Review and Critique of Operations Management Principles at IKEA

Unit: 16 Operation and Project Management
Qualification: BTEC HND (Level 5)
Address:
Term 2
Qualification Code: D/508/0491

Table of ContentsIntroduction.......................................................................................................................3
LO1: Review and critique the effectiveness of operations management principles.............3
M1 Review and critique the implementation of operations management in relation to Six
Sigma methodology and Lean principles.......................................................................................6LO2: Apply the concept of continuous improvement:.........................................................6
M2 Analyse the effectiveness of a continuous improvement plan using appropriate theories,
concepts and/or models...................................................................................................................9
D1 Apply appropriate theories, concepts and/or models to justify strategies of a continuous
improvement plan for achieving improved efficiency.................................................................10LO3 Apply the project Life cycle:.......................................................................................10
M3 Analyse the rationale for the project methodologies, tools and leadership within the PLC
for the given project......................................................................................................................12LO4: Review:....................................................................................................................12
M4 Critically analyse how the use of appropriate theories, concepts and models in the PLC
will differentiate between large and small-scale projects...........................................................14
D2 Critically evaluate the PLC through a practical and theoretical exploration of its
effectiveness....................................................................................................................................15Conclusion:.......................................................................................................................15
Reference:........................................................................................................................16

Introduction
In this unit “Operation and Project Management” I’ll explain the importance of
management for leading furniture company IKEA, what the company can offer with high
quality goods and wide range. The company I choose IKEA, is the largest furniture
manufacturing and retailer organisation that is operating business in different parts of world
according with what the customers need and demand.
LO1: Review and critique the effectiveness of operations
management principles
IKEA is the company I choose to work in this unit. Is one of the largest companies in
the world which already sell the electric fairs and washing machine. The company decided to
introduce a new product development which is the Large Screen Television Market. The size
the company decided is 58 inch, which will be the minimum because after this screen they
will develop other models which will be bigger than first one.
The positive things in this IKEA project is the name of the brand. Probably majority
of people has minim one item from IKEA, which can be electric friars, furniture, plates, etc.
All the customers know and trust this company because they know the story, they already has
an experience with their product. If the customer has to decide to buy a product from a new
company on the market or IKEA, 98% they will choose IKEA because of the bread name.
Another good thing for IKEA is that they already sell electronics and if they will start
this screen new project, they will not start from zero level, their employees has experience,
we are not speaking about something new 100% for IKEA.
The negative things can be marketing competition. Now exist many companies how
sell the screen for many years on the market like: Samsung, LG, Sony, Panasonic, etc. For
example: Samsung sell the first tv in 1970 and can be a serious competitor for IKEA because
of their tv experience. Beside these big companies, there are still small companies that have
been producing televisions for years. The companies who make just tv, they can make 100
different screens annually but IKEA makes a wide range of product. So, for IKEA to have a
good manage on the market with the new product (screen 58 inch) will be a bit difficult
because they already have a lot of different product.
Operations Management is about how the business can be administrated to create the
high level of efficiency in a company. It’s a complicate process to covering materials, select
the good labour and services to maximize the profit of company.

Operations vs Operation Management:
Operation is an idea you have in your mind which can be a concept or function.
IKEA had a concept to develop a new project which is the large screen 58 inch. They
decided the model, how the screen will be and what they need to create the new item.
The management works as a strategic oversight which is about how the idea will be
built in real life, how actually the idea can become real. We refer here to the screen design
and how the screen idea can be implemented. Any company in the world who wants to
develop a new item, the employee has to thing about how they idea can be interesting and
they can implement it.
When we speak about operations, we have to know that needs to exist a relation with
other business functions like: finance, human resources and marketing. All this tree are the
main functions in any company. Is important to have a good communication if they want to
achieve the same goal, they have to work as a team.
1. Financial function:
This function is responsible to found and after controlling the business capital investment and
collecting the money, the equipment and of course plant expansions. The operation managers
have to understand the financial investment and vice versa because without understanding the
methods the method between them, the financial plan will not exist anymore. Good
communication on both sides is important.
2. Marketing function:
This function has to understand the customers need and to be in close contact with them, at
the same time, with their needs and desires. After that, they have to generate a good company
services and find a way to develop a new market. For example, If the marketing department
wants to sell, first they have e to understand the what operation the company can produce and
find the type of customization operation to deliver. Marketing function with operation
function work are very close in their collaboration to provide good service to their customers.
3. Human Resource function:
This function is the responsible with recruiting which is one of the most important keys in the
company. Is very important to see and understand that the all human being is different and
this function has to know in which department every person can work. Someone can be good
for speaking and good communication with people, other employee can be good to work
themselves to plan, or creative people, etc. Human Resource has to see the employee’s skills
and hire people in any good position for them