Operations Management at JCB Excavators Limited: A Critical Analysis

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Review and Critique of Operations
Management
JCB EXCAVATORS LIMITED
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CONTENTS
LIST OF FIGURES.......................................................................................................................3
INTRODUCTION........................................................................................................................4
LO 1.......................................................................................................................................... 5
INTRODUCTION TO THE ORGANISATION.............................................................................5
OPERATION vs OPERATION MANAGEMENT.........................................................................5
IMPLEMENTATION OF THE OPERATIONS MANAGEMENT PRINCIPLES WITH JCB Ltd..........7
LO 2.......................................................................................................................................... 8
CONTINUOUS IMPROVEMENT.............................................................................................8
CONTINUOUS IMPROVEMENT PLAN....................................................................................8
LO 3........................................................................................................................................ 11
PROJECT LIFE CYCLE (PLC)...................................................................................................11
LO 4........................................................................................................................................ 15
EFFECTIVENESS OF PLC.......................................................................................................15
CONCLUSION.......................................................................................................................... 17
REFERENCES........................................................................................................................... 18
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LIST OF FIGURES
Figure 1: Kaizen Approach of JCB...........................................................................................10
Figure 2: PLC stages................................................................................................................12
Figure 3: WBS......................................................................................................................... 14
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INTRODUCTION
This project is concerned about the processes of operation and management and its scope
in the industry. In this assignment, operations used in the very popular British manufacturer
company, JCB will discuss. Its full name is J.C. Bamford Excavators Limited. In this
assignment, discussion of various theories and concepts related to improvement in the
productivity and business operations by virtue of new product introduction, management of
supply chain, and life cycle of a product takes place.
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LO 1
INTRODUCTION TO THE ORGANISATION
JCB is a British production company which was started by Joseph Cyril Bamford in 1945. It
manufactures products which are used for construction, agriculture, demolition etc. it has
statistics of producing more than 300 kinds of tractors, backhoe loader, machines and diesel
engines. It was headquartered in Rochester, United Kingdom. The current chairman of JCB
is Anthony Bamford. It has a total revenue of $1.8billion. The total number of employees
working here are over 11000.
OPERATION vs OPERATION MANAGEMENT
Operation management is basically described as the process for managing the people
(Holweg et al., 2018). The operation management process at JCB Ltd. is focused on planning
new strategies that provide stability to the company in tough market situations. Such
decisions cover many sectors of operations management like planning, identifying the need,
design, processes used for production, layout planning, post-production process,
dispatching, inventory controlling, and maintenance management and scheduling. To
resolve the above issues, JCB is involved in resolving the problems created at the time of the
production of vehicles and machines (Holweg et al., 2018).
JCB excavators Ltd. conducts various operations such as planning, directing, organizing,
scheduling and controlling the operations in the manufacturing, for converting raw material
and useful input resources into the desirable outcomes. These operations include the
design of the product, purchasing of the raw material from the supplier, organization of the
materials, manufacturing processes, after production processes, marketing, dispatching and
selling. These operations play an important role in the success and failure of the product.
Operations are the processes which are applied in any organization for completing the task
(Kiehtreiber et al., 2015). These processes have set methods to operate. For every
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manufacturing organization, production operations are common. These operations are
followed universally but their way of operating might be different. Operation management
is a concern with making theories and policies for the operations, performed by the
organization for any task. Operation management concerns for improving the quality of the
process and enhancing the performance of the entire task so that productivity and efficiency
of the organization will increase (Kiehtreiber et al., 2015).
THEORIES USED IN OPERATIONS MANAGEMENT AT JCB
Various theories are related to the management of an organization. Most scientific
management theory given by a mechanical engineer Frederick Taylor is used by the
manufacturing groups (Kiehtreiber et al., 2015). These theories are used for enhancing the
performance of the workers. According to this theory, unnecessary movements of the
workers are eliminated by assessing the steps involved in any manufacturing process.
According to Taylor, any work to the workers should be assigned according to the
capabilities and strength of the worker. This theory emphasizes "fair wages for fair work"
that means the worker will be paid according to the task (Nakamura et al., 2015). It gives the
best way for production industries. This reduces the extra efforts, cost of the product,
improving the efficiency and quality of the product. After this, it is started using worldwide
by different organizations. This theory helped JCB in increasing net revenue. Now they are
generating more revenue by reducing the total cost and number of resources (Kiehtreiber et
al., 2015).
Functions in operations management at JCB have a crucial role in producing valuable
products at a cheaper rate with better quality. Various operations are related to different
departments such as finance, marketing, sales, HR planning, R & D etc.
The operation management and finance department are interrelated to each other in terms
of arranging the capital for the purchasing of the raw materials. It also required some
immediate requirement situations (Bicheno, and Holweg, 2016).
With human resources, operations management is clubbed for the arrangement of the
employees. Better communication is required among operation management and the HR
department for identifying the requirements of the personnel.
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Operations related to advancement in technology, and demand of the customer can be
resolved by the mutual understanding of operations management and research and
department (Bicheno, and Holweg, 2016).
IMPLEMENTATION OF THE OPERATIONS MANAGEMENT PRINCIPLES WITH
JCB Ltd
Many operations management principles are involved in improving the performance of the
organization. Many of them are also used by JCB.
Use of Lean Production: - lean production system or agile manufacturing system is very
popular amongst the manufacturing industry. It saves time and cost for the organization.
JCB established a lean manufacturing system to improve its logistics. JCB introduced a global
strategy for the transportation plan and created new distribution approaches to support
growth and satisfy customer demand. According to Buckler, logistics and freight is an
important phenomenon for estimating the total cost of any material. It also reduces the
wastage and complexity of the system. It brings all the necessary resources such as man,
machinery, capital, materials etc. together. It reduces the unwanted flow of the materials
and also reduces the wastage (Bicheno, and Holweg, 2016). It is a methodology used for
reducing the unnecessary wastage of the materials without having any decrease in the
quality of the product.
Implementation of 5S: - 5s technology is a very famous technology in Japan. The main
objective of this approach is to make a workplace where everything is visible, has an
assigned place to perform a task and that should be easily accessible (Ishijima et al., 2016).
In this, 5S is related to Sort, Set in order, Shine, Standardization and sustain. The sort is
related to sorting out the items which are necessary for use. Set in order means all the
required materials are placed at a place where it is required. Shine means to clean the
workplace to work. Standardization is related to the condition and arrangement of the
workplace that it should be organized properly. Lastly, sustainability is related to improve or
maintain the current work performance of the organization (Ishijima et al., 2016). It gives a
huge increase in the assembly line of JCB. Problems related to dispatching and delays are
sorted out now.
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LO 2
CONTINUOUS IMPROVEMENT
The continuous improvement plan is mainly focused on increment in the current status of
any product or service. Improvement can be brought about by changing the general process
of production, manufacturing, management and other operations used in any business
(Farrington et al., 2016).
CONTINOUS IMPROVEMENT AT JCB LTD
JCB focuses on reducing the total cost of the product by implementing new technologies to
their production system. Lean production system helps JCB to reduce wastage and time of
material flow. It helps in order to generate higher revenue than the previous year
comparatively (Farrington et al., 2016).
JCB continuously worked to improve the quality. JCB ex-Chairman Lord Bamford said that
quality is essential in any product for achieving customer satisfaction. JCB is working on
implementing 50S technology to their organization, which will ultimately improve the
production process.
Enterprise Resource Planning i.e. ERP software helps any industry in atomizing various
processes related to finance, HR and inventory departments. It helps in maintaining records
for employees, cost acquisition and inventory stock. It also provides support for the post-
production process like scheduling, dispatching, marketing etc. (Agrahari, et.al., 2015).
Supply chain management of JCB focuses on proper scheduling and dispatching of material.
The satisfaction of the consumer is the first preference for JCB. For achieving it they
developed their SCM system which is used for starting and allocation of various operations
in the organization (Nielsen et al., 2017).
CONTINUOUS IMPROVEMENT PLAN
The continuous improvement plan is used in many industrial fields. In process or production
fields it is related to the Toyota production system's agile and lean production system and
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use of the kaizen approach. This is used for improving the efficiency of the workplace in
terms of reducing efforts, time and wastage (Farrington et al., 2016).
KAIZEN APPROACH
The kaizen approach is used by JCB for improving the regular operations of production and
services. Kaizen is defined as change for improvement, i.e. adapting continuous
improvement. According to the kaizen process, suggestions from every level and every
entity listen and if it finds useful then it is implemented to the processes (Macpherson, et.al.,
2015). In JCB kaizen process is used in the following manner.
Figure 1: Kaizen Approach of JCB
(Source: Posinasetti, 2014)
These four steps can be said as a continuous improvement cycle.
Identify: - it is related to identifying the opportunities for the organization. It can be
improved by good observation and analysis of the operations. It is the beginning of a
continuous improvement process.
Plan: - after identification of opportunities and operations better planning is a must.
Planning is done for proper utilization of the resources and the inputs (Nielsen et al., 2017).
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Execute: - after planning for the change its time to implement the changes according to the
need. Execution of any operation is concerned with better changes in the processes of the
organization.
Review: - review is related to getting feedback on various changes applied to the continuous
improvement of the organization. It is used as a result of the changes that they are worth
full or not (Posinasetti, 2014).
By use of kaizen concept and implementing 5S to the assembly line, JCB can able to get
continuous improvement. These two approaches are recommended to the organization for
improving their efficiency as 5S is already used by JCB which is a part of the kaizen concept.
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LO 3
PROJECT LIFE CYCLE (PLC)
The project life cycle is associated with the processes used during the completion of the
project. It is about the phases of a product that it possesses during its growing period (Slack
and Brandon-Jones, 2018). Every project requires a unique life cycle plan as it affects the
growth and success of any project. The project life cycle consists of four phases for
developing a new product.
Conceptualization/Initiation phase: - it is a phase of identifying the need for the product in
the market. It gives a direction for making concepts for the development of the project.
Planning phase: -planning phase is the next level of any project life cycle. In this phase the
development process of the product further takes place. Concept-based planning for the
manufacturing and production of the product takes place in this phase (Slack and Brandon-
Jones, 2018).
Execution phase: - it is the phase of applying various operations for completing the
manufacturing and developing phase of the project. Till this phase, the product is ready to
manufacture and in this phase product went out into the market according to the demands.
Figure 2: PLC stages
Source: (Slack and Brandon-Jones, 2018)
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Closure phase: - every product has a useful life of the operation. After this period
termination or retirement of the product takes place. Retirement of a product is preplanned
in terms of launching a new product.
IMPORTANCE OF PROJECT LIFE CYCLE IN DEVELOPING A NEW PROJECT
These are the certain importance of the project life cycle in any organization: -
 PLC is important as it is the approach to estimate the life of the product. It gives a
pre-market survey about the product which helps in developing the user-friendly
product (Stark, 2015).
 It is important in making a strategy before launching the product.
 PLC links the processes with the results.it enables the manager for analyzing
outcomes of each phase.
APPLICATION OF PLC
These are the applications of PLC
 It allows recognizing the resources according to the need before manufacturing of
the product (Alefari et al., 2017).
 It enables the project manager to do required modification at the time of
conceptualization phase which reduces the efforts and wastage of resources.
 It helps in making checkpoints for the products that if at any point the project is not
feasible then PLC helps in taking a decision without wasting the time.
 It gives the way of manufacturing and production for a product. It reduces risk and
uncertainty from the project (Mĺkva, 2015).
In given case PLC for the new product of Sunshine Drinks company is required. It can be
made as follows:-
1. Business case: - Sunshine Drinks Company wants to launch their new variety of
energy drinks i.e. XYZ Drink. It already possesses a range of soft drinks with tropical
fruit flavours and with summer fruits flavours. It also has paring water drink from
naturally filtered sources. the new product has the following characteristics: -
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