Operations Management

June 2021 Examination

1. What are various decision criteria for deciding a location for a business setup? Explain these
decision criteria with reference to a location decision for setting up operations of a Large
Hospitality Setup (like a Resort. etc). (10 Marks)

Answer 1.

INTRODUCTION
Location decision: it's imperative to comprehend what to pay special mind to while picking
another hotel area. There are different variables which should be consider prior to beginning
another friendliness (area) adventure. Choosing right area will help in future to get achievement.

Idea AND APPLICATION

1. Perceivability

You may have tracked down the cutest, quaintest area for an eatery in a memorable midtown
some place, yet in case you're wrapped up a side road with little pedestrian activity, except if you
have stunning promoting strategies, you may have the most Instagram-and Pinterest-
commendable space with zero clients.

While picking a space you need some place that is apparent. To decide perceivability, take a
gander at foot and vehicle traffic designs. On the off chance that individuals are strolling by,
who's strolling by? Is it babysitters with buggies? On the off chance that your café isn't kid well
disposed, they won't head inside. Are specialists and medical attendants passing by from a close
by emergency clinic to get a light meal on their mid-day breaks? Shouldn't something be said
about nearby fashionable people who need a popular long lunch? Decide whether close by
people on foot are your objective clients. If not, the space most likely will not work for you.

Check distinctive dayparts, as well. Do these cafes need a full-administration café for breakfast
or lunch, or will you adjust for those occasions, offering quicker assistance or a sandwich
counter, or would you actually like to open for high end food in the evening? Will that daypart
bring sufficient traffic?

For vehicle traffic, can individuals pass your café, and when they've seen it, settle on an
extremely late decision to pull in and look at it? Such countless individuals drive by new places
and think, goodness, I should attempt that new eatery, yet clients should have the option to go
there before you leave business. What number of cafés have you been significance to attempt just
to see a "for lease" sign in the window a half year later?

2. Stopping

However much no stopping, equal stopping, and off site stopping may work for the road bistros
of Europe and the country bars in the UK, it doesn't work for American cafés, except for huge
urban areas. Regardless of whether you're opening high end food or a mainstream chain, ensure
the land you lease or purchase is sufficiently large to oblige stopping for your eager client base.

3. Space Size

The space you lease or purchase needs to accommodate your size necessities. For each café seat,
you need around five square feet of kitchen space, so on the off chance that you have eighty seats
in your eatery, your kitchen needs to have 400 square feet of room least. Bigger spaces lessen
work environment mishaps by limiting slips, outings, and falls, the most well-known working
environment mishap as indicated by OSHA. You'll need to consider how enormous of a space
you need for your café prerequisites.
4. Crime Percentages

Crime percentages are unglamorous contemplations, however in the event that you place your
eatery in a wrongdoing loaded territory, are your objective clients going to visit? Horror rates can
make potential clients awkward, and on the off chance that they feel they'll be robbed strolling to
their vehicles, it will just drive away business, regardless of how unbelievable your coq au vin.

5. Encompassing Businesses and Competitor Analysis

You'll need to do your exploration encompassing organizations. It is safe to say that they are
progressing admirably? Is the territory well-to-do? Is there adequate space for your business?
Likewise, you'll need to understand what sorts of cafés do well around there; nonetheless, you
would prefer not to open a pizza joint if there are four around there. Zones can unfortunately
uphold a limited number of a similar sort of café. What will recognize any new café is incredible
assistance and reliably brilliant food.

You'll likewise need to understand what the structure was utilized for before you occupy it. In
the event that the structure wasn't a café, will the transformation costs influence your primary
concern? In the event that it was an eatery, was it there for a very long time with incredible
achievement and the proprietors needed just to resign, or did it change hands multiple times?
Discover why past eateries were fruitful or not and if area assumed a part in these variables.
Discover how area functions for encompassing organizations, and will you cook the correct
group? For instance, if there is a dance club close by, that will work in case you're taking into
account the night-time swarm when they've finished up an evening of drinking.

6. Availability

A few hotels discover accomplishment in off-the-roadway areas, or situated close to exits for
those highway voyagers who need some food yet don't need the typical drive-through joint.
You'd need to remember busy times for these sorts of areas, just as client segment. Contingent
upon your definite leave area, you might be restricting different kinds of traffic to your eatery.

7. Moderateness

Cost is consistently a main concern thought for any business. In the event that the lease or
acquisition of the space is more than you'll acquire every month in benefits, that area isn't
attainable around then. Notwithstanding, assuming you realize that you'll create business from
that area, you should think about it, yet you'll should have the option to bear the cost of the
forthright expenses before you turn benefits. Albeit a few dangers do pay off, you would prefer
not to be at where you're battling to take care of essential expenses. An amazing area will not
make ready for driving your café bankrupt.

8. Security

Whenever you've handled your ideal space, remember that OSHA reports that slips, outings, and
falls are the most well-known work environment mishap, representing 15% of every inadvertent
demise, and they are more pervasive in the café business. It's essential to introduce slip-safe
deck, have slip-safe mats in the kitchen spaces, and give your laborers profoundly appraised safe,
slip-safe footwear to help forestall those preventable slips and outings. Slips and outings could
cost your organization more in fines than leasing a space, so ensure you consider all points of
wellbeing while picking the best space. On the off chance that your space has its own hardware,
ensure that all fryers are protected, ice machines aren't spilling, and there aren't any outing
dangers in the kitchen.

End

While picking the ideal area for your new residence, settle on sure you're settling on the choice
with your eyes totally open, educated with the information on what area can mean for your
expenses and benefits.
2. List down briefly the various inventory management techniques prevalent in the industry.
Discuss how some of these techniques would be applicable to a Medical Store in effective
management of their inventories, i.e medical supplies. (10 Marks)

Answer 2.

INTRODUCTION

Inventory Management: Inventory the executives is the demonstration of staying with track of a's
loaded products and observing their weight, measurements, sums, and area. The objective of
stock administration is to limit the expense of holding stock by aiding entrepreneurs realize when
it's an ideal opportunity to recharge items, or purchase more materials to produce them.

Idea AND APPLICATION

1. Set standard levels

Make stock administration simpler by setting "standard levels" for every one of your items.
Standard levels are the base measure of item that should be available consistently. At the point
when your stock plunges underneath the foreordained levels, you realize it's an ideal opportunity
to arrange more.

Preferably, you'll ordinarily arrange the base amount that will get you back better than average.
Standard levels shift by item and depend on what amount of time rapidly the thing sells and how
it requires to get back in stock. In spite of the fact that setting standard levels requires some
exploration and dynamic in advance, having them set will systemize the way toward requesting.
Not exclusively will it make it simpler for you to settle on choices rapidly, it will permit your
staff to settle on choices for your sake.

Recollect that conditions change after some time. Keep an eye on par levels a couple of times
over time to affirm they actually bode well. In the event that something changes meanwhile,
don't be hesitant to change your standard step up or down.

2. Earliest in, earliest out (FIFO)

"Earliest in, earliest out" is a significant standard of stock administration. It implies your most
seasoned stock (first-in) gets sold (first-out), not your freshest stock. This is particularly
significant for transient items so you don't wind up with unsellable deterioration.

It's likewise a smart thought to rehearse FIFO for durable items. In the event that the equivalent
boxes are continually sitting at the back, they're bound to get exhausted. In addition, bundling
plan and highlights frequently change over the long run. You would prefer not to wind up with
something out of date that you can't sell.

To deal with a FIFO framework, you'll need a coordinated stockroom. This regularly implies
adding new items from the back, or in any case ensuring old item remains at the front. In case
you're working with a warehousing and satisfaction organization they presumably do this
generally, yet it's a smart thought to call them to affirm.

3. Oversee connections

Part of fruitful stock administration is having the option to adjust rapidly. Regardless of whether
you need to return a sluggish offering thing to account for another item, restock a quick merchant
rapidly, investigate fabricating issues, or briefly extend your extra room, it's imperative to have a
solid relationship with your providers. That way they'll be more able to work with you to take
care of issues.
Specifically, having a decent connection with your item providers goes far. Least request
amounts are frequently debatable. Try not to be hesitant to request a lower least so you don't
need to convey as much stock.

A decent relationship isn't just about being agreeable. It's about clear, proactive correspondence.
Tell your provider when you're expecting an expansion in deals so they can change creation.
Have them told you when an item is running bogged down so you can stop advancements or
search for a transitory substitute.

4. Possibility arranging

A ton of issues can spring up identified with stock administration. These sorts of issues can
handicap ill-equipped organizations. For instance:

• Your deals spike out of the blue and you oversell your stock

• You run into an income deficiency and can't pay for item you urgently need

• Your distribution center needs more space to oblige your occasional spike in deals

• A erroneous conclusion in stock methods you have less item than you suspected

• A sluggish item occupies all your extra space

• Your producer runs out of your item and you have requests to fill

• Your producer ceases your item abruptly

It is anything but a matter of if issues emerge, yet when. Sort out where your dangers are and set
up an alternate course of action. How might you respond? What steps will you take to tackle the
issue? What will this mean for different pieces of your business? Recall that strong connections
go far here.

5. Customary examining

Customary compromise is imperative. By and large, you'll depend on programming and reports
from your stockroom to know how much item you have stock. In any case, it's critical to ensure
the realities coordinate. There are a few strategies for doing this.

6. Focus on with ABC

Certain items need more consideration than others. Utilizing an ABC examination allows you to
focus on your stock administration by isolating out items that require a ton of consideration from
those that don't. Do this by going through your item list and adding every item to one of three
classes:

1. High-esteem items with a low recurrence of deals

2. Moderate worth items with a moderate recurrence of deals

3. Low-esteem items with a high recurrence of deals

Things in classification A require normal consideration in light of the fact that their monetary
effect is critical yet deals are capricious. Things in class C require less oversight since they have
a more modest monetary effect and they're continually turning over. Things in class B fall some
place in the middle.

7. Exact determining

A tremendous piece of good stock administration boils down to precisely foreseeing request. No
doubt about it, this is staggeringly difficult to do. There are incalculable factors included and
you'll never know without a doubt precisely what's coming—however you can attempt to draw
near. Here are a couple of things to see while projecting your future deals:

• Trends on the lookout

• Last year's deals during that very week

• This year's development rate

• Guaranteed deals from agreements and memberships

• Seasonality and the general economy

• Upcoming advancements

• Planned advertisement spend

In the event that there's something different that will assist you with making a more exact figure,
make certain to incorporate it.

8. Consider outsourcing

Outsourcing is right around an ideal situation from a stock administration viewpoint. Rather than
conveying stock and boat items yourself—regardless of whether inside or through outsider
coordinations—the maker or distributer deals with it for you. Fundamentally, you totally
eliminate stock administration from your business. Regardless of whether you simply need to
utilize outsourcing to test new stock prior to putting resources into a major request, it very well
may be an incredible expansion to your business.

Precise guaging is viewed as great in medication supplies stock administration.

End

One will ordinarily require a blend of stock administration methodologies to get the most far
reaching and powerful business strategy. Consequently, the clinical store can either utilize one
stock administration procedure or a mix of more than one way to deal with better and
proficiently deal with the firm.

At last, we can say that stock administration procedures can assist an association with
diminishing expenses at different levels and increment the association's benefit.
3. Many business organizations have operations in which operations management is a daily and
constant process. Managing a Restaurant is one such business, wherein the procurement and
managing various resources is a very strategic process. Explain the following concepts (with
atleast one example) in Operations of a Restaurant business, and conclude how relevant is it in
the business?

a. Define Quality and list and discuss in brief the various dimensions of quality in operations (5
Marks)

Answer 3a.

INTRODUCTION

Quality: Word reference meanings of "value" cover genuinely comparative ground. Merriam-

Webster characterizes it as "level of greatness" or "prevalence in kind," while Oxford decides on
"the norm of something as estimated against different things of a comparative kind; the level of
greatness of something." When discussing quality as far as giving items or administrations, be
that as it may, we need to penetrate somewhat further down into how we characterize the term.

Idea AND APPLICATION

There are eight such components of value. These are:

1. Execution:

It includes the different working qualities of the item. For a TV, for instance, these attributes will
be the nature of the image, sound and life span of the image tube.

2. Highlights:
These are attributes that are supplemental to the essential working qualities. In an auto, for
instance, a sound system CD player would be an extra element.

3. Dependability:

Unwavering quality of an item is the level of reliability and dependability of the advantage of the
item for a significant stretch of time.

It tends to the likelihood that the item will work without interference or separating.

4. Conformance:

It is how much the item adjusts to pre-set up determinations. All quality items are required to
exactly satisfy the set guidelines.

5. Strength:

It estimates the timeframe that an item performs before a substitution gets fundamental. The
toughness of home apparatuses, for example, a clothes washer can go from 10 to 15 years.

6. Workableness:

Usefulness alludes to the expeditiousness, kindness, capability and straightforwardness in fix

when the item separates and is sent for fixes.

7. Feel:

Stylish part of an item is nearly emotional in nature and alludes to its effect on the human
faculties, for example, what it looks like, feels, sounds, tastes, etc, contingent on the sort of item.
Auto organizations ensure that notwithstanding practical quality, the autos are likewise
masterfully alluring.
8. Seen quality:

A similarly significant element of value is the view of the nature of the item in the psyche of the
buyer. Honda vehicles, Sony Walkman and Rolex watches are seen to be great things by the
shoppers.

End

It is apparent from the measurements referenced before that it is vital for an eatery and each and
every business to keep up the nature of an item or administration in each perspective. Something
else, there will be an enormous issue for the business' benefits and income.

Different components influence the nature of items and administrations. Nine of the essential
components are cash, market, the board, inspiration, men, machines, materials, and automation.
Thus, we can say that quality doesn't just mean the item's quality. All things considered, it
implies the quality all the while, men, material, machines, and a lot more important things.

b. Bill of Material (BOM) (5 Marks)

Answer 3b.

INTRODUCTION:

Bill of Materials (BOM): A bill of materials (BOM) is a unified wellspring of data that rundowns
all gatherings, sub-congregations, parts, and crude materials expected to deliver one unit of a
completed item. Basically, each completed item has its own bill of materials. A BOM typically
contains an order, with the completed item showed at the high level, and the segments and
materials at the base level. The amount of every thing expected to finish one unit of the
following most significant level of gathering is likewise recorded.
Idea AND APPLICATION

For what reason are BOMs so significant?

BOMs contain all the data you need to fabricate an item, and go about as the center structure
squares of an item's records. They are frequently overseen across various designing controls
(eBOMs) and assembling groups (mBOMs), and furthermore immensely affect account and
buying, since they're utilized to ascertain the expense of gathering, just as plan the buying
timetable and cost of materials. Besides, deals can utilize BOMs to compute the expense of an
item and edges; and coordinations may require explicit BOM data, like bundling and conveyance
prerequisites. Ultimately, after deals administrations could counsel a BOM for substitution and
fix subtleties, or item details.

The way to effective BOM the executives is having an incorporated area for the BOM and other
item records. Organizations regularly have offices working in storehouses, utilizing various
devices and working with various item information. This can bring about loss of efficiency,
overabundance stock, improve and blunders, quality issues, missed cutoff times and item
dispatches, longer an ideal opportunity to showcase, and, in the end, botched freedoms. While,
the capacity to control change the executives guarantees everybody in the organization has a
solitary form of reality.

With numerous associations moving to worldwide activities, where item configuration is done on
one side of the world and assembling measures are re-appropriated on the opposite side of the
world, working together and sharing item data safely and viably is an absolute necessity. With
appropriate BOM the executives frameworks set up, associations can guarantee the uprightness
of the plan and assembling measures, just as moderate the dangers related with sharing item data.

End
Utilizing an ERP to make and deal with your BOM likewise makes acquirement of parts simple.
During the plan stage, while your designing division is as yet occupied at work planning and
designing another item, your acquisition group can approach the EBOM to perceive what
significant long-lead things are required, and can put in the request right off the bat, giving you
an opportunity to get your hands on these parts before creation starts. What's more, once more,
since everything is overseen in one framework that it naturally connected to your stock, your
buying division will consistently realize what is required, and what is now sitting on your racks,
prepared for creation.