Operational Management Report: H&M Scheduling, Layout, and Inventory

This report provides an in-depth analysis of H&M's operational management, focusing on how the company organizes its work, plans its layout, and manages its inventory. The report begins with an introduction to operational management, defining its key role in achieving organizational goals. The main body delves into H&M's application of various scheduling techniques, such as short processing time, and explores their impact on production efficiency and market responsiveness. It examines layout planning, emphasizing the importance of resource arrangement for productivity, and discusses the continuous flow production method utilized by H&M. The report also investigates H&M's inventory management policies, highlighting techniques like Just-in-Time and TQM. The conclusion summarizes the findings, emphasizing how these strategies contribute to H&M's overall operational success. The report highlights the interplay between scheduling, layout, and inventory management, providing a comprehensive overview of H&M's operational strategies and their effectiveness in meeting market demands and controlling costs. Finally, it provides insights into the use of technology and AI in optimizing these processes.

Operational management
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Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY..................................................................................................................................3
CONCLUSION................................................................................................................................8
REFERENCES..............................................................................................................................10
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INTRODUCTION
Operational management refers to planning of operations in such a way that it enable in
achieving of goals and objectives (Glende, Wolter and Komarnicki 2018). It is process of
planning, organizing, controlling, etc. of activities and tasks in context to production, provision
of services. It is important for organization to do proper planning of operations so that goals are
effectively attained. The operations varies within company and it depends on their size and type
of products being produced. The overall process helps in converting of raw materials into useful
outcomes in efficient manner. Moreover, there are different types of operation techniques in it
such as six sigma, lean, just in time, etc. which are applied by organizations.
This essay will lay emphasis on how operations scheduling techniques is used to organize
work, knowledge of layout planning and importance of inventory management policies for
controlling production costs will be discussed.
MAIN BODY
Every company performs various types of operations which depend their size and scope.
The operations means to transform raw material or input into output (Hu, Sun and Ruan 2020).
For that it requires a proper planning that how to perform operations, what technique to be used,
etc. for manufacturing companies it is necessary to keep production on time and aligned with
market demand so that market need is fulfilled. It is also essential to do production in efficient
way so that resource wastage is not there. Besides that, cost incurred is low and right employees
are used for it. In addition, scheduling means to schedule overall operations from procurement
till delivery of goods in market. Thus, basically, it means preparing a plan. However, there are
different types of scheduling techniques which are available that is used by companies. For
example- first come first serve, earliest due date, short processing time, etc. H&M is a Swedish
MNC operating in retail sector and offering fast fashion clothes for men, women, children, etc. It
was founded by Erling person in 1947. There are total 5076 stores of company at global level.
H&M is second largest clothing retailer after Zara.
Scheduling is necessary in production model (Lopota, Tsyrkov and Tsyrkov 2017). This is
because there are many activities which is included in production. Also, it requires to control and
manage overall process so that timely delivery of products is done and resources are properly
utilized. Thus, it requires a detailed scheduling in which tasks as well as jobs are allocate over
time. It is because each machine can do one job at time and there are various parameters set by
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which it becomes easy to perform operations. Scheduling process is useful in estimating time
required to perform operations. The main thing is analysis of start and completion time, use of
resources, etc.
First come first serve- this is a type of technique which is applied when single product is
produced. Basically, it is used when customer order product and is commonly used in companies
for singular products. However, having a variety of products then this technique is not useful.
Pros – it is simple and easy to understand as on basis of customer order the product is
manufactured (Meena, Yang and Zacharis 2019).
Cons – The process is time consuming as for different order to be delivered it takes a lot of time.
So, as H&M provide variety of clothing apparels so it becomes highly difficult for them to use
this technique in operation process.
Short processing time- As name depicts it is a technique in which products is produced wit
shortest processing time. It helps in producing more products within less time. Also, it takes less
time in it as machine are there to switch jobs.
Pros – The main strength is that it reduces average time for doing job in system. So, it maximize
jobs to be completed at first time and in any point. The material is taken out quickly.
Cons – Weakness is that short time push jobs that are long at back. It means that the overall
schedule is changed as short jobs are done first. It make it difficult to do long jobs. Sometimes,
jobs get stuck due to long processing time. The time is then added to lead time of complex parts.
In H&M this technique is useful as it will enable in delivering products in short time. There will
be no delay in fulfilling market demand. The staff will be able to perform their jobs in effective
way and attain goals and objectives.
Earliest due date- The technique refer to production being done on deadline. In this on basis of
deadline product is manufacture. Usually, business having singular product apply this schedule
process (Pereira, Pinho and Costa 2019).
Pros- the technique is helpful if sequence of due date differ from each other in significant way.
Cons – It require to find out due date of work and job so that earliest due date job is finished
first. But this consume a lot of time as staff figure out what to do next.
Operation due date – this technique figure out job that has to be start at process to make deadline.
Generally, it uses ERP system in which backward time of finished product is calculated. In this it
include processing, waiting, time, etc. and where product is processed. Then, sequence of every
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process is estimated till deadline. The part with the earliest operational due date for the next
process goes first, and so on.
Pros - It gives an entire overview of production system of company.
Cons- Jobs can be started long started because capacity is available and inventory as well.
It require an ERP system for it that is an additional expense.
Besides, in present time AI is highly being used in operational scheduling by which it has
become easy for H&M to calculate time of each job and then prepare a schedule. This has
enabled in giving actual estimated time for doing job and attaining goals (Ruparathna, Hewage
and Sadiq 2017).
While operating in UK the company is have designed an operational process to offer
products to people. So, for that they have formed an effective operation process. Thus, they have
used an operation scheduling technique for it. The technique used is use of robots and integrated
manufacturing technique to reduce errors in production. The machinery is schedule to work
when there is demand of products. In that they have find a way to supply and fulfill needs of
customer. The management has emphasized on monitoring of machine hours and labour hours.
H&M has used continuous flow production method in which they manufacture what
customer want. This is related to quantity, price, design, etc. therefore, it led to being efficient by
which they are successful in firm. Along with it, here, main aim of process is to produce standard
models by which customer need is satisfied. It also include products with various colors, designs,
and having a flexible production process.
Layout planning and work system process
With scheduling operation technique it is important to design a proper layout planning so
that it becomes easy to perform operations. Usually, layout planning means arranging of
resources in such a way that space is effectively consumed and there is no wastage of resources.
Here, resources are person, equipment, machinery, etc. The main thing is purpose of layout
planning is that it directly impact on productivity and quality of service. Hence, having an
effective layout means high productivity and efficiency with efficient utilization of resources. On
contrary poor layout planning led to rise in cost, poor satisfaction level of customers, info flows,
etc. There are various types of layout that is process, product, hybrid and fixed (Seita, Waheeb
and Syarilla Iryani 2020).
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Likewise, work system process is system which involve participation of human and
machine to perform work with help of info, technology, and other resources. This is done to
fulfil needs of customers in effective way. Thus, work system process and layout planning are
inter related to each other. This is because on basis of layout entire planning of system is done. It
involve placing of people at right place, etc. Hence, H&M have also developed a layout plan. In
that they are having various stores in UK. H&M uses continuous flow production method in
which they manufacture what customer want. This is related to quantity, price, design, etc.
therefore, it led to being efficient by which they are successful in firm. Besides, it is most cost
effective method as speed of production of products is adjusted as per demand of people in the
market (Sumets 2018). So, when there is rise in demand it automatically led to increase in
production line process. For that there are certain limits which is been set. In the production plan
there are 3 main production flows. They are design, manufacture and packaging.
The layout of plant is set in such a way by integrating of manufacturing technique and
designing a monitored production process. Here, main factor is that H&M have located their
stores in UK. So, it led to attracting of skilled labor force as production is trend in this region.
Another thing which was available in that area is effectively connected to road and rail network.
Thus, it is easy to handle and manage logistics from it as supplies are brought from vendors and
products are properly distributed via sub assembly suppliers. The government has provided
financial benefit to companies who have set up their plant in that area and provided job
opportunities.
Thus, work process system is effectively aligned with layout planning. It has benefited
H&M to design and produce variety of products in effective way. There is also resulted in
utilization of resources with minimal wastage (Tikhonov 2019). The company has applied some
operational management technique such as TQM and just in time. Thus, it has enabled in
increasing efficiency of operations and attaining of goals. Here, it is found that in TQM is key
concept of working applied by H&M. In this the company has given top priority to customer
satisfaction. So, in that it has focused on providing high quality to customers. However, in order
to attain the goal H&M has been able to find out customer requirement. It has resulted in
improving end output as well. Furthermore, staff is given training to work as per TQM
technique. Hence, it has led to creating a positive culture and generating values through it. In that
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H&M follow cycle of plan, do, act and check. The action of staff shows company way of
working.
It is evaluated that H&M uses short processing time scheduling technique to organize
work. They have developed a plan in which all short jobs are completed first and then long ones.
Besides, start and completion time of each job is calculated and on basis of that right person is
assigned role to operate on machine and equipment. Furthermore, info and resources are shared
as per job priority. The layout is also structured and designed in such a way that work is
organized easily and performed in efficient way (Vetrova, Lapochkina and Doroshenko 2019).
Here, H&M top management is involved in forming a plan and doing layout planning. However,
middle management do entire process of work system. This has enabled in giving actual
estimated time for doing job and attaining goals. Moreover, it has been evaluated that in H&M
work process system is that in organisation first of all market research is done to find out how
what are trends and needs of customer. Then, accordingly to that inventory is ordered. The
manager assign role to staff by developing a plan. The technology is also used in overall process
by which products are produced as per demand of market. The work process is monitored in such
a way that it is monitored in effective way. There are various steps followed in it that is design,
selection of raw material, production, packaging, etc. So, with all these it becomes easy to work
in effective way and attain goals and manufacture variety of products. Here, layout of store is
such that all activities are inter related to each other. The working process is highly structure in
such a way that each task is dependent on one another. Thus, priority tasks are completed first
and then remaining are done. The steps are followed in proper way. Therefore, there is
continuous flow of process in completion of activities. Thus, in all stores of H&M similar work
process as well as layout planning is done. The scheduling is done by estimating of time in doing
of tasks. It enables in maintaining of raw materials, facilities, use of materials, etc. The layout is
designed as per product type and likewise work process system are made. In same way resources
are also utilised and inventory is maintained according to demand of each product type (Yamin
and Alharthi 2020). Alongside, there are various facilities as well that is support, facilities,
additional, etc. which is applied in completion of tasks. H&M have followed the layout of
product type in which different areas is required as per process and other functions. The plan of
company is big as compared to toy company. Then, production process is developed as per
volume of production required. It has resulted in obtaining of maximum efficiency of process
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and meeting demand of market. The company make adjustment in their process and layout
design. Here, as per volume changes are made in production process. Machines are installed as
per size and sequence of production. The building is having a large size in which all types of
machine and equipment are installed. The warehouse of company is within 4-5 km of range so it
becomes easy to store products and distribute it. Then, it is distributed to different stores and sold
to customers. Here, remaining stock is left over in warehouse. However, technology is also used
in to track the remaining stock left (Glende, Wolter and Komarnicki 2018). In case of high
demand unused stock is sent to other stores and if require more than it is produced. In this way
overall layout planning and work process system of H&M is. There is proper process followed in
design of layout.
Importance of inventory management policies for controlling costs
It is essential for H&M to control production costs so that they can generate huge
revenue. Besides, reducing costs will help in increasing profit on clothing products and also there
will be efficient utilization of resources. So, this can be done only through controlling inventory.
It is because if inventory is managed then it automatically led to reduce costs. Thus, there is need
to form policy to manage inventory. Basically, inventory policy establish process of recording,
identifying of overall raw materials used in producing of products. The policy set out framework
and procedure that how managing is to be done. So, policy importance is as follows :
Inventory policy is an integral part of inventory management. It helps manage stock flow in a
better manner. Inventory control systems take an accurate measure of the current assets,
inventory in reserve, and provide a better idea about the financial condition (Hu, Sun and Ruan
2020).
It also helps to maintain a proper balance of different types of inventory in storage. Insufficient
stock can cause a manufacturing halt. Further issues can create a negative impact on the
customers. A proper inventory policy will ensure a business has enough raw materials to
smoothly run the manufacturing and supply of finished products.
It plays essential role in avoiding over accumulation. Various inventory management techniques
ensure products do not sit idle in warehouses. Also, certain businesses may integrate disposal
methodology to replace overstocked products by means of disassembly and refurbishments.
The lack of inventory policy can cause a complete shutdown of a business. To avoid that,
companies often implement strategies that integrate the raw material supplier, manufacturing
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departments, and logistical structure or transportation companies to minimise accumulation or
waste of finished goods (Lopota, Tsyrkov and Tsyrkov 2017).
Hence, with help of that inventory wastage is reduced and raw material is efficiently
utilized. Thus, there is no overhead cost incurred in overall production process. Besides, it enable
in effective managing of inventory in producing goods. For example- if inventory is not used
then it puts burden on company as it becomes waste in long time. Therefore, it led to incur more
cost in managing left stock, etc. Thus, with help of policy inventory is purchase as per
production requirement. This is done to ensure that minimal or no waste is incurred through it.
There are various inventory control methods used as well by company to manage it. These
methods are included in policy by which inventory management is done (Sumets 2018).
CONCLUSION
From essay it can be summarised that operations management plans, organize and control
overall activities within organisation. Scheduling means to schedule overall operations from
procurement till delivery of goods in market. H&M has used continuous flow production method
in which they manufacture what customer want. This is related to quantity, price, design, etc. In
the production plan there are 3 main production flows that is design, manufacture and packaging.
So, when there is rise in demand it automatically led to increase in production line process.
Inventory policy establish process of recording, identifying of overall raw materials used in
producing of products. It helps to maintain a proper balance of different types of inventory in
storage, avoiding over accumulation, etc. There are different types of operation techniques in it
such as six sigma, lean, JIT, etc.
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REFERENCES
Books and journals
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International Energy Conference (ENERGYCON) (pp. 1-6). IEEE.
Hu, X., Sun, L. and Ruan, J., 2020. Review of operational management in intelligent agriculture
based on the Internet of Things. Frontiers of Engineering Management, pp.1-14.
Lopota, A.V., Tsyrkov, A.V. and Tsyrkov, G.A., 2017, September. Methods and tools of
project-operational management of a machine-building enterprise. In 2017 International
Conference" Quality Management, Transport and Information Security, Information
Technologies"(IT&QM&IS) (pp. 544-547). IEEE.
Meena, N.K., Yang, J. and Zacharis, E., 2019. Optimal planning and operational management of
open-market community microgrids. Energy Procedia, 159, pp.533-538.
Pereira, A., Pinho, J.L. and Costa, C., 2019. Improving operational management of wastewater
systems. A case study. Water Science and Technology, 80(1), pp.173-183.
Ruparathna, R., Hewage, K. and Sadiq, R., 2017. Developing a level of service (LOS) index for
operational management of public buildings. Sustainable cities and society, 34, pp.159-
173.
Seita, A., Waheeb, A.U.. and Syarilla Iryani, A.S., 2020. The efficiency and effectiveness of
leadership in operational management level in organization.
Sumets, A., 2018. Key aspects of the modern paradigm of operational
management. Agricultural and Resource Economics: International Scientific E-
Journal, 4(3), pp.129-147.
Tikhonov, G.V., 2019. Operational Production Management Model of Competitive Products in
Mechanical Engineering. TEM Journal, 8(4), pp.1137-1142.
Vetrova, E., Lapochkina, L. and Doroshenko, S., 2019, October. Modeling of operational
communications and decision making process: Results of a study of automation of
operational management. In Proceedings of the XI International Scientific Conference
Communicative Strategies of the Information Society (pp. 1-6).
Yamin, M. and Alharthi, S., 2020. Measuring impact of healthcare information systems in
administration and operational management. International Journal of Information
Technology, 12(3), pp.767-774.
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