The Concept of Operations Management - Clarks in Lincoln - Case Study Example

An operation of Clarks (Lincoln) Contents Contents Introduction 3 Main Body 4 Performance objectives evident in chosen operation 4 2. Types of process technology evident in the operation 9 3. Capacity constraints within the operation 11 4. Specific recommendations for improvement 13 Conclusion 14 References 16 Appendices 17 Appendix 1: Questionnaire 17 Introduction This study is centred towards analyzing the concept of operations management. Operations management is associated with designing, controlling and overseeing production process. Every organization undertakes specific types of operational procedures. There are wide array of responsibilities included within operations management such as maximum utilization of resources, manufacturing high quality products and effectively addressing customer requirements. Operations management is inclined towards converting inputs like energy, raw materials or labour into various outputs in the form of products or services. This concept is undertaken by companies along with a set of evaluation metrics. These metrics are able to predict quality level of goods or services being manufactured. Operations strategy is all about utilizing productive resources available in a firm in order to retain competitive advantage for longer period of time. Evaluation metrics implemented by firms can be divided into two aspects such as effectiveness and efficiency metrics. These metrics encompasses quality, price, flexibility, stock availability, time and ecological soundness. An organization not only needs to utilize resources effectively but it should be highly concerned about operational impact on external environment. This study will be divided into sub-sections to identify operational quality of Clarks in Lincoln. Clarks is located in busy high streets of Lincoln. It can be stated that this shop is situated in the heart of the city. Clarks majorly excels in offering high quality shoes to their target group. High quality footwear and shoes is offered by the company to customers in Lincoln. The company offers shoes for men, kids and women. Fitting service is also made available for children. Shoe manufacturing operation will be highlighted in this particular study. There are wide array of parameters linked with this operation like timely delivery of products, appropriate stock keeping option, addressing customer requirements and maintaining product quality. Main Body 1. Performance objectives evident in chosen operation The performance objectives for manufacturing operation at Clarks can be determined with the support of polar diagram. A polar diagram represents five important factors such as cost, dependability, speed, flexibility and quality. Manufacturing operation is a critical aspect in overall business operations of Clarks. Products need to be placed in stores outlets in required time in order to address customer requirements. Cost is a performance objective set forth for this operation (Greasley, 2013). This is simply because low production cost shall enable the firm to pass on its savings to customers. On the other hand, regulating cost in manufacturing operation will support the company to enhance its additional customer service facilities. Dependability as a performance objective is also evident for manufacturing operation. The reason being Clarks brand reputation is totally dependent on manufacturing operation. Quality management and product innovation are two most crucial components of manufacturing aspect. Flexibility is another performance objective for this operation which governs adaptability level of this operational unit to external environmental changes. It is an essential performance objective since it determines the degree to which firm can remain competitive in the market place. Polar diagram comprises of quality as another performance objective. This objective basically denotes amount of error-free products (Bamford and Forrester, 2010). Quality can be stated as an evident performance objective because there are other players offering similar products in Lincoln High Streets. Speed is an important aspect in shoe manufacturing operation. This factor helps to determine the time lapse between products being delivered and supplied. Desirable speed has to be maintained in manufacturing operation because increase in lead time tends to increase overall operational cost. Polar diagram for Clarks’ operation is elaborated in below figure. This diagram clearly reveals that quality, dependability and speed are major performance objectives for selected operation of Clarks. Performance objectives are an important parameter in Clarks’ overall operations. Impact of these objectives on operations can be well studied by interacting with customers. Manufacturing operation and its quality is directly related with customer satisfaction level. The first question asked to respondents (sample size 100) was whether they satisfied with shoe quality at Clarks. Answers have been plotted in a pie graph as represented in figure 1. Figure 1 As per figure1, 79% of the respondents were satisfied with product quality at Clarks. This clearly reveals that manufacturing operation have to emphasize on quality management in order to develop a base of satisfied customers. Quality performance objective plays a significant role in terms of adopting best practices in manufacturing operation. The next question asked was regarding desirable shoe design available at the store outlet. This question has been analyzed with the support of a bar graph in figure 2. Figure 2 Figure 2 states that 65% of respondents were satisfied with innovative shoe design at Clarks but 35% still remains unsatisfied. This aspect can be correlated with flexibility performance objective. A firm can satisfy customers only if its operations are flexible enough to incorporate any form of changes. Flexibility objective hence analyzes adaptability level of a firm to changing market conditions. The third question put across respondents is satisfactory element observed by respondents in store outlet. Figure 3 Customers are more satisfied with quick service and quality products. Speed and quality are two major performance objectives. It can be stated that manufacturing operations should produce quality products to drag attention of customers. On the other hand, speed denotes the rate at which this operation is accomplished so as to deliver products on time to customers. These two aspects are closely knitted with such operation since it indicates satisfying customer requirements and regulating inventory level at a faster speed. The next question is a suggestion asked from customers in context of further improvement areas. Answers are plotted on a pie graph and elaborated further in figure 4. Figure 4 Customers feel that Clarks Lincoln should focus on extending their product line and innovating new shoe designs. These answers can be associated with performance objectives such as dependability and flexibility. Manufacturing operations is a highly dependable aspect as it determines level of product innovation and including more products. Figure 4 states that flexibility objective is not being appropriately addressed by the firm. Customers feel that there is more need to develop new designs and include more products by Clarks in its store outlets. This question is supported by the next question asked to customers related to the company being able to address market demand or not. Figure 5 63% of respondents believe that the company is being able to address market demand. This factor is well represented with the importance of flexibility and quality performance objectives in Clarks’ manufacturing operations. However 37% of respondents still think that flexibility occupies less rank as a performance objective. From all these evidences, it can be predicted manufacturing operations play a key role in customer satisfaction. The five performance objectives are centred towards evaluating efficiency level of selected operation at Clarks. 2. Types of process technology evident in the operation Manufacturing process is a vital operation since it determines quality level of products being delivered to customers. Total quality management is an important concept within operations management. This concept initiates a permanent change in organizational climate. It enables a firm to deliver exceptional quality services or products to target group. The most evident theoretical framework for Clarks’ manufacturing operation is lean manufacturing (Johnston, Clark and Schulver, 2012). Lean manufacturing is a process to effectively reduce waste from the system. Shoe manufacturing encompasses great amount of waste which needs to be eliminated in order to enhance ecological soundness. Lean manufacturing is precisely explained in figure 6. Figure 6: Lean Manufacturing (Source: Behnam, 2013) Clarks operate in a highly competitive market segment and hence it becomes essential for the company to incorporate ways to reduce waste percentage and facilitate just in time production. There are basically three forms of waste – muda, mura and muri. Muri is an unreasonable work that is imposed by management on workers like undertaking dangerous tasks, moving things from one place to another, carrying heavy weights, etc (Cannella and Ciancimino, 2010). Mura highlights fluctuation in context of operational or scheduling level and this factor is in terms of volume and quality. On the other hand, muda represents defects, over processing, inventory, transport, waiting, overproduction and motion. Just in time aspect in manufacturing process along with elimination of waste can be initiated on basis of process technology. Material processing technology and customer processing technology are two aspects evident for this particular operation of Clarks. Firstly these process technologies can efficiently address operational costs and delivery times (Slack, Chambers and Johnston, 2013). Material process technology is about implementing computer aided machines so that just in time deliveries can be initiated. CIM technology shall be most beneficial for Clarks. It is known as computer integrated manufacturing technology. Manufacturing operation is the main area of concern in this business. Competitive pressures influence a company to adopt technologies so as to ensure that products are delivered to customers on time. Computer integrated manufacturing will provide the company with a platform where technology based manufacturing operation shall increase speed of delivery and production. This form of computer based manufacturing operation is incorporated in many companies. The major negative aspect of this technology is that it reduces scope of manual labour and makes the entire system dependent on technology. It is essential for firms utilizing this concept to frame a contingency plan to be implemented during system failure. On the contrary, computer based operations can control overall mechanism in least time possible. All dimensions of a manufacturing process like that of Clarks can be controlled via computer integrated technology. A database is maintained throughout the system and all units are connected on basis of computer network. Customer interaction with sales personnel tends to delay the entire process at store outlets. This customer processing technology has no direct impact on manufacturing process but feedback can be acquired to foster further improvement in mentioned operation (Mitra, 2012). Active interaction technology like cash machines will enable customers to make quick payments without waiting in queue in Clarks store outlets. Customer feedbacks can be gained by implementing a process technology where customers can feed in their opinions in a computer aided device. However this technology cannot degrade importance of sales personnel in stores. They are equally important along with introducing customer processing technology. 3. Capacity constraints within the operation Capacity constraint can be stated as a fundamental constraint which plays an active role in regulating planning activity. An initial plan is set up to stay aligned with capacity constraint. Operations strategy has to be consistent with strategies adopted in business units. Process management is directly associated with capacity constraints. Capacity requirements are prominent for any business operations. On basis of these requirements a firm can design its business strategy. In many business scenarios it is observed that operational process tends to change according to specific business requirements. Capacity management is these scenarios are a vital issue. An organization is termed as profitable only when it is able to maintain a balance between supply and demand. When a firm fails to address market demand then it is due to capacity constraints. Capacity issues can be either long term or short term. For instance, in case of Clarks Lincoln, inventory management would be one of the capacity constraints. Manufacturing operation revolves around availability of inventory. The company can convert raw materials into finished products only when sufficient inventory is present in a firm. This capacity constraint also emerges due to inappropriate demand forecasting. Raw materials if not provided by suppliers on time then it shall delay the entire production process. Other capacity constraint will be production volume in given time frame. Volume denotes efficiency level of manufacturing process. Increasing market demand influences firm to manufacture large volumes of products in order to satisfy consumer market demand (Sodhi and Tang, 2012). Volume constraints facilitate a firm to manufacture small quantities of ordered products and thereby increasing production cycle. Apart from these two constraints, lesser availability of human capital can be regarded as another capacity constraint at Clarks’ manufacturing operation. Labour intensive operation is often proved to be more productive. However this operation is inclined towards witnessing such capacity constraint due to intricacies of the operation. These capacities have been utilized appropriately by the company in terms of allocating resources to specific activities. Human capital is utilized by the company in context of three major operations such as production, quality control and service delivery at store outlets. The company allocates labour mainly in its manufacturing operation so as to keep a balance between supply and demand (Patton, Clegg, Hsuan and Pilkington, 2011). Some team members are responsible for order tracking whereas others convert raw materials to work in progress or finished products. Production volume is utilized appropriately to certain extent. There are certain limitations on production volume where materials can be processed and converted into raw materials in a significant time frame. Clarks is more focused on manufacturing those shoe designs which have a high market demand. Scheduling and planning of activities are done on basis of market demand. On the other hand, managing inventory is an essential factor. This form of capacity is utilized maximum by the company through undertaking stock replenishment activities. A certain level of inventory is maintained by the firm which is known as safety stock (Lambert and Pohlen, 2001). Apart from this, a rapidly moving inventory cycle facilitates Clarks to convert raw materials quickly into finished products. However time delays by suppliers tend to weaken the entire operational procedure. 4. Specific recommendations for improvement The manufacturing operation of Clarks comprises of wide array of constraints. These constraints can be effectively eliminated only when operational procedure is enhanced. Amongst all the performance objectives, flexibility, quality and speed are the three objectives which need to be addressed properly by Clarks Lincoln. The company has to firstly incorporate quality management tools in order to produce error free products. Quality control tools are utilized by companies to evaluate quality level of products being manufactured in firms. There is certain quality control techniques used which is a form of graphical setting to identify causes or issues associated with quality. These tools are also known as cause and effect diagram, Pareto chart analysis, check sheet, histogram, control chart, stratification and scatter diagram. Fishbone or cause and effect diagram is most suitable framework which can be implemented by Clarks Lincoln. Individuals can be hired who shall prepare a cause and effect diagram in order to highlight loopholes in current operational procedure. In this diagram, causes can be classified into wide set of categories. They mainly encompass methods, people, materials, machines, environment and measurements. On basis of this tool it can be stated that there are 5Ms within any manufacturing business like Clarks. Causes and effects outlined shall be centred towards these 5Ms – man power, machine, material, measurement and method. Pareto chart analysis would give a broader picture regarding commonly occurring defects within the system. The frequency of identified defects in manufacturing operation shall be predicted by Pareto Chart analysis. This would enable the firm to accomplish performance objective like quality in a better way. Flexibility and speed are two objectives closely knitted with the technique of inventory management. RFID tagging or barcode inventory tracking are some efficient measures which can be adopted to control inventory level in the system. These are all technology based inventory tracking measures and is beneficial in times when it is tedious to determine current stock level. Ineffective inventory management results into decreasing level of customer satisfaction. Every organization needs to balance between supply and demand. Market demand can only be addressed significantly when product supply is sufficient in the organization. Stock replenishment activities will support the company to in terms of increasing speed of their manufacturing operation. Demand forecasting technique should be firstly designed by Clarks so as to analyze current market trends and competitiveness of business. This type of forecasted results would facilitate the firm to undertake technology based stock keeping activities. RFID technology is a recommended solution for inventory management since it eliminates all possible manual errors. The available stock level is identified using this technology and then required stock level is also predicted by the software. It provides a clear picture to the company in context of fast moving and slow moving inventories. To be more precise inventory costs can be regulated only when raw materials are quickly transformed to finished goods. Speed performance objective can be easily catered using this technique. On the other hand, maintaining a small percentage of safety stock based on forecasted results shall also enhance flexibility parameter. Any changes in market demand can be incorporated effectively in this operation if there are low inventory costs. In overall context, RFID technology enables a firm to reduce inventory holding duration and thereby enhancing speed of manufacturing operation. Conclusion As per this study, operations management includes wide set of critical tasks. There are different dimensions to be focused on in operations management which could improve quality level of business operations. It is observed that intricacies of any concept can be well determined only when it is applied on a real world organization. Clarks located in Lincoln High Streets is a well known retailer offering quality shoes to customers. This company manufactures shoes for three segments – women, men and children. In current scenario the company witnesses major challenges in the form of addressing performance objectives. Polar diagram represents five performance objectives such as cost, quality, flexibility, speed and dependability. This diagram clearly states the importance of performance objective in relation to a company’s operations. Manufacturing operation of Clarks Lincoln has been used in this study so as to determine strengths and weakness of operations management. Questionnaire survey had been conducted on respondents of sample size 100. There were specific factors which determined satisfaction level of customers. Customers were satisfied with shoe designs but they expected more innovation in product line. They even stated that manufacturing operation of this company is confined to narrow product segment. At times customer satisfaction is totally dependent on product innovation and quality. Quality control techniques shall help the company to design best frameworks that might help to deliver error free products to customers. Technology based manufacturing operations enables a company to eradicate loopholes from the system. It is an effective measure to accomplish performance objectives and thereby increase customer satisfaction level. Flexibility performance objectively can be addressed in a proper way only when the company adopts inventory management techniques. References Bamford, D. R. and Forrester, P. L., 2010. Essential guide to Operations Management: concepts and case notes. New York: John Wiley. Behnam, M., 2013. Operations and production systems with multiple objectives. New Jersey: John Wiley & Sons. Cannella, S. and Ciancimino, E., 2010. Advanced manufacturing and sustainable logistics. Germany: Springer-Verlag Berlin Heidelberg. Greasley, A., 2013. Operations management, Third Edition. New York: John Wiley. Johnston, R., Clark, G. and Schulver, M., 2012. Service operations management: improving service delivery, Fourth Edition. USA: Pearson. Lambert, D. and Pohlen, T., 2001. Supply chain metrics. The International Journal of Logistics Management, 12 (1), pp. 1 – 19. Mitra, A., 2012. Fundamentals of quality control and improvement. New Jersey: John Wiley & Sons. Patton, S., Clegg, B., Hsuan, J. and Pilkington, A., 2011. Operations management. USA: McGraw Hill. Slack, N, Chambers, S. and Johnston, R., 2013. Operations management, Seventh Edition. UK: Financial Times/Prentice Hall. Sodhi, M. S. and Tang, C. S., 2012. Managing supply chain risk. London: Springer Science & Business Media. Appendices Appendix 1: Questionnaire 1) Are you satisfied with Clarks’ shoe quality? Yes No 2) Was your desirable shoe design available at Clarks Lincoln? Yes No 3) What was the most satisfactory element you observed in this store outlet? Shoes collection Quick service Well trained sales personal Quality products Competitive prices 4) In which area you feel the company needs to further improve? Product innovation Service quality Extended product line Store design 5) Does Clarks being able to address market demand? Yes No Read More