Operational Decision Making - Research Paper Example

Cemex focuses on continuous improvement of the quality of its products to serve its clients better. Description of operations From the limestone minefields, limestone is transported to the several kilns operated by the company where it is processed to cement and conveyed to storage silos in Jebel Ali, Dubai. The process of cement production starts with the extraction of limestone in the mines. The limestone is then crushed through a milling process and addition materials are added. The milling process produces a fine powder known as raw meal that is preheated and then sent to kilns.

At the kiln it is then heated to 1500 degrees celcius to form clinker. Gypsum is then added to the clinker and crushed before being sent to storage silos. Another trademark product of the company is the ready mix concrete. Cement comes from the company’s production plant while water, sand and ballast used in the production of cement mixes are supplied by contractors to the company.. The company adopted a comprehensive production and distribution system known as GINCO. The system comes up with tailor made solution to every construction challenge with consistent quality.

Construction materials such as cement, water, ballast and sand are mixed in the desired ratios by the company’s mixers to meet the specifications of various constructions ranging from buildings to bridges, roads and dams. Supply Chain Decisions The strategy of Cemex is to strengthen its global leadership by improving profit margins in all stages along the cement value chain and maximizing the overall performance of the company. A critical decision that could affect the company and its supply chain is whether to deal directly with consumers of its products or to enlist the services of distributors.

Under the present system, the company manufactures and distributes its products in its main markets of Dubai and Abu Dhabi. The company also operates a delivery service and an ATM-like cement dispatch system that is convenient for its clients. Cemex prefers this system because it allows the company to serve the needs of its final clients more efficiently by engaging directly with them and also gives them a variety of ways to satisfy market needs and keep up with competition in a very dynamic market.

If the company is to expand its operations throughout the United Arab Emirates then the need to engage with distributors may arise. While profit optimization remains the focus of the company, subcontracting other firms to help in its expansion and distribution of its products could be critical to its success. Under the present system, the company eliminates additional costs of distributors thereby regulating the cost of its products but the distribution of the products is only limited to Dubai and Abu Dhabi.

The decision to expand the company’s supply chain could break the direct contact between the company and its final consumers which allows them to have a clear understanding of what the clients need and create more value for them but it could also open new grounds for expansion through the formation of new partnerships. The decision could also create new employment opportunities as well as giving local businesses an opportunity to grow in trade. Productivity The productivity of the company is measured in metric tonnes of its output.

Cemex has a cement grinding mill with an annual capacity of 1.6 million metric tonnes. The company also has nine active