Suggestions and Recommendations for the Operations Director of StarBurst Company - Case Study Example

Topic: Operations Research and Section # of StarBurst (ST) is a leading MP4 company. It has launched voice control device Stroll through which directions can be given to the computer through voice. This product made a massive business. ST is going to launch a new product after 18 months. The problem arises here that in some units, suppliers are not doing job as per requirement and 43 percent defective units are running. This situation can harm their reputation. In this article suggestions and recommendations are described for the Operations Director (OD) of ST to implement on the suppliers to retain the reputation of the company so that new product can be launched successfully. Quality techniques and quality assessment tools are also suggested in this article. INTRODUCTION StarBurst Technologies (ST) has their name in the field of technology especially in the market of MP4. Their last product has marketed so well that it provided the required capital for the investment in their new project. That product was Stroll-a device through which all directions to the computer can be given through voice. It was designed to work at the place of mouse. They were going to launch another product which was a mega project too. But this time there are threats to the company's reputation. Their plants in Australia and Asia were not working at per satisfactory level of quality. The rejected Stroll units were running at 43 percent which is enough ratios to effect the reputation of ST. ST is facing problems of bad reputation as well as some quality issues were also faced by some suppliers. Some of the suppliers were found to be not working as per requirement of their job and others need more understanding their job. The above all situations were in the mind of the Operations Director (OD) and he was thinking to resolve these issues. He was satisfied on one aspect of the issue that they have four weeks to set all the issues. Now following questions are to be answered:- 1- ST's suppliers have a number of problems that need fixing. Should their be continuation with the present strategy of "one component, one supplier, one market" Present recommendations for ST's supplier strategy. 2- The OD has asked for the recommendations on the supplier selection methods that ST should employ to ensure they contract the best partners. 3- There are a number of quality issues highlighted and it is not possible to change all the suppliers, so the only way is to improve how some suppliers work. Provide recommendations for the quality technique a supplier could adopt and why. 4- Having selected the quality technique the need is now to make recommendations on their quality assessment tools that can be used in assessing the issues and problems. 5- State the assumptions made on any aspect of the article. The main problem described in the report is the working behavior of suppliers of the company. It is the fact that it is hard to change the all supplier structure. Rather there should be a planned, well define guideline for system of work of the suppliers to be followed. One to One Market Strategy It is an approach more than a sales approach. It is also called one component, one supplier, one market strategy. It means to identify the customers' needs and then provide the services to one customer at a time. Clearly one supplier will deal with one customer at a moment of time. This strategy aims to recognize the customers' requirements, their complaints and issues on which they want the company to improve its services or products. The basic concept behind this strategy is to concentrate on the customers rather than products or services. It is strongly recommended to identify the company's customers. In customer identification, usually two types of customers are found: 1- A customer who switches to any other company in seek of bargain. 2- A customer who does not switch to any other company rather wants to get a product meeting his/her requirements from the same company. Customers of second kind are called loyal customers of a company. These customers should be the area of focus for a company. As investment on them can bring massive benefit to the company as these customers can convert 1st type of customers to the 2nd category. This strategy includes all parts of a company such as capital, services, product, management, etc. RECOMMENDATIONS for ST It is recommended to St's OD to focus on the suppliers immediately. The following steps can be adopted in order to improve the suppliers' work: 1- Immediately call a meeting of suppliers working at the company. 2- Clearly identify the problems that the suppliers were facing 3- Categorize the found issues. 4- Give prcised description to the suppliers of what the company wants from them. 5- Ask the suppliers to present actable solutions for the issues. 6- Make changes in the posts of suppliers on the basis of their performance. i.e. form groups of suppliers making the better performing supplier as their team incharge. 7- Fix a dead line to receive their complete work and ask the TEAM INCHARGES to submit the report of the work of their respective teams on that deadline. STRATEGY TO BE FOLLOWED It is strongly recommended to the company to follow "one-to-one market strategy". As at the moment ST's basic need is to sustain its customers the loyal customers, so that the reputation of ST can be retained up to certain level for the success of the upcoming product. Continuous improvement should be the goal of any company so as for ST. Mass Customization, like one-to-one market strategy, can be found to be more beneficial for ST in the current situation. This strategy focuses on customer satisfaction too. SUPPLIER SELECTION METHODS At the moment, ST needs very careful behavior while choosing suppliers and contractors for it. ST should select suppliers on the basis of following criteria: Capability to meet deadlines of orders. Ability to deliver the product safer (without any kind of damage to the product.). Level of loyalty to the company Soft speaking suppliers should be selected preferably. EXPLANATION OD should strictly follow the above described standards for selection. Meeting deadlines is the most important ability required for a supplier. Late deliveries directly affect the reputation of a company. Meeting dead line does not mean to just supply the goods on the last moment, but the supplier should have so much command over his work that he can supply the material in any unsuitable situation. A supplier should be well aware of all routes through which services can be carried out to the customers. So that in case of an urgent order, instant delivery could be possible resulting in an increase in the reputation of the company. The supplier should be capable of carrying the products free of any damage, loss or harm. Honest and smart working suppliers should be given preference. The supplier should be trustworthy enough for the company that can increase number of customers through good public relationship ability. Neatly dressed and softly speaking suppliers always amplify the company's name as well as increase the sales of the company. RECOMMENDATIONS FOR WORK OF SUPPLIERS Quality is not produced rather it is maintained in a system. It is not in form of a product to be poured into a bottle or top be kept in a drawer. It should be sustained throughout the process of manufacturing, packaging and delivering the services to the customers. According to quality experts, focus of a company should be on the process rather than on product. Working on the quality of a product will require higher cost as compared to working on a process. A process should be started with careful attitude for quality of each and every step involved in the manufacture of even a single product of lowest cost. For maintenance of quality of a process, the top management should be conscious enough of quality. Quality flourishes in quality environment. So every single employee working within the company must be aware of the importance of quality and a quality product. In the current situation, the OD should adopt critical behavior to the suppliers who are facing quality issues. As mentioned in the article, OD is thinking over to replace the unit working in Australia with one new better unit. However, this is not a solution for the said problem. New unit will require more capital to be invested, and the time ST has 18 months to make all matters to capture satisfactory level of performance. OD should focus on the way of work of the suppliers. It should be assured that from beginning of the manufacturing process, availability of quality material is possible at any cost. Quality at every step should be strictly checked throughout the process. 43 percent defected units running are alarming for the reputation of company. Quality environment there must be made possible. Quality of every product should be checked before its supply even to the suppliers. Internal quality audit system should be developed emergently. Specification limits for the process should be clearly defined to the employees of the company. Six Sigma and 5 S are two very important techniques must be followed by the company. Total Quality Management (TQM) is also helpful for maintenance of quality of the system. TQM plays an important role in assurance of quality in any system. The basic principles of TQM are defined as following: 1- Ethics 2- Integrity 3- Trust 4- Training 5- Teamwork 6- Leadership 7- Recognition 8- Communication These eight principles build HOUSE of QUALITY for any system. EXPLANATION of TQM The principles of TQM are explained as following: 1- Ethical values are very important for any business. These are promised to the customers to be provided by the company. These show the ultimate goal and vision of any company. So suppliers should be well aware of the Ethics of ST. 2- Integrity comprises of the steps followed by the company to meet their ethical values. No company can meet those values until employees and the system does not work according to the defined procedure. Especially in the current situation, suppliers of ST need hard work to meet the ethical values of the company. 3- Trust level should be higher for the suppliers both within ST and with the customers of ST's products. It is the trust level that defines the loyalty of a customer to a company and which enhances the repute of a company. Trust level can be retained through meeting the customers' requirements ( surely they require the company to fulfill the promises) 4- Appropriate training should be given to all employees of any company. In the situation under consideration, ST should immediately arrange a training session for its suppliers, alongside training workshops that should be organized as well. Investment in this way will definitely give a boosting result to the performance of the suppliers ultimately increasing the reputation of ST. 5- Team work strategy also plays an important role in better performance of employees. OD should make teams of suppliers. Each team should work under a team leader. Daily and weekly meetings should be planned for the teams. Similarly meetings of team leaders with the operations director (OD) must be assembled monthly with the agenda of submission of complete report of the work done of the team and difficulties faced by any member of team. 6- Leaders set the environment of workplace. In any company, top management plays role of leaders. Leaders must be brave enough to take decisions. It is responsibility of a leader to maintain unity within the team and to solve the problems of the members. Team leaders also must be capable of these qualities so that the purpose of efficient work may be obtained. 7- Recognition of the efforts of suppliers is must. There should be a check kept upon the suppliers. Their performance should be properly evaluated. Suppliers with inadequate job should be warned. And incentives should be given to excellent suppliers. 8- Communication can be called backbone of any workplace. Until or unless adequate communication system is developed within the company and with the external customers, required results can not be obtained. Customers' voice should be listened carefully as well as problems of suppliers should be resolved. QUALITY ASSESSMENT After adopting quality techniques, its assessment is important too. In the situation St facing now, its importance increases more. Quality can be assessed through the following tools: 1- Check sheets 2- Documentations of the process 3- Checking the specification limits Through check sheets, OD can easily go through the performance of the all employees. All record of receiving and delivering the materials should be kept in it. There should be tick marks on the in time completed tasks. Through this lack of work can be assessed instantly. All process should be documented properly. Daily record of all work should be kept in log books, and these books should be maintained. Specification limits defined to the suppliers must be followed strictly. Checking the performance of suppliers in contrast with those limits will help the director to quickly assess the work. Assessment of Quality is much necessary as it guides about the results of the efforts made by the company. All employees working within the company work very hard for the reputation of the company but when their efforts are not recognized and appreciated, they loose their morale. This thing is alarming for any company. Quality can be assessed through other ways too. This should be a daily routine of the officials. As if the management checks and evaluates the performance at least fortnightly, it adds to the efficiency of the company. The situation under which ST is going requires very hard and careful attempts of management as well as the staff especially the suppliers. ASSUMPTIONS The case studied here presents a situation which a company should not fall in. It is very strange that a company producing Stroll did not take care of the defected running units. 43 percent is quite large ratio. Surely this situation created due to the non serious behavior of the top management who are responsible for this. Moreover complaints in different parts of the product should be solved earlier, so that they may face any difficulty at the time of launch of new products. Now at the time of preparation for their new coming product, they have to sustain their reputation first. For this they have to work very hard and in very smart, efficient way they can achieve their goal. They have to invest the capital too. Time is also required. But if they considered these issues earlier than this time, the whole attention of the company might be towards the new project. They can introduce more new and surprising features of the new coming product. St's top management should not waste even a second more now. The complaints from the suppliers and customers should be received and recorded in proper way. The issues should be solved immediately. Customers should be given special care. Their requirements and needs from the company should be identified accurately as many of customers can not define their requirement. After identifying their needs, provide the services. Introduce discount packages to enhance customers' loyalty. In case of any defect, immediate action should be taken and there should be no queue found in the work place. One to one market strategy and Mass customization should be strictly followed. TQM is the most beneficial tool for maintaining the quality inside the company. Communication should be strong between all departments of the company. The units of the company working in different parts of the world should be given equal attention. Now at the moment Australian and Asian units need more care about the issues. Instead of investing in establishing new plants, OD's should try to ensure the best performance of these plants. References 1- Export Practice and Management, Alan Branch, Cengage Learning Business Press; 5 edition (November 23, 2005) The Alignment Performance Link in Purchasing and Supplying Management. Christian Baier, 2- Innovation Product Development and Commercialization-Case Studies and Key Practices for Market Leadership, Dariush Rafinejad, Ph.D, J. Ross Publishing (June 15, 2007) Just-In-Time Manufacturing: An Aggressive Manufacturing Strategy (Mcgraw-Hill Manufacturing and Systems Engineering Series) Richard T. Lubben Methods of Operations Research, Philip M. Morse, Kormendi Press (November 4, 2008) 3- Managing Customer Relationships: a strategic frame work by Don Peppers, Martha Rogers, Wiley; 1 edition (April 19, 2004) 4- 'One market, one law, one money Giandomenico Majone, London School of Economics and Political Science. Dept. of Law 2007 5- Operations Research Proceedings 2004, H. Fleurun, D.den. Hetrog.P.Kort, Springer; 1 edition (July 21, 2005) Operations Management and Student CD and Student DVD Package, Jay Heizer, Barry Render, Prentice Hall; 9 edition (November 9, 2007) Operations Research: An Introduction (8th Edition), Hamdy A.Taha, Prentice Hall; 8 edition (April 4, 2006) 6- Operations Research and Management Science Handbook (The Operations Research Series), A. Ravi Ravindran, CRC; 1 edition (December 5, 2007) 7- Pluralism in Europe: one law, one market, one culture : proceedings of the Annual Conference of the Societas Ethica in Ljubljana, August 2004 by Hans Ulrich, PublisherLit Verlag, 2006 8- Purchasing Supply Management, Micheal R. Leenders, P.Fraser Johnson, Anna Flyn, Harold E. Feoran, McGraw-Hill Education Singapore; 13th ISE edition (June 24, 2005) Principles of Total Quality, Third Edition, Vincent K. Omachonu, Joel E. Ross, CRC; 3 edition (May 27, 2004) 9- Purchasing and Supply Chain Management, Arjan van Weele, Cengage Learning Business Press; 4 edition (November 18, 2004) Quality and Performance Excellence: Management, Organization, and Strategy, James R. Evans, South-Western College Pub; 5 edition (March 12, 2007) Quality Management for Organizational Excellence: Introduction to Total Quality, David L.Goetsch, Stanlay Davis, Prentice Hall; 6 edition (January 9, 2009) 10- The Outsourcing Process-Strategies for Evaluation and Management, Ronan Mclvor, Cambridge University Press New York, 2005. Total Quality Management, Dale H. Besterfield, Carol Besterfield-Michna, Glenh.Besterfield, Mary Besterfield-Scare, Pearson Education (Singapore)Pte. Ltd., Indian Branch, 2004 Total Quality Management, Peratic Ltd. Publisher: Springer; 1 edition (February 22, 2009) Total Quality: Management, Organization and Strategy, James R.Evens, South-Western College Pub; 4 edition (November 1, 2004) Richard T. 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