Analytical Analysis of Carters Bakery Business - Case Study Example

Introduction In today’s business world, operations management is increasingly becoming important in the running of any business, as business enterprises continue to intensify their efforts in reducing the costs and improving quality and service. Operations management in business is concerned with product production and service, and it entails the task of ensuring the operations of a business are effective and efficient. Operations management also involves managing resources, distribution of products and services to clients and the examination of the queue systems. Hill (2005) describes operations management as “the field of study that focuses on the effective planning, scheduling, use and control of a manufacturing or service organization through the study of concepts that affects the organization”. (Hill, 2005) This business report presents an analytical analysis of Carter’s bakery business in terms in production, management and selling. The report will look at the areas that should be improved in the business. Operations management Operations management is very important in any business organization. The main aim of undertaking operation management should be to increase productivity, reduce costs of productions, and enhance flexibility to match customer requirements and at the same time improve quality and customer care services. (Ruffini, et al, 2000) Important Operations Management Issues at Carters bakery As business organizations formulates plans and ways of dealing with the business opportunities and daily challenges that come up within the business environment, it is important that the business formulates a system which is able to produce quality services and products in required amounts and within the required time frame. In relation to Carter bakery, the operations were not well formulated and market research carried out was not enough to give them enough information about the market. Designing the business system Designing the business system starts with developing product. Development of a product entails determining the features and characteristics of a good product to be sold. When designing a product it is important that the customer needs should be incorporated in the designing process. The facilities and tools which will be used in product production are in this category. Also information system that is required in monitoring and controlling the performance of the product are included in this stage of designing. As Slack et al, (2007) points out manufacturing process of a business or a company are integral part of the designing process and will determine the failure or the success of the business enterprises. The decisions address the questions such as how the product will be made. It is important to ensure that product designing is teamwork process and marketing and operating plans are incorporated so that the product can successful be launched on the market. It is apparent that the Carters did not have proper design of their business because they did not carry out enough market research in terms of customer requirements, product design and available market. (Slack, et al, 2007) Process design This determines how the product will the manufactured, the process designing has got two main components, which are technical component which includes decide on the equipments and the sequence of various operations. While scale economy component which is also termed as business component entails using appropriate amount of equipment to make the business enterprise workforce to be more productive. This will include determining; 1. The demand of the particular product if it is big enough to necessitate mass production 2. whether there is enough differences in customer demand in order have flexible systems of productions 3. Whether the demand of the product is too small or it is seasonal in that it won’t support mass and continuous production. Though, the Carters seem, to have a well define process design, it is clear that at times they have a problem with the process as it occurred at one instance when they had to produce low quality cakes. Effective organization Effective organization operations are important in tools in attaining the competitive advantage in a business industry. Knowing factors which influence the buying decisions of customers is important. Weiss & Mark (1989) states that; quality, price, product variety, product performances and product availability are some of the most critical factors that influence the customer when making buying decisions. All these factors are also influenced by business operations, for instance if there is high production of a product the cost of production can go down which will eventually reduce the price of the product. Due to the many commitments that the Carters have, they seem to have little time in spared solely for the Bakery, thus this is making the management of the business not to effective to the required levels. Role Everybody plays an important role in a business; the important aspect is that each person behaves differently in accordance to the operation function that is arising for such an individual. As an operations manager of a business it is important that the manager carries out different roles in the business. Among the roles are; Implementation of business strategy Being a supporter of the business Driver of business strategy Operations management objectives are very broad and they will differ depending with the business type and the products that the business is dealing with. Operations management will impact the different stakeholders in the business. The main stake holders are Customers; are the ones who are highly affected by any operations of the business. Employees; likewise the employees of an organization will be better off when a business organization is performing well. However, when it comes to operations management is goes beyond this success of the company and includes the working conditions in an organizations, the working conditions are set out by the way operations are designed. (Krajewski and Ritzman, 1993) Operations management has five performance objectives which includes; 1. Quality 2. Speed 3. Dependability 4. Flexibility 5. Cost Inside the business operations; in a business quality has a different affect. If the business operations are followed to the later and all the process and activities are followed very little mistakes will be done ensuring the quality is maintained. (Wild, 2002) The figure below shows the polar representation of performance objectives of any business. Wild (2002) points out that, “If managed properly, high quality, high speed, high dependability and high flexibility can not only bring their own external rewards, they can also save the operation cost.” Relating the figure to the Carter business it is clear that a lot of operations issues lack in their business, issues such as speed, flexibility, price and quality are major aspects that the Carters need to address in their business. Recommendations The following underlined measures need to be implemented by the Carter Bakery needs in order to improve the overall performance of their business. Product design This is very important because it will determine the features and the characteristics of the product as well as the functions of the product. Product design will also determine the quality and the price and the performance of the product. It is thus clear that the Carters did not design their products well, first there was no variations in terms of size, though they introduced the 1 kg later, as Hannah points out the cakes are not available in different varieties. For the business to improve more designs of the product have to be undertaken, this can be achieved through coming up with various designs of baking tins and decorations. Definitely, this will increase sales of the products. Produce quality; good quality in business operations affects the customers who use the products from the business. The customer should not have an issue to complain about the product. If the customers are satisfied then they can consumer more products from the company and ensure that they is steady income of revenue for the business. Thus this is what is termed as client or customer satisfaction. From the case study, Hannah points out at one time they produced low quality cakes, this should not happen again. As Hill (2005) notes, good things can always be made better. Thus, the Carters should strive to improve the quality f their cakes at all times. This of course needs to be through proper and accurate production process. Correct volume production; It is important that a business distinguishes between the actual number of the customers that the business can serve, and the maximum number of the customers which the business can cope up with. The later is termed as the capacity, this is the number customer that can be effectively be served by the business. First the Carters should only produce cakes which are enough to the market and avoid overproduction as it will lead to losses as observed before. Correct volumes will reduce costs and increase profits. Produce more varieties; It is important that a business be able to provide different variations of products to its customers so that they have a choice to make when it comes to the product. The Carters should produce varieties of the cakes so that they can offer their customer various tastes of the product. This will definitely increase their sells as variety creates more demand. Record keeping; on top of keeping monthly records, the Carters should also keep weekly sales reports which can be used to evaluate the sales and make constant and regular weekly analysis on sales which can be used in making any changes that are required. This will ensure that production can be checked. Weekly record keeping will also improve the analysis of business sales and immediate and quick changes can be undertaken within a shorter time. It is also important that the Carters has to meet weekly and discuss the production and sales records so that they easily monitor their business activities. Sales; making sales is important and a company should ensure that it offers its customers enough opportunity to make purchases. Many studies support the notion that sales are very important in for any business organisation. The Carters thus, create a way of increasing the amount of time they sell to customers so that they can make more sales and increase their production. At the same time the Carters have to create more distribution channels and outlets so that the customers can easily get a place to buy the cakes. This will highly improve there sales and ensure that they make more profits. Operations analysis Operations analysis is vital for a business organization to be able to tackle vital problems that the organization may be facing. (Slack, et al, 2007) The carters need to analyze the business frequently in order to know the areas that need to be improved. This will increase the efficiency of the business and ensure that they improve their service delivery. As Weiss & Mark (1989) states that, it is important that one understands the strategic environment of business operations in order to be able to understand the contributions that operations make to the success of an organization. This can be ascertained through the value- added way of the operations. Flexibility In any business it is important that the business operations be more flexible to allow operational changes and product design changes. Thus it is important that the Carters should try and have a more flexible operational approach that can give time a chance to implement changes in their business. As Krajewski and Ritzman (1993) clearly argue that, flexibility allows a business to be able to cope with volume fluctuations that occur of the year so that they produce just enough cakes during different seasons. At the same time flexibility will allow them to be able to put in place the necessary new innovation they may come up with, and also allow them to produce more varieties of cakes. The ultimate objective of this will be to improved effective and efficient business operations. (Krajewski and Ritzman 1993) Conclusion Business operations remain important in ensuring that a business performs well. It is important that various processes including business design are carried out in a proper manner. As it has been stated in the text, business operation has some main operations that need to be undertaken in a proper manner to ensure that the business succeeds. Operation management, designing the business system, process design and effective organisation are some of the important aspects in the business operation tasks. These aspects are clearly observed as important aspects that need to be improved in the Carter’s business. The Carter bakery business needs to undertake the above recommended which includes correct volume production of their cakes to avoid wastage, providing more varieties to increase sales and undertaking weekly sales records to closely monitor sales. This will ensure that the business operations of the bakery are improved become more efficient and more profitable. Reference: Hill, T (2005): Operational Management, (2nd edition), Palgrave; Macmillan. Krajewski, L.J., and Ritzman, L.P. (1993): Operations Management: Strategy and Analysis. Addison-Wesley Publishing, Ruffini, F et al (2000): Organization Design in Operations Management; International Journal of Operations and Production Management. Slack, N et al (2007): Operations Management, 5th edition, Pearson Education Ltd. Weiss, H. J., & Mark E. G (1989): Production and Operations Management. Allyn and Bacon, Wild, R (2002): Operations Management, 6th edition, Continuum. Read More