SELECT BUSINESS AND TECHNOLOGY COLLEGE

COURSE TITLE: OPERATIONS MANAGEMENT

NB: 1. Submit both assignments in one file through the given email address before
the Final Exam. Lemmabelay2004@gmail.com

2. Please write the Full Name, IDNO, and Section of the members on 1st page

Group Assignment 1 (25%)

Instruction 1: Select only 5 Questions you want among the given workout questions,

1. Last week employees at Bluegill produced 46 chairs after working a total of 200 hours.
Of the 46 chairs produced, 12 were damaged due to a problem with the new sanding
machine. The damaged chairs can be discounted and sold for $25 each. The undamaged
chairs are sold to a department store retail chain for $70 each. What was the labor
productivity ratio for last week? If labor productivity was $15 in sales per hour the
previous week, what was the change in labor productivity? (Sandres, pp 50)
2. A painter is considering using a new high-tech paint roller. Yesterday he was able to
paint three walls in 45 minutes using his old method. Today he painted two walls of the
same size in 20 minutes. Is the painter more productive using the new paint roller?
Calculate the productivity of the printer in both cases. (Sandres, Problems)
3. A firm cleans chemical tank cars in the Bay St. Louis area. With standard equipment, the
firm typically cleaned 70 chemical tank cars per month. They utilized 10 gallons of
solvent, and two employees worked 20 days per month, 8 hours a day. The company
decided to switch to a larger cleaning machine. Last April, they cleaned 60 tank cars in
only 15 days. They utilized 12 gallons of solvent, and the two employees worked 6 hours
a day.
a) What was their productivity with the standard equipment?
b) What is their productivity with the larger machine?
c) What is the change in productivity?
 4. Howard Plastics produces plastic containers for use in the food packaging industry. Last
year its average monthly production included 20,000 containers produced using one shift
five days a week with an eight-hour-a-day operation. Of the items produced 15 percent
were deemed defective. Recently, Howard Plastics has implemented new production
methods and a new quality improvement program. Its monthly production has increased
to 25,000 containers with 9 percent defective. (Sandres, Problems)
a) Compute productivity ratios for the old and new production system.
b) Compare the changes in productivity between the two production systems.
5. The design capacity for engine repair in our company is 80 trucks per day. The effective
capacity is 40 engines per day and the actual output is 36 engines per day. Calculate the
utilization and efficiency of the operation. If the efficiency for next month is expected to
be 82%, what is the expected output?
6. An electronics manufacturer makes remote control devices for interactive-cable-TV
systems. The following assembly tasks must be performed on each device.

Task Task time Description Predecessor(s)

(in mins)
A 0.50 Place circuit into circuit frame --
B 0.70 Solder circuit connections to central circuit A
control
C 0.40 Place circuit assembly in device frame B
D 0.30 Attach circuit assembly to device frame C
E 0.30 Place and attach display to frame --
F 0.20 Place and attach keypad to frame --
G 0.35 Place and attach top body of device to frame E, F
H 0.40 Place and attach battery holder to frame D
I 0.60 Place and attach bottom body of device to frame G, H
J 0.30 Test device I

a. Draw the precedence diagram for this problem.

b. What is the sum of the task times?
c. What cycle time will allow the production of 200 units over a ten-hour day?
d. What is the theoretical number of workstations needed?
e. Balance this assembly line using the most following tasks and the longest
operation time.
f. How do these two solutions differ? Which do you prefer; why?
7. Use the longest task time rule balance the assembly line described in the following table;
the line can produce 30 units per hour.

a) What is the cycle time?

b) What is the theoretical minimum number of stations?
c) Which work elements are assigned to which workstations?
d) What are the resulting efficiency and balance delay percentages?
8. Dress-making operation is being designed as an assembly line. The following table shows
the tasks that need to be performed, their task times, and preceding tasks. If the goal is to
produce 30 dresses per hour, answer the questions that follow the table.

a) Compute the cycle time.

b) Which task is the bottleneck?
c) What is the maximum output for this line?
d) Compute the theoretical minimum number of stations.
e) Assign work elements to stations, using the longest task time rule.
 f) Compute the efficiency and balance delay of your assignment.
9. A company is designing a product layout for a new product. It plans to use this
production line eight hours a day in order to meet a schedule of 400 units per day. The
tasks necessary to produce this product are detailed in the table below.

Task Task time (in Predecessor(s)

mins)
A 0.50 --
B 0.70 A
C 0.40 --
D 0.30 --
E 0.30 B, D
F 0.20 C, E

a. Draw the network described in the table.

b. What is the required cycle time (in seconds) in order to meet the schedule?
c. What is the minimum number of workstations needed to meet the schedule?
d. Balance this line using longest processing time.
e. What is the efficiency of the balance obtained
 Assignment 2: Operations Management Case Studies (25%)
Instruction 2: Select only 3 cases you want among the given case questions.

Case Study 1: Biddy’s Bakery

Biddy’s Bakery was founded by Elizabeth McDoogle in 1984. Nicknamed “Biddy,” Elizabeth
started the home-style bakery in Cincinnati, Ohio, as an alternative to commercially available
baked goods. The mission of Biddy’s Bakery was to produce a variety of baked goods with old-
fashioned style and taste. The goods produced included a variety of pies and cakes and were sold
to the general public and local restaurants.

The operation was initially started as a hobby by Elizabeth and a group of her friends. Many of
the recipes they used had been passed down for generations in their families. The small
production and sales facility was housed in a mixed commercial and residential area on the first
floor of “Biddy’s” home. Elizabeth (“Biddy”) and three of her friends worked in the facility from
6 a.m. to 2 p.m. making and selling the pies. The operation was arranged as a job shop with
workstations set up to perform a variety of tasks as needed. Most of the customers placed
advanced orders, and Biddy’s Bakery took pride in accepting special requests. The bakery’s
specialty was the McDoogle pie, a rich chocolate confection in a cookie crust.

Meeting Capacity Needs

Initially sales were slow, and there were periods when the business operated at a loss. However,
after a few years Biddy’s Bakery began to attract a loyal customer following. Sales continued to
grow slowly but steadily. In 1994 a first floor storage area was expanded to accommodate the
growing business. However, Biddy’s Bakery quickly outgrew its current capacity. In May of
2000 Elizabeth decided to purchase the adjacent building and move the entire operation into the
much larger facility. The new facility had considerably more capacity than needed, but the
expectation was that business would continue to grow. Unfortunately, by the end of 2000
Elizabeth found that her sales expectations had not been met, and she was paying for a facility
with unused space.
Getting Management Advice

Elizabeth knew that her operations methods, though traditional, were sound. A few years ago she
had called upon a team of business students from a local university for advice as part of their
course project. They had offered some suggestions but were most impressed with the efficient
manner with which she ran her operation. Recalling this experience, she decided to contact the
same university for another team of business students to help her with her predicament.

After considerable analysis the team of business students came up with their plan: Biddy’s
Bakery should primarily focus on production of the McDoogle pie in large volumes, with major
sales to go to a local grocery store. The team of business students discussed this option with a
local grocery store chain that was pleased with the prospect. Under the agreement Biddy’s
Bakery would focus its production on the McDoogle pie, which would be delivered in set
quantities to one store location twice a week. The volume of pies required would use up all of the
current excess capacity and take away most of the capacity from production of other pies.
Elizabeth was confused. The alternative being offered would solve her capacity problems, but it
seemed that the business would be completely different, though she did not understand how or
why. For the first time in managing her business she did not know what to do.

Case Questions

1. Explain the challenge Elizabeth faced in meeting her capacity needs. What should she
have considered before moving into the larger facility?
2. What is wrong with the proposal made by the team of business students? Why?
3. What type of operation does Biddy’s Bakery currently have in place? What type of
operation is needed to meet the proposal made by the team of business students?
4. Elizabeth senses that the business would be different if she accepts the proposal but does
not know how and why. Explain how it would be different.
5. What would you advise Elizabeth?
 Case Study 2: Creature Care Animal Clinic

Company Background

Creature Care Animal Clinic is a suburban veterinary clinic specializing in the medical care of
dogs and cats. Dr. Julia Barr opened the clinic three years ago, hiring another full-time
veterinarian, a staff of three nurses, an office manager, and an office assistant. The clinic
operates Monday through Friday during regular business hours, with half days on Saturdays and
extended hours on Wednesday evenings. Both doctors work during the week and take turns
covering Wednesday evenings and Saturdays. Dr. Barr opened the clinic with the intent of
providing outpatient animal care. Overnight services are provided for surgical patients only. No
other specialized services are offered. The facility for the clinic was designed for this type of
service, with a spacious waiting and reception area. The examining and surgical rooms are in the
rear, just large enough to accommodate their initial purpose.

As time has passed, however, the number of patients requesting specialized services has
increased. Initially the requests were few, so Dr. Barr tried to accommodate them. As one of the
nurses was also trained in grooming services, she began to alternate between her regular duties
and pet grooming. Pet grooming was performed in the rear of the reception area, as it was
spacious and there was no other room for this job. At first this was not a problem. However, as
the number of pets being groomed increased, the flow of work began to be interrupted.
Customers waiting with their pets would comment to the groomer in the rear, who had difficulty
focusing on the work. The receptionist was also distracted, as were the animals.

The number of customers requesting grooming services was growing rapidly. Customers wanted
to drop off their pets for a “package” of examining, grooming, and even minor surgical
procedures requiring overnight stays. The space for grooming and overnight services was rapidly
taking over room for other tasks. Also, most of the staff was not trained in providing the type of
service customers were now requiring.

The Dilemma
Dr. Barr sat at her desk wondering how to handle the operations dilemma she was faced with.
She started her business as a medical clinic but found that she was no longer sure what business
she was in. She didn’t understand why it was so complicated given that she was only providing a
service. She was not sure what to do.

Case Questions

1. Identify the operations management problems that Dr. Barr is having at the clinic.
2. How would you define the “service package (bundle)” currently being offered? How is
this different from the initial purpose of the clinic?
3. Identify the high-contact and low-contact segments of the operation. How should each be
managed?
4. What should Dr. Barr have done differently to avoid the problems she is currently
experiencing? What should Dr. Barr do now?
 Case Study 3: Prime Bank of Massachusetts

Prime Bank of Massachusetts was started in 1964 with James Rogers as CEO, who is now
chairman of the board. Prime Bank had been growing steadily since its beginning and has
developed a loyal customer following. Today there are 45 bank locations throughout
Massachusetts, with corporate headquarters in Newbury, Massachusetts. The bank offers a wide
array of banking services to commercial and noncommercial customers. Prime Bank has
considered itself to be a conservative, yet innovative, organization. Its locations are open
Monday–Friday 9–4 and Saturday 9–12. Most of the facilities are located adjacent to well-
established shopping centers, with multiple ATM machines and at least three drive-through
windows. However, Prime Bank’s growth has brought on certain problems. Having the right
amount of tellers available in the bank as well as in the drive-through window has been a
challenge. Some commercial customers had recently expressed frustration due to long waiting
time. Also, the parking lot has often become crowded during peak periods. While Prime Bank
was going through a growth period, the general banking industry had been experiencing tougher
competition.

Competitors were increasingly offering lower interest rates on loans and higher yields on savings
accounts and certificates of deposit. Also, Prime Bank was experiencing growing pains, and
something needed to be done soon or it would begin losing customers to competition.

The board, headed by James Rogers, decided to develop a more aggressive strategy for Prime
Bank. While many of its competitors were competing on cost, the board decided that Prime Bank
should focus on customer service in order to differentiate itself from the competition. The bank
had already begun moving in that direction by offering a 24-hour customer service department to
answer customers’ banking questions. Yet, there were difficulties with this effort, such as poor
staffing and not enough telephone lines. James Rogers wanted Prime Bank to aggressively solve
all customer service issues, such as staffing, layout, and facilities. He also wanted greater
creativity in adding improvements in customer service, such as on-line banking, and special
services for large customers. He believed that improving most aspects of the bank’s operation
would give Prime Bank a competitive advantage.
The board presented their new strategy to Victoria Chen, vice president of operations. Victoria
had recently been promoted to the V.P. level and understood the importance of operations
management. She was asked to identify all changes that should be made in the operation function
that would support this new strategy and present them at the next board meeting. Victoria had
been hoping for an opportunity to prove herself since she began with the bank. This was her
chance.

Case Questions

1. Why is the operations function important in implementing the strategy of an organization?

Explain why the changes put in place by Victoria Chen and her team could either hurt or help
the bank.
2. Develop a list of changes for the operations function that should be considered by the bank.
Begin by identifying operations management decisions that would be involved in operating a
bank, for example, layout of facility, staff, and drive-through service. Then identify ways that
they can be improved at Prime Bank in order to support the strategy focused on customer
service.
3. How different would these improvements be if the bank had a strategy of cutting cost rather

than supporting customer service?

 Case Study 4: Hon Hai Precision Industry

Being cheap is our specialty

Hon Hai Precision Industry is sometimes called the biggest company you have never heard of.
Yet it is one of the world’s largest contract electronics manufacturers which produces many of
the world’s computer, consumer electronics and communications products for customers such as
Apple, Dell, Nokia and Sony. Since it was founded in 1974, the company’s growth has been
phenomenal. It is now the world’s biggest contract manufacturer for the electronics industry.
Why? because it can make these products cheaper than its rivals. In fact, the company is known
for having an obsession with cutting its costs. Unlike some of its rivals, it has no imposing
headquarters. The company is run from a five-storey concrete factory in a grimy suburb of Taipei
and its annual meeting is held in the staff canteen. ‘Doing anything else would be spending your
money. Cheap is our specialty,’ says Chairman Terry Gow, and he is regarded as having made
Hon Hai the most effective company in his industry at controlling costs. The extra business this
has brought has enabled the company to achieve economies of scale above those of its
competitors. It has also expanded into making more of the components that go into its products
than its competitors.

Perhaps most significantly, Hon Hai has moved much of its manufacturing into China and other
low-cost areas with plants in South-East Asia, Eastern Europe and Latin American. In China
alone, it employs 100,000 people and with wages rates as low as one fifth of those in Taiwan,
many of Hon Hai’s competitors have also shifted their production into China.

Questions

1. Identify the various ways in which Hon Hai has kept its costs low.
2. How easy will it be for Hon Hai’s competitors to copy the way it has kept its costs low?
 Case study 5: Operations objectives at the Penang Mutiara10

There are many luxurious hotels in the South-East Asia region but few can compare with the
Penang Mutiara, a 440-room, top-of-the-market hotel which nestles in the lush greenery of
Malaysia’s Indian Ocean coast. Owned by Pernas–OUE of Malaysia and managed by Singapore
Mandarin International Hotels, the hotel’s general manager is under no illusions about the
importance of running an effective operation. ‘Managing a hotel of this size is an immensely
complicated task,’ he says. ‘Our customers have every right to be demanding. They expect first-
class service and that’s what we have to give them. If we have any problems with managing this
operation, the customer sees them immediately and that’s the biggest incentive for us to take
operations performance seriously. Our quality of service just has to be impeccable. This means
dealing with the basics.

For example, our staff must be courteous at all times and yet also friendly towards our guests.
And of course they must have the knowledge to be able to answer guests’ questions. The building
and equipment – in fact all the hardware of the operation – must support the luxury atmosphere
which we have created in the hotel. Stylish design and topclass materials not only create the
right impression but, if we choose them carefully, are also durable so the hotel still looks good
over the years. Most of all, though, quality is about anticipating our guests’ needs, thinking
ahead so you can identify what will delight or irritate a guest.’

The hotel tries to anticipate guests’ needs in a number of ways. For example, if guests have been
to the hotel before, staff avoids their having to repeat the information they gave on the previous
visit. Reception staff simply checks to see whether guests have stayed before, retrieve the
information and take them straight to their room without irritating delays. Quality of service also
means helping guests sort out their own problems. If the airline loses a guest’s luggage en route
to the hotel, for example, he or she will arrive at the hotel understandably irritated. ‘The fact that
it is not us who have irritated them is not really the issue. It is our job to make them feel better.’

Speed, in terms of fast response to customers’ requests, is something else that is important. ‘A
guest just should not be kept waiting. If a guest has a request, he or she has that request now so
it needs to be sorted out now. This is not always easy but we do our best. For example, if every
guest in the hotel tonight decided to call room service and request a meal instead of going to the
restaurants, our room service department would obviously be grossly overloaded and customers
would have to wait an unacceptably long time before the meals were brought up to their rooms.
We cope with this by keeping a close watch on how demand for room service is building up. If
we think it’s going to get above the level where response time to customers would become
unacceptably long, we will call in staff from other restaurants in the hotel. Of course, to do this
we have to make sure that our staff are multi-skilled. In fact, we have a policy of making sure
that restaurant staff can always do more than one job. It’s this kind of flexibility which allows us
to maintain fast response to the customer.’

Dependability is also a fundamental principle of a well-managed hotel. ‘We must always keep
our promises. For example, rooms must be ready on time and accounts must be ready for
presentation when a guest departs. The guests expect a dependable service and anything less
than full dependability is a legitimate cause for dissatisfaction.’ It is on the grand occasions,
however, when dependability is particularly important in the hotel. When staging a banquet, for
example, everything has to be on time.

Drinks, food, entertainment have to be available exactly as planned. Any deviation from the plan
will very soon be noticed by customers. ‘It is largely a matter of planning the details and
anticipating what could go wrong. Once we’ve done the planning we can anticipate possible
problems and plan how to cope with them, or better still, prevent them from occurring in the first
place.’

Flexibility means a number of things to the hotel. First of all it means that it should be able to
meet a guest’s requests. ‘We never like to say NO. For example, if a guest asks for some
Camembert cheese and we don’t have it in stock, we will make sure that someone goes to the
supermarket and tries to get it. If, in spite of our best efforts, we can’t get any we will negotiate
an alternative solution with the guest. This has an important side-effect – it greatly helps us to
maintain the motivation of our staff. We are constantly being asked to do the seemingly
impossible – yet we do it and our staff think it’s great. We all like to be part of an organization
which is capable of achieving the very difficult, if not the impossible.’
Flexibility in the hotel also means the ability to cope with the seasonal fluctuations in demand. It
achieves this partly by using temporary part-time staff. In the back-office functions of the hotel
this isn’t a major problem – in the laundry, for example, it is relatively easy to put on an extra
shift in busy periods by increasing staffing levels. However, this is more of a problem in the
parts of the hotel that have direct contact with the customer. ‘New temporary staff can’t be
expected to have the same customer contact skills as our more regular staff. Our solution to this
is to keep the temporary staff as far in the background as we possibly can and make sure that
our skilled, well-trained staff are the ones who usually interact with the customer. So, for
example, a waiter who would normally take orders, service the food and take away the dirty
plates would in peak times restrict his or her activities to taking orders and serving the food. The
less skilled part of the job, taking away the plates, could be left to temporary staff.’

As far as cost is concerned, around 60 per cent of the hotel’s total operating expenses go on food
and beverages, so one obvious way of keeping costs down is by making sure that food is not
wasted. Energy costs, at 6 per cent of total operating costs, are also a potential source of saving.
However, although cost savings are welcome, the hotel is very careful never to compromise the
quality of its service in order to cut costs. ‘It is impeccable customer service which gives us our
competitive advantage, not price. Good service means that our guests return again and again. At
times, around half our guests are people who have been before. The more guests we have, the
higher is our utilization of rooms and restaurants, and this is what really keeps cost per guest
down and profitability reasonable. So in the end we’ve come full circle: it’s the quality of our
service which keeps our volumes high and our costs low.’

Questions

1. Describe how you think the hotel’s management will:

a) Make sure that the way they manage the hotel is appropriate to the way it competes for
business;
b) Implement any change in strategy;
c) Develop the operation so that it drives the long-term strategy of the hotel.
2. What questions might you ask to judge whether this operation is a stage 1, stage 2, and stage
3 or stage 4 operations on Hayes and Wheelwright’s scale?
3. The case describes how quality, speed, dependability, flexibility and cost impact on the
hotel’s external customers. Explain how each of these performance objectives might have
internal benefits.
Case Study 6: Flextronics
Behind every well-known brand name in consumer electronics, much of the high-tech
manufacturing which forms the heart of the product is probably done by companies few of us
have heard of. Companies such as Ericsson and IBM are increasingly using electronic
manufacturing services (EMS) companies which specialize in providing the outsourced design,
engineering, and manufacturing and logistics operations for big brand names. Flextronics is one
of the leading EMS providers of ‘operational services’ to technology companies. With over
70,000 employees spread throughout its facilities in 28 countries, it has a global presence which
allows it the flexibility to serve customers in all the key markets throughout the world.

From a market requirements perspective, Flextronics manufacturing locations have to balance

their customers’ need for low costs (electronic goods are often sold in a fiercely competitive
market) with their need for responsive and flexible service (electronics markets can also be
volatile).

From an operations resource perspective, Flextronics could have set up manufacturing plants
close to its main customers in North America and Western Europe. This would certainly
facilitate fast response and great service to customers; unfortunately these markets also tend to
have high manufacturing costs. Flextronics’ operations strategy must therefore achieve a balance
between low costs and high levels of service in its strategic location and supply network
decisions One way Flextronics achieves this through its operations strategy is by adopting what it
calls its ‘industrial park strategy’. This involves finding locations which have relatively low
manufacturing costs but are close to its major markets. It has established industrial parks in
places such as Hungary, Poland, Brazil and Mexico (the Guadalajara Park in Mexico is shown in
the illustration above). Flextronics’ own suppliers also are encouraged to locate within the park
to provide stability and further reduce response times.

Case Questions

1. How does Flextronics’ operations strategy help the company to satisfy its customers?
 2. What specific operations competences must Flextronics’ have in order to make a success
of its strategy?

Case Study7: Birmingham International Airport

Robert Johnston, Case date 2002

In the space of just 30 minutes every weekday, around 5.00 in the evening, around 20 flights
arrive at and depart from the Euro-hub Terminal. At the same time, aircraft are arriving and
leaving the Main Terminal next to the Euro-hub. Across the runway and acres of tarmac, at the
site of the original airport, the overnight freight operation is just beginning to wake up with the
arrival of staff and the preparations for the first aircraft from Europe or the United States. Some
of the 7000 staff from the 150 organizations based at Birmingham International Airport (BIA)
see to the needs of their customers. The baggage handling operation is sorting, checking and
dispatching bags to the many departing aircraft.

The ground crews are loading and unloading aircraft, putting meals on board, filling the fuel
tanks and cleaning the aircraft during their brief spell at the air bridge. The airlines’ ticketing
staff are dealing with lines of passengers, each of whom may have a different final destination.
The information desk is fully staffed, dealing with the many queries, such as people wanting to
know if their plane is on time, the location of a bank or hotel, or trying to work out how to get by
road or rail to their final destination. Passengers flow through the lounges, passport control and
security checks, and use toilets, duty free shops and restaurants, all of which have to be kept
clean and stocked for their convenience. All of these activities, and more, are coordinated by
BIA’s Operations Director, Richard Heard. Richard explains his role:

‘Out of all the people that work at the airport, BIA employs about 700 and I oversee about 600 of
them. These operations people are basically concerned with the day-to-day running of the airport
and the short and medium-term operational planning. This includes a whole raft of things on the
airfield and in and around the terminals. The airfield side of things essentially involves
maintaining the runways, agreeing slot allocations with the airlines, developing and
implementing safety management systems and keeping the fire crew fully trained, for example.
This is a heavily regulated area so we work very closely with the Civil Aviation Authority. The
other side of the operation is about managing the terminal buildings and other facilities. This is
almost like running a shopping centre with its focus on customer service but with special security
arrangements.

Airport security is a key task which we run in-house, employing about 300 people. I also have a
facilities management team and an engineering services team that look after the maintenance of
the whole site. ‘In terms of long-term design and development, we set up teams to oversee the
planning of new building projects, such as new catering outlets, car parks and people mover
systems. This plan uses the forecasts of passenger numbers and guides our decisions about what
to build and when, and how to pay for it. We have been growing at a rate of about 10 per cent a
year over the last 10 years. In 2000 the airport handled 7.6 million passengers and our growth is
set to continue, with an anticipated 10 million passengers expected to travel through Birmingham
by 2005. This plan involves serious money; we are talking about a capital plan of about £50
million a year over the next 15 years. This is all very much driven by operational needs.
Managing and developing the airport’s operations are huge challenges.

‘One of the major tasks for operations is not just to provide the infrastructure for all the other
organizations on site – such as airlines, handling agents, retailers, cargo handlers – but also to
provide the leadership and coordination for them. There are also groups off site, such as
community groups, which we liaise with as we work to monitor and improve the environment.
My personal job is about coordination and setting the safety and customer service standards for
everyone to adhere to.

‘All of us from the different organizations try to work together as a team and there is a great
community spirit here that has built up over the years. Everyone wants their own bit to work well
and the whole thing to work well together. We all have a great understanding of everyone’s
problems and there is an excellent spirit of cooperation.

‘The real secret of managing operations, if you are ever going to sleep at night, is to make sure
you have really good processes and procedures in place. We can’t have people making it up on
the spot. Everything has to be thought through and tried and tested. We spend a great deal of
time reviewing and developing processes. We have to have procedures for fires, evacuations,
bomb threats, ill passengers and even deaths in the terminal. Unfortunately, we do have medical
emergencies, not surprising since we have about 30 000 people passing through the airport every
day in the summer.

‘Another key task is operational planning. We do this on an annual basis. Operational planning is
about making the operation as efficient as possible by working out how we can best allocate our
infrastructure to the airlines. For example, we need to decide who is going to get the air bridges,
who is going to get certain stands, who is going to have their passengers bused to the terminal at
peak times, and so on. However, you have to remember that the operational plans are just that,
plans, and as ever, things go wrong – schedules fall apart because of plane delays or mechanical
problems, for example. So we also have terminal duty managers whose job it is to sort out the
day-to-day operational problems. Our team of terminal managers covers the airport 24 hours a
day, every day of the week, with one senior manager overseeing each shift.

‘Many of the things that happen are recurring problems, such as delays or diversions, and you
know you will end up with a lot of passengers waiting around a lot longer than they want to. The
job of the duty manager is to coordinate all our efforts, ensuring that the catering people know
what’s happening and making sure our information services people know so they can tell the
passengers, for example. The terminal managers need to keep their ears and eyes open.
Passengers may report that they have seen someone acting suspiciously and the managers need to
know what to do. When passengers get off the plane and their bags are not there, although it’s
the responsibility of the airlines or their handling agents, our people may have to pick up the
pieces. When people try taking prohibited items through security, such as a family heirloom with
a large curved blade, we have to explain patiently to them that they have to leave it with us.

‘The terminal managers also have to deal with major incidents – things like bomb threats or, like
last year, when the Spanish coach drivers went on strike leaving many passengers stranded at the
airport. The job of the terminal manager is to sort it all out and make sure everyone knows what
is happening. It involves a great deal of common sense but it is not easy. If you have to do an
evacuation, for example, everyone will be at different stages in the passenger processing and
security clearance procedures, so when the incident is over, we have to try to put them all back
where they came from without mixing them up or they all have to start the process again!
‘We have the equivalent of the terminal duty managers looking after the airfield side: operations
duty managers. Their job is about dealing with the day-to-day problems, such as changing stand
allocations when delays occur or arranging snow clearance if we have a sudden fall. Again plans
are in place and everything has to be thought through.

We also have weekly communication meetings when we get the operations and duty managers to
work with the operational planning department.
‘Our mission is to be the best regional airport in Europe. To do this we need continually to try to
improve everything we do. It sounds simple but it is not easy. For example, we have almost no
capacity at the peak times that is between 7.00 a.m. and 8.00 a.m. and between 5.00 p.m. and
6.00 p.m. when we are busy with short-haul European traffic, so we are trying to encourage other
airlines to fill in the off-peak times. This is ideal for long-haul operators and we now have flights
to South East Asia and America, and just last year we added an Emirates flight to Dubai. This
allows us to use the middle of the day when we have runway and terminal capacity and it suits
everybody as we can all make better use of our facilities.

‘Running an airport is a fascinating and exciting challenge. No two days are the same. We know
that we can make a real difference to our customers, both passengers and airlines, by what we do.
We also make a major contribution to the impact on the local economy by encouraging inward
investment and exports. As an operations manager, my job is to make it all happen. It’s a
fantastic opportunity and it really does make a difference – it’s great!’

Questions

1. Identify some of the micro-operations to be found at the airport. For each one:
a) Identify the transforming and transformed resources.
b) State which is the predominant transformed resource.
c) Describe the output of each micro-operation and say who you think its customers are.
2. Summarize the job of the operations director. What are the main issues/problems he faces in
managing the airport?
3. What do you think Richard Heard actually does each day (how does he spend his time)?
4. Discuss the relationship between the day-to-day tasks and the long-term issues and explain
how Richard manages to oversee both at the same time?