Management Task Analysis - Ferrari, Mercedes Benz, Tata Motors - Case Study Example

Operations Management‏ Chosen Organizations Ferrari (Formula One team) Mercedes (A high end luxury car assembly plant) Tata Motors/Tata Nano (A modern automobile assembly plant producing a mid-priced family car) Key management tasks for organizations 1. Cost reduction Ferrari Formula 1 is a highly profitable and lucrative sector but international companies like Ferrari have to focus on cost minimization and cost reduction due to high investment on racers, equipment cost and on research and development (Bisagni, Fraschini, & Terletti, 2005) This has been the core impetus of the management of Ferrari at an operational level. Mercedes Benz assembly plant One of the core operational objectives of the management of Mercedes is to focus on cost minimization because Mercedes designs its cars for high end customers and has to make intensive investment on research and development and product quality (Finkbeiner & Hoffmann, 2006) Tata Motors Assembly plant (Tata-Nano) According to Wells (2010), Tata motors designs and assembles motor cars for families with moderate income and it relies heavily on economies of scale. Due to this reason, management of Tata motors gives huge emphasis on being cost efficient regarding its product manufacturing as well as assembling lines. 2. Improving operational activities Ferrari Formula 1 requires high level of intensity and adrenaline rush. This propels car manufacturers to design cars and engines which are rigid and resilient in even the adverse racing conditions and allow the drivers to give their level best. Due to the fact that there is no financial and economical constraint on Ferrari, the management of Ferrari has certainly made consistent development in this regard to improve its operational activities (Donahay & Rosenberger, 2007) Mercedes As discussed earlier, Mercedes is a high end car manufacturer and due to this reason needs to design cars which can attract the wealthiest of customers. The key motive of the management of Mercedes Benz in this regard is to maximize the potential of its manufacturing and assembly plant and to enhance the productivity and efficiency of its cars. Tata Motors Assembly plant (Tata-Nano) From the sales of Tata Nano, Tata Motors has certainly made a mark for itself in the automobile sector and has generated business from the middle and even lower income sector. However, the management of Tata has taken various innovative and creative steps to improve upon its business operations and this has been the key goal for the company for a very long time. 3. Attracting and retaining talent Ferrari The operational activities of Ferrari require the company to attract, hire and retain a highly skilled and talented workforce. The company is a highly technical and competent global organization which has the quality to attract and retain highly skilled employees by offering higher than market salaries and offering various lucrative opportunities. Due to the abundance of financial resources, the management has certainly been able to achieve this aim in a highly successful manner. Mercedes According to Clarke (2005), Mercedes is a high end car manufacturer and to maintain its supremacy, it needs to hire the best engineers and supporting staff. The management knows that it needs the best talent in all functional areas. For the best possible maintenance of its assembly and manufacturing plant, the management of Mercedes has taken adequate steps for improving the quality of its automobiles and has ensured that the cars of the highest quality. Tata Motors Assembly plant (Tata-Nano) The innovative plan of creating a family car for the low and middle income families of India is certainly an achievement for Tata Motors and this was only possible through implementation of the creative and innovative ideas of the precious talents at Tata Motors. To achieve such groundbreaking feats in the long run, the management of Tata has to make sure that it is able to hire and retain the services of individuals who can prove to be an intangible asset for the company and can add value to the company’s services in the long run (Palepu & Tahilyani, 2011), Product Process Matrix The product-process matrix is a key tool in facilitating an understanding regarding the strategic options which are available for a company specifically within the context of an assembly or manufacturing function (Stevenson & Hojati, 2007). It can help in production processes for specific or a group of products. Process strategies of Product Matrix relevant to car manufacturing and assembly plant Connected Line Flow/Few Major Products, High Volume In a car manufacturing and assembly sector, specifically when volume is high, an assembly line is ideal to be set up. In this manner each worker will have a specific task for completion. For instance, in an assembly plant as well within a formula race, a person could be assigned for attaching wheels to a car within a specified time period, and then it is passed on for engine checking, than for tire fitting and so on. In this manner, the work flow is continuous and is adjusted periodically to ensure smooth execution of the process. Integration of Process Matrix with the 10 strategic OM decisions 1. Goods and service design: It is a crucial component specifically in the context of the car industry. For Ferrari and Mercedes it is highly relevant and important as both produce high end cars for a specific market and there designs are viewed by people as a status symbol. It is different from Tata’s perspective as the core emphasis is placed on producing efficient and cost effective family cars at low prices and low focus is made on product design. 2. Quality: The quality of the product and the satisfaction of the final consumer play a very important role in this regard. From the perspective of Ferrari, quality is crucial as the company has to compete in one of the toughest sports in the world and the end product has to be flawless. The same could be said for Mercedes and Tata as the core emphasis is placed on high quality and potentially zero defects. 3. Process and capacity design: Process options commit the company to comply with and design process decisions which help the management in committing to specific technology, use of skilled labor and maintenance of products. For Ferrari, Mercedes and Tata process and capacity design has a core emphasis on company operations because they determine the expenses and capital commitments requirements as well as most of the basic structure for each company. 4. Location selection: It is a fact that selection of factory location has a pivotal impact on manufacturing as well as service companies and can play a difference between success and failure. Although, location selection may not have a huge impact on the strategy of Ferrari and Mercedes but will be pivotal for the assembly plant of Tata Nano. An assembly plant works round the clock without any stoppage and any hindrance in the production process of this plant could be fatal for the future objectives of the assembly plant of Tata. 5. Layout design: The layout design is comprised of material flows, maintaining the material capacity needs, determining the scientific and technological needs and also inventory requirements influence layout. All these factors are pivotal within the operational framework of Ferrari, Tata and Mercedes as these factors are interlinked with the final outcome of the process. 6. Human resources and job design: The most important part of any business is its human resources. They are an integral part of the company’s business operations. For Ferrari, Mercedes and Tata Motors, it is impossible for the companies to operate in an environment without their most important business resources. Due to this reason, these companies pay the utmost importance to the training, development and well being of their staff on a consistent basis because they are directly linked with the operational activities of the company. 7. Supply-chain management: For a racing team such as Ferrari, Supply chain management may not be highly important but for manufacturing plants like Tata and Mercedes, prompt deliveries of manufacturing materials is the core function of the business and a hindrance in this process could be fatal for the company’s operational activities. 8. Inventory: Optimum level of inventory is crucial for consistency in operational activities of manufacturing plants and the same can be said for Tata and Mercedes. 9. Scheduling: Companies have to make effective and efficient schedules for their production and business operations and they must be developed in a manner which can meet the demands of its business operations. It has certainly been followed by management of Mercedes, Tata and Ferrari with consistency. 10. Maintenance: For Ferrari Mercedes and Tata the utmost maintenance of its cars and assembly and manufacturing equipments is critical because they help to maintain the level of stability within the company. Competitive priorities and why are they right? Competitive priority could be defined as selecting an operational strategy which is value-creating for a company. By considering and analyzing the industry in which Ferrari, Mercedes and Tata operate, the competitive priorities analysis is as follows: Ferrari Response A response strategy is thought of having the ability and the core competency in matching to the changes a sector where operational activities can change substantially. For Ferrari, Response strategy is highly crucial as well as beneficial because it has to demonstrate constant flexibility and dynamism due to the nature of the industry in operates in, i.e. Formula One racing. The quick and volatile nature of Formula One demands quickness and agility and Ferrari needs to implement the response strategy in its process as well as operational strategy. Mercedes Differentiation Differentiation could be defined as a product being sold by a company which has unique and unconventional features and specifications. For Mercedes, this is certainly an optimum strategy in terms of implementing competitive priorities because allows the firm for creating opportunities and for creating uniqueness which may not be located within a specific function or activity and could arise in possibly everything which the firm does. From an operational and process point of view, Differentiation could be defined as going beyond physical as well as service attributes of a product and this influences the enhancement in value of Mercedes and attracts the customers towards its brand. Tata Motors (Tata-Nano) Cost Leadership Cost leadership could be termed as possessing the lowest production cost within a specific sector. For Tata Motors, this competitive strategy should be its core priority because this allows the company to spread its brand towards a wider pool of customers and reach beyond the domestic market of India. They are directly interlinked with Tata’s process and operational strategy because it allows the company to maximize its profitability on economies of scale and as a result maximize its revenue. References Bisagni, C., Di Pietro, G., Fraschini, L., & Terletti, D. (2005). Progressive crushing of fiber-reinforced composite structural components of a Formula One racing car, Composite structures, 68(4), 491-503. Clarke, C. (2005). Automotive Production Systems and Standardisation: from Ford to the case of Mercedes-Benz. Springer. Donahay, B., & Rosenberger III, P. J. (2007). Using Brand Personality to Measure the Effectiveness of Image Transfer in Formula One Racing. Marketing Bulletin, 18. Finkbeiner, M., & Hoffmann, R. (2006). “Application of Life Cycle Assessment for the Environmental Certificate of the Mercedes-Benz S-Class” The International Journal of Life Cycle Assessment, 11(4), 240-246. Palepu, K & Tahilyani, R. (2011). Tata Nano-The Peoples Car. Harvard Business School Strategy Unit Case, (710-420). Stevenson, W. J., & Hojati, M. (2007). Operations management, Boston: McGraw-Hill/Irwin. Wells, P. (2010). “The Tata Nano, the global ‘value’ segment and the implications for the traditional automotive industry regions” Cambridge Journal of Regions, Economy and Society, 3(3), 443-457. Read More