Operational Analysis of Recycling Centre Corporation (RCC)

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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