Understanding Operations Logistics and Supply Chain Management

This document provides an understanding of the function of operation, logistics, and supply chain management in an organization. It explores theories and concepts related to managing quality, JIT, and Lean. The document includes a case study on Tesla's operation, logistics, and supply chain management.

Understanding
operations logistics and
supply chain
management

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY ..................................................................................................................................2
Review of relevant Operation, Logistics and Supply Chain Management theories ..................2
Critical analytic discussion with relevant and similar examples and apply appropriate
solutions of Operations Management..........................................................................................5
Conclusion and recommendation................................................................................................5
REFERENCES................................................................................................................................7

INTRODUCTION
In an organisation the function of operation, logistics and supply management are similar
in nature as it allow an organisation to produce best quality of product or services by minimising
the wastage of products. However, these are similar in nature yet each of them contains different
roles which makes them unique from each other. In context of supply chain management, it is
concern with the procedure of planning and management of all activities by involving in
sourcing, procurements, conversion and all logistics activities (Akgün and et.al., 2014). On the
other hand, logistics is regarded as a part of supply chain management which comprises the
activities like planning, implementing, controlling the flow or storage of goods and services in a
better manner. Moreover, the term operation is refer to those in which it signifies that the
conversion of raw material into finished goods by utilising the available resources in optimal
manner. However, it has been signifies that each of them are interconnected with each other or it
has been believed that operation management is the basis of both supply chain management and
logistics. Henceforth, with the proper utilisation of these three element enable organisation to
improve its operation management chain and also can enrich the quality of output of the
processes in an amended manner among competitors. In regard of this report, Tesla has been
considered which is a reputed and branded company in Automative industry and it sis established
in the year of 2003. The company is known for manufacturing electric arcs and Tesla energy
across the world with best and effective quality in service. Additionally,this project is fully
grounded on the topic called managing quality and JIT and Lean in order to maintain a balance
between operation, logistics, supply chain management of Tesla in an improved way. However,
there are various theories or concepts related to Managing Quality, JIT and Lean like Total
Quality Management, Lean Principles which enable firm to enrich its overall productivity and
proficiency ratio in an efficacious and expeditious way. n which assist an establishment to
improve their overall efficiency of production and also to satisfy customer need or demand in an
improved way. This study involves application of relevant theories or concepts related to
improve operation ,Logistics and Supply Chain Management like Total Quality Management, .
Moreover, proper allocation of resource and efficient usage of available resources lead an
organisation to improve its overall effectiveness of product and also help them to minimise the
wastage of product in an amended way. Finally, providing suitable recommendation in order to

enhance the potentiality of an organisation operation, logistics ad supply chain management
within current marketplace.
MAIN BODY
Review of relevant Operation, Logistics and Supply Chain Management theories
In every form of organisation, the role of operation, logistics and supply chain
management contains a significant impact as it enable them to maintain the product or service
quality as well as to make use of all available resources in an improved way. Along with this,
combination of these three elements help establishment to control variability within
manufacturing process, increase productivity ratio and also lowers the cost of production. IN
context of this project, managing quality and JIT and Lean concepts has been taken into
consideration. Each of these terms are supported and grounded with various theories or models
that aid them to monitor or govern each and every business function of organisation in order to
place the brand in a competitive and aggressive position in an impressive way (Hennies and
et.al., 2014). In relation to Tesla, some of the models or theories has been included which is
explained below:
Managing Quality
In every establishment, the concept of quality plays a crucial role as it lead them to gain
competitive advantage and also to enhance the brand value of firm within competing industry in
a better way. However, the term managing the quality of quality management encompasses the
activities like determination of quality policy, implementing the plan, controlling and improving
the quality of products in a better way. Apart from this, in order to handle or manage the quality
of company's products the theory of Total Quality Management is viewed as integral
component. In context to Tesla, for maintaining its product or service quality TQM approach
has been adopted which is explained below:
The term Total Quality Management is defined as a management approach which
incorporated in the year of 1950 with a purpose of continuous improvement of production of
goods and services in a effective manner. Moreover, with the implication of this components
Tesla can improve its internal processes and also increase customer satisfaction for attaining
sustainable growth and developing in competing marketplace (Hugos, 2018). Along with this,
the primal objective of Total Quality Management is to eliminate the waste and enrich the

efficiencies by ensuring whether the production process of firm is attempted well in first time.
However, if Tesla make an effort to implement TQM in a proper manner then it lead them to
decrease cost related to corrective or preventive maintenance, effective overall performance, and
empower company to gain loyal customer towards their brand without nay obstacles. Hence,
some of the benefits which TQM render yo Tesla in order to manage the quality of its production
process are as follows:
Reduce the product defects: In TQM, one of the key principle is to decrease the error or
waste from the manufacturing process. However, in context of Tesla, TQM enable them allocate
the requires resources in a improved way and also aid firm to produce its product or service in a
right manner in their first attempt itself. This means TQM assist Tesla to create product with
fewer defects that aid them to reduce the products recall and finally it results into future
consumer support in an improved or amended mode. Apart from this, TQM also help Tesla to
minimise the unessential tasks, waste of resources and many more. Due to such action, it enrich
Tesla efficiency within competing industry and also help them to save time and dup0lication of
tasks in an efficacious manner (Kayvanfar and Teymourian, 2014).
Lower costs: The another benefits which Tesla acquires with the adoption of TQM in its
business operation is the it lead them to decrease total quality costs. However, the primal aim of
TQM is to deliver zero defect products which impact Tesla to reduce its overall cost of
production and also empower them to produce maximum output with optimum utilisation of
resources in an effectual and prompt manner. Thus, it also benefit organisation to make use high
end technology, competent personnel which enhance its productivity ratio in a better mode.
Satisfied customer: Under this aspect, with the implication of TQM it enable
establishment to use innovative technology that empower them to increase it's market share and
profitability ratio in an improved way.
JIT and Lean
In an establishment, the aspect of JIT plays a vital role as it prevent them from using
excessive inventory as well as lead firm to carry out the production operation in a smooth
manner with less wastage of product or services. However, JIT is regraded as both inventory
management methodology and also continuous process improvement program (Li and Wang,
2016). Furthermore, within manufacturing section, JIT is regraded as a workflow methodology
as it intended to reduce the flow times and also to manage the response time form supplier to

customers for obtaining profit maximisation in an amended mode. Hence, JIT manufacturing is
similar to Lean as both the aspects signifies eliminating the wastage of products or services from
manufacturing process. Additionally, the term JIT is developed and introduced in Toyota
manufacturing plants with an intent of meeting out the consumer demand with minimum delays.
Moreover, Taiichi Ohno is the father of Just in Time concept. Moreover, the foremost objective
of Just in Time is that to minimise the waste by effective maintenance of inventory management
throughout the whole supply chain. In context of Tesla, the adoption of JIT plays a crucial role as
it help them to generate a balance between inventory and continuous improvement process for
placing the brand in a better position. The key reason which empowered Tesla to acquire the
function of JIT into its functional unit is that JIT approach has the capacity to improve the
competitiveness of company and also help them to minimise the wastes in order to obtain highly
efficiency or quality based products or service into existing marketplace. Apart from this, Tesla
take an initiative in adopting some of the theories or principles of JIT and Lean which is
discussed below:
Kaizen: This principles signifies that reducing waste and continuous improvement should
go hand in hand. Moreover, this concept is split into two categorise i.e. change and good that
drive Tesla to adopt appropriate medication and enhance the quality of product in an innovative
style. This is because, it sates that in order to improve the enhance the Tesla's manufacturing
process continuous improvement help business to identify its defect or errors in a impressive
way and also lead them to take corrective course of action. Due to such actions, Tesla can easily
minimise the waste or product or services and can enrich the productivity of firm (9 Lean
Manufacturing Principles to Kill the Jargon and Get Quality Results, 2018).
Heijunka: It is Japanese term which states that leveling production that means no matter
what happens during process but the final output should be same every day. However, in case of
Tesla, it enable them to examine its average order amount that lead them to keep its production
consistent and help Tesla to avoid unnecessary defect in a better mode. Moreover, it also aid
them to maintain its fluctuation stock that help Tesla to manage its stock level. Additionally,
Heijunkais best suitable for manufacturing products which are either complex or take long time
to create as well as the demand of products can be fairly predictable without any obstacle
(Maletič, Maletič and Gomišček, 2014).
Poka-Yoke:

Henceforth, the above mentioned theories enable Tesla to manage its quality and also to
manage its inventory level that drive them to minimise the wastage of product or services in
order to gain competitive advantage in an innovative way.
Critical analytic discussion with relevant and similar examples and apply appropriate solutions of
Operations Management
As per the earlier discussion, it has been signified that with the implication of Total
Quality management and Lean principles help Tesla to enhance the profitability and productivity
ratio in an trenchant and economical manner. In addition to this, the main focus of JIT and TQM
is to identify or determine the obstacles within production process and also displays hidden issue
of inventory for improving overall productivity ratio. Additionally, the main objective of Just in
Time is to increase the inventory turnover and decrease the holding or connected cost which aid
Tesla to control utilising excessive inventory for attaining sustainable proficiency ratio in
competing industry. On the other hand, adoption of Total Quality Management enable Tesla to
manage optimum synchronization between the manufacturing cycle and delivery of material that
aid them to understand supplier and manufacturing marking condition in terms of quantity and
delivery of the material. For example, Tesla is a car multinational car manufacturer of electric
cars as it is regarded as one of the world's best selling electric vehicle model. (Ramezani and
Razmeh, 2014).However, within its manufacturing procedure it make an effort to manage
minimum inventory levels, because there is a strong dependency on supply chain in order to
deliver the parts requires for manufacture certain electric cars. However, with the adoption of
Total Quality Management and Just in Time approach, the parts which is needed for
manufacturing car does not arrive or reach before and after firm needs rather, it only arrives
when Tesla are in need. However, it has been identified that JIT and TQM help Tesla to govern
or control its supplier activity which help them to prevent themselves by utilising excessive
space for keeping stock and can easily manage inventory management. Furthermore, with the
utilisation of TQM and JIT, Tesla was able to keep its stock holding cost to a minimum level
and also help them to deliver .099999% defects in their manufacturing process in comparison to
previous overall performance. Due to such initiation, it lead them to place their brand in an
aggressive and competitive position in a desired time period without any hindrances. Along with
this, by maintaining inventory management it lead Tesla to enhance its product quality in an
innovative or productive style within prescribed time duration.

Here some of the graph which shows the positive impact of JIT and TQM within Tesla
operations which is given below:
As per the shown chart, it has been signified that Tesla inventory's performance has been
improved from the year 2013 to 2017 i.e. 250.00M to 2.438B. With the proper allocation of

resources and handling of JIT principles, it lead Tesla to minimise the unnecessary handling cost
and also empower them to produce less defected product.
From the drawn bar graph, it has been identified by maintaining proper quality in its
operation functional unit, it help them to increase its vehicle production from 11,160 to 85,555.
Hence, with such performance, it drive Tesla to place its brand in an aggressive and competitive
position in an innovative or productive style.
Conclusion and recommendation
Henceforth, Tesla utilises Total Quality Management and Just in Time approach in its
business function for decreasing the wastage of products and delivering product in a best quality.
Hence, some of the recommendation which has been identified to improve Tesla operation,
logistics and supply chain management are as follows:
 The primal initiative which Tesla can imply into its functional unit is that they should
maintain high standard for reporting and analytics that help them to gather real time

data and also can manage multiple views at the same time without any
misunderstanding or misconception among manpower. This is because, advanced
reporting and analytic technique has immediate access as it is available at 24/7. With
the help of such action, Tesla's manager can effectively maintain the product quality
and also can make better decision in order to place the product in a competitive or
aggressive position.
 In context of Tesla, who operate its functional unit in global level, it is difficult for its
manufacturer to handle or monitor each and every section of the car manufacturing
process. Therefore, Tesla's superior can make an effort to develop a tracking system
over mobile devises that aid them to capture and aggregate real time data during
moving from places to places. However, such adoption enable them to enlarge its
market share and also can help its personnel to offer best quality product or services
within competing marketplace in an innovative and creative style.
 In addition to this, Tesla can provide proper training and development program to its
manpower which help them to attain sustainable growth and profit margin ratio within
competing industry in an innovative and productive style among competitors.
It has been summarised from the above report that proper management of raw material or
resources help organisation to deliver best quality service and also to acquire best position within
competitive industry in a stipulated time duration. Moreover, implication of appropriate theories
help establishment to expand its productivity or profitability ratio in a improved manner.
Although there are differences between the role of operation, logistics and supply chain
management yet they are inter-related and in order to be profitable in this competitive age,
companies must have an experienced and effective team of supply chain, logistics and operations
managers.

REFERENCES
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parallel machines scheduling problem: a just-in-time approach. International Journal of
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Online
9 Lean Manufacturing Principles to Kill the Jargon and Get Quality Results, 2018.[Online];
Avilable Through. <https://www.process.st/lean-manufacturing-principles/>