Implementing Operation Management for Competitive Advantage

The provided report delves into the implementation of operation management by Hot Point Company, highlighting its potential to gain a competitive advantage over rival companies. The PLC stages are examined, along with the continuous development plan's role in improving product quality. Additionally, the Kaizen cycle and Six Sigma concepts are discussed as effective methods for achieving project success.

OPERATION
AND PROJECT
MANAGEMENT

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1 Review and critically evaluate the implementation of operation management principles....1
M1 Review and critique the implementation of operations management...................................3
TASK 2............................................................................................................................................4
P2 Continuous improvement plan based on the review and critique of operations management
principles.....................................................................................................................................4
M2 Analyse the effectiveness of a continuous improvement plan............................................5
TASK 3............................................................................................................................................5
P3 Project life cycle for the given project..................................................................................5
M3 Rationale for project methodology, leadership and tools within PLC................................8
TASK 4............................................................................................................................................8
P4 Review and critique the effectiveness of the PLC in application to the chosen project using
appropriate theories, concepts and models..................................................................................8
M4Criticall analysis of the use of appropriate theories, concepts and models in the PLC will
differentiate between large and small-scale projects.................................................................11
CONCLUSION .............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Operational management is defined as an ongoing organisational activity which is carried
out to supply service or produce products. Appropriate operations carried out by employees
results in production of desirable outputs. Operational management benefits in systematic
handling of strategic and day-to-day issues. In case of project management, aspects like
organizing, controlling and planning takes place so that resources can be used optimally. This
will benefits company in achieving desired goals (Nicholas and Steyn, 2017). This assignment is
based on Hotpoint electric heating company which is an America based manufacturer situated in
California, US. Company specialises in dealing with home products and electronic appliances.
Company offers freezers, fridges, gas, washing machines, electric friars etc.. company is
planning to launch 58 inches television in market. This report covers principles of operation
management along with a continuous improvement plan in context of company. Beside this,
stages of PLC are discussed which are required to complete a project. At last, effectiveness of
PLC in respect of project is carried out.
TASK 1
P1 Review and critically evaluate the implementation of operation management principles
About Hotpoint: It is an America and UK based company which deals in electronic
appliances. Products offered by company are tumble dryers, washing machine, gas, geysers,
refrigerators, cookers etc. Manager of company is going to introduce 58 inches television in
market along with stadium screens. Manager of the company is given responsibility to conduct a
research so that product can be introduced in market without facing any complexity.
Operational management principles:
Operation management is a field which is related with organising, planning and
supervising in aspects like manufacturing, provision and production of service. This kind of
management ensures appropriate transformation of inputs into outputs. Fineness of these outputs
will results in desired outcomes for Hotpoint ltd. Different principles associated with operational
management are mentioned below:
Lean production: It is an effective approach associated with management which
emphasize on eliminating and cutting waste without compromising with quality. This lean
production can be applied to all aspects which are associated with business such as design,
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production and distribution. This will allow the manager in Hotpoint to reduce their costs and
expenses while manufacturing of TV. This method makes the production process more efficient
and responsive to market needs (Kerzner and Kerzner, 2017).
Principles of lean production are mentioned below:
 Elimination of waste: Lean production ensures little wastage of resources due to which
manufacturing and production process takes place desirably. The main principle behind
implementing lean production is optimal utilization of available resources. Manager in
Hotpoint can use lean production method to reduce wastage due to which expenses will
reduce and profitability will be achieved.
 Kaizen: This principle specifies continuous improvement by eliminating those aspects
which do not add value to the product during manufacturing process. By improving
software and machinery used in TV, manager of Hotpoint can improve the features of
TV. This will benefits the company in increased sales.
 Just in time production: According to this lean principle, manager of Hotpoint needs to
emphasize on task working so that demands of customers can be satisfied. No excess
features in TV will be added which will add cost to the product without adding any value.
Implementation of lean production in case of Hotpoint:
 To implement lean production, Manager of company needs to manage inventory in an
appropriate manner. Standing inventory of software, machinery and other electronic
products will benefit the company in reducing wastage of resources and space.
 Another way to implement lean production within Hotpoint is to avoid assigning too
many workers for a single task (Jacobs, Chase and Lummus, 2014).
Positive aspects:
 Lean production will benefit Hotpoint in increasing overall productivity by reducing cost
and wastage.
 Due to standing inventory, space required for materials & resources will be less.
Negative aspects:
 This process is difficult to implement due to complexity and long term commitment.
 It is an risky process. In case extra resources are required, employees have to wait until
supplier supply time. This denotes wastage of time.
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Six sigma: It is an operation management principle which helps in identifying defects in
process, service or product. This principle is based on quality management fundamental. In case
of Hotpoint, six sigma can be a measure associated with process performance. Once the
performance of introduced TV is evaluated then goal of the manager in Hotpoint will be to
further improve the features of TV so that wide sales can be achieved. Basic principles
associated with six sigma are mentioned below:
 Customer focus: According to this principle, manager of Hotpoint needs to introduce
features in TV as per the demand and requirements of customers. Otherwise, this project
can fail and will results in heavy loss of revenue.
 Identification of cause of problem: To further improve the quality of TV, manager of
company needs to identify the issue due to which problem initiates. This can be achieved
by communicating with workers which have manufactured product and customers which
have used product.
Implementation of Six sigma:
 Manager of Hotpoint company needs to allocate resources in an organised and optimal
manner.
 Appropriate training and knowledge must be given to employees regarding TV so that
they can innovate new ideas to improve the features of TV.
Positive aspect:
 This operation management principle will helps Hotpoint to gain competitive advantage
over rival companies. In case of TV, quality of software and machinery used is to utmost
priority. If quality will be good and improved continuously then sales and revenue of
company will increase (Leach, 2014).
Negative aspect:
 It is an expensive process for small companies like Hotpoint as appropriate training and
certification will be needed. For this heavy investment of capital is needed which is
difficult for company to manage.
M1 Review and critique the implementation of operations management
Operational management helps in managing manufacturing and production process of
company in an appropriate manner. Lean production and six sigma have some advantages and
disadvantages. Aspect of lean production is that it will eliminate waste and reduce cost but is a
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complex process to implement. Aspect with six sigma is that it will improve the quality of TV
machinery but requires heavy investment which is hard to manage by Hotpoint.
TASK 2
P2 Continuous improvement plan based on the review and critique of operations management
principles
Lean principles have various advantages and disadvantages like it is very useful tool in
minimising waste which is produced from the industrial unit of hot point. It also enhances
customer relationships by focussing on the needs and requirements of the customers and making
policies in hot point accordingly which satisfies the needs and demands of consumers. But it has
a crucial drawback when equipment fails and this will lead to major inconsistencies within the
hot point. This can lead to the problem of meeting the demand and supply of their wholesale
byers and supplier and even it can create frustration in workers due to breakdown of system.
Six sigma is a very important approach used in management of hot point. It has the
advantage to drive customer and aims to accomplish maximum customer satisfaction with
minimising deviations. It targets the customer delights and innovative and creative ways are used
to exceed customer expectations (Lee and et. al., 2014). It leads to rise in profitability. But at the
same time it poses various drawbacks like innovative approach implies deviations in production
of hot point which can further lead to redundancy. It also requires highly skilled and qualifies
personnels for implementation and lack of this can result in inappropriateness and destruction.
Continuous improvement is essential for every company as it assists them to gain
competitive advantage over others by attaining sustainable business performance. By using
these types of operation management techniques company can reduce their wastage and besides
this it removed extra work which does not contribute in the final product which is consumed by
customers. Continuous improvement plan of Hotpoint is mentioned below,
Plan: This is the first stage of improvement in which Hotpoint will analyse their plan of
launching 58 inch TV in the market. At this time they will analyse their techniques and activities
which they are going to implement with the help of Six sigma and lean principles so that
efficient product would be made.
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Do: After planning, Hotpoint have to implement the planning on a real scenario on a
small scale so that if it failed then company does not have to bear high losses. Hotpoint have to
produce less amount of TV pieces with the help of lean principles and six sigma techniques.
Check: After implementing, Hotpoint have to analyse and monitor the process and find
out the result after that. If company is able to attain higher efficiency on a small scale then they
have to plan it for a bigger scales. All the resources have to check by Hotpoint before
implementing change in the company.
Act: At last, after planning all the plans according to their skills and resources. Hotpoint
will launch their changes of process on a bigger and wider scales so that company can gain
competitive advantage over other competitors in the future by launching 58 inch TV.
M2 Analyse the effectiveness of a continuous improvement plan
Effectiveness associated with continuous improvement is that it will helps the manager to
evaluate performance of project desirably. Also, all the loopholes in the success of the project
will be acknowledged. This will helps in improvement of quality of TV. This plan will benefits
the company in enhancing their revenues and sales. If anything needed to be chan ges in plan,
manager can accomplish it desirably.
TASK 3
P3 Project life cycle for the given project
Hotpoint is an electronic company which is planning to introduce stadium screens and 58
inched television in market. Before introducing the product into market, it is vital for the
manager of the company to conduct a proper research regarding the product. This will benefits
the company in acknowledging the success rate of product in an appropriate manner.
Every product have a specific lifetime. As time passes by products became less familiar
and demand for new services & products enhances. Most of the products have less timespan so,
in order to grow business continuously manager of Hotpoint is planning to invest heavily in
product development. Major stages associated with project life cycle are mentioned below:
 Introduction stage: This is the first stage associated with PLC. This stage is considered
as the most expensive stage as company launches a new project so heavy investment is
required. As Hotpoint is not a large organisation, market size for company is small. This
means when 58 inches TV will be introduced then sales will also be low. With times,
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they will increase as popularity of product will increase. Expenses of company will be
high because of aspects like consumer testing, advertising and marketing, research and
development etc. It is important for manager of company to manage these costs desirably.
 Growth stage: This stage encounters heavy sales and profits. Also, during this stage
company enjoys economies of sale in production, enhanced profit margins (Floricel and
et. al., 2014). Due to this, it will became easy for manager of Hotpoint to invest more in
promotional and advertisement activities. This will benefits the company in enhancing
customer base for newly launched 58 inches television.
 Maturity stage: At this stage the product is already established in market and the
objective of manager in Hotpoint is to maintain the market shares of company by
stabilising the sales of newly introduced television. In this stage it is important for the
manager of company to invest wisely. Also, modification in characteristics and features
of TV takes place during this period which will benefit the company in gaining
competitive advantage.
 Decline stage: This is the last stage in PLC, during this stage the popularity of product
vanishes as market became saturated or preference of customers have changed. Decline
of product is inevitable but with the implementation of proper strategies, manager of
Hotpoint can earn some profit.
Business case for Hotpoint:
Project Name Launching of 58 inches television
Date of project
approval
21/02/19
Contribution to
business strategy
Our main strategy is to offer electronics with best features but the current
situation is quite different. Introducing 58 inches TV in market will
ensure enhanced sales and profit as the product will have unique
features. These new features will outdates the existing technology.
Options considered To achieve expected success:
 Experienced R&D team is hired.
 Expertise employees are going to handle production process
 Smart touch technology to operate TV
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Benefits Associated benefits will be:
 Increased sales and profitability
 Satisfaction of customers
Timescales As per the initial analysis, TV will take 6-7 months for production
Costing Software = 35,000£
Project management = 30,000 £
money given to project members= 90,000 £
Total estimated cost = 155,000 £
Expected return on
investment
Year 1 = 1000 £
Year 2 = 120,000 £
Year 3 = 180,000 £
Associated risks Rival companies in same sector are giving tough competition by
introducing same technology in less price.
Project plan for Hotpoint:
Project plan is a document which helps in proper execution of project activities. This
project management will helps the manager of Hotpoint in appropriately defining aims and
objectives of company.
 Aim: Aim of project is to successfully launch 58 inches television in market.
 Objective: Company has expected 20% increment in revenues of company in next 6
months.
 Scope: It is refereed to area in which activities have to be performed. There is a great
scope of working in this project as people in UK prefer to buy standardised products due
to high living standard. Hotpoint will gain wide sales and revenue.
 Quality: It is important for company to offer good quality and standardised products so
that customer base of company will increase. This will helps in enhancing market share
of Hotpoint.
 Communication: To manufacture TV in expected manner, it is important for employees
of Hotpoint to have proper interaction and communication level with one another.
Improper communication can results in business fail (Nenonen and Vasara, 2013).
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Work break down structure:
This aspect helps in breaking project work into small manageable sections. Responsibility
of each section is given to different person s that all the tasks can be accomplished desirably.
M3 Rationale for project methodology, leadership and tools within PLC
For this project, secondary methodology is used where all the required information is
collected with the help of internet and online sources. Leadership style used by manager of
Hotpoint is using situational leadership. Because in this project, situational leadership is taken
because organisational structure is complex and it is not possible for manager to tell every aspect
to employees so they are given some power. tools like software and electronic devices are used
in order to complete the project.
TASK 4
P4 Review and critique the effectiveness of the PLC in application to the chosen project using
appropriate theories, concepts and models.
Product life cycle refers to the process through which a production progression passes
through and it starts from introduction to growth, maturity and decline. Moreover Kaizen theory
and lean management model theory is useful in analysing the effectiveness of the PLC only at
the time when large project are being carried out as compared to small projects because it
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require much cost to be incurred while implementing this theory, so as per the budget and project
of Hot point company this theory can be used As the project that is being carried out by Hot
point company is launching of TV that is of 58inches terms to be large project.
Kaizen theory:
It is a theory which is being used in order to explain about the effectiveness of PLC in
application to the project carried out by Hot point company. This theory refers to the process of
structured approach which facilitate in identifying and eradicating the sources that may cause
problems and which indeed is implemented and executed with a force and power. Additionally it
facilitate in ensuring that the process is being completed quickly in time without any delay. Thus,
it is because of the reason that Kaizen is based on the belief that everything can be improved by
identifying issues, opportunities then creating solutions in order to implement it so as to carry out
each activities smoothly (Walker, 2015). If the management of Hot-point will take this theory
into consideration then it will be helpful in achieving the continuous improvement without any
hurdle in an organisation which will result in achieving the target aims and objectives of an
organisation within the specified time period.
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Source: Kaizen Cycle, 2019
Furthermore, if the company will take this theory into aspect then it will help in
continuous improvement of the project that is being carried out as it involves seven steps. First is
to get employees involved in project, secondly gathering of list of problems and encouraging
solutions in order to choose the best idea, after that the solution is being tested. Then measures is
being analysed on a regular basis, if it is term to be successful then the solution is being adopted,
similarly the process moves on. Thus, it helps in accomplishing and achieving the aims and
objectives effectively and efficiently without any hurdle.
Six sigma model:
This is the another model which is being taken into consideration as it is termed to be a
statistical based, disciplined and data driven approach which result in continuous improvement in
methodology by eliminating defects in the products, process and services.
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Illustration 1: Kaizen Cycle

Source: Six Sigma, 2019
This model helps in achieving the effectiveness in product life cycle of the large scale
project that is being carried out by Hot point company, as the fundamental objective of this
methodology is to implement a measure based strategy which focuses on improving production
process and variation reduction by minimizing the chances of defects. Thus, it result in achieving
the accomplishment of project on specified time period without any delay (Mubin and Mubin,
2016).
M4Criticall analysis of the use of appropriate theories, concepts and models in the PLC will
differentiate between large and small-scale projects.
Kaizen theory and lean management model theory is useful in analysing the
effectiveness of the PLC only at the time when large project are being carried out as compared
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Illustration 2: Six Sigma

to small projects because it require much cost to be incurred while implementing this theory, so
as per the budget and project of Hot point company this theory can be used As the project that is
being carried out by Hot point company is launching of TV that is of 58inches terms to be large
project.
CONCLUSION
From above mentioned report, it can be concluded that implementing operation
management will benefits the company in gaining competitive advantage against rival
companies. A continuous development plan will helps in improving the quality of product. There
are some stages in PLC which defines the success of a product for a limited time period.
Effectiveness of PLC will be acknowledged by using different concept, theories and models.
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REFERENCES
Books and Journals
Nicholas, J. M. and Steyn, H., 2017. Project management for engineering, business and
technology. Routledge.
Kerzner, H. and Kerzner, H. R., 2017. Project management: a systems approach to planning,
scheduling, and controlling. John Wiley & Sons.
Jacobs, F. R., Chase, R. B. and Lummus, R.R., 2014. Operations and supply chain management
(pp. 533-535). New York, NY: McGraw-Hill/Irwin.
Leach, L. P., 2014. Critical chain project management. Artech House.
Lee, C. K. H. and et. al., 2014. Application of intelligent data management in resource allocation
for effective operation of manufacturing systems. Journal of Manufacturing Systems.
33(3). pp.412-422.
Floricel, S. and et. al., 2014. Extending project management research: Insights from social
theories. International Journal of Project Management. 32(7). pp.1091-1107.
Nenonen, S. and Vasara, J., 2013. Safety management in multiemployer worksites in the
manufacturing industry: opinions on co-operation and problems encountered.
International journal of occupational safety and ergonomics. 19(2). pp.168-183.
Mubin, S. and Mubin, G., 2016. Risk analysis for construction and operation of gas pipeline
projects in Pakistan. Pakistan Journal of Engineering and Applied Sciences.
Walker, A., 2015. Project management in construction. John Wiley & Sons.
Serra, C. E. M. and Kunc, M., 2015. Benefits realisation management and its influence on
project success and on the execution of business strategies. International Journal of
Project Management. 33(1). pp.53-66.
Bryde, D., Broquetas, M. and Volm, J. M., 2013. The project benefits of building information
modelling (BIM). International journal of project management. 31(7). pp.971-980.
Online
Kaizen Cycle. 2019. [Online]. Avasialble Through:
<https://webcache.googleusercontent.com/search?q=cache:EWZj-a3Sl7YJ:https://
searcherp.techtarget.com/definition/kaizen-or-continuous-improvement+&cd=12&hl=>.
Six-sigma. 2019. [Online]. Available Through: <https://www.qualitymag.com/articles/94429-
back-to-basics-six-sigma>.
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