Designing, Managing, and Improving Operations: Patties Foods Report

This report presents an in-depth analysis of Patties Foods' operations, focusing on the design, management, and improvement of its manufacturing processes. The report proposes a new product, 'ACTPIE,' a pie shaped like action figures, and utilizes De Bono's Six Thinking Hats method to design the product, considering factors like market appeal, production costs, and potential challenges. It then delves into the design of the production unit, including a value stream map and floor plan. Furthermore, the report addresses operational management aspects such as supply chain and inventory control. Finally, it offers recommendations for enhancing operations, including waste reduction, improved maintenance, and staff training, aiming to optimize the production unit's efficiency and effectiveness.

UTS: ENGINEERING
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SUBJECT NAME: Operations Engineering
SUBJECT NUMBER: 49989
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Operations Engineering
Assignment
Designing, Managing and Improving the Operations of a Manufacturing
Company
Faculty of Engineering and Information Technology
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Executive Summary
This report is based on Patties Foods and it focusses on
designing a new product for the company called ‘ACTPIE’ which is a
concept of producing pies in the shape of action figures. The report
carries out critical analysis and takes care of various factors of
production like a detailed design of the product using the De Bono’s
Six Thinking Hats process. It also gives a detailed design of the
operations of the production unit including the value map stream and
a detailed floor plan of the unit.
Then the report discusses about the management of various
operations like supply chain management, inventory and stock
control. After which it discusses the improvements that should be
brought in the operation of the production unit. Finally it makes
critical suggestions like avoiding wastage of resources, improving
maintenance activities and providing adequate training to the staff for
improving the operations of the production unit.
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Table of Contents
Contents Page No.
Executive Summary 2
Introduction 4
Process of Designing a New Product 5
Designing the Operations 11
Managing the Operations 16
Improving the Operations 18
Conclusion 22
References 22
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Introduction
Patties Foods, is an Australian food manufacturing company that produces baked
goods, ready-made desserts, frozen fruits, pastries and meat pies. Patties Foods war founded
in 1966 by the Rijis family, who were originally immigrants from the Netherlands. Their
headquarters is at Bairnsdale in Victoria, Australia. They are the largest meat pie producers in
the world and are publicly listed on the Australian Stock Exchange. Their production includes
Herbert Adams Pie, Snowy River pie, patties and Four’N Twenty pies. Patties Foods have
several subsidiaries namely Four’N Twenty, Chefs Pride, Herbert Adams, Creative Gourmet,
Patties, Nanna’s and Snowy River brands.
The business was originally started as a cake shop in Lakes Entrance, Victoria, in
August 1956 as Patties Bakeries. It was they bought by Peter and Annie Rijis in 1966, the
demand for their products started increasing after the introduction of bread rolls and pies.
Due to the increase in production they started expanding and the production of the food items
were moved to Bairnsdale in 1985 as the main production unit of the plant till date.
As their business expanded, they started distributing their products in Melbourne in
1986 and by 1995 they started exporting to New Zealand. They then started launching new
products like Arriba, a Mexican flavoured food range and sold their bread business so that
they could focus on their Pastries business as it was growing in demand. They then renovated
their factory in Bairnsdale so as to include the production of finger foods, sausage rolls and
pasties with an increased capacity. By 2003 they started acquiring iconic brands like Four’n
Twenty, Nanna’s and Herbert Adams and added gluten free food items to their product
roaster.
Steven Chaur is the chief executive officer of Patties Foods, as of this day Patties
Foods consists of 570 people producing over 300 different food items every year. Their
products are sold all over Australia in major hotels, restaurants, clubs, cafes, groceries and
convenience stores. They sell their products to various caterers, schools and stadiums through
their distribution network. They even sell their products in overseas markets like America and
England.
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Most of Patties foods subsidiaries have their own factories and outlets and some of
their main outlets are mentioned here. Four’n Twenty have their main outlet in Bendigo,
Melbourne Showgrounds and an even larger bakery at Ascot Vale from where deliveries are
made across entire Australia. The Herbert Adams bakeries started out in Prahran and
Brunswick but it now has around 60 stores in various cities of Australia with main bakeries at
Canberra, Ballarat, Melbourne, Bendigo and Greelong. They sell their products at over 450
stores spread over Australia. Whereas Nanna’s, another subsidiary of Patties started out at
Pitt Street in Sydney in the early 1950’s moved its business to Cremorne and then to Gosford.
Now Nanna’s crumbles and fruit pies are made in the Bairnsdale factory of Patties with its
same original recipe.
Figure 1. Steps followed in the food production units
This report starts with the application of De Bono’s six hats technique to design of a
new product, then it discusses the operation of the production plant which include the floor
plan and the Kanban plots, then it discusses about the management of operations after which
it suggests the improvements in the operations so as to optimize the production process.
Process of Designing a New Product
 New product Design using De Bono’s Six Thinking Hats
Storing and Despatching different products
Assembling and Depositing the packed products
Packing and Labelling the cooked product
Cooking the mixed raw materials
Mixing differnt ingredients
Weighing, Sorting and Grading
Raw Material Storage
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The six thinking hats model was developed by Edward de Bono for improving parallel
thinking by cohesively planning the thinking process so as to effectively think together.
The model was designed based on a colour scheme which comprised of six different
colour with each colour for thinking in a different direction. The colours and the way in
which each colour is helps a person to think is as described here. White hat focusses in
the collection of available information, yellow hat is for identifying the benefits that could
be achieved, green hat is for creativity and involves innovation in the product, black hat is
for discrepancies in the product so that a more realistic product is developed, blue hat is
for managing the goals and thought process and finally the red hat signifies emotions or
the instinct that the new product would work (De Bono, 1985). ‘ACTPIE’ is the new
product that is to be brought into the market by Patties Foods. ‘ACTPIE’ is the regular pie
having the same recipe that made Patties Foods so famous but in the shape of action
figures and thus the name ‘ACTPIE’. The design as per six thinking hats is as follows.
White Hat:
 Patties Pies are famous all over Australia as it has been the flagship product of
Patties Foods for decades.
 ACTPIE should be marketed properly through advertisements.
 Since it doesn’t involve new recipe there will be minimum additional cost
attached to the product.
 Find the appropriate dies for moulding the pies in the shape of figurines.
Yellow Hat
 Packaging Patties Pies in the shape of action figures gives it a refreshed look.
 Since it is a new concept initial competition will be less.
 Since it is in shape of action figures it would attract a lot of kids to buy more.
 No requirement of creating a new recipe instead the recipe instead tried and
tested recipes could be used.
Green Hat
 Special editions of some figurines could be sold on special occasions like
Christmas and Easter.
 Patties Foods could be promoted by making Pies in the shape of its logo.
 Could collaborate with comic book companies like DC comics and Marvel so
as to promote their products and movies.
 Could be used to supply required nutrition to kids.
Black Hat
 The concept could be easily adopted by other competitors.
 Patties Pie is an established product and it might take customers longer to
accept ACTPIE.
 No new recipe is involved.
 More care should be taken during packing and transporting stages as the
figurines would get damaged easily.
Red Hat
 By adding more nutrition content to the products, the product would become
healthier.
 Since it is a new concept there is a feeling of insecurity amongst the team.
 ACTPIE would be a hit amongst children.
 Older customers might not find it appealing enough.
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 The Design Review Checklist
A design review checklist as shown below was developed to investigate the progress of
‘ACTPIE’ project.
Function Question Response
Yes/No Comments
Production
Is new equipment required
for ACTPIE production? Yes Die for moulding the pie into
figurines are required.
Is there a requirement for
replacing the other
equipment?
No Other equipment is in good
condition
Are the recipes for producing
ACTPIE ready? No Testing is still under way
Is it necessary to change the
floor plan for the new
product?
Yes The dies have to be made a part
of the production process
Is the new floor plan ready? Yes The new floor plan is ready but
the dies have not arrived yet
Storage
Is there a requirement for
more storage room? Yes
The quantity of ingredients
would increase for which more
space is required
Is a new storage unit
available? No The new storage unit is still not
delivered.
Is the new storage unit going
to be available at the
manufacturing plant?
Yes The new storage unit has been
integrated in the floor plan
Could the storage units be
used to store the already
available ingredients?
Yes
No new ingredients are
required. There is only an
increase in the quantity of
ingredients.
Supplier Is there a requirement for
new ingredients?
No No new ingredients are
required.
Blue Hat
 All the recipes and most of the equipment for manufacturing ACTPIE is
already available.
 Research has to be done on which figurines could the pies be moulded into.
 Which of the Patties Pies recipe would the customers like to have as ‘ACTPIE’
should be found out using customer surveys.
 Permission from the action figurine patent holders should be obtained if
patents are present or else avoid using such figurines so as to cut costs.
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Is the selection of suppliers
completed? Yes
Our existing suppliers could
deliver all the required
ingredients
Do the suppliers supply good
quality ingredients? Yes
Regular audits are organised by
our company to ascertain the
quality of ingredients supplied.
Could the existing suppliers
deliver the right quantity at
the right time?
Yes
Our suppliers have always been
punctual and they always
deliver the correct amount.
If the suppliers fail to deliver
is there an alternative
supplier?
Yes
Alternative suppliers are
available, but we have to get
into an agreement with them at
the earliest?
Human
Resource
Has the number of staff
requirement increased? Yes Personnel who are good at
moulding are required.
Is the requirement done? No The recruitment process is
under way.
Distribution
Is there a requirement for a
new distribution network? No
Our existing distribution
network would be able to
handle it.
Should we reduce the
delivery times to the retail
stores?
No
The same delivery time that is
applicable to our existing
product range could be applied
for the new product.
Sales and
Marketing Is a new marketing strategy
required? Yes
A fresh marketing strategy is
required to promote the new
product.
Is the new marketing strategy
ready? No
Work is under way for
developing a new marketing
strategy.
Is there a requirement for
new packaging for ACTPIE?
Yes Since it is a new product of
different shape it requires new
packaging strategy.
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Has the new packaging
strategy already been
developed?
No
Research is been carried out to
determine the best way to pack
the new product.
Finance
Is the new product going to
earn any profit? Yes
As per the financial analysis
ACTPIE is going to make
profit.
Will the production cost for
ACTPIE be higher than that
for our existing products?
Yes
There will be initial investment
for the dies and labour but after
that there will only be profits.
Has an estimation of the
financial risk been carried
out?
Yes An assessment of financial
risks has been carried out.
If ACTPIE fails, would it
affect the cash flow to
maintain regular operations?
No
Financial assessments indicate
that we would still be able to
carry out regular operations.
 Summary of the Design Review Outcome
As far as production is concerned, no new equipment is required for
manufacturing ACTPIE. The orders for the dies have been made and the
floor plans have been adjusted to incorporate the new products
manufacturing process. As per storage, new storage unit is required and it
could be used to store even the existing ingredients. No new ingredients are
required for manufacturing ACTPIE and all the ingredients could be
supplied by our existing suppliers.
Recruitment for new staff is under process and would be completed as per
schedule. The existing distribution network is capable of supplying the new
product effectively. A new marketing strategy has to be adopted for
promoting ACTPIE and it is being developed. A new packaging strategy is
also under development and will be ready in time. Financially the new
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product is viable and the financial estimates indicate that the new product
would generate profits rather than losses.
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DELIVERY
VALUE ADDED TIME: 660 min
NON-VALUE ADDED TIME: 995 min
TOTAL PRODUCTION TIME: 1655 min
VALUE ADDED TIME AS % OF TOTAL PRODUCTION TIME: 39.88%
Dispatching
final Product
PackagingInspectionPlace the
rolled
Dough in the
Die and
Cook
Preparing the
Dies
Cleaning the
Dies
Roll the
Dough into
Shape
Fold to form
a Dough
Mixing all the
Ingredients
Raw Material
Storage
Refrigerate the
Dough
Weighting the
Ingredients
Preparing the
Ingredients
Production Scheduling and Planning
PATTIES FOODS
PACKAGING
COMPANY
DELIVERY
DELIVERY
FORECAST OF ORDER
RETAIL
STORES
&FORECAST OF ORDER
SUPPLIER
ORDER FOR ACTPIE
ORDER FOR INGREDIENTS
480 min
20
min
15
min
15
min
15
min
30
min
20
min
20
min
20
min360 min
40 min40 min120 min40 min80 min180 min80 min40 min40 min
Designing the Operations
Figure 2. Value Stream Map
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