Operations Management in Business

Task 1

1.1 Importance of operations management for business

Operations management is significant for Furniture Supplier Company because of the following reasons. These are as follows...

Enhancing the productivity

Operations management needs to ensure the quality of the manufactured products. Therefore, it plays a significant role in enhancing the productivity and profitability of Furniture Supplier Company.

Improving the financial condition of the enterprise

It can be assessed that management of the supply chain is ensured through operations management. Thus, it helps in bringing advancement to carry out the processing for the firm. Hence, the finished products are offered to retailers within the minimum period and thus, it has an impact on the financial condition of the Furniture Supplier Company.

Helps organization in meeting client's priorities

Operations management plays a crucial role in managing the demand and supply of a firm in meeting the customer's priorities effectively. Through such function, it is important to maintain the balance between the quality ordered and supplied by the firm of furniture.

Managing product and service

The growth of the product includes varied steps. It starts with the generation of ideas and ends with the sale of products. However, for a Furniture Supplier Company, operations management is crucial as with this, it can plan varied schedules that would assist the business in manufacturing products within the stipulated time frame.

Optimal allocation of resources

Operations management helps in allocating scarce resources to different activities and functions within the business. The resources involve time and cost that are essential for the success of a Furniture Supplier Company. Thus, proper allocation and management of resources help in enhancing the productivity and profitability of the firm.

1.2 Analysis of Operations Functions of Furniture Supplier Company

The different operations functions of business are as follows...

Time management

The operations function is to plan the schedules in which the time taken by different activities of a business is assessed. However, it ensures that the completion of activities is attained within a set time scale so that the project may not get delayed over a specified time.

Cost management

It is an essential function of operation management. However, the cost allocated with varied business activities and functions is assigned with the help of operations management. It helps in managing the resources that are dedicated to the production and delivery of products and services. With the assistance of this, Furniture Supplier Company can minimize its expenses and thus, ensure to manage the overall cost of business.

Allocation of resources

Optimum allocation of resources is a crucial function of operations management. It helps in ensuring that the production process of a business runs smoothly when its resources such as cost and time are allocated effectively as per the priority of varied tasks.

Managing quality

It is another function that is performed in operation management. A furniture Supplier Company needs to measure the quality of finished products before selling them to the leading furniture retailers. It will help in enhancing the overall efficiency of the production system so that the best products can be manufactured.

Managing change

It is essential to manage the change within the firm so that different activities such as planning, monitoring, redesigning, and controlling the activities need to be carried out effectively to gain the best results.

1.3 Evaluation of Furniture Supplier Company by using process model of the operations management

It can be evaluated that the process model of the Furniture Supplier Company is effective in making decisions. Such a type of model involves varied activities such as input, transformation, and output. Although, varied theories and models are used to assess the operations management of a firm. However, it can be comprised of closed and open systems, probabilistic, random, and deterministic systems. In this, the operation management of Furniture Supplier Company is an open system. It is because; business needs to communicate at regular time intervals with the external business environment. In the input process, it requires raw material which is provided by the suppliers of the business. Thus, all these raw materials are processed through the conversion process and thus, input is converted to output.

In the transformation process, it involves various factors such as people, environment, technology, and structure which are essential in the completion of this step. The finished product is then transformed to customers in the form of output. Additionally, Furniture Supplier Company possess a probabilistic process model. This is because businesses can determine the end outcomes in advance depending upon the future results. Thus, with the help of an open process model, businesses can deliver the finished products to their clients that involve retailers that carry furniture business. However, the future demand for furniture products of enterprises can be estimated with the assistance of a Probabilistic system. Through this, the firm can keep an eye on its production capacity management.

2.1 Explanation of three E's

Three E's are essential for the success of business which involves effectiveness, economy, and efficiency that are enumerated below...

Efficiency

It states the way of carrying out things as smoothly as possible. It involves the allocation of resources in suitable ways so that the process can flow smoothly. However, to attain efficiency in business operations, business needs to eliminate the activities that cause delays while executing the operational process. Therefore, business needs to attain efficiency by producing the best outputs in the form of quality furniture. It results in attaining the desired results which will further enhance the productivity of Furniture Supplier Company.

Economy

Businesses must make production effective so that it will incur less or minimum cost to the firm. However, the economy defines carrying out activities in the cheapest way that is possible for the firm. Producing low-cost materials is only possible when a business makes bulk purchases and produces merchandise in high volume. Such type of element can only be attained when the Furniture Supplier Company minimizes its expenses which are incurred from activities such as manufacturing and delivering the final products. Through economy, business operations can ensure that desired outcomes are achieved within specified time and cost.

Effectiveness

In such type of element, it refers to making it effective so that client's needs and requirements can be fulfilled by the manufactured products within the firm. Thus, Furniture Supplier Company can assess the effectiveness based on the degree to which set targets and goals can be attained. Effectiveness ensures the success of the enterprise in the long run. Thus, it results in improving the quality of output that is produced by the organization.

Thus, it can be evaluated that the above-mentioned three E's result in excellence which is only possible when a Furniture Supplier Company manufactures its products with economy, effectiveness, and efficiency.

2.2 Tension between cost minimization and quality maximization

It can be assessed that cost minimization and quality maximization are crucial elements to attain success within a firm. However, Furniture Supplier Company needs to maintain a balance between both these factors to achieve the desired results. By carrying out this, the business faces varied issues that result in developing tension between cost minimization and quality maximization. It is significant for a business to manage its costs in the short run so that it can achieve the desired results. At the initial level, it is difficult for business to execute the production in high quality. This is because; the management of the business does not know whether the produced products will be accepted by clients or not. While, if the products are manufactured in small quantities then the business will be able to manage the quality of the products that have been produced. Thus, it can be evaluated that the quality of products can be maximized but the cost of production will be enhanced with this.

However, in the long run, Furniture Supplier Company can make production at a large scale. It will result in minimizing the cost of production. But it reduces the quality of the product at the same time. Furthermore, if a business integrates innovative technology for executing the production process then this will impact both facets. Although it helps in enhancing the quality of furniture the cost would be increased substantially with the usage of the latest technology. Thus, the tension between cost minimization and quality maximization arises when the raw material present to the firm is costly. The business also requires skilled labor to carry out the job in an effectual manner. Such workers will be paid high salaries and thus, it serves as the cost of the firm. This results in cost maximization and quality maximization. Therefore, to maintain a proper balance between cost and quality, the furniture Supplier Company is required to allocate the resources effectively.

2.3 Evaluation of the significance of five performance objectives

The significance of performance objectives such as cost, dependability, flexibility, quality, and speed that underpin the operations management are as follows...

Cost

To achieve such a performance objective, the Furniture Supplier Company has to minimize its direct and indirect expenses. With the low-cost objective, a business can enhance its productivity. However, it has an impact on sales and profitability of the business. For instance, if a business manages to minimize its expenditure then it would achieve the desired outcome within the specified period.

Dependability

It is another crucial objective of the firm. However, it covers the aspect of customer convenience. The dependability performance objective can be achieved only when the Furniture Supplier Company makes timely delivery of products and services and satisfies the client's needs. Thus, it would result in reliable operations for organizations that help them in attaining the desired targets.

Flexibility

Such performance objective affects the business's ability to adopt changes. It will improve the potential of the operational management system of the firm. However, with the change in preferences of clients, Furniture Supplier Company needs to make alterations to their existing products or design new furniture outlay so that client's needs can be satisfied.

Quality

It helps in ensuring the production of error-free products as per the specifications provided by clients. Through this, performance objective helps in enhancing the performance and sales of merchandise. Also, with the help of quality control measures, businesses can attain set standards.

Speed

Organizations can attain this performance objective only when it takes a short delivery time. However, it helps in facilitating the production process of business to run smoothly. By adopting a speedy process, Furniture Supplier Company helps meet the needs of clients promptly. It also assists in improving the brand image of the firm in the market and satisfies the requirements of the target market.

Task 2

3.1 Explaining Linear Programming

Linear programming can be stated as a linear optimization that helps the business in achieving the best outcomes. It involves profit maximization and cost minimization objectives. It is considered a mathematical model that can be used by Furniture Supplier Company in finding solutions to the issues that arise because of inappropriate allocation of resources. However, the needs under this technique are demonstrated in linear relationship form. Further, such type of technique can be applied when linear association exists among variables. Such a model helps organizations optimize the results based on an unambiguous set of constraints. Operational research helps in ensuring the use of linear programming in determining the solution to varied production and business issues.

3.2 Critical path analysis and networking planning

Critical path analysis and networking planning are as follows...

Critical path analysis

Furniture Supplier Companies can schedule their activities with the help of a project management tool that is known as critical path analysis. It helps the business to effectively manage its complex business activities. It is useful in assessing the actions that are crucial for the completion of a project. With the help of this, the project manager can determine the longest path that can be taken to complete the task within the shortest time duration. However, the delay caused by one activity of the project will have an impact on the overall completion of the project. Critical path analysis helps the business to gain insight into whether or not it is carrying out its actions in a planned way. Furthermore, it enables Furniture Supplier Company to ensure that it makes timely delivery of products to attain satisfaction.

Network planning

It can be defined as the set of activities that are critical to the success of project completion within a specified time, cost, and other resources. Networking planning can be done through adopting program evaluation and review techniques. With the help of this, the Furniture Supplier Company can determine the amount of time and cost allocated to varied activities. Thus, it helps in analyzing the critical path activities.

3.3 Need for operational planning and control in producing furniture

It can be analyzed that operational planning and control is crucial in Furniture Supplier Company for the following reasons...

Project management

Here, operational planning is needed by the firm for the aim of designing its project plans. However, businesses can manage their resources effectively with this. It also helps in making the proper allocation of resources. Thus, the Gantt chart method can be used to control the project. It helps Furniture Supplier Company to monitor their activities and whether they are on the right track or not.

Future forecasting

Furniture Supplier Company estimates future demand, sales, and quantity of stock by operational planning. Thus, business is required to plan its future tactics on this basis.

Quality assurance

The organization needs operational planning and control for the aim of managing the quality of its products and services. Businesses need to implement varied quality control techniques such as Six Sigma and variance analysis to maintain the quality standards within the firm.

4.1 Designing layout for producing furniture and its operational outcomes

It can be considered that the possible layouts that are present to the firm are process, product, and hybrid layout. In the product layout, the work situations and equipment are designed based on a product line that has to be manufactured. While in a hybrid layout, is a combination of product and process layout. For instance, the appropriate layout for a Furniture Supplier Company is a process layout under which similar activities are grouped. In this, every department involves skilled employees who have expertise in executing particular activities. Thus, it helps ensure quality assurance in every process. The layout of the production process constitutes the attributes such as flexibility. It is because; with the change in product line, the process may also be changed. Through carrying out appropriate processes, the end product can be prepared to satisfy the needs of clients.

4.2 Producing network plan and critical path

The network plan involves a range of activities that start with executing the market research to the delivery of the final product. Businesses can plan their activities so that they can keep track of the time and cost that is attached to each action. In this, the Furniture Supplier Company network plan is prepared for the packaging process.

4.3 Identification of approaches for project management and quality control

It can be evaluated that the approach that can be used for the aim of quality control is total quality management. Such type of method is critical in enhancing the ability of the firm to deliver products that have high quality. However, such an approach focuses on elements like customer focus, worker engagement, and process-centered integrated systems, etc. in keeping the quality of the product on track. The total quality management approach helps in providing training to workers so that tasks can be accomplished with proper standardization. Businesses can make use of this technique that emphasizes process thinking. It helps Furniture Supplier Companies attain proper quality objectives when it has a systematic and strategic approach toward their vision, mission, and goals. Moreover, continuous enhancement in the process by the organization will help in managing and maintaining the quality of products within the enterprise. TQM helps in defining the role of communication in upholding the superiority of furniture products and services.

Conclusion

It can be concluded from the research that operational management plays a crucial role in the success of the firm. It helps businesses in enhancing productivity, efficiency, and quality so that the best results can be attained. However, the three E's elements assist in enhancing the productivity and profitability of the firm. Also, it can be evaluated that the five performance objectives underpin the operational management of a Furniture Supplier Company. The network plan developed for the packaging process is designed that demonstrate the minimum and maximum time that is required for the aim to accomplish the project effectively.

References

• Berger, A., 2011. Operations Management. GRIN Verlag.
• Clegg, B. and Wan, Y., 2013. Managing enterprises and ERP systems: a contingency model for the interpretation of operations. International Journal of Operations & Production Management.
• Eriksson, D., Hilletofth, P. and Hilmola, P. O., 2013. Creating value through wholesaler and retailer interface. Industrial Management & Data Systems.
• Hazletta, A. S., McAdamb, R. and Walkerc, T., 2013. The role of operations management in public sector policy and practice alignment: a local government analysis. Production Planning & Control: The Management of Operations.
• Jones, P. and Robinson, P., 2012. Operations management. Oxford University Press.
• Kikwasi, G. J., 2011. An evaluation of construction skills in Tanzania. Engineering, Construction, and Architectural Management.

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