Theories and Concepts Related to Dimensions of Operations Management - Essay Example

?Operational Management Issues for Services The Dimensions of Operations Management Table of Contents Table of Contents 2 Introduction 3 Theories andConcepts Related to Dimensions of Operations Management 5 Challenges faced by a Head of Operations in Automobile Industry 10 Managing Various Customers 11 Managing the Experiences and the Outcomes 11 Understanding the Concept of Service 11 Handling the Coordination amid Different Parts of the Organisation 13 References 15 Bibliography 18 Introduction Operations management is a dimension of management that concerns with designing, controlling and overseeing the production process along with reforming the operations of business for the deliverance of effective services and goods. It deals with the management and design of products, services, process as well as supply chain. The dimension of operations management ranges from strategic level to operational level. The issues in strategic level consist of determination of location and size of manufacturing plants and designing of technology in supply chains among others. Tactical issues or factors entail methods of project management, structure and layout of plant, selection as well as replacement of equipment. The issues in operations include management of inventory, inspection and quality control, policies of equipment management (MIT Sloan School of Management, 2013). Operations management issues for services comprise various aspects that entail development of new services, managing experience in services, analysing the process along with yield management among others (Johnston & Clark, 2005). Service is the hub of economy in every society. Services, infrastructure and communication play a significant role in every sector of economy. Services in government play a stabilising role in the environment in terms of growth in economy and investments (Fitzsimmons & Fitzsimmons, 2004). The dimensions of operational management comprise four types that include finance, internal process, customers and learning and innovation. In the aspect of financial dimension, it can be stated that most of the business organisations look for profit by attaining the objectives in the financial aspects in the short-term, resulting in maintaining profits along with enhancing the productivity of the organisation. Customers are a key aspect to an organisation. The objective of on organisation is to maximise the sales by providing quality products to customers and generating greater revenues for the organisation. Adequate optimisation of internal processes results in satisfaction of the customers along with enhancing profits for the organisation. It can be stated that process of innovation facilitates to develop the process of manufacturing, which in turn results in earning greater profits by satisfying the demands of the customers with quality products (Mack, 2013). Automobile industry in terms of service operations management generates various kinds of issues that include ensuring timely and efficient support to operations, product stocking and security. Operational service offers services related to security management along with receiving deliveries of vehicles as well as ensuring reliability and high quality of support from back office. Ensuring effective management of inventory, controlling and managing every aspect of inventory of stock, maintenance and timely delivery of service along with quality assurance of products can also be considered as significant aspects in service operations management (GulfTalent.com, 2012). Service operations management is the concept that is used by the management in service operations which covers various activities, liabilities and decisions. These operations are executed in a variety of services in the business environment (Johnston & Clark, 2008). With these considerations, the essay intends to discuss the dimensions of operations management. Moreover, the various critical challenges in terms of operations management faced by a Head of Operations of automobile industry will be taken into concern in the discussion. Theories and Concepts Related to Dimensions of Operations Management In relation to theories of operations management, it can be stated that the concept of customer demand planning process has been recognised as one of the significant aspects. The process of customer demand planning (CDP) enables the relationship between suppliers and customers for fulfilling the requirement of better services and products. Moreover, CDP is the process of business planning that facilitates customers and suppliers to improve the forecasting of demands that comprises inventory and production planning as well as revenue planning. Here, it can be stated that with effective relation between suppliers and customers regarding supply of demanded products it would assist an organisation to generate revenues by a considerable level. The aspect of supply chain process also facilitates in forecasting of demands which is initiated by the process of demand planning by the customers. In this context, it can be stated that resources are allocated through capacity planning in order to generate a plan for attaining the demands of the customers. Moreover, it can be stated that capacity planning is considered as an important factor for the implementation of the supply chain process for an organisation. It is a very complex process. Furthermore, the process of inventory management also facilitates the supply chain activities for effective flow of products or services. Operations planning and scheduling assists an organisation in appropriately scheduling, planning and disseminating the resources that are productive in order to maintain the level of supply in an effective manner for services and products. The aspect of resource planning enables to ascertain how the process of planning is carried out and how the information gathered from the process of planning is used in other functional aspects in an organisation (Krajewski & et. al., 2011). In the context of demand planning in the automobile industry, it can be stated that the execution and demand planning are two significant aspects that service providers in logistics are engaged in supply chain process for automobile in the global market context (Partridge, 2011). It can be observed that most of the automotive companies outsource non-core value functions for maintaining services in terms of configuration, line sequencing and management of inventory. For demand planning in the aspect of automobile industry, it can be stated that organisations look for inventing fresh products and innovative software that could assess the growth of sales for automotive products in the global markets. As time is changing, innovative technologies have become the talk of the hour and most of the companies are going for innovation. It is essentially carried out in order to attract customers and maintain the rate of growth as well as demand for the products by a considerable level through the supply of the products in the market within the time limit (Rushton & Walker, 2007). It can be stated that balancing between capacity and demands can facilitate to generate greater profits by delivering quality products resulting in satisfaction of customers. Capacity planning refers to aggregate planning. Capacity planning is the activity for implementing the capacity of the operations for an organisation effectively. In this regard, it can be stated that the operations of an organisation depend on the demands of the products in the markets by the customers. Negative demands for the products provide fluctuations in operations for the organisation and vice versa. While establishing long-term capacity planning, it is required for the managers to take decisions regarding amending the aspects of capacity for operational aspects during the medium term. Therefore, it is required for managers to assess the demands of the products for a period of 2 to 18 months during which the planning for the product is to be varied according to the time duration. As divulged earlier, capacity planning in most of the large organisations depends on the fluctuation of demands on a seasonal basis. Most of the services and products consist of seasonal demands along with seasonal supply. Companies adopting demand planning software can generate forecasting of demands with the use of statistical tools and techniques. It is possible for automobile companies, for instance Ford Motor Company, to respond more rapidly and effectively to the demands of the consumers through the enhancement of supply chain, i.e. the software of demand planning. Moreover, it is observed that most of the automobile companies have accomplished positive outcomes through the management of demands in the supply chain activities. With the execution of the demand planning software, it has been possible for automobile companies to maintain decrease in the level of inventory by 50% and delivery of finished products in time to an increase of 40%. This resulted in an increase in demands of the customers by a considerable level. In the context of supply planning, it can be stated that the decision had been taken by three large automotive companies i.e. Ford, Daimler Crysler and General Motors to work together for establishing a unique supply chain planning and system. It can be observed that Ford Motors with the assistance of demand planning and supply planning software have considerably developed its operations process. It has been observed that expenses made by Ford are around US$80billions on a year which has assisted the company to meet customer demand specifications more comprehensively. This has enabled the automotive companies to understand the execution and the impact of planning for supply chain in the competitive business arena (Philips, 2009). In response to capacity planning, it can be stated that leading automobile organisations such as Ford Motors provide services in the market by facilitating customers with branded original Ford and Lincoln Mercury parts and services that enables the company to maintain the growth of the organisation by a significant level by meeting the demands of the customers along with delivering quality products and services. Moreover, in order to meet the demands in future, most of the automobile companies are planning to maintain competitive demands by decreasing the capacity of manufacturing along with plant related employment (Plunkett, 2006). For instance, Ford Motors’ India section has planned to utilise its full capacity of the plants in 2013 and is eyeing for expansion in the aspects of facilities as well. The organisation is also looking for expansion as the demands for Ford is increasing considerably which can be recognised from the significant growth of sales i.e. 30,000 cars sold in 2012 in the global market (Ghosh, 2013). However, in this connection it can also be stated that most of the automobile companies in order to attain more adequate profits in operations process are recruiting skilled employees and providing them adequate training for maintaining greater productivity in organisation by delivering quality services to customers in a cost effective manner. The industry is in tremendous pressure for improving the performance by decreasing the manufacturing costs as well as by improving the process of production for facilitating better services to customers. The companies also emphasize on elimination of bottlenecks and maintenance of adequacy in operations by serving customers with effective quality services (Visual Thinking, 2011). In terms of technology service, it can be observed that most of the automobile companies focus is on providing services through just-in-time process for checking the status of the vehicles via online sources along with reengineering process techniques. This would assist leading automobile companies to serve customers in a better manner and to maintain their productivity. Most of the automobile organisations are also focusing on innovativeness all over the product line which helps in effective operations activities. Enabling operations of information technology (IT) by leading automobile companies has assisted in controlling the technological aspects for rendering effective services that could be beneficial for the organisations as well as for the customers. The process of operations services carried out by leading automobile companies also includes the application of web service which facilitates to maintain and monitor machine maintenance and quality assurance. Moreover, with the assistance of cutting-edge technology of Microsoft and SYNC, effective services have been offered to customers in the global market context, enabling to enhance the profitability by selling quality products and generating revenue. Moreover, Service Parts Management (SPM) solution also assists in providing effective services in operations for Ford to maintain its sustainability in the global market context. The operational services are offered by most of the automobile companies by developing and deploying varied systems for providing effective services to customers. Service operations also facilitate in managing large global programs by Enterprise Resource Planning, development of product system and Asset Management (Summer, 2006). SPM usage in operations of service can be considered as one of the best applications used by leading organisations. With SAP, technology it is possible for the organisations to invest for improvement of new products or services facilitating to meet the demands of the customers. SAP helps leading automobile companies in effective planning of inventory as well as distribution resource planning, adequate deployment of parts and effective procurement process (Alexander, 2013). In terms of providing quality services, it can be stated that companies in the automobile industry are instrumental in maintaining system of production and are optimised in maintaining quality standards. It can be stated that quality management in automobile industry is a significant aspect. Companies, for maintaining quality, focus on creating competitive advantages in order to maintain sustainability aspects. Controlling the quality along with maintaining the expectations of the customers is important from the viewpoint of organisations. Quality services provided by automobile companies not only enable to uphold customer retention but also facilitate to enhance sales as well as market share of the organisation. Moreover, with greater and effective quality of products, it increases the brand loyalty of the organisation by a considerable level. In this regard, it can be stated that in modern day context, companies are going for maintaining quality as they have to face tougher competition in the market from various competitors in the global market context. This has resulted in most of the companies looking for producing quality products with cost efficiency for increasing the growth of sales and profits for the organisation. Most of the leading automobiles organisations have established Profit Improvement Program in order to decrease the manufacturing costs and maintain quality of the products that could enhance the growth of sales for the organisation (Scribd Inc., 2013). Challenges faced by a Head of Operations in Automobile Industry There are various challenges faced by a Head of Operations (HOO) in terms of services in automobile industry which can be considered as significant problems in maintaining service operations. The challenges include managing various customers, understanding the concept of service and handling the coordination aspects in different areas of organisation. Another challenge can be identified as continuous improvement of operations and innovation aspects along with management of issues for short and long-term on a simultaneous basis. This can be elaborated based on the following grounds: Managing Various Customers Most of the service organisations do not only serve generally homogeneous type of customers, but they serve different variety of customers in a different way as well. The management in automobile industry based companies is also responsible to maintain other customers such as stakeholders in an organisation along with internal customers i.e. the employees (Johnston & Clark, 2005) Managing the Experiences and the Outcomes One of the significant challenges faced by HOO is managing the outcomes and the experiences. In service operations, there are no clear boundary in terms of outcomes and experiences. A few service organisations in automobile industry endeavour to transform intangible parts of services into tangible ones. It can be stated that intangible parts can at times create problems in controlling and maintaining specifications (Johnston & Clark, 2005) Understanding the Concept of Service A service organisation must be clear in its approach of what to sell and what would the customers’ buy. These are the most important factors for service organisations such as automobile industry based companies to have a clear concept of service which is considered to be a critical dimension for making clarification of products produced and offering deliveries to the customers (Johnston & Clark, 2005) Handling the Coordination amid Different Parts of the Organisation The management of service operations in automobile industry is a very demanding aspect and it requires the integration of resource management, marketing and management of people. The HOO is responsible in maintaining coordination amid various parts in respect of service operations in the automobile industry. It is also essential for HOO to ensure that all the aspects of supply chain process are maintained quite effectively and completed in the right order. This would result in maintaining growth in service operations for automobile industry (Johnston & Clark, 2005) Conclusion From the above observations, it can be comprehended that operations management inculcates various aspects in service operations for different industries which are required to be maintained. It includes various factors such as development of new services, management of positive service experience, analysis of the process and yield management among others. It has been recognised that through effective demand and capacity planning in automobile industry greater sales and productivity can be maintained along with generating revenue for the organisation. In the modern day context, it is necessary for every industry to be cost effective in their approach as with rising competition, it is important for any organisation to maintain its sustainability in the global market context by upholding product and service quality. In this context, it is apparent that through effective demand and supply of quality products, greater profits can be ensured. Moreover, proper management of different operational aspects in the automobile industry such as managing various customers, handling the coordination amid different parts of the organisation as well as maintaining profitability of the organisation would ensure greater productivity and sustainability at the same time. References Alexander, T., 2013. SAP Helps Asian Automakers as they Globalize their Operations. SAP for Automotive. [Online] Available at: http://scn.sap.com/community/automotive/blog/2013/04/13/sap-helps-asian-automakers-as-they-globalize-their-operations [Accessed April 07, 2013]. Fitzsimmons, J. A. & Fitzsimmons, M. J., 2004. Service Management. The McGraw Hill Company. GulfTalent.com, 2012. Operations Manager – Total Facilities Management (Automobile Industry). The Role. 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List Four Types Of Focus Dimensions Used In Operations Management. Home. [Online] Available at: http://smallbusiness.chron.com/list-four-types-focus-dimensions-used-operations-management-35814.html [Accessed April 07, 2013]. Philips, H. B. 2009. Business Driven Tech. (W/Cd) 2E. Tata McGraw-Hill Education. Plunkett, J.W. 2006. Plunkett's Transportation, Supply Chain and Logistics Industry Almanac 2006 (E-Book). Plunkett Research, Ltd. Partridge, A. M., 2011. Auto Logistics: Revving Up Service Parts Logistics Operations. News. [Online] Available at: http://www.inboundlogistics.com/cms/article/auto-logistics-revving-up-service-parts-logistics-operations/ [Accessed April 07, 2013]. Rushton, A. & Walker, S., 2007. International Logistics And Supply Chain Outsourcing: From Local to Global. Kogan Page Publishers. Scribd Inc., 2013. Quality Practices in Automobile Industry. Introduction. 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