Operational Analysis of Recycling Centre Corporation (RCC)

This report provides an operational analysis of Recycling Centre Corporation (RCC), including the calculation of the company's major asset capacity, customer mapping exercise, and strategic analysis of consumer requirements. It discusses the physical infrastructure and facilities capacity, production capacity, mechanical capacity, financial analysis of operation costs and revenue, and strategic analysis of consumer needs.

Operation management
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Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
(1) Calculate the capacity of the company’s major asset............................................................3
(2) Complete a customer mapping exercise for RCC..................................................................4
(3) Conduct an operational analysis of the RCC operation.........................................................6
(4) Assess and compare different possible options for the strategic direction that the company
should take...................................................................................................................................9
(5) Finally you should argue for what you feel are the most appropriate managerial actions that
the Board of RCC should take...................................................................................................11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13
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INTRODUCTION
Operation management is considered as the administration of practices performed by
business for developing the higher efficiency level that is possible into entity. This is regarded
with transforming labours as well as materials into final products or service in effective way as
much as possible which will be helpful in maximising the organisational profitability. This is
essential for entity to manage the regulate practices seamlessly. With their assistance, a firm is
capable to develop effective utilisation of their resources such as funds, raw materials and other
resources (Ahmadi and Rezaei, 2020). It is crucial for improving the whole productivity in
effective and efficient manner. In general term, it is regarded as procedures which include
preparing, arranging, managing, controlling and guiding the manufacturing and production
process. This report is based upon Recycling Centre Corporation (RCC) which is headhunted
through parent firm Recycle centre LTD. this is basically a publicly traded organisation within
Scandinavian region and was founded in year 1985. In this report, the calculation of company’s
major assets capacity is performed. Moreover, customer mapping exercise as well as operation
analysis of RCC operation are explained. Apart from this, comparison of different possible
options for strategic direction which firm undertake and managerial actions that board of RCC
must take are also discussed in this report.
MAIN BODY
(1) Calculate the capacity of the company’s major asset.
The capacity of the heavy-duty spreader in tons per week*.
Tons per hour 70
Number of working hours per week (11*5) = 55 hours
Waiting time and breakdown per week (11+3) =14 hours
Working hours = (55-14) hours =41 hours.
The machine is operating inefficiently at 5%
Therefore, 95% of 70 tons per hour = 66.5 tons
(66.5 tons * 41 hours) = 2726.5 tons
20% of this is waste we have (20% * 2726.5 tons) = 545.3 tons
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The capacity is, therefore, (2726.5-545.3) tons
= 2181.2 tons per week
The annual revenue currently being generated from this machine assuming a selling price
of $370/Ton.
As selling price of $370/Ton
(tons per week * the number of weeks in a year)
= (2181.2 * 52 weeks * $370 per ton)
=$41,966,288
The annual production costs of the heavy-duty spreader.
The annual production costs of the heavy-duty spreader.
(Fixed cost+ Variable cost)
(utilities, rent, depreciation + freight cost, material procurement)
($16 + $27+ $260) per ton * 2181.2 *52
($303 per ton * 113,422.4)
=$34,366,987.2
The annual profit or loss from this asset.
Annual profit or loss = (Total Revenues- Total Cost)
($41,966,288 - $34,366,987.2)
=$7, 599,300.8
(2) Complete a customer mapping exercise for RCC.
Customer mapping is considered as an aspects which deals with a journey of consumers
towards a products or the stages which drive towards acquisition of goods. This assists
organisation to step into the shoes of consumers as well as observe its enterprises from the
client’s point of view. Also, this is an effective way for visualising how an audience interacts
with enterprise is through mapping it (Andervazh, Javadi and Aliabadi, 2020). Moreover, this is
also helpful for business for gaining insights into common consumer pain points; how it can
develop experience of audiences, explain what clients required for accomplishing a purchase. So,
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the Recycling Centre Corporation (RCC) perform consumer mapping as it is helpful in
developing a roadmap of business and explain the requirements of clients as well as it may also
encourage and motivates them. In respect of Recycling Centre Corporation (RCC), consumers
are categorised into outbound as well as inbound. Inbound consists municipalities and large
construction firms, small scarp traders and manufacturer. On other side Outbound includes metal
manufactures. Therefore, the customer mapping is discussed below:
Step 1: Understanding the buyer persona – The initial step is in mapping the customers is
to get knowledge about the customers (Astarita and et. al., 2020). As in Recycling Centre
Corporation (RCC), there are two kinds of consumers such as outbound as well as inbound.
Inbound consists municipalities and large construction firms, small scarp traders and
manufacturer. On other side Outbound includes metal manufactures. Both have different
perceptions regarding their product or services.
Step 2: Understand the buyer’s goals – As once the firm has developed the buyer persona
so at this step, they have to deeply understand that what is the ultimate goals of customers. So, in
respect of Recycling Centre Corporation (RCC), its customer goals is t obtain quality scrap metal
at most effectual prices as well as seeking for disposing the old metal asserts also needs a higher
price. Moreover, they also required quality product at better price.
Step 3: Mapping out buyers touch points – A touch point is considered as any time a
consumers comes in contact with firm’s brand that is before, during or after it buy something
from them (BAGHAEE and GHAREHPETIAN, 2020). It also involves moments which happens
online or offline by marketing, in persona or over phone. In respect of Recycling Centre
Corporation (RCC), they may know about the touch points through their websites, e-mail, word
of mouth and many more.
Step 4 – Identifying consumer pain points – In this, the firm has to bring whole their
information as well as seek at bigger picture for identifying the potential road blocks into the
journey of consumers. In respect of Recycling Centre Corporation (RCC), some roadblocks are
which can impact their product as well as production cost for soaring and as an outcomes they do
not able to meet the requirements of clients.
Step: 5 – Prioritize and fix roadblocks – In this the firm ahs to focus upon resolving the all
roadblocks by performing some changes. In respect of Recycling Centre Corporation (RCC), fix
solving the issues they may develop strategy which will be helpful in accomplishing the
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requirements of clients and also assure that its needs are accomplished during shredding as well
as compression so that scrap metals will be available at the time when clients required it.
Step: 6 – Update and Improve – As consumer are constantly modifying as well as evolving
so the firm’s customer mapping has to perform similarly. In respect of Recycling Centre
Corporation (RCC), they as to introduce some unique products or services such as four chamber
sorting system, pilot programme with nudging which intent at enhancing waste segregation and
many other.
Therefore, all this help Recycling Centre Corporation (RCC) to understand the current as
well as future requirements of customer whether it is inbound or outbound customers. Also, try
to provide customer satisfaction through some unique products or services which will outcomes
in enhancing profitability in effective and efficient way.
(3) Conduct an operational analysis of the RCC operation.
Operational analysis is considered as the process of determining the present performance
of operational investment as well as measuring that performance beside a developed specified
schedule, cost as well as parameter of performance (Chen and Jia, 2020). In addition to this, it
deals with assessment as well as measurement of an actual system within operations. In respect
of Recycling Centre Corporation (RCC), there are numerous operation that they are performing
so the analysis related to capacity planning or management. So, there are some points that are
undertaken for discussing about the operational analysis of Recycling Centre Corporation (RCC)
operation:
The physical infrastructure and facilities capacity: The physical capacity of Recycling
Centre Corporation (RCC)is maximised through various key aspects such as machinery grouped
into a cell based layout, that is facilitated a fastest truck which becomes useless at the period of
physical connection of material’s flow. As it reduces the rates of conveyor belts as well as
related utilities which is required for maintaining it in more effective and efficient manner.
Along with this, the two shear balers with a shear force in between 3. 75 to 6.5 tons for smallest
one within an hour as well as the largest one among 14 to 16 tons which maximise the capacity
of production as this allows Recycling Centre Corporation (RCC) operation improving their
packaging ability and therefore transport their product to various consumers. The automation of
compacting as well as shearing procedures also assures that process effectiveness.
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Production capacity: In Recycling Centre Corporation (RCC), this is considered vital firm
capacity that is impacted through three key factors such as an average of 11 waiting hour in
every week, 3 break down hours each week as well as machinery ineffectiveness. From the case
study, this has been determined that the waiting is generally outcomes of in appropriate raw
materials entry within respect sector as well as breakdown occurs because of nominal
maintenances provide to heavy duty spreaders (Farag and et. al., 2020) . This has been assumed
that machine is working at full capacity that is 100 % such as 5 days in a week and 11 hour per
day. Therefore, this outcomes in saving 14 hours into a week and will be converted into total
production of 980 tons in a single week. So, after obviating the wastage, this would be 784 tons
of outputs that is attained for sale. Moreover, there is loss of about 2 hundred and 90 thousand
and 80 dollars just because of production operation that is below the maximum one each week.
Mechanical capacity: In Recycling Centre Corporation (RCC) operations, its heavy duty
spreader work ineffectively as that minimises the capacity of mechanical. The plants present
perform with having 95% of effectiveness level. It considers that each hour machine is running
that low down its capacity that outcomes in some minimisation of 3.5 tons. So, if they minimise
wastage of 0.7 then the result will be 2. 8 tons which get reduced just because of their operation
ineffectiveness. In respect of monetary value then this will be the loss of around $1036 per hour.
As the organisation like Recycling Centre Corporation (RCC) do not able to afford such a big
loss mainly over longer durations. Such as within a week there are losses about $ 42, 476 as well
as in a year it will be around $ 2, 280, 752. So, there are huge losses just because of in
effectiveness of mechanical that is heavy duty spreader machines.
Financial analysis operation cost and revenue: Seeking towards the cost operations
analysis, Recycling Centre Corporation (RCC) generally incurring two kinds of cost that are
variable as well as fixed cost. Whereas the variable costs includes material procurement and
freight. On another side, fixed cost involves depreciation, utilities and rent. As it s deeply
analysed that among two outcomes, the whole cost is $ 303 per ton beside this the revenue was
realised of about 370 tons. In addition to this, the fixed cost is around $ 16 per ton as well as
when this comes towards variable cost, $ 27 is freight cost per ton and $ 260 per ton is material
cost. Therefore, per ton profitability is $ 67. Along with this, the profit from heavy duty spreader
is approx 7, 599, 300 dollars as well as on holdings whole aspects remains constant.
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Strategic analysis of consumer requirements: Firms operate for serving their customers as
they plays vital role (Grynning and et. al., 2020). Within Recycling Centre Corporation (RCC),
there are two types of customers outbound as well as inbound. Inbound consists municipalities
and large construction firms, small scarp traders and manufacturer. On other side Outbound
includes metal manufactures. So, while performing operational analysis is also important for firm
to know about the customer requirements. Therefore, a strategic analysis of consumer needs is
performed through respective company. While creating the strategic clients needs analysis, this is
vital to understand its benefits within potential market area. Such as in respect of Recycling
Centre Corporation (RCC), they identified themselves into a consequences which can impact
their product as well as production cost for soaring and as an outcomes they do not able to meet
the requirements of clients. In this respect, the respective organisation has to develop strategy
which will be helpful in accomplishing the requirements of clients and also assure that its needs
are accomplished during shredding as well as compression so that scrap metals will be available
at the time when clients required it. So, accomplishing the above needs will not only provide
satisfaction to clients but also minimises operating costs. Moreover, the outcomes will be an
effective organisational profitability as well as this also enhances loyalty of potential consumers
(Hemmati, Mohammadi-Ivatloo and Soroudi, 2020). They need a regular flow of quality scrap
metal and also most effectual prices as much as possible. Apart from this, the person who is
seeking for disposing the old metal asserts also needs a higher price. Along with this, the main
objective of Recycling Centre Corporation (RCC) is to provide best price to their suppliers for
wade off useless rivalry from another same type of company. So, the present circumstance shows
that neither consumer nor suppliers are total have knowledge about respective company as a key
player within potential market area. For instance, the manager of RCC has to create awareness
among audiences as well as supplier in effective and efficient manner.
Managerial Corporation challenges that Recycling Centre (RCC) are facing: There are
various challenges that Mr. Eric are facing. One of the top challenges is in competent yard due to
which they can no able to obtain the sufficient raw material for operating the industry with their
fuller capacity. As this will results in, 11 hours are wasted within a week as well as in a year in
about 572 hours get wasted which consider that respective organisation’s revenue are
minimising. Moreover, the shortage of raw materials or scrap metal has drives towards
inefficient rivalry and Mr. Eric is not much competent so that it can able to control the
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circumstances. Also, in few cases in which Yard manager promise its suppliers that it is going to
replace their traditional system with new one. Apart from this, in respect of firm’s policy, they
face risk mainly on extension of involvement with their suppliers just because of its false
promises. The lack of raw material also represents alternatives like performing upon the proposal
that Recycling Centre Corporation (RCC) will represent to the Environmental Ministry. But from
various alternatives, so still Mr. Eric cannot able to decided so that they has to deal with time
constraints as it has one through some evaluation with Board of company upon changing
procedures that are formulating into firm by manager. Apart from this, its management has to
deal with market price of scrap metal which are changing as time passes. As an outcomes there is
low profitability margins and keeping the respective firm in such situation so that they has to
enhances its potential through obviating waiting time of raw material as well as developing the
effectiveness of heavy duty spreader, providing more attention towards breakdown maintenance
at continuous basis. Therefore, the respective company’s management has to deal with all these
challenges as well needed to provide solutions as fast as possible.
(4) Assess and compare different possible options for the strategic direction that the company
should take.
Strategic direction is considered as the actions that are considering for attaining the
objectives of its firm’s strategy. It consist plans as well as performance it has put into the areas to
perform towards business’s vision of future for their organisation. Moreover, the strategic
direction into business as overall enables them to concentrates their staff upon particular
objectives (Kotenko and Kotenko, 2020). Also, staff must get knowledge about how every work
or task are effectively fits within the objectives of enterprises in order to obtain a huge sense of
significance within large project. Within various cases, organisation has to perform harder for
enhancing its market penetration, diversifying its practices, bring new goods or determining new
marketplace. Recycling Centre Corporation (RCC) is not left out; this have a future to live. As
per its determined present situation, it may lay down various strategic directions which they
required to consider for facing the uncertain upcoming problems or issues. Such as
diversification includes enhancing the products or market range which is served through firm.
So, the associated diversification consist diversifying goods or services along with relations
towards existence enterprises. Whereas, the conglomerate diversification includes expansion of
products or services without having any relations with business. Therefore, Recycling Centre
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Corporation (RCC) is similarly to be implicated into both kind of diversification. Along with
this, because of inappropriate raw material, they should think about something other which it
may perform so that it can obtain scrap metal which is consider as current challenge. Also, they
can also deal with some other business like municipal recycling waste. It would ensure that the
respective company business is not only fixed with singular kind of business but may have
various sources of raw material which are also in relation with safeguarding the environment. In
addition to this, for dealing with municipal may formed an effective work relation which can
assists business to negotiate with few of the main favourable policies for Recycling Centre
Corporation (RCC) as well as the public at huge focused upon existent business as well as even
provide an upper hand to obtain scrap metals several individuals at very low cost in comparison
of its competitors.
The other strategic direction which may be undertaken through Recycling Centre
Corporation (RCC) includes market penetration. This implies enhancing shares of present
marketplace with recent range of products (Niu, Rong and Ying, 2020). Moreover, this is
performing in such a manner in order to maximise its market share. Also, it based upon the kind
of market area which Recycling Centre Corporation (RCC) is into; for this it is considered to be
a leading market. This means that there are some one who always ready to purchase as well as
the upcoming will facilitate very much efficient opportunities within potential market area. The
organisation must intent at maximising their market penetration for input as well as output both.
However, Recycling Centre Corporation (RCC) faces several issues. There is always someone
for purchasing its finished outputs. The key problems are obtaining the raw materials as well as
few of drivers have often faulted and co-operated rather with rivalry. In this respect, they
required grabbing the attention of their lost customers and one ways for performing it is to
purchase or obtain effective deals or offerings in more effectual manner in comparison to its
competitors. Therefore, this may outcomes into retailisation from rivals and even difficult norms
as another suppliers destroy some government installation, which is late sold as scrap. Along
with this, there are some another variable options which as to be extended rather than just
concentrating upon proving effective price to their supplier in respect of its supplies towards
several yards. Apart from this, as part of their strategic planning, this is essential that in case firm
could has their logistics department which they operate as separate business in order to reduce or
obviate what has take place at previous times.
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Apart from this, in respect of product development, this is an aspect where entity delivers
changed or new product to existent market place or new market area. It would include forming
new strategic capabilities as well as risks of project management (Toghani Holari, Taher and
Mehrasa, 2020). Moreover, it has to be very much concentrated towards Ministry of
Environmental proposal of developing sector as well as municipal particular waste solutions.
This is essential for firm to come up with new Board staff with new competencies in field of
operations as well as recycling waste. In another cases, the marketplaces reaches up to point of
maturity, this means that firm cannot able to obtain more input for enhancing the production or
output. In addition to this, Scrap metals are not readily available such as soil and others. It takes
time for gathering enough quantities as well as operating into a board area that could be costly in
respect of logistics. Along with this, it is a period for Mr. Eric to become innovative and bring
new goods for new marketplace. Beside this, the market maturity is generally reached into two
ways first when there is production within firms and this could be refers that recent marketplace
is saturated or when there are not appropriate raw materials for supporting the plants that would
mean that the existent resources has been exhausted or irrelevant to keep on supporting industrial
practices. It is a sign that firm must move upon the ways of developing another industry within
economy.
(5) Finally you should argue for what you feel are the most appropriate managerial actions that
the Board of RCC should take.
Managerial actions is considered as a course of local action which is reasonably open
towards a management to support as well as appropriate circumstances of staff disputes, bad
performances or intolerable attitudes at initial possible opportunity (Vlotman, Smedema and
Rycroft, 2020). As within organisation like Recycling Centre Corporation (RCC), management is
very much accountable for plant operations. Mr. Eric as a manager has to undertake few
management actions which are similarly to safeguard the plant as well as develop the wealth of
shareholders. Such as, Recycling Centre Corporation (RCC)’s manager must have to improve the
effectiveness of heavy duty spreader in about 99%. As it will be helpful for them to protect their
plant from slow down of revenue generation because of inefficient machinery. Art from this,
they should also concentrates upon maintenance over the weekends as well as it would minimise
the chances of breakdowns periods mainly during the week. Also, this is important for Recycling
Centre Corporation (RCC)’s manager to undertake or perform some kind of addition investment.
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This seems that even if there were not any rivals, so the waiting time of machinery should be
minimise radically because of inputs scrap metal nature which are not always available and do
not required time to accumulate. So, the alternative investment will assists Recycling Centre
Corporation (RCC) to operate even if there is low supply of scrap metals. Along with this, it is
also essential that they should have its separate logistics department which assists them to
perform the operations of transport as a kind of different business into respective organisation so
that they can able to produce more revenue as well as pay their drivers (Wolniak, 2020). In
addition to this, the line of its business has to be more competitive and respective company
administration must not forget to provide rewards to suppliers in adequate manner as well as
reduce disputes among various yards managers as all of them always bid for the similar kind of
materials.
CONCLUSION
As per the above report, it has been concluded that operation management is play crucial
role within all organisation as it assists them to develop effective utilisation of their resources
such as funds, raw materials and other resources. It is crucial for improving the whole
productivity in effective and efficient manner. It is important for firm to know about their key
assets capacity as it is helpful in getting knowledge about machinery production capacity,
average cost and others. In addition to this, customer mapping assists firm to gain insights into
common consumer pain points; how it can develop experience of audiences, explain what clients
required for accomplishing a purchase. Moreover, the operational analysis is performed through
company as this helps them to deals with assessment as well as measurement of an actual system
within operations. The strategic direction into business as overall enables them to concentrates
their staff upon particular objectives. Along with this, the organisation has to undertake various
managerial actions that help them to support as well as appropriate circumstances of staff
disputes, bad performances or intolerable attitudes at initial possible opportunity in effective and
efficient way.
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