu$ury, be#erages, and gift food and candy * ee +ppendi$ ,B-. 6urthermore, Bayonne co2operated closely with its customers to de#elop artwor" and pac"age design * ee +ppendi$ ,B-. 7espite a !uite long2term profitable period since the start of Bayonnes establishment, the company witnessed a financial loss of 8,)',)94 in October 2011 * ee +ppendi$ /-. The main reasons are due to Bayonnes inefficient operation system, along with wea" corporate culture. 1t would be in the best interest of Bayonne that the president considers all the factors analyzed in determining issues and recommendation within this report. ANALYSIS Issue #1: Weak corpora e cu! ure" u#suppor $%e a#& u#a!$'#e&. The main cause of Bayonnes wea" corporate culture is due to lac" of a strong strategic #ision statement * ee +ppendi$, 1B-. trategic #ision statement illustrates managements aspiration for the future and portrays the companys strategic course and long2term direction *3yerson :ni#ersity, 21-. ;oreo#er, it helps manoeu#re the resources of company personnel in a common direction to companys main goal. :ndeniably, an unclear strategic #ision statement will create differences in employee perspecti#es. ;oreo#er, the board was composed of family

members * ee +ppendi$ )B.a- and there is no solid compensation or performance e#aluation that promotes corporate culture * ee +ppendi$ )B. h-. +nother cause is lac" of communication among departments< = ;anagers at each department use different personal practices to determine how an order is processed without sufficient communication * ee +ppendi$ )B.c-. This e#entually creates pressure on the following department = >o one felt a real need for accurate terminal2base shop floor production reporting * ee +ppendi$ )B.g-. 0rinted schedule is inaccurate. chedule generated by computerizing system twice a wee" is not aligned with actual operation */241= cheduling department does not inform sales department of late deli#eries * ee +ppendi$ )B.a-

Issue #(: De!$%er) Issues 7ue to the fact that Bayonne was late more than 20( of the time in October */2,5-, some customers e#entually decided to ad&ust the due date to recei#e product sooner * ee +ppendi$ 2+-. ;oreo#er, the percentages of late orders and partialed orders are e$tremely high */2,9-. The root cause is due to insufficient communication and understanding of the whole company operation system. 6or e$ample, ean ?uinn does not "now that not all departments can gang up orders li"e he does * ee +ppendi$ )B.e*. ome orders then cannot be completed and deli#ered to customers timely. Issue #+: ,ua!$ ) Issue"e-cess or !ack o. '!ue The October report retrie#ed from Bayonne /ase illustrates that )( of Bayonne products were defecti#e due to glue problems * ee +ppendi$ ,B*. ;oreo#er, 1( of shipped products were re&ected by customers due to the same reason * ee +ppendi$ ,B-. The number of customers re&ect was significant in October, which contributed to a considerable increase in /ost of .oods old compared to the pre#ious months * ee +ppendi$, /-. The ma&or reason for !uality problems lies in 6old and .lue department< = There is no fre!uent maintenance schedule for the "ey machines at the department * ee +ppendi$ )B.7* = 0ressure on finishing orders timely, and being pushed aggressi#ely without "nowing from the manager at /omposition, heeting, 0rinting, and 7ie2/ut department * ee +ppendi$ )B.@* = The machines seem to be old, and unable to handle high #olumes of orders * ee +ppendi$, )B d-. Aot melt glue guns and belts are not synchronized efficiently */242-

DISCUSSION

Based on issues identified abo#e and factors analyzed in the appendi$, the following alternati#es are strongly recommended for Bayonne 1nc to ta"e into account. The pros and cons of each possible solutions are also discussed . Issue #1: Weak corpora e cu! ure" u#suppor $%e a#& u#a!$'#e&. The alternati#e to address such issue of Bayonne is that the company should remodel the whole operating system, with more #i#id #ision statement. ;oreo#er, it should establish a more solid and fair performance e#aluation system, which is aligned with the companys core #alue. This will e#entually enhance the unification of employee ethics supporting Bayonnes core #alue. Aowe#er, this method is considered to be time2consuming, e$pensi#e, and to re!uire long2 term employees cooperati#e commitment. +nother alternati#e to impro#e Bayonnes wea" corporate culture is to pro#ide many &ob rotation opportunities for each department, and entertainment e#ents for employees to impro#e their relationship. +lthough employees will ha#e a deeper understanding of Bayonnes operation system, this method cannot ser#e this issue in the long run due to the companys lac" of clear #ision statements. Issue #(: De!$%er) Issues 1n dealing with this issue, Bayonne may consider obtaining deli#ery ser#ice from outsiders. This will cut down on operation duties and the company can spend more resources on other departments to enhance efficiency. ;oreo#er, this method is li"ely to increase better deli#ery ser#ice customerB thus, impro#e customer e$perience. Aowe#er, outsourcing deli#ery ser#ice may create more conflicts with the schedule of Bayonnes other internal operationB especially, the 7ying and .luing departments as they are re!uired to finish products more punctually. Bayonnes management can also consider applying different rewards and incenti#es that encourage its staff with meeting deadlines and pleasing customers. 7espite being a short2term andCor mid2term solution for this problem, the rewards will probably mislead Bayonne o#erall producti#ity. 6or instance, meeting deadlines can be the e$pense of product !uality, which is currently a big issue for Bayonne. @mployees will tend to pay less attention to such a matter. 1n order to please customers, sales employees may offer more discounts than they are supposed to. +s a result, this reduce the companys net income. Issue #+: ,ua!$ ) Issue"e-cess or !ack o. '!ue The main root causes of Bayonnes !uality problem are the pressure of meeting deadlines and insufficient maintenance at the 6old and .lue department. /onse!uently, Bayonne may need to hire more personnel to ensure regular maintenance, while in#esting in additional e!uipment to create more capacity. 1n spite of being costly at first, this method ensures that the company is able to impro#e its products !uality and to handle increased orders when penetrating new mar"et segments. To meet internal deadlines among different departments, Bayonne can introduce pre2 wor" order &ac"et. The report will be sent to different departments when the prior one starts wor"ing on an order. This will inform the later department of what orders are on the way in

couple of days. The main disad#antage of this method is that Bayonnes each department is too used to wor"ing independently and rarely depends on printed wor" schedule. This corporate culture will li"ely reduce any positi#e effect of this method. RECOMMENDATION O#erall, the companys top management should remodel Bayonnes operating system, pro#iding a clear statement of #ision. 1t plays an integral role in setting supporti#e employees mindset towards any companys common goal, which is success. This practice is not only a long term solution compared to &ob rotation method, but it can also sol#e the root cause of wea" corporate culture at Bayonne. The company can also apply &ob rotation method as a short2term or mid2term solution. ince Bayonne is penetrating new mar"et, a more unified operating system is more desirable. 1n terms of deli#ery issue, should Bayonne pro#ide rewards encouraging employees to meet deadlines, there may be negati#e effect on Dalready poorE products !uality. @mployees may be misled by the rewards and pay less attention to the !uality. +s a result, it is strongly recommended that Bayonne should outsource the ser#ice. Bayonne will be able to spend more capital resources on other in#estments, which include obtaining additional e!uipment and hiring more personnel for fre!uent maintenance at 6old and .lue department. This will impro#e Bayonnes product !uality, and the capacity to handle increased !uantity of customer orders. 1n conclusion, it is important to note that the abo#e selected solutions for each issue ha#e a strong cohesion. 7e#eloping a clear #ision statement enhances supporti#e corporate culture, as human capital resources will be directed in a common way. This will li"ely sol#e most of the current efficiency operation issues, especially inability to meet internal operation deadlines among departments. ubse!uently, outsourcing deli#ery ser#ice will not put any unnecessary pressure on the 6old and .lue department when all products are finished punctually. 1t also allows Bayonne to increase the current operation capacity by other strategic in#estments.

EXTERNAL ANALYSIS /A00ENDIX A* 1A. s ra e'$ca!!) re!e%a# .ac ors $# 1e 2acro"e#%$ro#2e# /0ESTEL a#a!)s$s*3

The legal and sociocultural are the main factors in the pac"aging industry. /hanges in customers mar"eting distribution channel will affect Bayonnes business, and the 67+ impacts Bayonnes product design. (A. I#&us r)4s co2pe $ $%e .orces /0or er4s 56 A#a!)s$s* There is not enough e#idence to draw a conclusion appropriately. Aowe#er, it does

confirm that customer satisfaction plays the main "ey in Bayonnes success, and the company is #ulnerable to changes in sociocultural factor. +A. I#&us r) c1a#'e &r$%ers Technology 1nno#ation in product designs to draw more customers */240+d#ancement 3eusability 1ncreased awareness of en#ironmental sustainability leads to higher demand for products used recycled materials 6le$ibility and The business of Bayonne consists of pro#iding customized pac"aging */2,'-.The

/reati#ity more fle$ible the product design is, the more competiti#e ad#antage Bayonne is +d#ertising This will change Bayonnes customer ad#ertising distribution channel, and has method impact on Bayonnes business *see +ppendi$ 1+These dri#ing forces play a part in shifting any companys business strategy in the pac"aging industry. /ustomer preference has the most significant influence on the industry. They tend to re!uire high fle$ibility and creati#ity in design, which is important to their ad#ertisement. 7A. S ra e'$c 8roup 2ap *>ot enough e#idence in the case, there is no competitor in the case5A. 6ra2e9ork .or co2pe $ or A#a!)s$s *>ot enough e#idence in the case, no competitor:A. ;e) success .ac ors Timely deli#ery ser#ice< Bayonnes product is crucial to customer campaign2Dits all schedule to hit on a specific date. 1f our product isnt there, the customer goes nutsE */2,5-. 6inancial trength< 1t allows company to in#est in additional e!uipment and human capital resources to e$tend operation capacity limit. +bility to ser#e multiple mar"et segments< customization is a "ey in attracting customers from different mar"ets, and follow changes in ociocultural factor * ee appendi$ 1+ 0roduct !uality< /ustomers will be unsatisfied with poor product and re&ect orders. */2,)<A. I#&us r) Ou !ook .enerally, the pac"aging industry is conducti#e to good profitability. /ustomers need products from this industry for their promotional or ad#ertising campaigns */2,5-. 1t states that the paper pac"ing industry grew considerably in the 1950s and early 1900s */2,'-. 1n order to sustain profitability, companies within the industry must continue to be inno#ati#e in operation process and product designs. Bayonne seems to ha#e issues with some of the Fey uccess 6actors identified abo#e. /onse!uently, management should ta"e actions to sol#e those issues. INTERNAL ANALYSIS /Appe#&$- =* 1=. Co2pa#)4s curre# s ra e'): 1- Gision, ;ission and Ob&ecti#es a- Gision< unclear. The case does not gi#e any information regarding #ision statement. This is an issue. b- ;ission< offer essential ser#ices from design assistance through final deli#ery */2,'c- Ob&ecti#es< minimizing costs, obtaining good !uality and meeting deli#ery promises */2,)-. 2- Business and 6unctional trategy a- Business trategy< i- Obtaining competiti#e ad#antage due to mar"et di#ersification */2,'ii- 7e#eloped comple$ product designs for large orders */2,'iii- +llows customization */2,'i#- .eneric trategy< /ost %eadership */2,)-2minimizing cost. b- Fey 6unctional trategies< i- ales 7epartment< 0rice aggressi#ely in the new mar"et to increase more #olume */240ii- 0roduction 7epartment< /omposition 7epartment< de#elop pac"age and printing designs for orders, finalize printing plates and die2cutting dies ordered */240-.The 0rint department< print the sheets */240-.7ye2/ut 7epartment< cut the printed sheets into blan"s, and printed papers are to be folded and glued into finished product */240iii- chedule< chedule products for deli#ery, and schedule what need to be done */242-

i#- ?uality /ontrol 7epartment< ensure product !uality meet the stated standard */2,)-. ,- Fey 0erformance 1ndicators< a- /ustomer satisfaction based on measures of timely deli#ery and high !uality< Bayonne has been recei#ing complaints from customers regarding product !uality and deli#ery */2,)b- >et income< >egati#e net income in October c- /ost efficient system< /ost seems to be high in October, including scrapped */2,H(=. VRIN a#a!)s$s 3esources or /apacity 0hysical resource *7ie2cut machine, 6old I .lue e!uipment1ntangible resource *+rtwor" and pac"age printing I design application-

Galuable The machines allow Bayonne to customize artwor" and print for pac"aging products */2,5 Technology, any software, pro#ides uni!ue features of image and design to customer orders */2,)3are J J +ssume that these machines are e$pensi#e and that only a few firm can afford. 1t is probable that any competitors are pro#iding same ser#ice as Bayonne 1nimitable J J /ompetitors can purchase the machines if they ha#e enough financial resources The same intangible asset can be purchased by the competitors >on2 ubstitutable K +ssume these e$pensi#e machines are only tool can be used in this pac"aging industry. 1n2house artwor" are non2substitutable as this is uni!ue medication from Bayonnes customers +=. SWOT a#a!)s$s trengths Offers in2house artwor" printing and pac"aging design */2,'1nno#ation in comple$ pac"age design in different mar"et */2,'+ble to .lue I 6old with comple$ blan"s */242.ood relationship with suppliers2D suppliers can restoc" in 122 days */241Opportunities @$pansion to new mar"et and attract more customers */240Aigh profitability in ;anhattan */2407=. Va!ue C1a$# 0r$2ar) Ac $%$ $es Lea"nesses :nclear strategic #ision %ac" of communication and support among management team members */241,42,4,%ow !uality products in October2 )( defecti#e */2 ,)>o incenti#eCreward system /ustomer re&ect 1 ( of orders2 1.'( of ales */2,HThreat hift from ad#ertising method to 1nternet */2,'/hanges in 07+ restriction may increase cost of operation */240-

Seco#&ar) Ac $%$ $es: Tec1#o!o') a#& S)s e2 De%e!op2e# : +llows in2house artwor" and design with customers */2,' >R 2a#a'e2e# : There is not enough e#idence 0a)ro!! ? 8e#era! A&2$#$s ra $o#: There is not enough e#idence. 1n conclusion, Bayonne lac"s se#eral essential secondary acti#ities to support the primary operation 5=. Represe# a $%e 9e$'1 e& Co2pe $ $%e S re#' 1 Assess2e# : >ot enough e#ident, there is no competitors in the case :=. Te# @as$c 2a#a'er$a! asks o. 1e s ra e') e-ecu $o# process a*S a..$#' 1e or'a#$Aa $o#: 2The board members consisted of all family members */2,'-. +s a result, the board is not competent enough to lead the whole organization effecti#ely. There is a need for a leader who will re#ise the current strategy and identify a clear #ision for Bayonne. 2 ;anagers seem to be e$perienced. Aowe#er, they are not cooperati#e towards the common goalB for instance, conflict between sales and production departments */241-. This creates misleading assumption among departments, and efficiency problems. 2 There is not enough personnel at the ?uality /ontrol *?/- department and 6old I .lue department. There is only one inspector of the ?/ shifting from /omposition to 7ie2cut department, and another one from 6old I .lue to 6inishing department */2,)-. 2 1n terms of training current employees, Bayonne lac"s &ob rotation programs through different tas"s. ;oreo#er, the company also does not pro#ide any incenti#es or rewards encouraging employees to impro#e wor" producti#ity, or any performance e#aluation. @*=u$!&$#' 1e or'a#$Aa $o#a! capa@$!$ $es " Bayonne has a competent team of employeesB howe#er, there is no solid programs to update and de#elop that team. c* Crea $#' a s ra e')"suppor $%e or'a#$Aa $o#a! s ruc ure " 7ue to the absence of clear #ision statement and sufficient communication among departments, the business structure at Bayonne is unsupporti#e. There is no fre!uent discussion between all the managers and the board members to discuss issues. @ach manager seems to ha#e to deal with his issue by using personal e$perience and assumption. 6or instance, the cheduling manager rarely reports late deli#ery because he belie#es that would create more unnecessary wor" */242-. +nd he will &ust li"ely deal with the issue by himself. ;oreo#er, ean ?uinn sends 3ic" .omes a lot of orders that are one or two days from the due date, or e#en late already without "nowing that .omes cannot gang orders as he can */242-. ubse!uently, 3ic" .omes deal with the issue by using his way, which decrease the !uality product */242&*A!!oca $#' su..$c$e# resources o s ra e'$c e-ecu $o#

2 3esources are allocated effecti#ely. The 6old I .lue department re!uires more additional e!uipment and more fre!uent maintenance schedule. The machines at this department cannot gang many orders at once and are old */242-. e* I#s $ u $#' po!$c$es a#& proce&ures 1a .ac$!$ a e s ra e') e-ecu $o# 2 There is no clear set of procedures determined how an order should be treated */24,-. +s a result, the wor"flow is inconsistent and does not facilitate strategy e$ecution. .* A&op $#' @es prac $ce a#& @us$#ess processes 1a &r$%e s ra e') e-ecu $o# ac $%$ $es 2 1t is not illustrated in the case that Bayonnes management ta"es efforts to study the best practice, or to compare with other competitors. The pre#ious G0 of operation mind set was Dwell ha#e to try harderE */2,)- without a clear strategy. This might li"ely affect other managers mindset negati#ely. '*I#s a!!$#' $#.or2a $o# a#& opera $#' s)s e2s 1a e#a@!e co2pa#) perso##e! o &o 1e$r s ra e'$c ro!es pro.$c$e# !). 2 The information and operating systems are inconsistent. The schedule system is not helpful, since it does not reflect the actual wor"flow. 1nformation or data of wor"flow, schedule to wor" or inspect product are manually recorded */242, 4,-. +s a result, the information is greatly e$posed to human error. D>o one felt a real need to follow production reportingE */24,1*T)$#' re9ar&s a#& $#ce# $%es &$rec !) o 1e ac1$e%e2e# o. s ra e'$c a#& .$#a#c$a! ar'e s " There is no rewards or incenti#es pac"ages mentioned in the case to promote performance or retain any s"illed employees in Bayonne /ase. $* I#s $!!$#' a corpora e cu! ure 1a pro2o es 'oo& s ra e') e-ecu $o# " There is little cohesion and supporti#e engagement among departments. This is due to lac" of #ision statement from Bayonnes senior e$ecuti#es. 2The current culture is not aligned with Bayonnes generic business strategy, which is cost leadership in the mar"et. %ac" of communication puts more pressure on the 6old and .lue department, which in turns increase number of defecti#e products */242-. This increases /ost of .oods old. B* E-erc$s$#' 1e $# er#a! !ea&ers1$p #ee&e& o prope! s ra e') $2p!e2e# a $o# .or9ar& 2Bayonne needs to ha#e a competent leadership at the top le#el to create and guide the corporate culture aligned with the companys core #alues. ;oreo#er, leadership at the lower le#els is also desired to be able to deal with une$pected issues. 1n conclusion, Bayonne is unable to perform the 10 basic managerial tas"s well to ensure its strategy e$ecution. The main reasons are lac" of discussion regarding issues, clear #ision statement, and consistent wor" procedures. <=. Ma#a'er$a! Issues Aow can Bayonne impro#e or re#ise the current corporate cultureJ The current corporate culture is considered to reduce operation efficiency at Bayonne. There is insufficient communication among the board members and managers to analyze issues and come up with solution. 0eople tend to mind their own &obs and deal with their issues based on personal e$perience and assumption. 1t is time that Bayonne need to re#ise this culture Aow can Bayonne impro#e deli#ery issueJ hould it outsource it or impro#e the ser#ice internallyJ

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Bayonnes products are #ery important to customers businesses. +s a result, deli#ery issues will harm Bayonne reputation. There are se#eral customers ta"ing action to either switch to another firm *+ppendi$ /- or ad&usting the due dates to recei#e orders sooner */2,9 Aow can Bayonne deal with !uality issuesJ Bayonne is struggling with !uality issue2either e$cess or lac" of glue. )( of products were scrapped due to being defecti#e, and 1( of products were re&ected by customers due to !uality issues */2,)-. These factors increased /ost of .oods sold. ;oreo#er, it tends to reduce gross sales as customers are unsatisfied with products !uality.

6INANCIAL ANALYSIS /Appe#&$- C*

8ross Sa!es E a##ua! c1a#'e Cus o2er ReBec s E a##ua! c1a#'e CO8S S1$ppe& Ma er$a!s E a##ua! c1a#'e /Scraps* E a##ua! c1a#'e Re'u!ar DL E a##ua! c1a#'e OT DL E a##ua! c1a#'e IL super%$sor) E a##ua! c1a#'e M.' O> E a##ua! c1a#'e To a! CO8S E a##ua! c1a#'e O 1er e-pe#ses E a##ua! c1a#'e Ne I#co2e E a##ua! c1a#'e Oc "11 ',140,4)H 1'.52 2H',4'' 12,.02 ,,25',)H, 21.49 '9H,)H1 4H.49 '2',H45 ,2.)2 11),49' ''.'5 29,554 19.0, 40,'20 229.24 24,'9',992 2'.4) 5,4,H14 ''.,, 2,)',)94 22H9.,2 Sep"11 4,4,5,'00 44.,0 2,,,5,4 '5.4H 2,H04,4)' 45.'H 40',229 '0.HH ,9),420 4'.5, H4,5H9 '12.91 2',10H )4.40 'H,2)1 10.25 2,,)),,,)0 '0.11 ',H,,)9 '1.)H 20,,9,) 221.4' 1,520,,50 2)5,H51 2H1,5,' 12,21H 1',2H2 '1,924 22,440,409 ,'4,,02 2'9,)15 Au'"11 ,,0H',5)0 221,,'1 (C11 40,,,H,),, 5.51 2,5),11H H,.'9 2,,H)1,0'0 14.,, ,,',2,59, ,'.04 ,,421,)H9 19.0' ,)',120 2,.5) 159,111 )4),4'4 212.25 2,1,91),,0H 1).,) 4,5HH,494 2H.2H ,,1'H,H14 24,.4H (C1C ,H,0H1,0,5 '.H1 2222,42) 2).5' 20,H52,)1H 0.05 2,)1),2'1 0.21 2,5H4,192 0.1, 294,H59 11.1) 12',25' H,),9H2 0.'H 22H,4,0,10H 0.09 ,,5,2,2') 22.59 ','5),2'0 2,.H, 19,29),,02 2,1),,419 2,'4H,2'1 2)',19, 1,9,'H' H,2,HH1 22',144,'1, ,,94),49' ',502,545 (CCD ,',0)9,202 21H',,4)

Bayonnes net income has been decreasing since 2009, in spite of sales growth. This should be an indicator that inefficient operation system has increased /ost of .oods old */. -.

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6urthermore, diminishing increase rate in 2010 gross sales reflects that customers may not be unhappy with Bayonnes productsB thus, they are switching to another company. >et income in 2011 decreased by 4,.4H( compared to 2010, due to significant loss of 8,)',)94 in 2011. This loss is a conse!uence of percentage growth in /ustomer 3e&ects *12,.02(-, which decreased .ross ales. ;oreo#er, /. in October was affected by increase in unnecessary e$penses of craps, 4H.49( compared to eptember. +round )( of products were found defecti#e in October and then scrapped */2,) Owing to inefficient operation, the following e$penses2 ;aterials, 7irect %abour, and total O#erhead2 went up at higher rates than increase in .ross ales. The numerical changes are illustrated in the table abo#e. +s a result, /. increased at higher rate than ales.