Operational_Management

MMPBL/502: Managing the Business Enterprise Facilitator: Thomas A Graham Hollace Humphrey September 4, 2010 Operations Management Operational management primary deals with the design on management of products, processes, services, and supply chains. It considers the acquisition, development, and utilization of resources that an organization need to deliver the goods and services that their clients want. It is important to focus on the issues which are currently affecting Kudler Finest Food. Expanding to an organic line is the newest trend for every business, and keeping up can a somewhat challenging for an organization. Kudler Company is committed to its customer satisfaction and this is primarily why; they plan to start contracting with local growers of organic produce. In taking these steps operational changes will need to be addressed. This paper will focus the issues that will affect these changes and search for corrective methods. The following are the targeted issues; Identify those business processes at kudler that could be affected, to what degree will the supply chain will be affected, and describe the quality control tools and performance standards that kudler will use to ensure the effectiveness of its operation. Kudler have many businesses processes; however those that will be greatly affected are logistics and mass customization. Logistics is a technique of organizing, arranging, and the foundation of business operations of procurement, purchasing, inventory, warehousing, distribution, transportation, customer support, financial, and human resources. With this new line of produce product kudler will have to make substantial adjustment to how business is run in general. They planning reflect the influx of customers who primarily buy organic foods. A different section for these products will have to be put in place.  This line of product will include items such as oranges, bananas, pears, plums, etc. This depends on various things, namely, seasons, supply and demand, quality and quantity and most of warehousing to keep all produce fresh.  Whereas pricing, advertising, and customers’ satisfaction will be considered their high priority. However, keeping this promise because customer preference and lifestyle is a direct correlation to this plan.  Concerning purchasing, inventory and transporting of these product; kudler will need to make prior arrangement about what is done in respect to their current way of doing business.  Mass customization is focusing on specific group of people and their preferences.  According to Chase, Jacobs & Aquilano, (2006) mass customization is a method of "effectively postponing the task of differentiating a product for a specific customer until the latest possible point in the supply network” (p. 419). Catering to a specific group needs can be quiet challenging not to forget time consuming. Customers who buy organic foods are the elite few or those who are considered part of the population that is somewhat health conscious In this case; kudler is dealing with the pressure of consumers who are in need of organic product. The high demand for organic foods as a whole has driven this company to adjust. Kulder will have to deal with all customers order and by contracting this type of product, kudler is basically becoming part of today's trend and this will strengthen their competitive advantage.  Acquiring these products also means that they are plan reflects the company's mission statement that is customers’ satisfaction.  The components of kudler’s supply chain that consists of purchasing, advertising, and inventory managements need to be addressed; as well as all produce products. Mentzer, (2001) defined supply chain as, is the systematic , strategic coordination of the traditional business functions and the tactics across these business functions within a particular company and across businesses within the supply chain, for the purposes of improving the long term performance of the individual companies and the supply chain. Concerning purchasing the new produce that ranges from apples to melons; to issues such as season, pricing, and transport should be considered. For example; in the summer months fruits like watermelon, peaches, and avocado are plentiful in contrast to the other months when apples are in abundance. The produce department will have to make several changes. First, pricing will have to be adjusted to the going market rate, in comparison to the regular products. Second, the organic produce will have to be display in separate compartment with the appropriate labeling. This way customer can have access to the product with ease. Third, the quality and quantity of the produce products available will be base on the demand for particular items. The different seasons, and some customers can influence the readiness and availability of these products. Fourth, transporting produce items will follow the normal procedures. However, inventory will receive the order from the purchasing department and it is their obligation to check for the correct quantity and attempt to reduce the amount of damage product that remains at kindler. The most suitable quality control tools that will work for kudler are competitive benchmarking and generic benchmarking. Both generic and competitive benchmarking methods function as a tool for companies to search for unique practices. Both approaches provide an opportunity to possibly enhance the growth and take a company to a higher level of success. These are available resources that can provide companies direction on benchmarking. Benchmarking is a formalized way of learning from other people. According to Gomez-Mejia (2001), “Decision makers need to establish reasonable goals and benchmarks to make sound judgments about the effectiveness of the decision. It is also important to allow enough time for a decision to take effect” (p. 213). The main goal of benchmarking is to identify best practices in processes to help understand and evaluate current positions with the intention of seeking methods of improving performance. When used correctly, benchmarking is an ongoing process that seeks to keep abreast of changes in improvement processes. Generic benchmarking is the process of looking beyond the industry for the best practice. .Generic benchmarking could also be used in an area such as finding best practices for change management or transformational leadership. The performance standards that will be used and check Kudler’s operations are strategic planning and product development. Both of these standards will be used to monitor the effectiveness of the proposed plan. In addition it will serve as a guide, which may give kudler a competitive edge over other companies. Strategic planning is about taking a meticulous, honest, and thorough look at both; When an organization – have the resources, capabilities, competitive advantage, areas of opportunity, shortcomings, etc. The environment in which this gets competed is the customers, suppliers, competitors, market trends, government regulations, foreseeable opportunities and threats, etc. By creating products with new or different characteristics that offers additional benefits to the customer. It may involve modification of an existing product or its presentation, or formulation of an entirely new product that satisfies a newly defined customer want or market niche. In conclusion, Kulder Fine Foods mission is its commitment customers’ satisfaction. In choosing to embark on a plan to expand to organic produce may prove to be the boldest move by this company. This is based on the wide vary of product they already have available. This can be a high challenge but with the right Planning, organizing and utilization of resources their plans have a potential for instant success. However with the corrective measures in place the plan will work not only with the regular routine but as part of normal business function. Organic foods are important to a particular group of conscientious customers. This group ranges from the healthiest to the wealthiest. By focusing on this group may generate the kind of revenue that Kudler is looking for or probably needs. Also, with all the corrective measure put in place it will be hard to ignore customers’ buying power. This is an investment that will pay off and any unforeseen risk will be minimal. Kudler adjustments and implementation will work with diligence and perfect approach. Reference Chase, Richard B.; Jacobs, F. Robert; Aquilano, Nicholas J. (2006). Operations Management for Competitive Advantage (11th Ed.). New York: McGraw-Hill/Irwin. Gomez-Mejia. (2002). Management. New York: McGraw-Hill Mentzer, J.T. ET. al. (2001): Defining Supply Chain Management, in: Journal of Business Logistics, Vol. 22, No. 2, 2001, pp. 1–25 . Rod Napier, Patrick Sanaghan, and Clint Sidle. (1997). High Impact Tools and Activities for Strategic Planning. New York: McGraw-Hill. http://www.businessdictionary.com/definition/product-development.html#ixzz11oq1aEoW http://www.skills2lead.com