Operations Management

This article discusses the ten critical decisions required in operations management and how to make effective decisions for smooth business operations. It also provides solutions to the finance and manufacturing problems faced by Chad's Creative Concept in a case study. The solutions include effective scheduling, inventory management, supply chain management, and maintenance decisions.

Running Head: OPERATIONS MANAGEMENT
Operations Management

OPERATIONS MANAGEMENT 1
Contents
Answer 1..........................................................................................................................................2
Answer 2..........................................................................................................................................3
References........................................................................................................................................5

OPERATIONS MANAGEMENT 2
Answer 1.
Operating decisions can be defined as the decisions which are made for the purpose of managing
the day to day operations of the business. Ten critical decisions are required to made in
operations management namely quality management, service and product design, location,
process and capacity design, supply chain management, human resources and job design,
inventory management, scheduling, layout design and maintenance decision (Choi, Cheng and
Zhao, 2016). Taking into consideration Chad’s Creative Concept case study, Chad is required to
make decisions regarding the operational flow of the business in order to ensure that there is no
stoppage at any stage in the manufacturing process. The situation which is currently being faced
by Chad is between manufacturing and turnover. The case study also clarifies that there is no
problem in the performance of the current staff. The focus of the business should be on
scheduling, inventory and maintenance for the purpose of making right decisions in this regard
(Ancarani, Di Mauro and D’Urso, 2016). Also, the case study provides that the raw materials
related to the manufacturing of standard line are in work in progress. This, in turn, leads to slow
progress of the business causing inability to make good turnover. A critical situation can come
across the business due to its non- favorable and non- promising financial status. Therefore, there
is a need to make decisions regarding scheduling for the purpose of reducing the number of raw
materials under the category work in progress. This problem can be avoided by way of proper
scheduling of the standard line manufacturing (Haksever and Render, 2018).
Another problem specified by the case study the costs associated with the standard product
warehouse is increasing at a rapid pace which is creating difficulties for Chad Thomas. This
problem can be resolved by making effective decisions regarding inventory and supply chain
(Burns and Dewhurst,2016). The inventory should be reduced by Chad and this can be controlled
with the help of reducing replenishment lead times, centralizing the inventory and making the
use of PARETO chart for analyzing the sales vs inventory. The supply chain designed for the
products of this business should be good and it should be implemented as soon as possible in
order to deal with this problem. Another decision which is important for Chad’s business is
regarding maintenance. The problem faced by Chad in terms of insufficient capacity and finance.
There is no problem with regard to the nature of the business s growth is visible for both custom

OPERATIONS MANAGEMENT 3
and standard line. However, both the manufacturing line should be maintained on equal basis
without dropping any of them. This is due to the fact that there is no reduction in the demands of
these manufacturing lines rather the demand is increasing. In case, if any of the manufacturing
line is closed by Chad, he will probably lose a number of opportunities for the growth of the
business. Both the manufacturing line can be systematically maintained with the help of an
effective maintenance decision without any waste or loss from both the lines. The manufacturing
capacity can be aimed to be improved for meeting the increased demand. Good planning is
necessary regarding all the process of production. The basic aim of strategic capacity planning is
to meet demand by production capabilities at the optimal level. With the help of the above
suggested decisions, the operations of the business can be carried out in a smooth manner.
Moreover, it will further enhance the future of the business and will offer good profits and return
on investments.
Answer 2.
The problems faced by Chad Thomas are in terms of slow manufacturing process and finance.
For the purpose of resolving the finance related problem, Thomas can go for relocation of the
warehouses. The case provides the fact that the costs for standard furniture line are increasing
and the public warehouse space is also very expensive. Therefore, Chad is required to adopt cost
effective operations by relocating their warehouses to the locations which are cheapest. Delays in
the process of manufacturing leads to the problem of low finance as the raw materials still
remain under work in progress. The problem of finance can be resolved by way of cutting down
the warehouse costs or by reducing the time taken by raw materials under work in progress
(Sankar, Kannan and Muthukumaravel, 2014). Decrease in work in progress along with
systematic operating can be ensured by the implementation of new scheduling by Chad. The
custom furniture is given greater priority as compared to standard line which, in turn, results in
stoppage of the raw materials for standard line in the progress of manufacturing. The analysis for
the priority should be made again and the custom and standard manufacturing should be given
equal priority. This will lead to non- stoppage of the standard raw materials in work in progress.
Both products will follow the promising cycle of first in – first out which suggests that the
product on which manufacturing is started first will be finished first. The standard
manufacturing will not be put on hold and will continue at the same time.

OPERATIONS MANAGEMENT 4
Delayed manufacturing line is another problem faced by the firm which also appears as a
disadvantage and can also result in losses in the future. Delayed work leads to the blockage of
money as the sales are not made (Smith, Maull and CL Ng, 2014). Chad can attempt to overcome
this situation by making decisions regarding business capacity enlargement by enabling more
facilities. Just in Time (JIT) production can also be adopted so that the production can be made
by the business in the client’s desired quantities. The production will be balanced by JIT as the
manufacturing process will be evenly spread throughout a specific time period for cultivating
seamless flow between the diverse processes involved (Filippini and Forza, 2016). When the
work in progress levels of Chad’s business will be reduced in a controlled and synchronized
manner, the business will be free from the problem of blockage of money. Problem scan be
identified on timely basis and therefore can be resolved before it affects the business. The
demands of the business undertaken by Chad are in its increasing phase which, in turn, has the
capability of providing a better future to the business (Masudin, Kamara, Zulfikarijah and Dewi,
2018). Chad should aim at increasing the staff employed for performing the operations of the
business such that the orders can be completed on timely basis. Since the finance level of the
business is not good, recruiting greater number of employees can create a number of difficulties.
If this is not possible for Chad, an alternative can be adopted by encouraging the existing
workers to perform overtime work in order to maintain smoothness in the operations of the
business. This will require the investment of only a smaller amount as compared to the
investment required for recruiting new staff for the business (Walker, Chicksand, Radnor and
Watson, 2015). By providing an option to work overtime, the existing workers can assist the
business in manufacturing more furniture. Task arrangement and good scheduling, which is a
part of operation management, can also be ensured with the help of such an option (Storey,
2016). By way of considering the above mentioned points, problems can be avoided by Chad
Thomas and can be easily preventing from occurring in the future.

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References
Ancarani, A., Di Mauro, C. and D’Urso, D., 2016. Measuring overconfidence in inventory
management decisions. Journal of Purchasing and Supply Management, 22(3), pp.171-180.
Burns, P. and Dewhurst, J. 2016. Small business and entrepreneurship. Macmillan International
Higher Education.
Choi, T.M., Cheng, T.C.E. and Zhao, X., 2016. Multi methodological research in operations‐
management. Production and Operations Management, 25(3), pp.379-389.
Filippini, R. and Forza, C., 2016. The Impact of the Just-in-Time Approach on Production
System Performance: A Survey of Italian Industry. A Review and Outlook. In A Journey through
Manufacturing and Supply Chain Strategy Research(pp. 19-39). Springer, Cham.
Haksever, C. and Render, B., 2018. Service and Operations Management. World Scientific
Books.
Masudin, I., Kamara, M.S., Zulfikarijah, F. and Dewi, S.K., 2018. Impact of Inventory
Management and Procurement Practices on Organization's Performance. Singaporean Journal of
Business Economics and Management Studies (SJBEM), 6(3), pp.32-39.
Sankar, K., Kannan, S. and Muthukumaravel, A., 2014. E-Logistic for Warehouse
Management. Middle-East Journal of Specific Research, 20(6), pp.766-769.
Smith, L., Maull, R. and CL Ng, I., 2014. Servitization and operations management: a service
dominant-logic approach. International Journal of Operations & Production
Management, 34(2), pp.242-269.
Storey, D.J., 2016. Understanding the small business sector. Routledge.
Walker, H., Chicksand, D., Radnor, Z. and Watson, G., 2015. Theoretical perspectives in
operations management: an analysis of the literature. International Journal of Operations &
Production Management, 35(8), pp.1182-1206.