International Operations and Innovation Management: Supply Chain Management and Operation Management

This report provides a detailed comprehension of supply chain management and operation management in the context of House builders and Retail stores. It includes a level production plan for Covolo Diving Gear and evaluates the policies of Waters For Africa (WFA).

International Operations and Innovation
Management
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Table of Contents
Introduction......................................................................................................................................4
Task 1...............................................................................................................................................5
Task 2...............................................................................................................................................6
Task 3...............................................................................................................................................7
Task 4...............................................................................................................................................8
Conclusion.......................................................................................................................................9
Reference list:................................................................................................................................10
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Introduction
The report includes a detailed comprehension of the supply chain management and has selected
the House builders as context A and Retail stores as context B. The report consists of an input-
output diagram for both the settings along with a detailed understanding of the operation
management and the riles of an operation manager. Furthermore, the report has included a level
production plan for Covolo Diving Gear and has explained the advantages as well as
disadvantages of the plan. In addition to this, the report has evaluated the policies of Waters For
Africa (WFA) and has compared the existing order about EOQ. The report has also suggested
changes that are necessary for Mike for the betterment of WFA.
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Value of construction
Value added by each industry
Profits Wages
Jobs
Task 1
1.
A: Housebuilder
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Inputs
Skilled motivated, happy employees
Raw materials
Customer requirements
Capital
Processing system
Design of products and services
Production
Delivery of services
Outcomes
Delighted Customers
Customer needs to meet
Outputs
Products
Services
Financial results
Repeat Business
B: Retail Store
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2. The essential tasks that the Operation Manager has to perform are as follows:
For context A:
The leaders are the ones that provide motivation and guidance to the fellow employees, and the
employee highly depends on them. The Housebuilders have to execute several processes that
include both physical as well as mental efforts. The operation manager has to motivate the staffs
and initiate several steps that can help them to build homes. The development of the organisation
depends on the leadership, and therefore, it is incredibly crucial for the operation manager to
maintain appropriate control over the employees and build suitable homes for the respective
customers. It is also essential for the operation manager to develop appropriate strategies that can
increase the overall quality, efficiency as well as productivity of the employees and henceforth
the entire organisation. In addition to this, the leadership styles also play significant roles in the
overall growth as well as the development of the organisation.
For context B:
The retail chains in the world, the management of the organisation ensures that the overall
growth as well as the development of the retail organisation. The Operation manager of the
organisation has to ensure that the strategies that are applied for the development of the products,
as well as services, are following the modern trend in the market. It is the responsibility of the
operation manager to motivate the employees during several unavoidable circumstances such as
during economic recessions. The operation manager has involved themselves in the development
procedures of the products as well as services that are available for the customers. The operation
manager also has to look over the projects as well as operational systems that the organisation
has to execute to benefit their respective revenue.
3. For A: Housebuilders
Cost: Average
The price that is provided to the customers for building their houses depends on several factors
that include area, electrical circuits, drywall, insulation, Underlayment, Framing, Roofing,
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Plumbing, and other decoration of the bathroom, kitchen counters. Therefore, the management
ensures that they provide a justified cost to their customers.
Speed: Steady
The Housebuilders are usually considered to be extremely fast in the execution of their
procedures, and the workers are highly difficult. Therefore, they are fit to work in long shifts and
therefore, the overall work remains at a steady pace.
Quality: Appropriate
The variety of the houses that are built by House builders are precisely how the customers want,
and therefore, the condition can be regarded as appropriate.
Flexibility: Highly flexible
They are highly flexible with their operations as well as other vital procedures. The organisation
can develop their work in several unfavourable circumstances. Even during the rainy season, the
workers maintain the same pace just like regular days.
For B: Retail Store
Cost: Cheap
Retail Store is known for its extremely cheap products and high amount of discounts that are
offered to the customers. The development of the organisation in the present generation highly
depends on the costs, especially in the retail markets. Therefore, the management ensures that the
overall prices of the products, as well as services, are cheap. It helps the organisation to gain a
suitable competitive advantage in the extremely high competitive market.
Speed: High
The organisation is known for its excellent and reliable services that are offered to the customers.
In this generation, there are several retail chains; therefore; they have to ensure that they provide
fast and reliable services to the customers. It helps them to gain the trust as well as the respect of
the customers.
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Quality: High
The products, as well as services that are offered by Retail Store, generally are of well-known
brands. Moreover, Retail Store's products are produced in an appropriate place, and quality
checked.
Flexibility: Moderate
Since there is an extremely high competition in the retail markets, the management has to ensure
that the organisation remains extremely flexible that helps them to embrace the changes of the
popular market and globalisation.
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Task 2
1.
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A B C
D
E F G
H
END
A – Excavate
B – Electrical
C – Interior
D – Frame
E – Foundation
F - Roof
G – Masonry
H - Landscape
For B: Retail Store:
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Manufacturers Transportation
Loaded to docksShipped to overseas
Transportation Shelves of the Retail Store
2. For Context A: Housebuilder: The suitable location would be a reasonably crowded one.
The site should have an approach that promotes the sustainable development of the organisation.
For Context B: Retail Store: The retail stores are one of the most famous and highly
appreciated stores in every metropolitan city, and therefore, an appropriate location would be one
that has a large crowd most of the time. It would help the organisation to catch the attraction of
the customers quickly.
3. For context A: House Builder: The Measures of capacity has to be average as here the
overall productivity depends on the quality, not quantity. It is because each of the workers has to
execute several tasks that involve experience and skill. However, they depend on the overall
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productivity; however, in the case of house builders, the measures of capacity can be regarded as
average.
For Context B: Retail Store: The retail stores are generally crowded, and the employees have
to fulfil the needs as well as requirements of the customers. Th3erefore, they require more
workforce as well as labours. It helps the organisation to satisfy the customers and gain a
reputation in the market. Therefore, it can be concluded that the measures of the capacity of the
retail stores are high.
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Task 3
The following level production plans of Covolo Diving Gear for the year 2015. The production
plan is based on the Sales Forecast of September 2013 to August 2014:
Months Production cost
January £18,000
February £15,000
March £14,500
April £24,000
May £33,000
June £34,000
July £34,500
August £34,000
September £26,000
October £26,500
November £31,000
December £33,000
Table 1: Level Production Plan
(Source: Created by the learner)
Benefits of the plan: The plan shall allow the management of Covolo Diving Gear to generate
suitable budgets that can help them to earn a significant profit. The level budget plan enables the
management to validate as well as manage their overall revenue significantly.
Disadvantages of the plan: The plan has several benefits; however; several external factors can
impact the growth as well as the development of the organisation without any prior concern.
Therefore, this level production plan can get hampered and the management can receive severe
consequences in their revenue.
2. The chase plan is generally beneficial for the administration when they are in dire need for
development. The control of the Covolo Diving Gear ca create a chase plan taking the external
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factors marketing environment and previous stats of the organisation. However, there always
remains a risk of receiving a significant loss in the revenue as the organisation has to take
substantial risks for the reviving themselves from the loss.
3. a) The monthly S&OP that has been updated with the rolling plan horizon has alleviated
Patricia’s concern because the sales of Covolo Diving gear have made profits through the rolling
plan horizon.
b) The sales and operation management has a significant influence on the growth as well as the
development of the organisation including the Covolo Diving Gear. The Sales and operation
management plan provides the management with a detailed comprehension of the budgets and
future planning of the organisation. It does not matter whether the forecast changes or not, the
sales and operations plan enables the management to gain a step ahead of the situations that may
be coming in the future.
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Task 4
1. Critical evaluation of EOQ
Months Production cost
January £18,000
February £15,000
March £14,500
April £24,000
May £33,000
June £34,000
July £34,500
August £34,000
September £26,000
October £26,500
November £31,000
December £33,000
Order
Quantity
Holding
Cost Order Cost Material Cost Shortage Cost Total Cost
Q hC(Q/2) (R/Q)S CR (B(Q-n)^2)/2Q TC
18000.00 $164,700.00 $2.22 $15,250.00 $0.00 $179,952.22
15000.00 $137,250.00 $2.67 $15,250.00 $0.00 $152,502.67
14500.00 $132,675.00 $2.76 $15,250.00 $0.00 $147,927.76
24000.00 $219,600.00 $1.67 $15,250.00 $0.00 $234,851.67
33000.00 $301,950.00 $1.21 $15,250.00 $0.00 $317,201.21
34000.00 $311,100.00 $1.18 $15,250.00 $0.00 $326,351.18
34500.00 $315,675.00 $1.16 $15,250.00 $0.00 $330,926.16
34000.00 $311,100.00 $1.18 $15,250.00 $0.00 $326,351.18
26000.00 $237,900.00 $1.54 $15,250.00 $0.00 $253,151.54
26500.00 $242,475.00 $1.51 $15,250.00 $0.00 $257,726.51
31000.00 $283,650.00 $1.29 $15,250.00 $0.00 $298,901.29
33000.00 $301,950.00 $1.21 $15,250.00 $0.00 $317,201.21
57.30 $524.32 $698.05 $15,250.00 $0.00 $16,472.37
61.71 $564.65 $648.19 $15,250.00 $0.00 $16,462.84
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0.00 10000.00 20000.00 30000.00 40000.00
$0.00
$50,000.00
$100,000.00
$150,000.00
$200,000.00
$250,000.00
$300,000.00
$350,000.00
Costs per Order Quantity
Holding Cost
Order Cost
Material Cost
Total Cost
Shortage Cost
Order Quantity (Q)
2. To make changes in the inventory management, Mike has to apply the EOQ as well as FIFO
method. The EOQ method shall allow Mike to maintain sufficient levels of inventory. The EOQ
shall also allow Mike to calculate the overall ordering quantity of the inventory. The Economic
Order Quantity shall allow Mike to minimise the storage as well as holding costs and be specific
to the business. The EOQ has a significant impact on the overall growth as well as the
development of the organisation. This particular model shall provide Mike with the specific
numbers regarding the re-orders, supply as well as holdings of the inventory accordingly.
On the other hand, the FIFO method shall help Mike to assume the cost correspondence flow
along with the usual physical flow of the commodities. The balance sheet amount of the
inventory is generally estimated based on the existing values, and therefore, the chance of
manipulation of the income is considerably less. Furthermore, FIFO or the First In First Out
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method is extremely easy to apply in the development of the WFA organisation. Mike shall
receive significant benefits by taking these two methods into account. The EOQ and FIFO
methods shall allow Mike to make suitable changes in the development of the Water For Africa.
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Conclusion
The report has revolved around several concepts of the supply chain management. There is a
detailed description that has been provided in this report regarding the house builders and retail
stores that has been selected from the A and B contexts. There is an input output diagram in this
report that provides a detailed understanding of the operation managements and has depicted the
roles of the operation manager in the house builders and the context of retail stores. In addition to
this, the report has evaluated the level production of Covolo Diving Gear and has provided a
detailed comprehension of the cons and pros of the plan. In addition to this, the report has also
included that whether or not Covolo Diving Gear will be able to develop a suitable chase plan.
The report has also evaluated the inventory policies for the Water For Africa in accordance with
the EOQ method. Moreover, there are recommendations including the EOQ and FIFO method
that are included in the report that suggests ways through which WFA can enhance their
inventory management.
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