Assignment On Operation Management -1

Running head: OPERATION MANAGEMENT 1
Operation Management
Student’s Name
Institution Affiliation

OPERATION MANAGEMENT 2
Supply Chain Structure
Cupcakes are prepared in a manner that one cake serves one person. The supply chain
structure should facilitate delivery of raw materials on a timely basis, processing of Cupcakes in
time and making delivery to the customers before the agreed timelines. Time will be an essential
in designing of the supply chain structure of the business. The management will endeavor to
ensure that the supply chain is smooths to ensure that products are delivered to the customers on
a timely basis. One of the main values that the business would use to sell itself is reliability in
delivery of orders within the agreed timelines.
Harvey, Heineke & Lewis (2016) notes that a reliable supply chain process is one of the
main concerns that companies that supplies consumer goods should prioritize to develop to
remain competitive and to win the trust of customers. Jonsson (2000) states that having
deliveries made on time can make a difference between a company winning new customers or
losing the existing ones. As a result, when setting up the manufacturing business, stringent
measures will be put in place to ensure that the supply chain will be the cornerstone of the
business.
In order for a supply chain to be reliable, the management should get the intervening
processes such as delivery of raw materials, production efficient and delivery of products to the
customers in the right way (Liu, Han & Zhou, 2014). Our supply chain model will, therefore,
emphasize on the three major processes.
Supply of raw materials
Processing and packaging
Supply to customers

OPERATION MANAGEMENT 3
Supply of raw materials.
The raw materials required by the business includes wheat flour, sugar, baking powder,
eggs, and milk. Our strategy in contracting of suppliers will be based on the capacity of provide
the required raw materials on a timely basis. The company will identify at least 3 suppliers who
can supply each raw material to ensure that productions are not delayed due to shortage in supply
from one supplier. Eggs supply will be outsourced from Egg Farmers of Canada and the wheat
flour will be outsourced from Dover flour, Arva Flour Mills Limited and Parrheim Foods.
The ordering process will entail raising of purchases vouchers that are authorized by operations
manager who will be the head of the entire supply chain process. Once the products are
delivered, the store manager verifies that the right quantities are received and generates a goods
received note, which he shares with the finance department for the suppliers to be paid.
Processing of products and packaging
The production process will be overseen by a supervision and operations manager.
Production will be based on orders placed by the customers. The costing manager will ensure
that the bill of materials is mixed in the right proportions to ensure that the quality of the
products produced are in-line with the business’s quality standards. Production efficiency will be
enhanced by ensuring that the labor hours, machine hours and floor space utilization are
optimized.
Raw material will be transferred from the store to the factory on first-in-first-out (FIFO) to
mitigate losses that may occur as a result of poor handling of inventory. The costing manager,
the supervisor and the store managers will sign a requisition form that will authorize the transfer
of goods from the store to the factory for production purposes.