Logistics and Operations Management - Term Paper Example

Logistics & Operations Management of the Module Table of Contents Introduction 3 2.Findings and analysis 3 2 Planning and organising efficient operations and networking 3 2.2.Problems of controlling component activities 6 2.3.Problems of controlling quality 7 2.4.Project evaluation method 7 2.5.Resource scheduling methods 8 3.Conclusion 8 4.Recommendation 9 References 10 1. Introduction One of the key determinants of a successful business is efficient and effective management of operations. Although operational and network planning occurs mostly in manufacturing environment, but in the contemporary business environment service oriented business are also seen employing operational management techniques. Businesses may sometimes refer to operational planning as production planning which involves the application of similar techniques. However unlike operational management which involves the management of overall operations, production management only focuses on actual production (Mentzer, Stank & Esper, 2008). A robust business environment can never be established without a proper networking infrastructure. This is precisely because a strong communication framework one of the most vital ingredients that enables an organization to achieve operational efficiency. Information sharing between business units is pivotal for a business precisely because it enhances the degree of collaboration. As far as logistics services are concerned, an efficient networking mainframe is highly imperative precisely because it enables logistic managers to schedule their operations appropriately. Given the fact that timely receipt and delivery of products is the primary objective of logistic service companies, efficient operations management and network planning is an optimal requirement (Bass, 2014). In such a context, the researcher in this particular research endeavours to conduct a critical analysis of some of the aspects of efficient and effective operational management techniques. 2. Findings and analysis 2.1. Planning and organising efficient operations and networking First of all, monitoring the overall operational performance is a critical activity as far as organising efficient operations are concerned. Given the fact that scheduled processing of input materials and delivery of output products is the ultimate objective of any industry, monitoring the performance of each and every segment that ensures scheduled operations is highly important. Failing to do so has adverse impacts on operational efficiency. Figure 1: Methods of organizing operations efficiently (Source: Slack, Chambers & Johnston, 2010) Operations strategy plays an intricate role in establishing the foundations of a business. It concerns a prototype of strategic decisions and actions that set the role, activities and objectives of an operation. A majority of businesses anticipate their operations strategy to enhance their operational performance over the due course of time. However that depends on the effectiveness with which operational strategies are formulated and subsequently implemented. By formulating efficient operational strategies a business places itself in a position whereby operations can be planned appropriately. The fundamental determinants of organizing key determinants are to implement a proper business strategy and subsequently take appropriate measures that support the business strategy. Thereafter a manager needs to drive the business strategy by giving it long term and unique advantage. Ensuring all the above mentioned factors are extremely important as complementation between the activities need to be attained (Goodale, et al., 2011). Having mentioned all these factors, it has to be kept in mind that businesses also have to ensure that external neutrality is achieved. A company can achieve external neutrality by comparing its operational processes as well their efficiency level with other companies in order to address any areas of inefficiency. This is one way of planning efficient operations. Not only does that help the company to increase its efficacy but also allows managers to measure themselves against their competitors. Process design is the next most important step that is aimed towards aligning operations efficiently. Achieving cost and time efficiency is one of the fundamental objectives of organizations. This can only be attained if each and every process is designed and collaborated efficiently. For instance, a project involves the production of bicycles where the process initiates with the timely supply of raw materials and thereafter each and every part is assembled in different sub-departments and finally the whole unit is assembled. The process needs to be designed in such a way that there is no demand supply gap. Failing to do so might lead the company to incur considerable inventory holding costs as a result of excess inventory storage (Brown, Bessant & Lamming, 2013). Providing the capacity to satisfy current as well as the future demand is a major responsibility of operations management. Achieving a proper balance between the capacity and demand enables companies to satisfy customer in a cost effective manner. This can be attained through a proper capability planning and control strategy. However, this strategy alone does not guarantee success for a company. The same has to be integrated with appropriate inventory planning and control strategies. Inventory planning and control is crucial in order for accompanies to reduce inventory wastage. Moreover, it also allows companies to forecast the need for raw materials so that they can e received at the right time and at the right quantity thereby avoiding any form of operational delay. By ensuring all the above mentioned factors optimal level of operational efficiency can be achieved (Subramanian & Ramanathan, 2012). Ensuring effective networking between operations is another fundamental objective of companies throughout the world. In order to be able to achieve this objective, managers need to outline network diagrams in a comprehensive manner thereby modelling each and every segment of the work breakdown structure appropriately. One way of doing that is by creating a critical path of the overall project thereby specifying the time required for finishing a particular task. By doing so, the manager is able to allocate resources effectively and efficiently for the successful completion and at the same time is also able to identify any areas of slack. Efficient networking strategies also allow managers to ensure that there is a smooth flow of information between every functional department. This is precisely because a strong collaboration between operations is crucial when it comes to achieving higher operational efficiency. Companies often seem to adopt various measures in order to ensure a robust networking model. However, these models are associated with their own disadvantages which in turn sometimes lead to operational inefficiency. For example a critical path is too dependent on the early start time and late finish time of a particular activity. This method is applicable for small projects. Nonetheless for complex projects that involve multiple activities, over reliance on the above mentioned factors can prove to be ineffective. In addition critical path method does not consider any external uncertainties which actually are crucial regarding the initiation and completion of a particular project (Barratt, Choi & Li, 2011). 2.2. Problems of controlling component activities Considering the example of supply chain management whose component activities include purchasing, logistics, physical distribution management, materials management and CRM, controlling these activities prudently is imperative for a company. Given the fact these activities are considerably complex, maintaining coordination between them via a control mechanism is pivotal. However, companies face a number of problems while maintaining a control over these activities. First of all, the complex nature of these activities often makes it difficult for managers to control them appropriately which in turn increases the lead time of a project. Therefore, in case of a big project an increased lead time of a project leads the company to incur cost inefficiency. In addition, it has often been seen that managers fail to understand the intricacies related to these activities which in turn results in a poor forecast of demand. Consequently there is a demand supply gap that leads to sedimentation of excess of inventor that further results in inventory wastage. Not only does a company incur considerable holding cost but they also face operational delay due to improper controlling of component activities. Another problem of controlling component activities is over indulgence of managers in exerting control over the activities. Therefore they make less effort in reviewing the performance exhibited by officials working in different component associative departments. Consequently the operational efficiency of organization deteriorates (Slack, Chambers & Johnston, 2010). 2.3. Problems of controlling quality One of the major problems manager face while controlling quality is assessing the benchmark for a particular product. Given the fact that customer preferences and specifications keep on changing over the due course of time, it becomes considerably difficult for managers to set the benchmark for a particular product or service. Another problem is that managers often get themselves too involved in ensuring the quality of their delivery which in turn hampers the efficiency of other processes (Oakland, 2014). Contrasting views regarding quality between managers is also another problem when it comes to controlling the quality of a particular product or service. Contrasting views between managers often leads to conflict of opinions which gradually leads to a conflict of interest. Inadequate measures of quality is another problems faced while controlling quality. Given the fact that TQM is the only model of quality assurance, companies often face the problem of not having an appropriate model in place the gauge the quality of a product or service (Dale, Van Der Wiele & Van Iwaarden, 2013). 2.4. Project evaluation method Project evaluation and review technique (PERT) is one on the most fundamental evaluation tools that is used by a considerable number of businesses throughout the world. The tool was designed with the underlying propose of evaluating as well as the representing the activities that are involved in the completion of a particular project. Much like Critical path method, PERT analysis tool enables managers to assess the time that is required to accomplish a particular task as well as to identify the time that is required for the overall conclusion of the project. The model was mainly developed in order to simplify the planning and scheduling of complex and large projects and as such this analytical tool has proven to be immensely beneficial for its users. Not only does PERT analytical model defines and portrays the noticeable dependencies between the elements of a work breakdown structure (WBS) but it also identifies the critical path of an activity thereby gauging the early start, delayed start and any slack associative activity. Therefore, the large amount of data generated by this tool regarding a particular project facilitates effective decision making (Taroun, Yang & Lowe, 2011). Although PERT is extensively used all over the world, this technique has its fair share of drawbacks. The model fails to identify every intricate dependency between WBS elements in case of very complex projects and on the other hand this tool is not effortlessly scalable for smaller projects (Cottrell, 1999). 2.5. Resource scheduling methods The nature of resource scheduling methods employed depends largely on the availability of resources. For example when resources are scarcely available for a particular project, an efficient resource allocation and scheduling strategy is pivotal. This is precisely because it enables operational managers to minimize the overall delay of a particular project. On the other hand, resource constrained scheduling also reduces the flexibility with which a particular task within a project can be approached. Resource constrained scheduling also enables managers to prevent any form of inventory wastage thereby preventing firms from incurring excess holding costs. However, this method also increases the level of scheduling complexity thereby increasing the lead time of a project. Another resource scheduling technique that is often implemented is splitting or multitasking. The method is employed so as to generate a better project schedule as well as increase the utilization of resources. This technique often involves interruption a particular assignment in order to allocate resource into another assignment and thereafter return the resource to complete the interrupted work. This method is mostly feasible for start-up companies where the shutdown cost in negligible. However due to increased integration, delay in one project may create subsequent delays in another project. The peaks and valleys of resource demands often create scheduling problems (Saber & Venayagamoorthy, 2012). 3. Conclusion Organizing and planning efficient operations is one of the fundamental responsibilities undertaken by managers all over the world. This objective is achieved on a number of levels with the help of clearly defined and formulated strategies that facilitate smother operational flow. Having a cluster of coordinated strategies combined with a robust networking architecture is a key determinant of attaining operational efficiency. There are a number of methods that can be implemented in order to increase operational efficiency but they come with their fair share of drawbacks and it is up to the adaptability and capability of managers regarding how they address these issues and employ the tools in an effective manner. 4. Recommendation It has been noticed that managers often fail to address intricate details within a project which results in an overall delay thereby deteriorating operational efficiency of an organization. Moreover, they do not have the knowhow regarding the implementation of appropriate operational management strategies as well as they do not possess sufficient knowledge regarding the strategic tools that are available. Therefore senior managers should take the responsibility of imparting quality training to their immediate subordinates in order to make them capable of evaluating the requirements of an operation and adopt strategies accordingly. Managers also have to get acquainted with the analytical tools so as to be able to use them while conducting a particular project. They should have sufficient knowledge regarding the weaknesses of these models so that the strengths can be tapped efficiently and projects can be concluded within a predefined deadline. References Barratt, M., Choi, T. Y. & Li, M. (2011). Qualitative case studies in operations management: trends, research outcomes, and future research implications. Journal of Operations Management, 29(4), 329-342. Bass, B. (2014). Logistics & Operation Planning. Retrieved from http://smallbusiness.chron.com/logistics-operation-planning-14618.html Brown, S., Bessant, J. R. & Lamming, R. (2013). Strategic operations management. Routledge. Cottrell, W. D. (1999). Simplified program evaluation and review technique (PERT). Journal of construction Engineering and Management, 125(1), 16-22. Dale, B. G., Van Der Wiele, T. & Van Iwaarden, J. (2013). Managing quality. New York: John Wiley & Sons. Goodale, J. C., Kuratko, D. F., Hornsby, J. S. & Covin, J. G. (2011). Operations management and corporate entrepreneurship: The moderating effect of operations control on the antecedents of corporate entrepreneurial activity in relation to innovation performance. Journal of Operations Management, 29(1), 116-127. Mentzer, J. T., Stank, T. P. & Esper, T. L. (2008). Supply chain management and its relationship to logistics, marketing, production, and operations management. Journal of Business Logistics, 29(1), 31-46. Oakland, J. S. (2014). Total Quality Management and Operational Excellence: Text with Cases. London: Routledge. Saber, A. Y. & Venayagamoorthy, G. K. (2012). Resource scheduling under uncertainty in a smart grid with renewables and plug-in vehicles. Systems Journal, IEEE, 6(1), 103-109. Slack, N., Chambers, S. & Johnston, R. (2010). Operations Management. 6th edition. New York: Pearson. Subramanian, N. & Ramanathan, R. (2012). A review of applications of Analytic Hierarchy Process in operations management. International Journal of Production Economics, 138(2), 215-241. Taroun, A., Yang, J. B. & Lowe, D. (2011). Construction risk modelling and assessment: Insights from a literature review. The Built & Human Environment Review, 4(1), 87-97. Read More