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FA1 DJK submission final
FA1 DJK submission final
FA1 DJK submission final
Chapter 1: Introduction
The first chapter introduces the reader to exactly what operations management is and
attempts to illustrate how important operations management is in any organisation.
Central questions arise from this chapter as it assists in furthering the understanding
of what operations management comprises of. Some of these questions include the
following: what is meant by the input-transformation-output process as well as what is
meant by the process hierarchy (Slack, 2016:3). Feeding from the previous questions,
the different characteristics of operations processes will be analysed and evaluated
(this analysis and evaluation will continue for all the summarised chapters) as well as
understanding what it is operations managers do.
Operations and management can be divided in to two sects as even though it serves
as a unit of study in its name, broken up, these two terms have different meanings
(Slack, 2016).
In evaluating this, I echo why this must be strived for going over and above for one’s
customer and even doing this unreasonably so. The book by Will Guidara (2024)
‘Unreasonable Hospitality’ give countless examples as to they went above and beyond
for their customers by personalizing their experience where the server in the restaurant
overheard a family from China stating they want to experience the snowfall outside
(restaurant is based in New York) as they have never seen snow before but were not
certain they could as they were to leave the next day. The server reported this to the
operations manager and quickly the manager had organized for appropriate gear and
sleighs for the family to experience the snow. Actions such as this, amongst others,
allowed Guidara’s then restaurant, Eleven Madison Park, being rated as the worlds
best restaurant in 2017.
Illustrative Case Study: A multinational corporation in the oil and gas industry might
prioritize financial performance and shareholder value maximization due to the capital-
intensive nature of its operations and the expectations of investors. Although the
corporation recognises the significance of social and environmental responsibility, its
main emphasis may lie in profitability and expansion, thus constraining the efficacy of
the Triple Bottom Line (TBL) approach in promoting sustainable practices.
Operations performance objectives are the precise targets that organisations strive to
accomplish in their operations. These objectives are crucial to the organisation
because they provide a clear direction and purpose for their operations. These aims
may encompass: Cost: Reducing expenditures related to production, encompassing
materials, labour, and overhead charges. Quality: Providing products or services that
satisfy or surpass client expectations and adhere to applicable standards and
specifications. Speed refers to the act of reducing the duration required to provide
clients with products or services, encompassing both production lead periods and
delivery timeframes. Flexibility refers to the ability to promptly adjust to shifts in client
needs, market conditions, or manufacturing requirements. Dependability refers to the
ability to offer products or services, including delivering them consistently and reliably
on time and ensuring their reliability.
Strategy is a word deriving of Greek origin strategos which means to lead an army.
These are some similarities to this militant metaphor to business strategy in that both
attempt to set broad objectives (if implemented properly) direct an enterprise to its
goals as well as pathways that will assist in the business in achieving its goals. Both
importantly too emphasise long-term rather than short-term objectives.
It is crucial that operations principles are adhered to meaning that that the operations
strategy ideally must mirror the requirements of the business’s markets. For example,
if the customer values a low price (which is a competitive factor) a performance
objective of the business would be that it has to excel at costs. The same can be used
in the example with speed (as discussed in chapter 2), if the customer wants fast
delivery (another competitive factor, speed will have to be the operations performance
objective. This paragraph then shows how the market greatly can influence
performance objectives and this is why it is of importance to study, acclimatise and
find gaps in the market when drawing up the operations strategy as well as to stay up
to date with latest trends and ever developing the operations strategy as the market is
never static.
Linking to the above, an operations strategy (known as ‘the process’) can be put
together following the four stages known as formulation, implementation, monitoring
as well as control.
Formulation deals with the process of clarifying different objectives and decisions
making up the strategy as well as links between them. Coherent and comprehensive
strategies should be aimed to be produced (see bottom-up approach on
comprehensive strategies). Implementation: Execution is key here. Three issues often
arise here that are crucial to achieve successful implementation- strategic clarity,
nature of leadership of the top management as well as effective project management.
Monitoring takes a more quantitative approach as here ongoing performance and
diagnosing of data is tracked. This ensure that changes are proceeding as planned as
well as showing any early indications of deviation of the plan if any. Finally, control
involves a mixture of the monitoring and implementation as it is here where the
evaluation of the abovementioned takes place.
Chapter 4- Process Design
One key element of process design is the analysis of current processes to identify
areas of inefficiency or bottlenecks. This involves mapping out the steps involved in a
process, evaluating the flow of materials and information, and identifying areas where
delays or errors occur. By analysing these processes, managers can identify
opportunities for improvement, such as automating repetitive tasks, streamlining
decision-making processes, or reallocating resources to optimize performance.
Another important aspect of process design at is the use of quantitative and qualitative
tools to model and simulate processes. Tools such as simulation software,
mathematical models, and statistical analysis can help managers predict the impact
of changes to a process before implementation. By using these tools, managers can
test different scenarios, evaluate potential risks, and identify the most effective
solutions.
Innovation plays a critical role in determining the success of services and products in
operations management. It impacts design by pushing boundaries and driving
creativity to develop solutions that meet the ever-changing demands of consumers.
Good service and product design is essential because it directly influences customer
satisfaction, operational efficiency, and ultimately the bottom line of businesses.
Innovation in design leads to the creation of services and products that are more
efficient, user-friendly, and cost-effective. By incorporating new technologies,
materials, and processes, companies can stay ahead of the competition and meet the
evolving needs of their customers. For example, the introduction of AI-driven chatbots
in customer service has revolutionized the way companies interact with their clients,
providing quick and personalized responses around the clock.
The stages in service and product design typically involve ideation, conceptualization,
prototyping, testing, and implementation. Each stage is crucial in ensuring that the
final output meets the desired specifications and fulfils customer expectations.
Collaborative efforts between design teams, engineers, and end-users are essential
to gather insights, feedback, and iterate on the design to achieve optimal results.
Interactive design, where users can customize and personalize their experience, offers
numerous benefits in service and product design. It enhances user engagement,
creates a sense of ownership, and increases customer loyalty. For instance, online
platforms that allow customers to tailor their products to suit their preferences have
seen a surge in popularity due to the personalized experience they offer.
Process layout, also known as functional layout, groups similar resources together
based on their function. For example, all machining operations may be in one area,
while assembly operations are located in another. Process layout is suitable for
businesses that produce a wide variety of products and offer customization options,
as it allows for flexibility in production.
Product layout, on the other hand, arranges resources in a line or sequence based on
the production process. This layout is ideal for businesses with high volumes of
standardized products, as it enables a smooth and efficient flow of work through the
production process.
Cellular layout combines elements of both process and product layouts by grouping
resources into cells that are dedicated to specific product families or processes. This
layout is beneficial for businesses that produce a moderate volume of standardized
products with some customization options.
Fixed-position layout is used when the product is too large or complex to move through
the production process. In this layout, resources are brought to the product, rather
than moving the product through the facility. This layout is common in construction or
shipbuilding industries.
When choosing a layout type for an operation, it is essential to consider the nature of
the products or services being produced, production volume, customization
requirements, and the flow of work through the facility. Each basic layout type should
be designed in detail to optimize the use of space, minimize unnecessary movement
of resources, and enhance the overall efficiency of the operation.
In conclusion, forecasting and layout & flow are vital components of operations
management that play a significant role in the success of a business. By accurately
predicting future demand and designing an optimal layout for the facility, businesses
can improve efficiency, reduce costs, and enhance customer satisfaction.
Understanding the various basic layout types and designing them appropriately is
crucial for effective operations management.
Operations managers play a critical role in ensuring that processes are optimized for
efficiency and effectiveness. Process technology is a key aspect of operations
management that operations managers need to understand in order to make informed
decisions and improve operational performance. In this essay, we will discuss what
operations managers need to know about process technology, how process
technologies are evaluated and implemented, the importance of people issues in
operations management, the contribution of operations managers to human resource
strategy, different forms of organization designs, job design, and work time allocation.
Once a process technology has been evaluated and selected, operations managers
are responsible for overseeing its implementation. Implementation involves planning,
organizing, leading, and controlling the activities required to integrate the new process
technology into the existing operations. Operations managers need to ensure that
employees are adequately trained, processes are redesigned to accommodate the
new technology, and performance metrics are monitored to track progress and identify
areas for improvement.
People issues are crucial in operations management because people are the driving
force behind any organization. Operations managers need to consider human factors
such as motivation, communication, teamwork, and leadership in order to achieve
operational excellence. People issues can impact productivity, quality, innovation, and
customer satisfaction, making them a top priority for operations managers.
In addition to managing people issues, operations managers also play a key role in
contributing to human resource strategy. Operations managers are responsible for
recruiting, training, and developing employees, as well as designing job roles and
organizational structures that support the overall business strategy. By aligning
operational goals with human resource strategy, operations managers can create a
more cohesive and effective work environment.
Organizational designs can take various forms depending on the nature of the
business, market conditions, and strategic goals. Common organizational designs
include functional, divisional, matrix, and network structures. Operations managers
need to carefully evaluate the strengths and weaknesses of each design and select
the one that best aligns with the organization's objectives.
Work time allocation refers to how work hours are assigned and organized within an
organization. Operations managers need to carefully plan and allocate work time to
ensure that resources are utilized effectively, tasks are completed on time, and
employee workload is balanced. By optimizing work time allocation, operations
managers can improve operational performance and achieve better outcomes.
Chapter 10 and 11: The nature of planning and control & Capacity management
The primary differentiation between planning and control is in their time orientation
and focus. Planning is a forward-looking process that seeks to predict and get ready
for potential situations, whereas control is a current-focused activity that concentrates
on making immediate modifications to uphold performance criteria. Planning sets the
structure in which control functions, serving as the plan for distributing resources and
carrying out operations.
The impact of supply and demand on planning and control in operations management
is substantial. Changes in supply and demand require quick and flexible reactions to
ensure efficient operations. For example, a rise in demand may entail modifications in
production schedules or resource allocation, whereas a decline in demand may
require inventory management methods to avoid excessive stock.
The activities of planning and control cover a range of functions, such as predicting,
organising, managing inventories, and ensuring quality. Forecasting facilitates the
anticipation of future demand patterns, allowing for proactive planning and allocation
of resources. Scheduling is the process of coordinating the schedule and order of
operations in order to maximise the use of resources. Inventory management assures
the presence of sufficient stock quantities while minimising the expenses associated
with storing inventory. Quality control ensures the integrity of the product and customer
satisfaction by maintaining strict standards during production.
Capacity is quantified using many indicators such as utilisation rate, efficiency rate,
and throughput rate. The utilisation rate is a measure of how much of the available
capacity is being used, whereas the efficiency rate is a measure of the actual output
compared to the maximum possible output. Throughput rate refers to the speed at
which units of output are processed during a specific period.
Capacity planning involves aligning the projected demand with the capacity levels in
order to effectively manage operations and avoid queuing problems. This entails
evaluating the existing capacity, projecting future demand, and pinpointing
discrepancies between supply and demand. Capacity planning and queuing theory
are related as they both study the behaviour of waiting lines and service systems.
Queuing problems occur when the amount of demand is greater than the available
capacity, resulting in delays and inefficiency. By comprehending queuing principles,
operations may optimise service levels, minimise waiting times, and boost customer
happiness.
Conclusion: In summary, good planning, control, and capacity management are crucial
components of operations management, allowing organisations to successfully
navigate intricate operational environments and accomplish strategic goals. Market
fluctuations and operational efficiency depend on the interplay between supply and
demand dynamics, as well as the implementation of responsive planning and control
mechanisms. Organisations can improve their competitiveness and resilience in a
dynamic business environment by adopting capacity management principles and
implementing effective coping techniques.
Inventory it may well be argued falls under the planning and control section of the
operations function. This is because the adequate amount of product or service to
supply is dependent on market conditions stem from inventory management coupled
with forecasting (see chapter 6-7) to help make predictions and calculation to assist
with coming as close as possible to deliver the product or service at a proper and
timeous manner. Note that forecasting is essential here as inventory planning
techniques rely on the forecast made. It is worth noting that effective inventory
management ensures the presence of suitable products in the right quantities at the
right time and place.
When managing inventory, it is important to carefully analyse the amounts and timing
of orders. Various approaches, such as Economic Order Quantity (EOQ) and Just-In-
Time (JIT) inventory systems, help optimise the quantities and timing of orders.
The Economic Order Quantity (EOQ) model calculates the optimal order quantity that
minimises total inventory costs, including factors such as ordering costs, holding costs,
and demand variability. Organisations can determine the optimal order quantity that
maximises cost efficiency by carefully analysing and controlling these expenses.
Inventory control systems are essential for managing inventory levels and ensuring
operational efficiency. Inventory management can be accomplished using different
methods, including ABC analysis, Just-In-Time (JIT) inventory systems, as well as
inventory tracking technology.
ABC analysis categorises inventory items based on their importance and value,
allowing companies to allocate resources effectively and focus on products with
significant worth. Items are classified into categories (A, B, and C) based on criteria
such as sales volume, profitability, or significance to operations.
Inventory tracking technology, such as barcode systems and radio frequency
identification (RFID), enables real-time and uninterrupted monitoring of inventory
levels and movements. These technologies provide the capability to monitor the real-
time state of stocks, streamline the procedures associated with order fulfilment, and
facilitate accurate forecasts of demand.