Operations Management and Quantitative Techniques - Case Study Example

? OPERATIONS MANAGEMENT & QUANTITATIVE TECHNIQUES CASE STUDY 1. Master production schedule for the bread maker for Realco WEEK 1 2 3 4 5 6 7 8 PRODUCTION BROUGHT FORWARD 7000 23500 43500 62000 86950 113350 141850 176450 PLANNED WEEKLY PRODUCTION 40000 40000 40000 40000 40000 40000 40000 40000 WEEKLY ORDERS PROMISED (23500) (23000) (21500) (15050) (13600) (11500) (5400) (1800) REMAINING INVENTORY 23500 43500 62000 86950 113350 141850 176450 214650 The projected end inventory, which is also the available to promise order numbers increase as the weeks go since they are cumulative in nature. At the end of week 1 we have an ending inventory of 23500 units followed by 43500 units, 62000 units, 86950 units, 113350 units, 141850 units, 176450 units and 214650 units respectively for weeks 2,3,4,5,6,7 and 8 respectively. They increase as the weeks progress mainly because the number of orders made per week decline as weeks progress as follows; in week one we have a promised shipment of 23500 for week 1 followed by 23000, 21500, 15050, 13600, 11500, 5400, and 1800 for weeks 2,3,4,5,6,7, and 8 respectively. Realco has not overpromised, actually they have under promised as the amounts carried forward keep accumulating as the week’s progress. This has the risk of loss as unnecessary stock may be in store for unexplained reasons. What Realco should do is to update the numbers of the promised orders so that the remaining inventory number can at least go down for the sake of savings in terms of costs. With increased orders, again the revenue of the company may also increase drastically. Jack’s approach to order promising is the Capable to Promise (CTP) approach whose function includes capacity constraint issues in the calculation and hence it can be integrated together with the production scheduling, manufacturing as well as transfer and purchase planning. In our case, it is integrated together with production brought forward, production and the remaining inventory and its model is based upon the model that is chosen from the capacity-scheduling engine. The program has the advantage of having the ability of responding to “what if” scenarios. He program is able to make calculations of inventory and no bound orders through a calculation of the earliest dates when such items can be available, or when they can be transferred from another place. The main disadvantages are that the system is quite lean and hence slow when it comes to making order promising. It also leads to the accumulation of inventory which may be detrimental to the organization in terms of foreseeable losses hence should be avoided. The program is quite separate from the order promising system calling for unification for smooth operations (Connelly & Hoel, 2010). Formal master scheduling technique will be applicable due to its nature of creating stability and responsiveness. It would therefore improve the process through enhanced clarity by way of organization and reporting of relationships within the company. It will also aid in understanding of the product, which bread, the manufacturing and purchase process as well as planning and control. It brings with it a formal job description that brings along details of responsibility and performance measurements. Finally, the formal master scheduler has the ability of promptly responding to feedbacks through identification of areas where it influences material or capacity availability (Fraser, Murphy & Bunting, 2003). The organizational changes, which will be required to ensure this system comes in include; the establishment of performance measures and the proactive use of root-cause analysis to identify areas, which require improvements. There will also be a change in the policies, processes and procedures for the sake of modernizing the systems. Following on question 2, is neither worse nor good, this is because refusing customers orders upfront has the impact of chasing away the customer upfront and no business is ready to lose a client since they are what makes it be called business (Connelly & Hoel, 2010). Accepting the customer’s order and failing to deliver is even worse since it involves an agreement and integrated emotions. The master scheduling therefore has the implications of helping in managing of change with time fences after such fences have been identified, recognized and actively used to manage change, this schedule also has the ability of managing the what if analysis and the impact on change. It allows for the requests for change to be modeled within the formal planning and scheduling plans for the determination of their overall effect (Fraser, Murphy & Bunting, 2003). In the event, that Realco produces 20000 bread makers instead of the previously known 40000, this would mean that production would have been cut by half per week. According to the master scheduling record, the production would only list as 20000 throughout. The net impact will be the reduction of the level of remaining by 20000 though it remains cumulative and the figure continues to rise. The new master scheduling would appear as follows:- WEEK 1 2 3 4 5 6 7 8 PRODUCTION BROUGHT FORWARD 7000 23500 43500 62000 86950 113350 141850 176450 PLANNED WEEKLY PRODUCTION 20000 20000 20000 20000 20000 20000 20000 20000 WEEKLY ORDERS PROMISED (23500) (23000) (21500) (15050) (13600) (11500) (5400) (1800) REMAINING INVENTORY 3500 23500 42000 66950 93350 121850 156450 194650 The impact that this has on the average inventory level is that 20000 despite the fact that they will remain progressive will cut them. CASE STUDY 2 Lean is a philosophy is a philosophy that manufacturing and software organizations have adopted to develop the agility needed to meet overwhelming global challenges. Under this philosophy, companies strive to reducing waste, enhancing iteration speed, and continuous improvement through improved innovation so that they are able to realize their objectives (Taghizadegan, 2006). Toyota is the first company that devised and employed the method, it has fought to retain the same ideology and one of its aspects for this is their focus on quality. The company has strived to maintain quality of its automobile by ensuring they value their people, develop and retain strong leaders, they also think and act world class and finally they make decisions based on logic. Toyota realize that to make people want to always improve they have to be engaged on their jobs while being developed, nurtured and their welfare taken care of well activities which makes them valued by the company that they work for. Toyota has ensured that they maintain very low employee turnover while noticing and regarding the achievements for each of their employees (Askin & Goldberg, 2002). Secondly, from the case study it is noted that Toyota takes it upon themselves to train and always retrain their employees. They conduct this through leadership, where the company brings up a crop of leadership that believes in the potential of its own workforce. Toyota leaders believe that every member of the company irrespective of their level is important and hence values everyone for success. For quality purposes, Toyota tries within its means to become lean given the level of organization we witness in its operations with every process clearly defined through set standards. This has enabled the company attain good ranking in the world markets. Finally, for the sake of quality, Toyota makes and implements their decisions based on thorough communication (Yamazaki, 2013). The senior management of the company is open to questions and suggestions of the junior employees, which has always helped Toyota survive long in the auto industry. I can therefore conclude that a company is not able to follow the lean philosophy without having a strong focus on quality and that is why Toyota has always struggled to be at the top while producing products with good quality, withdrawing those they realize have defects and do not meet customer expectations (Taghizadegan, 2006). Coordinators are the company’s top management circle; they have played an important role in the company of ensuring that the company’s employees value each one of them without creating a rift. One of the projects they rolled out was the 18-month project in 2000 which was geared to build back up the core of its front line managers whom they realized were quite bossy. This group has also helped training for their employees most so those in management positions on ways they can handle their juniors a program in which they have done using many kaizen projects. TPS coordinators was also keen on ensuring that Toyota did not wallow in a pool of lack of employees hence they resorted to train people as the company made efforts to expand so that they could have equally experienced employees worldwide of the same if not matching experience as the TPS coordinators. However, this group is not able to emulate or replicate since their skills are acquired after many years of practical and one on one interaction with their jobs. According to Hajime Oba, Detroit’s approach to Lean philosophy is wrong since they only apply the lean techniques as a way to slash inventory. The lean approach is wide and encompasses well over six aspects that is value of employees, decision making based on logics and not politics, development and retention of leaders as well as the company thinking world class. A company that acts in this manner like the Toyota is a company above mere operations and one, which is focused to create a brand (Taghizadegan, 2006). Therefore, to purport that the lean technology is only geared toward the development of one aspect or the use of simply one aspect is wrong. Most of the American manufacturing companies there mistake the lean approach and I agree that most of them are far much far from achieving the requirements of the lean philosophy; they simply have a mention of it without actually implementing the aspects of this form of technological operations (Askin & Goldberg, 2002). That is the advent of the failure of the Toyota fierce competitors like Detroit. Haste makes waste otherwise meaning the act of being fast may at times slow things down and this applies to Toyota in its Georgetown branch. Here, the company is trying to inflict growth very fast by making both production and supplies very first without taking care of the fundamental aspects such an employee development and quality production, which are the most important aspects of the success of any firm in the market place. As a result, the company in Georgetown has run into a series of problems in terms of the quality of its leaders and the quality of their production as with the case in 2002. The company has dealt with this through their TPS coordinators who have embarked on training of their leaders, taking a keen note of the employees’ complaints and generally trying to improve the image of the company that is ruined. They make the employees of the branch learn about the TPS so that the culture is upheld (Yamazaki, 2013). References Askin, R. G., & Goldberg, J. B. (2002). Design and analysis of lean production systems. New York: Wiley. Connelly, J. P., & Hoel, L. A. (2010). Access management performance measures for Virginia: a practical approach for public accountability. Charlottesville, Va.: Virginia Transportation Research Council. Fraser, B., Murphy, C., & Bunting, F. (2003). Real world color management: industrial-strength production techniques. Berkeley, CA: Peachpit Press. Taghizadegan, S. (2006). Essentials of lean six sigma. Amsterdam: Elsevier. Yamazaki, K. (2013). Hybrid factories in Latin America. Houndmills, Basingstoke, Hampshire: Palgrave Macmillan. Read More