Welcome to Cruise International, Inc - Case Study Example

Case study Chapter Welcome to Cruise International, Inc Cruise International Inc. (CII) is an international organization. This is because its presence and scope of operation covers a large geographical area spanning aver different countries and continents. Although its headquarters are located in Florida, they use ports in cities in different countries for embarkation and disembarkation. For example, Amsterdam in Netherlands, Hong Kong in China, Rome in Italy and Southampton in England 2. In a broad sense, CII is a service industry in the offering voyage packages to its customers who wish to spend their holiday visiting different cities across the world. The inputs are the tourists and passengers as well as the supplies such as the foods. The inputs are the personnel in different departments and the supplies such as the foods and beverages. The resources include the cruise ships, personnel while the output is the different services offered to the customers. This process is summarized in Figure 1 below. Customer feedback can be collected using appraisal forms to be filled by the customers as well as suggestion boxes placed at strategic locations both in the waiting bay and in the cruise ships. 3. The location of CII affects several aspects of the firm. The location of the firm will affect the firm’s future expansion plan and policy, the diversification plan as well as the supply of raw materials. The decision to locate the headquarters at Miami which is one of the cities with the highest number of embankments in the United States brought the services closer to the customers. The customer base of the firm are the passengers who are taking part in the cruising expeditions. 4. There are several departments in a cruise ship. a) Engine department It is responsible for ensuring that the main propulsion plant and its auxiliaries are operated in a safe, smooth and efficient manner. The Chief engineer is responsible for to overseeing the overall operations of the engine department. b) Deck department The department is tasked with the responsibility of commanding and navigating the cruise ship. The highest officer in the department is called the Captain and is the staff who is ultimately responsible for the smooth navigation of the ship but can delegate the work to other members of staff. c) Catering department Production of high quality and appealing meals to the cruising passengers in the ship as well as the staff is tasked to the catering department. The department also employs waiters beakers, food and beverage managers as well as store keepers. d) Entertainment department The members of this department include musicians, band leaders, dancers, comedians, sound and lighting technicians. The department coordinates all the hosting activities for the passengers. Chapter 2: Getting Acquainted With Cruise International, Inc. 1. CII is committed to provide high quality services to their customers, be it guests or travel agents. It is done by timely and accurate processing of all travel bookings with the highest respect and courtesy. The other aspects of the mission statement are the relationship with suppliers and the employees of the company. The company acknowledges the importance of the suppliers and distributors as well as their right to make a fair profit. The company also treats its employees with respect and providing them with safe working conditions. All these aspects are crucial in a service industry since the quality service delivered to its customers as well as the satisfaction of the suppliers and employees determines the success of the business. The main co values emphasized are customer satisfaction, and employee motivation. These values gives the company an upper hand in the industry and therefore it is able to attract more customers while retaining its best employees. 2. The similarities in the mission statements of the three companies (Crystal Cruise Lines, Silver Seas Cruises and CII) are the provision of excellent services to their customers, guests and travel agents who are the consumers of their products. The differences stems from their travel packages where Silver Seas Cruises offers personalized premium packages, which are more expensive than for the other two companies. 3. Although CII must perform in all the four competitive priorities, it should focus should focus more on the Quality priority in line with its objective of provision of service of the highest quality to its customers 4. Productivity is a measure of how efficient the inputs are converted to outputs. The productivity of CII would be measured by dividing the revenue for the cruising operations carried out by the cost incurred in the voyages. Chapter 3: Service Packages and Processes at Cruise International, Inc 1. The following are the services offered to the esteemed customers of CII while on board to their ships. a) Photography There are photo packages, digital photos in Compact Discs (CDs) and other merchandise available to the customers. b) Shopping There are tax and duty free shops in the CII cruise ships where exclusive merchandise, luxury goods and speciality candies can be purchased at affordable price. c) Meeting facilities Businesses and corporates can take advantage of the conference facilities at the CII conference centre on most of the ships to hold their meeting and conventions while on board. d) Internet and phone services Customers can keep connected to their friends and families by staying connected via the web or their digital devices while on board by taking advantage of the free internet cellular services offered at the cruise ships of CII. 2. Quality in the service involves taking care of all people irrespective of their physical conditions. Therefore, CII should come up with a comprehensive package facilities and amenities including auxiliary aids and staterooms to make the vacation of people with disabilities comfortable. 3. 4. The services offered by CII can be classified as pure services. This is because the services are exclusively in the hospitality industry cruising expeditions, shore excursions and much more. 5. Technology has been incorporated in the service design by using online booking services. Automated file storage and retrieval has also reduced the time for serving customers and therefore the company is able to serve its customers accurately and faster. 6. Out sourcing of a service is contracting another company to do a task instead of the contracting company doing it. CII has outsourced the security services from a local security firm. The cleaning services currently undertaken by the CII staff can be comfortably outsourced from other local firms so that CII can focus on its provision of highest quality services to its customers Chapter 4: Chapter 4: Supply Chain Management at Cruise International, Inc. 1. Supply chain management essentials offer an insight into supply chain planning, processing and global operations. It has the following key features; Supply chain management has a three module presentations where each module has a set of four video episodes and related materials for presentation, a reading list and a case study. The study involves key planning activities that bring strategy to life via timely coordination of orders, materials, capacity needed and necessary labor. Vital concepts are presented in a way engaging and non rigid format that allows an individual to to reach out to the content at his convenience with any computer. Here, one learns more about procurement fundamentals, purchasing processes and strategic sourcing. 2. The use on internet has made an easy access to information in a quick and simple manner, accessible to the public and within reach of cruise international incorporation. It has brought about the revolution in communication and social network. In this error, people communicate, data sharing and people work through the internet throughout the day, on a daily basis which in essence will enable the workers of cruise international incorporation, to work from home and from nations abroad since the internet has removed the borders of nations, which further assist in the process of globalization. Some of the factors that Cruise International Incorporation should consider and discuss with the supplier, include; The nature and purpose of the partnership between then. The power and authority of every partner involved in the partnership. Profit and loss sharing. Contributions for capital from each partner. Handling of partnership disputes. Ways and means to resolve partnership conflicts 3, From the point of view of partnership, several advantages can be deduced, bellow are outstanding benefits of partnership; Tax benefits- here taxation is done once as opposed to corporations which bear taxation twice, that is, at corporate level and personal level when dividends are shared with the shareholders. This benefit of a single taxation can also be done through formation of a limited liability company. Collaboration which allows owners to draw resources and expertise of the co-partners. The core partners share the burden and the responsibilities to lighten the work load, and members always have time for their private activities. Rising of capital which to partners is much easier than corporations because partners can easily acquire loans as individuals and on better terms since partners guarantee loans with their personal assets. Uniformity in laws, uniform partnership act provides a consistent of laws with regard to forming and running partnerships that make it simpler for small business owners to know the laws that affect them. 4. Below are the factors the Cruise International will consider before outsourcing services; how frequent do they need and use the service that is, core business functions shouldn’t be outsourced but further have an employee to handle specific aspects. The budgetary constraint in situations where the budget is of limitation, then it is advisable to outsource. The expertise in a specific field if need arises in the company then outsourcing is helpful. With regard to out sousing, information technology should be outsourced. 5. Purchasing professionals should not indulge in corruption practices, if facing a challenge they ought to report to senior management. Again they should use their power in most appropriately. Under influence or abuse of power and acting professionally, is negative to the company. The professionals should adhere to all rules governing their area. Chapter 5: Total Quality Management (TQM) at Cruise International, Inc. 1. Quality of service is the main determinant of customer satisfaction. Being a service industry, quality may be subjective depending on the perception factors such as courtesy, friendliness promptness and waiting time. Quality in the services offered will determine if the customer return on another occasion and he will refer others to the firm hence quality is key in the cruise industry. 2. The most appropriate person to assess the quality of service at CII is the guest. This is because the he is the person who received the services form the staff of the company. He will therefore be in a position to determine whether the quality of the services is worth the cost incurred to access the services. 3. The 5 dimensions developed by SERVQUAL can be used to measure quality in CII. These dimensions includes the appearance of the tangible facilities such as the personnel and equipment, the ability to perform the specific task accurately and dependably, Assurance which courtesy and knowledge of the employees and empathy which is the personalized attention accorded to customers by employees. Employees’ appraisal forms can be used for internal measurement of quality. 4. The survey form although it is long and tiresome to fill will enable the company to acquire vital information about the quality of services offered so as to continue improving the quality. The information about the income bracket of the guest will also assist the firm to know how much the customer is willing to spend on holiday and therefore organizing an affordable package for the customers in future. The fact the survey form will be read by a computer will ensure that more forms will be evaluated at a very short time. Chapter 9: Capacity Analysis at Cruise International, Inc 1. The following data summarizes the guests’ data for Friendly Seas 1. Time Total Guest VIP Guests Regular Guests 12-1pm 550 50 500 1-2pm 300 40 260 2-3pm 200 30 170 3-4pm 100 20 80 4-5pm 70 10 60 5-6pm 30   30 Total 1250 150 1100 Time needed to process VIP guests for 1 staff = 4minutes × 150 = 600 minutes (10 hours) Time for 4 staff members = 10 hours/4 = 2.5 hours Time needed to process normal guests for 1 staff = 3 minutes × 1100 = 3300 minutes (55 hours) Time for 12 staff members = 55/12 = 4.58 hours Capacity to process VIP tickets = 6-2.5 = 3.5 hours×60×4 = 840 guests Capacity to process normal tickets = 6-4.58 = 1.42×60×3 = 256 guests 2. Percentage utilization of staff processing VIP guests = 150×100/ (840+150) = 15.15% 3. Percentage utilization of staff processing regular guests =1100×100/ (1100+256) =81.12% 4. 15% increase in servers = 115×16/100 = 19 servers VIP servers = 4×19/16 = 5 servers Normal servers = 19-5= 14 servers 5. Automating the process of processing of the guests Chapter 10: Layout Analysis at Cruise International, Inc 1. Layout of a facility refers to the floor configuration of the departments and work centres in the facility. The design of the facility in terms of layout should make maximum use of the available space and should contain all the support services in the design to reduce time wastage. The facilities of the embarkation process are located far from one another therefore increasing the waiting time. A lot of floor space is also left un-used due to the floor configuration and location of different services for example a lot of space left between the waiting bay and the registration centres. The layout has not created emergency exit routes in case of fire and therefore does not safeguard the staff and guests against any emergencies that may occur. 2. Assuming that the embarkation process is an assembly line and the guests are the raw materials, the flow of the materials would be slow due to the lay out of the different work stations for example from the luggage drop off point to the registration desk via the waiting area. The route would not allow only the forward flow of the materials towards the completion stage without backtracking. This would also not reduce the material handling to the minimum, as it is required. 3. To improve the embarkation process I would recommend that the layout be adjusted to carry out the security checks as the guests enter the waiting area. The photographers would also be stationed at the waiting area. The number of servers at the security and photography section should also be increased Chapter 11: Work System Design at Cruise International, Inc. 1. Average = 220/10 = 22 times. 2. Collection of additional data will require delegation of the task to other staff members so as to cover a wider are and therefore increase staff covered by the exercise. Harmonization of the type of data recorded will be harmonized by generating a universal form that will be used by all staff. 3. The table below compares the data collected before and after effecting the new plan. The new plan of delegating the data collection to other members of staff increased the data captured and therefore the use of the time is better accounted for. 4. The sampling supports her assumptions because the amount of time spent by the stewards in cleaning the staterooms or delivering evening turn down service exceeds 48 hours weekly. 5. The consequences of her expectations are that the stewards will be overworked and therefore reduce the quality of service, which will be against the company’s mission statement. The other consequence of the expectations is the high employee turnover already being experienced in her department. Chapter 12: Inventory Management at Cruise International, Inc. 1. Fixed ordering cost Syringes needed each month = 60000 x 1% = 600 syringes. Number of dozens needed = 600/12 = 50 Cost of the syringes = 50 x $96 = $4800 2. Annual holding cost per unit Holding cost per unit = $10 per month Annual holding cost = $10 x 12 = $120 3. Annual holding cost for the supplier offers First offer Cost of the syringes for one month = $7 × 600 = $4200 Inventory held = 0 Second offer = 6.5 × 12 × 600 = $ 46800 Inventory held = 6600 × 6.5 = $ 42900 Holding cost per unit =42900/7200 = $ 5.95 4. The first offer is the best option since all the syringes purchased will be used in the same month. There will be no inventory held and that will reduce the holding cost to zero. Chapter 13: Staff Planning at Cruise International, Inc 1. Month 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 Floor supervisors 6                                   Head room supervisors 12                                   Cabin stewards 36                                   Assistant stewards 20                                   Chapter 14: ERP Systems at Cruise International, Inc. 1. Enterprise Resource Planning (ERP) is software that allows companies to automate and integrate several business processes, share a common database and business practices throughout the organization to enable real time production of information. The system strives to coordinate the whole business of the firm form supplier evaluation to the processing of invoices although the feat is rarely achieved. It strives to achieve the objective by the creation and use of a centralized database to assist in the flow of information amongst the different departments and sections in the firm. The difference between Material Requirement Planning and ERP is that while ERP allows managers to schedule and replenish stock on a need-to-order basis rather than a time-to-order basis, ERP systems strives to integrate all the departments and the sectors of the business by use of a single centralized database. 2. ERP would be appropriate in the service sector such as the one operated by CII because it would assist handling most of the front and back office duties such as maintaining guest histories, room bookings and dinner reservations of guests. 3. Major ERP providers include Compiere, Apache OFBiz, Phreedom and Postbooks in the United States. All these are open-source soft-wares that that provide ERP solutions to small and medium enterprises by merging the company’s key operations into one software. 4. The company can invest about 15% of its revenue in premium ERP system. The system will allow it to integrate most of the customer and supplier details and hence enable faster delivery of the services to the customers and suppliers as well 5. Other than the financial considerations, the company must have personnel with the capacity to operate the system as well as maintain it. Chapter 15: Scheduling at Cruise International, Inc. 1. Optimal schedule Bob Stan Klaus John Alex C.P. Task Painting 8 10 9 9 8 8 Plumbing 7 7 8 9 6 8 HVAC 7 8 8 7 7 9 Desalinization 5 7 7 6 5 6 Elevator 4 2 4 5 3 4 Electrical 10 12 12 9 9 10 Engine 6 6 5 4 5 5 Refrigeration 7 8 7 9 6 9 Lighting 3 3 2 3 3 2 Total 57 63 62 61 52 61 References Johnson R., Slack N., & Chambers S. (2007). Operations Management (5th ed.), New York;Prentice Hall Kumar S.A. & Suresh N. (2009). Operations Management. New Delhi; New Age International Limited. Render B., Heizer J. (2011). Operations Management (10th ed.), New York; Pearson Read More