Operations Management Assignment: Improving Operational Areas Of Manufacturing & Service Industries
Operations Management Assignment Objective:
This Assignment is designed to assess students how deep of their understanding the principles, concepts, and techniques that are applied to the design, planning, control, and improvement of manufacturing and service operations systems.
Assessment Scene (Background):
Operations Management is the management of processes or systems that transform inputs into finished goods and/or provide services. Over the past decades, many firms have learned the painful lessons that neglect of the operations function can be extremely hazardous to the health of the organization. It has been demonstrated that operations management becomes a primary function of a firm, and plays an important role in effectively improving the firm's performance and competitiveness. You are the Operation Management Consultant for a “Start-up” company and you are asked by the CEO of the Start-up company to analysis the company operation managerial efficiency. Since the company was started-up by a group of teens who have not had occupied any conceptions about management nor operation management. This course provides an overview of operations management in both the manufacturing and service industries.
You will need to:
Upon completion of the assignment, students should have a full demonstration of showing his deep understanding of the principles, concepts, and techniques in operations management, and use the quantitative and qualitative tools to analyze basic operations-related issues. Specifically, students will be able to:
1. Understand the basic role of the operations function in business organizations and its interdependence with other key functions
2. Understand how operations strategy is used to support the business strategy and to obtain a sustainable competitive advantage
3. Understand the key decisions and trade-offs involved in effectively managing manufacturing and service operations
4. Apply basic technical and analytical skills to identify, formulate, and solve operations management problems
Introduction to Operations Management Assignment
Operations management (OM) is one of several approaches to increase a company's efficiency. For-profit maximisation, resources and labour are transformed as fast and efficiently as possible into goods or services. Operations management teams balance costs and revenues in order to maximise net operational profit. This study will look at a variety of operational areas and how they might be utilised to maximise revenues for a new start-up company.
Management of operations
Operations management includes the use of people, resources, equipment, and technology. Operations managers consider the needs of the consumer and the company's capabilities while purchasing, creating, and delivering products to customers (Azhar, Prayogi & Sari, 2018). In addition, operations management is responsible for addressing strategic issues such as the size of production facilities, project management approaches, and the architecture of information networks. In addition to inventory management and raw material procurement, quality control, materials handling, and maintenance requirements are some of the other operational challenges.
Productivity, competitiveness, and strategy all go hand in hand.
In terms of competitive advantage, competitiveness is defined as anticipating market changes before rivals and modifying supply accordingly. A company's competitive advantage can come from a variety of functional areas within the organisation, such as the ability to attend shorter product delivery cycles; the ability to produce new products quickly; the ability to adjust volume changes and lower costs; and the ability to fulfil the promise of delivery. Despite the fact that these techniques seem simple to implement, they demand a great deal of time and effort. Increasing productivity is one strategy to boost competitiveness in the workplace (Baehre et al., 2021). Consider the fact that competition and productivity are interdependent concepts and that for competitiveness, it is vital to have firm foundations of productivity. In addition, the expansion of the economy necessitates a rise in productivity. According to this definition, productivity is a measure of how successfully the resources needed to achieve a certain goal are used. Resources utilised in the production process like raw material, equipment, labour, and other aspects of production are known as inputs, while outputs are the products of the production process as a consequence of using these resources.
In the same way, as a country's or a sector's competitiveness is affected by productivity, so is the competitiveness of individual businesses. Business competition has a significant impact on the design of organisational strategies, objectives, and goals, as well as on how the company allocates resources to carry out internal activities in a dynamic and efficient way. As a result, a competitive firm is one that is able to offer goods and services on time and at a price that is reasonable for the customer (Blut, Teller & Floh, 2018). It's because of these environmental changes that firms are always looking for new methods to adapt to them. Companies are faced with a variety of challenges and possibilities because of these shifts, which has an effect on how they choose strategies and define goals and make decisions.
Forecasting is a strategy that utilises previous data as inputs in order to produce educated predictions that are predictive of future trends. It is common for businesses to use forecasting in order to identify how to allocate their budgets and prepare for projected expenditures in the near future (DeJong et al., 2020). In order to make educated business choices and implement data-driven initiatives, forecasting is essential. These selections are made based on present market circumstances and projections of what lies ahead.
An effective and long-term competitive advantage can be achieved in a variety of ways by implementing an operations strategy.
Product and service design
The money one makes from selling design products and services keeps the business going. It's critical to approach the creation of the goods and services strategically and methodically, given their central role in the organisation. People, communication, and material components all play a role in the creation of great service. Product design is the process of taking an idea and turning it into a real, useable product using manufacturing capabilities and product and business expertise (Fakana, 2018). Actual product design combines manufacturing skills with product and business expertise in order to turn ideas into physical and practical products.
The process by which manufacturers evaluate the resources they need to fulfil the demand for their goods or services is known as capacity planning. To meet client demand, a company's capacity determines how much production, in the form of products and services, it can generate. In order to fulfil future product demand, businesses may use capacity planning methodologies to determine how much raw material, equipment, personnel, and investment in facilities they need to make over time (Leninkumar, 2017). In the absence of capacity planning, clients may be unable to have their requests met on time, resulting in a loss of business. In order to effectively plan manufacturing resources, a robust capacity planning method is essential to use. The manufacturer's money is being wasted because of excess capacity, which might have been better spent elsewhere. On the other hand, a lack of capacity means that the manufacturer is unable to produce according to the needs of the customer at a given time.
Selection of processes and layout of the facility
To increase output, eliminate mistakes, and constantly improve product quality falls under the umbrella term "operations management." Operational management relies heavily on process selection and layout. One can build more effective manufacturing processes if one understands the foundations of each and their relationship. The arrangement of equipment, machinery, and personnel in a workplace, referred to as the "facility layout," is an important consideration in any workplace design (Li et al., 2020). Depending on the overall size of the buildings, yards, and other places available, business owners may pick from a variety of layout possibilities. Operation managers are usually tasked with designing production facilities in a manner that minimises the movement of semi-finished items from one station to the next. In order to produce a product, it is necessary to carefully plan out the many work procedures that will be used in the manufacturing process. As an example, think about stitching clothing. All of the steps in the manufacturing process may be accomplished using different methods. The production objectives should guide the decision-making process when it comes to selecting a method. It's possible to get better output for the same amount of money but with a higher rate of error, for example, with these alternatives.
Systematic Design of the Work Environment
Employees and workplace equipment work together to fulfil the system function inside the workplace, in the workplace environment, and under work task circumstances. A canning plant or an electronic pump assembly workstation, for example, may be considered a working system. When designing a working system, the components and interdependencies of system components are taken into consideration (e.g., work task, work organisation, work environment). Thus, the design of a whole system is more than the sum of its components. Designing a working system is a complex process that requires consideration of a wide range of factors, including the needs of the target audience (Othman et al., 2019). As a result of job design, each employee's tasks and obligations are aligned with the restaurant's objective. Methods analysis reduces the number of activities that aren't absolutely essential and increases the efficiency with which work is done. Using work measurement, one may gauge how well the employees are doing and see how they stack up against other options.
Location Planning and Analysis
All physical facilities are located at a specific site or area. It influences the organisation's ability to provide. Choosing a location is an important aspect of any company's strategic planning process. Location considerations aren't just a one-time issue for new companies. Existing ones are typically more involved in these types of decisions than new ones. There are several factors to consider while making a location selection. National retail analysts assess and pick the best urban and regional markets for new shop openings at the national level. In order to service the market effectively at the urban level, prominent retail locations must be distributed optimally. The location of the non-manufacturing activity affects the ease with which consumers may do business with the firm (Rita et al., 2019). Location of manufacturing and non-manufacturing corporate activities affects operational costs, which in turn affects profit and the price of products or services.
Understanding the fundamentals of stock/inventory valuation quality is essential to manage industrial and service operations properly.
Customers' specifications, set measurement standards, adequate material utilisation, and a suitable manufacturing process all contribute to a product's quality. Quality is a relative word and is often used in connection to the product's use (Sousa et al., 2020). Quality is the ability to meet or exceed expectations. It's all about "fitness for purpose."The quality of a product or service is the ability of that product or service to meet or exceed the needs of the client.
An important part of quality control is testing units to ensure they meet the requirements for their end product. The goal of the testing is to find out whether there are any issues in the manufacturing process that need to be addressed. Consumers desire better goods, and firms that have good quality control can provide those needs. It is necessary to conduct quality checks at every stage of production (Sudari et al., 2019). The testing of raw ingredients, samples from the production process, and the completed product are all common methods used by workers. When an issue occurs in the manufacturing process, it is important to know where it is occurring and how to avoid it from happening again in the future. For a firm, the kind of quality control utilised depends heavily on the type of product or industry it specialises in. To ensure that a customer does not become ill from eating or taking a medicine, food and drug manufacturers conduct chemical and microbiological testing on samples from the production line. In order to ensure that the product is ready to eat, producers may follow the packaging instructions for visual examination (Syerov, 2020). To guarantee the smooth and effective operation of vehicle engines, quality control in the automotive industry focuses on the interplay between components. Meters that measure the flow of electricity may be used in electronics testing.
Quality Tools and TQM
Quality management (TQM) is an all-encompassing strategy for managing all corporate operations in order to provide products or services that meet and exceed customer expectations (Thabit & Raewf, 2018). CIMA. Workplace involvement, improvement at every level, and customer satisfaction are all key to TQM's business philosophy. Goal-setting and performance evaluations from the customer's point of view are included in this collection of connected practices. High-quality tools include SIPOC or Flow diagrams, FMEA, and "Kawakita Jiro" affinity diagrams.
Management of the supply chain
Efforts by suppliers to build and operate supply networks that are as effective and inexpensive as feasible constitute supply chain management (SCM). Product creation, manufacturing, and supply chain management are all part of a supply chain's scope (Goestjahjanti et al., 2020) (Goldsby et al., 2020). Supply chain management is often aimed at centralising or linking the production, shipping, and distribution of a product. Managing the supply chain may help organisations save money and provide items to customers more quickly. Internal stocks, manufacturing, distribution, sales, and the inventories of the company's suppliers are kept under tighter supervision to achieve this goal. According to supply chain management (SCM), the vast majority of products on the market are a consequence of collaboration between many different businesses. It has been a long time since most firms began to see supply networks as a value-added component of their operations.
In the eyes of a business, inventory is one of the most important assets. There are several industries where the foundation of a company's operation is its raw materials and completed goods (Kuhlmann et al., 2017). The consequences of a lack of inventory when and where it is required might be severe. Inventory might sometimes be seen as a liability (if not in an accounting sense). The danger of spoilage, theft, damage, or fluctuations in demand increases with a big inventory. A lack of sales may necessitate the disposal of inventory at clearance pricing or even the destruction of it. As a result of these factors, inventory management is critical for firms of all sizes. Decisions about when and how much to buy or create, as well as when and how much to sell, may quickly become complicated (Lee, 2020). Spreadsheet (Excel) formulae are often used by small firms to keep track of inventory and decide when to restock manually. In the case of large corporations, ERP software will be used. Software as a service (SaaS) is used extensively by the world's major organisations.
An entire manufacturing plan may be developed using aggregate planning, which assures continuous output at a plant. Production planning over a 3- to 18-month term is the norm. Not only individual production runs or individual products but the whole operation of a facility (or for big organisations, spanning many facilities) is covered by aggregate planning (Masanja, 2020). Aggregate production planning allows firms to maximise resource usage despite considerable fluctuations in demand for particular items, such as changes in client orders, supply chain dynamics, and other factors.
An advanced planning and scheduling system (APS) has the capacity of aggregate planning for firms that use digital technologies in a manufacturing operations management (MOM) environment (Nabukeera, Ssekadde & Bwengye, 2018). Aggregate production planning may be done utilising paper-based, spreadsheet, or custom software systems. However, as goods, manufacturing processes, and supply networks have become more complex, the type and amount of information that must be taken into account while making aggregate plans have expanded significantly. In order to meet their aggregate planning demands, firms are increasingly using APS systems. Aggregate planning aims to reduce operational costs by ensuring that production demand and capacity are properly aligned to avoid waste. In order to keep costs down, and aggregate plan describes what materials and resources are required and when they should be purchased. The goal of aggregate planning is to optimise a manufacturing facility's production at the lowest possible cost to the company.
MRP and ERP
One way to make sure that a manufacturing company operates well is to manage the shop floor, inventory, operations, and scheduling. Real-time data and software technologies help firms to automate operations and make smart data-driven choices as production and supply chains grow to satisfy growing global requirements. It is usual to use ERP (enterprise resource planning) and MRP (manufacturing resource planning) software solutions (material requirements planning). Material Requirements Planning (MRP) software systems are referred to by the abbreviation. They are particularly useful in manufacturing since their principal function is to detect and monitor what production materials are required and when. This allows producers to avoid the downtime that occurs when they are unable to produce. Even if a company's core activity is not manufacturing, MRP systems may still be useful for planning production (Nwobia and Aljohani, 2017). This programme aids in the forecasting and ordering of necessary supplies, as well as the maintenance of adequate stock levels by production planners. "Enterprise resource planning" is the acronym for ERP. To better service an entire company, these systems are based on the MRP II software's current features. There are several ERP apps that connect with each other to help firms manage both the parts and the total of their organisation more efficiently. Individual ERP SaaS (Software as a Service) programmes may be hired by businesses to solve specific business processes. Businesses may also choose between Big-Business ERP and Small-Business ERP, each of which is built to meet the business demands of various enterprises. When selecting an ERP system, businesses should look for a system that will not need costly adaptations, is able to adapt to the quick speed of company change, and addresses future technology.
Just in time management
If a product or material is required but will not be used for many hours, it is made and bought right away (Leninkumar, 2017). This is referred to as a Just-in-Time inventory management system or JIT inventory management system. Consequently, the purpose of just-in time inventory management is to maximise inventory turnover while minimising holding costs and other expenses, as well as other factors. When a firm uses the Just in Time approach, it makes, saves, and records just the orders that are required to fulfil the company's product orders. Companies utilise the Just in Time (JIT) technique to ensure that production runs smoothly and that orders are filled on a timely basis.
Working in a manufacturing or manufacturing-related context, scheduling refers to the process of organising, controlling, and optimising labour and effort. The order in which actions are accomplished in a chain is referred to as sequencing. It is possible to begin the following task after the previous one has been completed. While scheduling is the practice of designating certain time intervals for particular tasks, it is not the same as planning (Nwobia and Aljohani, 2017). The following are the principles of operation scheduling that may be summarised: The use of scheduling may help to enhance capacity planning. Scheduling is beneficial in order to simplify the order production process. Schedules are useful in keeping track of a variety of duties. To ensure that each component of the manufacturing process is correctly planned, time and resources must be allotted for each phase. Production is planned using Gantt charts, the critical path method (CPM), and the production execution review and feedback (PERR).
A start-up company's ability to be sustainable and effective over the long run is dependent on its ability to take into account all of the critical instruments and aspects of operation management. Additionally, it is critical to note that the strategy must include all of these considerations since a single point might destabilise the overall balance and proper flow of business activities.
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