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  • Category:
    Management
  • Document type:
    Assignment
  • Level:
    Undergraduate
  • Page:
    3
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    2087

OPERATIONS MANAGEMENT

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Operation management is a branch of management that is concerned with the designing and controlling of production as well as redesigning business operations in the production of goods and services. It ensures that business operations are efficient in the sense that it uses a few resources as needed. I t also ensure that business operations are effective in meeting customer requirements. Most importantly, it is concerned with processes that involve a conversion of inputs into outputs in the form of goods and services. Operations management is based on some principles that guide operations in any organization. These principles ought to be followed strictly for the success of any organization. They include; the principles of inventory management, operation planning, manufacturing management, distribution and logistics and managing operations. Additionally, operation management revolves around four theories that are essential in the various concepts that are critical to the organization. The theories include; business process redesign, six sigma, lean manufacturing and reconfigurable manufacturing systems.

The principles of operation management as stated earlier are the guidelines that streamline the operations of any organization. They are therefore very important to put into consideration. It consists of five modules, and one of them is the principle of inventory management. The main goal of this principle is to impact an operational knowledge, understanding and the basic vocabularies used in the application of basic principles of inventory management. It provides participants with an understanding of their roles and responsibilities in the control of inventory and its impact on the organization. The second one is the principle of operations planning, whose goal is to impact the understanding of the basic principles and techniques of manufacturing and distribution. These principles and techniques are used in various levels of production and material planning processes from the strategic level to tactical level (Barnes, 2010). 

The third principle is the principle of managing operations. Its goal is to instill the knowledge and understanding of the computerized technologies, systems, and process management tools. They are used in the design and operation of the manufacturing and distribution environment. The fourth principle is the principle of manufacturing management which provides an introduction into the manufacturing environment. Through interaction with problem-solving exercises, participants gain a functional competency in manufacturing management and production activity control. It also involves materials requirements planning, capacity, and management, managing the manufacturing environment, manufacturing planning and control activities. The last principle is the principle of distribution and logistics. Its main goal is to introduce the foundations of planning and control in logistic operations. The basics involved include logistics management, transportation, supply chain management, warehousing, fulfillment and the distribution requirements planning (Render, Heizer & Munson, 2016). 

Operations management theories are also crucial to the success of any business (Leseure, 2010).  It encompasses four main theories, and one of them is business process redesign (BPR). It was formulated in the year 1993 and is a strategy that focuses on the analysis and design of workflow and business processes within a business. It goal is to help companies restructure organization through the design of business process from the ground going up. The second theory is reconfigurable manufacturing systems which are production systems designed to accommodate an accelerated change in the hardware structure and software components. The idea allows systems to adjust effectively to any changes that they can continue with production and perform its functions effectively. Six-sigma is another theory that focuses on quality. It aims at increasing profits and reducing costs. The tools used in this theory are charts, ratios, and potential defect calculations. The last theory is the lean manufacturing which is a systematic method of removing waste from the manufacturing process. It accounts for the wastes that are created through uneven workloads or overburdening. The primary goal of this theory is to eliminate the wasteful resource expenditures as much as possible.

The current situation at Ace Outdoor Power Centre is astonishing. In the case study, we see the Phil Mathers operating three retail stores separately. It means that the three differently located stores are operating autonomously meaning they are independent of each other. For this reason, the three managers employed to manage each store do not coordinate for the success of the whole business. The center also offers different products and services hence, they don’t have some uniformity. Phil Mathers as the C.E.O of the entire business has no business with the other two stores. He was only concerned with the one he was managing. Trust was what made him not to keep checking the other two stores. He had too much trust on the other two managers that they were doing the right as required (Stevenson, 2015). 

The situation at Ace Outdoor Power Centre had some pros and cons. One of the advantages is that the C.E.O had no pressure over his business operations. He was just at his center and always believed that the other two managers were doing the right. Another advantage is the easy and quick processes of purchasing equipment. We can see from the case that they used laissez-faire approach which is a shortcut. The use of qualified and trusted employees who work under minimal supervision is also an advantage. From the case, it is evident that such employees are productive since they made the business so popular that was admired by everyone. However, the cons also have some weight. One is the fact that the company can get into serious losses if their laissez-faire approach gets them into problems. Another approach is that lack of record keeping which can lead to losing of properties. The current situation is safe for the success of the business (Mahadevan, 2010). 

The most disappointing part of the case is the used of laissez-faire approach in the business. The method is usually used in an economic system where the private parties are free from government interferences. The interferences, in this case, include government regulations, tariffs, privileges, and subsidies. From this definition, it means that the business did illegal transactions in its business and especially purchasing and inventory management practices. If transactions are illegal, it means that performing them is a bridge of law and consequences are never favorable. The use of this approach by Ace Outdoor resulted in odd purchasing and inventory practices. I the case, we also deduce the aspect of lack of records. Mathers did not keep the records of purchases and inventory. It is evident as he did not know what the other stores have purchased the sales they made. In fact, he was not aware of what was happening in those particular stores (Shim & Siegel, 2011).
 

In the case study, several problems were realized as the major milestones. One of them was the lack of a proper purchase and inventory system. Phil Mathers did not have the records of the other two stores. And because he left the stores to run as independent entities, it was difficult to follow up their daily activities. Another problem was that the owner had no tight policies and procedures. It made the business stores to operate independently as there was no uniting factor. The lack of procedures also made the managers perform operations to the best of their knowledge without following stipulated procedures. Phil Mather had a problem of not monitoring the activities of other stores. He was only devoted to looking after his branch only. It is a problem because in case of an issue he cannot be in a position to trace the problem and even come up with a solution. The owner never took a time to consult, think and introspect. These ideas help in ensuring a smooth flow of process and realization of problems and possible solutions. He always stayed alone, and there was no coordination between the managers. He never thought of ideas that would improve his business. The lack of suitable processes in its operations was also a problem (Wild, 2013). 

The current situation had problems, and there is a need to find solutions to search problems. One is the need to use a suitable purchasing and inventory system. The employment of the principles of inventory management could be of good use. It instills the understanding of applying the basic principles of inventory management. Furthermore, it provides participant on their major roles and responsibilities when it comes to control of inventory. In this case, the managers would have had some procedures to be followed in the control of inventory as stipulated by the principle (Cooke, 2012).  If these would be followed, then there would be an excellent inventory management system. The problem of purchasing would be solved by the owner of the business avoiding the dubious methods of purchases. He should have the consistency of purchasing the required stock and not just when it gets depleted. It can be improved by having the records of outgoing stock to monitor the movement.

The availability of tight policies and procedure can also be a remedy for the success of the business. It involves having stipulated rules and regulations that must be followed. Organizations with policies always have their operations streamlined. The reason is that the staffs work under the same rules and not doing things as they feel like as in this case where the managers perform according to their consent. Another problem was the lack of monitoring. In this case, Phil Mathers was not monitoring other stores. He was only looking after the store where he was situated. He should use the theory of six-sigma. The theory focuses on quality. It ensures that proper monitoring is made to ensure that the output of any business is admirable. The target of this approach is to increase profits and decrease costs. The owner of the business should, therefore, us this theory to increase profits and at the same time reduce cost. These can be achieved through monitoring of business processes (Chary, 2015). 

The above case of John smith needs to have some recommendations of the purchasing and inventory system. He should keep in mind the principle of operations management. One is the principle of inventory management. It is critical as provides a better understanding of the ordering techniques, inventory management fundamentals that can use in the business. Furthermore, it includes modules such as purchase order management. It will help in the right steps to follow when making orders as well as the recommended techniques of inventory management. The theory of business process redesign can also help in the breakthrough of Smiths processes. It focuses on the analysis and designing of the workflow of business processes. Its major goal is to restructure the business process from the ground upwards. It can help in restructuring the business process in this case for it to realize more profits. Most importantly is the influence of the lean manufacturing theory. It is a method that eliminates wastes within any process. It also accounts for any waste created. It can, therefore, be used by the business to avoid a lot of wastage of resources and in the long run, it improves it operations and performance (Shim & Siegel, 2011). 

In conclusion, the operations management principles and concepts are very crucial in any given organization. They provide the required techniques that can lead to the success of any given business. Operations management involves all the processes that involve the processing of inputs into outputs. It is the processes that every organization gets involved into and therefore they must be taken with a lot of seriousness. These particular processes have the role of creating and delivering of goods and services to its customers. They are shown properly by a transformation model that involves the intake of input which goes through processing to get an output.

References

Barnes, D. 2010. Operations management: an international perspective. London, Thomson.

Stevenson, W. J. 2015. Operations management. Boston, MA, McGraw-Hill.

Mahadevan, B. 2010. Operations management: theory and practice. Upper Saddle River, Pearson.

Shim, J. K., & Siegel, J. G. 2011. Operations management. Hauppauge, NY, Barron’s Educational Series.

Wild, R. 2013. Operations management: text and CD-ROM. London, Thomson.

Cooke, J. T. H. 2012. Operations management: the art & science of making things happen : what the business schools don’t teach you to survive and flourish

Heizer, J. H., & Render, B. 2014. Principles of operations management. Upper Saddle River, N.J., Pearson/Prentice Hall.

Render, B., Heizer, J., & Munson, C. 2016. Principles of operations management: sustainability and supply chain management

Chary, S. N. 2015. Theory and problems in production and operations management. New Delhi, Tata McGraw-Hill

Leseure, M. 2010. Key concepts in operations management. Los Angeles, SAGE.