Effect of Budgetary Logistical - Constraints on Manufacturing Strategy - Research Paper Example

Abstract This research paper represents a research undertaken on the effects of budgetary logistical and budgetary constraint on the manufacturing strategy. The paper contains an introduction that briefly explains the research topic, a discussion that discusses the findings of the research and a conclusion that summarizes the research findings. The discussion provides a clear understanding on what a manufacturing strategy is as well as various manufacturing strategies that can be adapted for a manufacturing process. It then talks about the reasons why budgeting is necessary in the implementation of a manufacturing strategy and then later discusses the various ways in which budgetary logistical and budgetary constraint affects a manufacturing strategy. Introduction This research paper explains the effects of budgetary logistical/ constraint on the manufacturing strategy. According to Miltenburg (2008), manufacturing strategies are aimed at solving manufacturing problems and assisting the manufacturer in their objective to have a competitive advantage. The budgetary logistical or constraints are expected to have a great influence on the approach the manufacturers would choose to solve manufacturing problems as well as how he chooses to look for a competitive advantage. The research explained by this paper, explain how budgetary constraint or logistical affect the choice of a manufacturing strategy as well as its implementation. This research mainly relies on secondary source of information as our main information source. Discussion Manufacturing strategy is composed of various aspects of a manufacturing process. This strategy is mainly aimed at minimizing cost of production while not affecting production and product quality. If this is achieved it can increase the revenues of the manufacturers and thus increasing his profits. The most important manufacturing strategy in the today’s competitive business environment is the setup reduction program (Giri & Moon, 2004). The setup reduction program like other manufacturing strategies is mainly aimed at reduction of production costs while maintaining product quality. Though it was not introduced many years ago it has become very popular in the manufacturing industry and it is now greatly used by several manufacturers. Setup reduction program involves a reduction in the expenses incurred in designing a setup for the production process in manufacturing industry. According to Hoffman (1996), this would reduce overall production expenses and tooling expenses as well as increasing production speed and volume. This shows how important this kind of a manufacturing strategy is on a manufacturing process. The strategy is also known to improve both the competitiveness and profitability of a manufacturing firm. However, these can only be achieved if the manufacturer used the strategy effectively. It is therefore one of the manufacturing strategies that manufacturers should effectively employ in their manufacturing process regardless of the type of products they deal with. Implementation of setup reduction program as a manufacturing strategy is however very challenging among many manufacturers. This is because of the different approaches that it can take. One of such approaches is the use of a cross-functional event format with flexible time frame (Carreira & Trudell, 2006). Although this approach is very common among manufacturers, still other approaches can be adapted to implement this manufacturing strategy. Among the approaches that can be adapted to implement a setup reduction program, all of them are challenging and therefore in most cases manufacturers fail to effectively implement this manufacturing strategy. This makes the manufacturers to fail to achieve the full benefit of the program whenever they implement it. The setup reduction program is not the only manufacturing strategy that can be adapted to improve a manufacturing process. According to Carreira (2005), implementation of a lean flow layout, implementation of a cross-training program and development of metrics can also be adapted. Like the setup reduction program, these strategies are also very challenging to implement but can greatly assist the manufacturer in increasing productivity of a manufacturing process. This makes strategic planning to be paramount in the implementation process of these manufacturing strategies. An implementation budget is very crucial when it comes to planning how to implement a manufacturing strategy. This is because it acts as a general plan of production and management and can be used to expose many problems in a manufacturing firm (An, Bao, & An, 2008). This is where the issue of budgetary logistical and budgetary constraint comes into effect. As we understand, an effective budget is one that is able to maximize program outcome despite the constraint. The budgetary logistical on the other hand are the ways in which a budget should be made to maximize its effectiveness while not violating the ethics of the manufacturing industry. The budgetary logistical and budgetary constraint affects the manufacturing strategy in various different ways. However, all these ways affect the operation of a manufacturing firm greatly either directly or indirectly. The effects are experience almost in all the levels of designing a manufacturing strategy. This includes strategy planning, designing, implementation, analysis, and evaluation. Budgetary logistical and budgetary constraint, both affect the manufacturing strategy adapted by a manufacturing firm differently in each of the levels and that is why I have decided to consider them differently. This is mainly with an objective of understanding them better and revealing any relationship in terms of the effects that might be experienced in each of the levels. When planning for a manufacturing strategy which to adapt, the manufacturer should put into consideration both budgetary logistic and budgetary constraint of the company. This is because these are the major determinants of the kind of resource available for the chosen manufacturing strategy. According to Ronen (2005), different manufacturing strategies require different combination of resources. Improving logistics of a company requires different resources to changes in prices or products. Understanding budgetary logistical and budgetary constraint can greatly assist the manufacturer in deciding the kind of manufacturing strategy that best suits his situation. The implementation of a manufacturing strategy is another issue that is greatly affected by both budgetary logistical and budgetary constraint. As Gottschalk (2009) states, majority of the manufacturing companies have limited manufacturing capacity, capability and resources. This means that the manufacturing company cannot be able to implement any kind of a manufacturing strategy that it wishes for due to these limitations. Understanding budgetary logistical and budgetary constraints helps the company in understanding its limitations in terms of capacity, capability, and resources. This makes the manufacturer to be effective in the implementation of the manufacturing strategy that he finds to be most appropriate for his specific situation. Analysis of a manufacturing strategy is another very significant undertaking in a manufacturing operation. This is because it helps the manufacturer to understand how the manufacturing strategy he has adapted has affected the operation of the company. According to Peck, Olsen & Devore (2011), data and information are the basis of any form of an analysis. The budgetary logistical as well as budgetary constraint acts as a major source of data and information in the analysis involving manufacturing strategy adapted by a company. They therefore play a very great role in the process of analysis of a manufacturing strategy that is adapted by a manufacturing company. As a result, they make the manufacturing strategy to be effective in terms of its implementation hence improving the operation of the company. Another way in which budgetary logistical and budgetary constraint affect a manufacturing strategy is during the evaluation of the strategy. Manufacturing strategy evaluation involves evaluating various actions adapted by the strategy and it is done using evaluation models (Leondes, 2003). There are various evaluation models available for use in evaluating this kind of a strategy. The budgetary logistical and budgetary constraint provides information that can be very important in the selection of an appropriate evaluation model for a specific situation. Therefore, the budgetary logistical and budgetary constraint effect the manufacturing strategy chosen by a manufacturer through influencing the type of evaluation model selected to evaluate the strategy. Conclusion A manufacturing strategy is very important in any kind of a manufacturing firm since it assists the manufacturer to gain a competitive advantage as well as increase productivity. There are various manufacturing strategies which can be adapted all of which are challenging to employ. To be able to employ these manufacturing strategies information about budgetary logistical and budgetary constraint is fundamental. This information plays important roles in the employment of any kind of a manufacturing strategy in a manufacturing process. These roles can be used to indicate the effect of budgetary logistical and budgetary constraint on the manufacturing strategy. The role can be distributed in terms of the role budgetary logistical and budgetary constraint play in planning process of a manufacturing strategy, the role they play in the implementation process, the role they play in the analysis process and the role play in the evaluation process. However, I have not been able to identify the interrelationship between these roles and therefore further research on the issue is required. Reference An, X., Bao, H., & An, N. (2008). Design of Strategic Budgetary Management System Based on ERP. Tianjin: Tianjin University Press. Carreira, B. (2005). Lean Manufacturing That Works: Powerful Tools for Dramatically Reducing Waste and Maximizing Profits. New York, NY: AMACOM. Carreira, B., & Trudell, B. (2006). Lean Six Sigma That Works: A Powerful Action Plan for Dramatically Improving Quality, Increasing Speed, and Reducing Waste. New York, NY: AMACOM. Giri, B. C., & Moon, I. (2004). Note on an Economical Lot Scheduling Problem Under Budgetary and Capacity Constraints. Retrieved from: http://psa.ie.pusan.ac.kr/publication/paper/35.pdf. On 19 July 2012. Gottschalk, U. (2009). Process Scale Purification of Antibodies. Hoboken, NJ: John Wiley & Sons. Hoffman, E. G. (1996). Setup Reduction through Effective Workholding. New York, NY: Industrial Press. Loendes, C. T. (2003). Computer Aided and Integrated Manufacturing Systems: A 5-Volume Set Manufacturing Processes, Volume 5. London: World Scientific Publishing. Miltenburg, J. (2005). Manufacturing Strategy: How to Formulate and Implement a Winning Plan. New York, NY: Productivity Press. Peck, R., Olsen, C., & Devore, J. L. (2011). Introduction to Statistics and Data Analysis. Boston, MA: Cengage Learning. Ronen, B. (2005). The Theory of Constraints: Practice and Research. Amsterdam: IOS Press. Read More