Quality of Management - Capital Car Parts LTD - Essay Example

Capital Car parts LTD CCP Introduction The Organisation CCP is a private limited company that is based in London. It was established in 2010 and is a successfully operating business on a national level. Capital Car Parts is the UKs leading distributor of parts for all makes of cars and light commercial vehicles. The company was originally established to supply second-hand car parts for old and new cars, including classic and luxury cars. Our company has over 20000 stocked part numbers, far more than any of our competitors specialising in second-hand car parts. This figure is constantly increasing. There are some occasions that a part is not in stock or is one of the original parts we have to find from scrap yards, because it is no longer produced by our manufacturer; in these instances, our Special Orders Team is always on hand to help our customers. Our Buyers and Product Managers are, quite simply, the best in the business.  They search the world to deliver the best in range, value and quality for our customers. To maintain a consistent supply of good quality parts, we use high quality of sourcing and shipping operations.  The company is fairly new and it is mainly based online. The company has started to sell products on eBay in order to evaluate market demand for second-hand car parts. This allows the company to find out which model of cars are predominantly used in the market and have more demand. E-commerce is the fastest growing segment of business today; this is especially true for businesses that are new in the market. The Internet has opened the portal wide for all entrepreneurs, from small operators to big organisations (Chaffey 2004). As CCP is a small, new company, there are 10 people working in different sections: manager, marketing & IT, packing, administration and delivery. They all are familiar with car parts, as this is very important for the company. Please see the structure below: The company mission is to provide second-hand car parts to customers around the world, so they can maintain their cars in cost-effective ways. It also serves those who have classic cars and cars where the factory has stopped producing parts. Some of the customers are from countries like Poland, where the country does not have their own brand name cars. They are buying second-hand cars mainly from Germany. Their market demand for second-hand car parts is very high. Nowadays, factories produce new model cars and parts so they do not produce the previous model; in these cases, people that have old cars have to find parts from second-hand car parts dealers. This report analyzes and evaluates a CCP operation system in order to improve weak areas of the system. To address these weak areas, the report will suggest new systems in order to have better quality management and customer satisfaction, allowing the business to achieve their goals. Problems Despite becoming more dynamic, businesses are still looking for further improvements and ways to achieve higher performance levels to compete effectively in the global market. Even though businesses often find that overall average efficiency and quality have improved, there are always impacts on deep-root quality; this is because there are errors in their existing improvement efforts, including lean manufacturing. CCP is in a new company, so there are main issues that the company has to resolve order to continue to operate: 1. Lack of supplier 2. Lack of right system in place; and processes are predominantly manual 3. Place 4. Machinery Organizations use a variety of approaches to find the root cause of problems. The most popular formal approach is probably the fishbone, or Ishikawa diagram, which this report uses in order to identify causes of problems. Cause and effect diagram for defect Capital Car Parts 1. Supplier 2.ordering system listing cost (EBay) No analysis of failure Money Lack of knowledge Lack of space Lack of knowledge 4. Place Equipment failure 3. Testing machine Place: storage place is a very important element for CCP in order to store as much second-hand car parts as possible. At the CCP base is London it is very difficult to find big spaces. In this case, they have to move out of London because the rent is cheaper; they also they can store more car parts to increase their sales and lower costs. Supplier: they have to find out many second-hand car suppliers in order to fulfil their customers’ demand. For example, they have to have different models of Mercedes Benz, because this car’s parts are expensive not all the people can afford to buy them brand new. In this case, they have many demands from other countries, such as Germany. However, it is not easy for CCP to find frequently find parts for this car. They always search in different scarab yards and from auto-traders. It’s clear they need to find more suppliers. According to slack N (2004, p. 682), “any failure in the delivery or quality of good services into an operation can cause supplier failure.” It’s also noted that the more an operation relies on suppliers of materials or services, the more it is liable to failure caused by missing inputs. Ordering system: as CCP is a fairly new company, in order to find their market demand, they are using Ebay to sell all the parts. This is costly for them because they have to pay a 15% listing price for each part they are selling. Ebay also does not let them exceed a certain amount, so this limits their sales. In addition, CCP is paying shipping so the cost of postage is high. In this case, their position in Ebay is very low, causing problem in the ranking system; as such, they won’t be seen by customers as many times as possible. Hayes and Wheelwright (1984) believed that an organization’s operations can provide a source of competitive advantage. It is believed that using their Four Stage Model, CCP would at the moment be between stage 2 and 3. This is mainly because of the fast growth of the new company and the initial lack of resources to be spent on operations strategy. Machinery: sometimes car parts have problems and customer send it back. The company then has to replace the part; in this cause they have to pay double the price for shipping. In order to fix this problem, they have to use testing methods before sending out the product. In addition, customers asking about replacing parts with parts for similar cars cause problems. The customer asks if it is possible if the parts can be replaced with the same car but different model. The company cannot provide this information in their listings on eBay as they do not have engineers or systems to help them in this matter. If they could provide this information, they could gain high benefits. Planning and Improvement The company has now observed that they are in need of their Operations Strategy to be even more supportive of their Business Strategy. The first step is that their objective should be clear, measurable and, preferably, quantifiable. Therefore, they have to break down the project to three areas: purpose, end result, and success. Also, before they can devise their approach to the improvement of their operation, they need to know how good they are already; in these regards, they should measure their performance in terms of the five performance objective: quality, speed, dependability, flexibility and cost. CCP’s first step towards improvement is making a website. This will lead their customers to buy directly from their website and pay for the part. In this case, they do not have to pay to EBay for listings, so their cost reduces; also, their customers will have clear picture of their products and services. For example, on Ebay they list specific parts and provide information, but they cannot provide more detailed company information. In addition, on the website they should have an online chat section where the customer can gain all the information directly from the administrative staff before they purchase their product. This will reduce their refund parts. They also will not have to pay for postage and shipping duplicates. In terms of their place, they have rented a bigger storage area where more parts will be stored. This allows them to purchase and sell more car parts. According to their new machinery system, they purchase new testing machines. Now each part will be tested before packing in order to reduce the cost of duplicate posting. Management of CCP should monitor all these sections in order to have a successful plan. They should also use bench marking. For example, they could compare CCP with a company like “FIND A PART,” as they are their big competitors. The needs and performance of customers and performance and activity of competitors, also has particular significant in shaping the objectives of all CCP operation (Johnston & Clark 2005). The Project Manager will need to be chosen and the MD will need to be informed after every step is concluded. The Human Resources will need to ensure that there is enough manpower to support the new venture as well as carry on with the day-to-day workload. As per Ulrich’s HR Model (1997), an Employee Champion figure and a Change Agent will be required during the duration of the process. The Employee Champion will ensure that everyone affected by the change will be listened to and cared for; the Change Agent will manage the resources necessary for the change to happen. Step of design process: 1. System Developer to assess how long the system integration will change, what costs will be involved and how simple it is for the operator to get used to this change. 2. Webmaster to create a link on the website that will be connected to the order placing facility, which includes on-line advice (chat system). 3. System Developer to create the back end of the Order Placing feature and connect it with the main system. 4. Webmaster to upload the link. 5. Customer Service to test the new feature and advise the System Developer of any necessary changes. 6. Customer Service to create login details for all customers and inform them of the new feature and how to use it. 7. Customer Service will receive the order through the email request before customers order the product and they also will receive on-line information and advice. 8. Their order will be sent for dispatching. Main processes that relate to total quality Since the main objective of the company is customer satisfaction, Company TQM should maintain strict principles. Employee engagement, training and work environment are major concerns, and the company should endeavour to meet all customer demand. The management team should have significant experience and training in car part compliance. Identifying, understanding and managing interrelated processes, like customer special requests and packing, contribute to the organizations effectiveness and efficiency in achieving its objectives. Recommendation Customer and Market feedback is needed to ensure the system is delivering on performance as it was designed to do. Through incremental improvements, inputs from customers, marketing, and operations, technicians will create a better system than originally launched. Customer feedback will hold the backbone of the company, and customer satisfaction will be the main focus of the company. Within this area of specification, a number of specific measures have been noted. The overriding features of these measure fall within the area of supply chain management, but can also be noted within system process efficiency. Along the specific areas of efficiency improvement, it’s recommended that the company increase place along both physical and Internet domains, through a number of earlier articulated measures. It’s also evident the company must improve supplier to customer supply chain efficiency, both in terms of product measures and supply chain shipping. Finally, increased levels of machinery and technology must be invested in to decrease extraneous spending measures by testing car-parts before shipment. Ultimately, in implementing these recommendations the company will achieve higher efficiency levels and a greater market share. Conclusion In conclusion, in considering the means by which the Capital Car Parts limited can improve their overall organizational efficiency this report has articulated a number of pressing elements. Within this spectrum of understanding, the organization has identified issues of challenge within the areas of supplier, system, place, and machinery. The report has examined these elements and specified the means by which they can be better organization around process efficiency measures. Furthermore, recommendations have been supplied that indicate the specific course route this organization can assume in the future business environment. Ultimately, business process system design can ensure that this system is designed and built to accommodate the needs and intent of the business users. This business process focus is important throughout the ordering system to provide customer better quality of service and product, from concept to deployment. It also forces a continuous awareness on the part of all participating in the development process of the business objectives. The systems are designed to support what customers need to reach the ultimate business objectives. Technology will change over time, but the conceptual business processes will not. Read More