Concepts and issues of operation management

Essay add: 28-10-2015, 18:25   /   Views: 188

Introduction:

Operation management can be defined as - design, execution and control of a firm s operations that convert it s resources into desired goods and services, and implements its business strategy (Business dictionary, 2009). In today's world Operation management to every organization irrespective of it s size. It is concerned with the creation of products and services upon which we all depend. This in turn increases the efficiency of production, thereby giving the potential to improve revenues (Slack et al ,2004). Operations management has become a challenging task, as promoting creativity requires to respond to many changes. This results in an number of technological and environmental challenges, to which operation managers, seek solutions (Hall,1992).

In this essay, I would like to explore the concepts, issues and implications related to operationsmanagement. For a better understanding of these concepts in the real world situation, the company in consideration is Knight Frank. Knight frank is a real estate consultancy company formed in 1896. It offers highest standards of quality and integrity in global property transactional, management and advisory services. Knight Frank has a wide global network with operations in more than 43 countries and handling in excess of US$ 800 billion. It caters to the needs of corporate, individuals and investors on their commercial, residential and agricultural property requirements (Knight Frank, 2009). For a deeper insight of the services offered by Knight Frank, I have chosen the Indian market.

Knight Frank India Pvt Ltd deals in strong pedigree of services like advisory services, agency services, project management, commercial agency, facilities management, land agency, capital transactions, retail agency, hospitality and residential agency. In India the cliental includes world s leading multinational companies, investors and high net worth private individuals. It s key clients being Deutsche Bank, HSBC, Sony music, TATA group, Barclays, Maersk, BP/Castrol etc(Knight Frank,2009).

Problem identification:

India as such is an emerging market, where are opportunities are plenty and in a field in which knight frank operates very few competitors are present in large scale consulting . The scenario in India is that everything is unorganized may it be the biggest company to the smallest company, this is where Knight Frank gets an advantage being a global company, the company knows how to handle situations and opportunities because of their past experience in another emerging country and can execute a task in an organized way. One problem, which is most prevalent among real estate consultants, is the LEAD TIME. If the lead-time can be take care of or reduced then the company can benefit a lot more than what they aim to achieve. Lead-time can be defined as the time interval between initiation and completion of a process (Princeton education, 2009). For example according to a US based real estate consultancy firm lead times shortened would result in a more clear and stable schedules,which in turn would benefit the client economically and increase the profitability (SAI consulting, inc 01-09). Managing lead-time is a task, which is very tough to control as different projects require different kind of handling, so by implementing a standard procedure of Process Design the task of managing lead time can be controlled. It is up to the operation managers to implement what kind of implementations are implanted in order to achieve a desired output. For example if a corporate firm assigns a task to Knight Frank and in turn Knight Frank asks for a time of 30 days for the completion of the project. If the same project was completed within 25 days by reducing the lead-time and over a year's period the company can take into account two more clients, hence increasing the company profits and business.

Analysis:Operation management concept:

One concept which could be applied in terms of solving a problem like lead time would be Process Design. It is a flow chart wherein different processes are applied at different times in order to achieve a desired output. For every operation to be successful it should have the given inputs that is then processed in the required manner and then the desired output/product is obtained. Given below is the flowchart of Process Design:

The first step of Process designing is idea generation/concept generation, at this stage a design starts as a more general, undefined idea or concept to which the company thinks would give a possible solution to a need. At this stage all the members including operation managers, employees from marketing, sales, r&d, customers etc discuss all the possible ideas and thoughts by different means like brainstorming, group discussion etc so a relevant idea could be picked upon and forwarded to the next step of Screening(Slack et al, 2004). Once the ideas are ready they are transformed into concepts and are screened, screening gives us the criteria's for - overall shape the product would have, the way in which the product would function, the purpose of the same and the benefits it would give to the customer. Not always a concept is sent into the next stage, sometimes if the concept itself does not appeal then the concept is dropped. Screening gives an opportunity to figure out whether the product in process is feasible, acceptable and what are the vulnerabilities it may face (Slack et al, 2004). After the product is screened the next step is creating a preliminary design , the purpose of this step is to specify the components of the products and defining the process to create the product. In this step all the inputs are first collected, then, the method in which all the inputs are joined together to form a desired output. One should take care of the fact that the method in which the output is got is not to complex, because if passed through and implemented then other people who would work on this design should not face complexity. In other words standardization is done in order to not repeat the same task in the same way , and if many tests are done but the still the previous task was better , one can go back look at the standardized way and perform the task(Slack et al, 2004). After the preliminary design is ready and accepted , the next step is to evaluate and search for possible improvements before prototyping and final designing. The need for this step is to see if the product can be improved before it could be given out to the customers, it has three useful ways for improvisation. First is called Quality function deployment (QFD), the purpose of this step is to ensure that the design made fulfills the requirements of it s customers. Second is Value engineering (VE) is done in order cut costs and avoid any unwanted expenses. Explaining it in simpler terms it means any extra cost which do not contribute to the value and performance of the product are eliminated. Third step is cost to function analysis, if more costs are being used in less important function than the one in which it is required too (Slack et al, 2004). The final step in process designing is prototyping and final design, in this step the final product which is improved and ready for use is sent in for computer simulation, where the product can be viewed virtually and final changes can be made in order to deliver the best required output for the customer.

Sometimes conflict of ideas may occur wherein a standardized way may be too old or outdated and requires changes or completely a new procedure, in such circumstances operation managers must make sure the best possible solution which offers efficiency and effectiveness is put in place so that the company could benefit the maximum (Slack et al, 2004).

Concept application:

As already discussed above, reducing lead-time benefits the company and it s operations, now we shall see how the application of an operation management concept would help in reducing lead-time. Knight Frank is a global company and recently has ventured into the Indian market, so all it s dealings and outputs must be to best of their abilities in order to set a standard which they have set worldwide. When a company comes and hands over a project to Knight Frank, the company specifies a certain amount of time in which they would complete their task and the faster the task is delivered and executed the better it would be for the company, not to forget the quality and standard of their work should also be maintained. Once a task is given by the operation manager all the teams ranging from the marketing team to the r&d staff should discuss the possible ideas, which would help in accomplishing the task. Sometimes while taking a project the Knight Frank consultant should interact with the customer itself because it may lead to excellent ideas, which may be worked upon. For e.g. a person owing a certain space of land in a prime locality in Chennai (India) would have a certain plan in his mind and would appoint Knight Frank for the best possible utilization of that space.In turn what the company would do is to send people on field work and gather as much as information possible and find out the new developments in and around that area, the ability to do this task in an organized manner and faster way would reduce the lead-time. Once all these details are got then ideas are put forward for the specified land and if accepted are sent into concept screening. In this step it is the duty of the Knight Frank operation manager to take note of the ideas, which are relevant, and ones, which are not, and to filter them, so that time is not wasted on something, which is not required to work upon. In this step after the ideas have been filtered,then, how of the end design would look, how it would function when given back to the customer and finally also specify the risks attached to it. Screening process is one in which a considerable amount of time is taken, because of the filtration process in which only a few ideas are taken into consideration and rest are not. Inorder to make this process fast an experienced person who has knowledge in the field could be useful as well as a person with decision-making skills. After this is completed the Knight Frank designing team gets into action and specifies the inputs required for e.g. (the land size, which direction the land faces, location of roads leading to the land etc) and implement a design, which could be worked upon for the further development. All these processes are done keeping in mind the ideas and screening, which were conducted previously. In preliminary design,Knight Frank should employee creative people who have a sense of sketching and drawing a design that outlay the building or whatever required in that space whichin turn would make the process quicker. And once if standardization is done then the whole process can be done much faster, keeping in my mind that the standardization is not outdated and unworthy off. Next and possibly the most important step is evaluating the project and making sure improvements are made wherever required. Evaluation step involves the Knight Frank taking into consideration it s cost inputs and attaching it s profits and evaluating the project and giving the rough estimate to the customer. So basically if a standardized method should be in place for helping to finish the process faster for e.g. (if a land size x is taken for consultation the price would be y and if a land xx is taken into consideration the price would be yy). To make it simple if a similar size land comes in for consultation the price is set so that every time evaluation is not required* (* keeping in mind that this may vary from projects to projects and different values may be done even for similar land size). Final improvements are required mostly all the times, in order to have a better and efficient design for the customer. These improvements are the ones, which are clearly visible. The final step is prototyping and final product, after the evaluation is completed putting it on paper would not be sensible enough therefore a prototype design should be made by the company which can then be shown to the customer and if any changes are required from the customers endthey can be instantly modified, this is achieved with the help of various software's. This is a task when is generally performed fast and hence no reduction in time can be done, as it is automated process performed by the computer. Once the final design is ready and approved by the manager, Knight Frank should inform it s customer that the project is ready and can be collected. One should also keep in mind that once a process is completed Knight Frank should provide service to it s clients incase of any problems with the design. Only lead-time reducing would not mean instant success for the company, but it is one of the important factors in real estate consultancy. And once factor which most of the companies face time delay in. Knight Frank should serve it s main purpose along with reduction in lead-time, which is quality product and service ((Knight Frank, 2009).

Referneces :
  • Available at www.businessdictionary.com/definition/operations-management.html accessed 28th December 2009.
  • Slack, N , Chambers, S and Johnston, R ,2004 . Operations management. Prentice hall.
  • Hall , R.(1992) The strategic analysis of intangible resources , The Strategic Management Journal. Vol. 13
  • Knight Frank, 2009 available at www.knightfrank.com accessed 27th December 2009.
  • Kinght Frank, 2009 available at www.kinghtfrank.com/india/ accessed on 27th December 2009.
  • Available at www.wordnetweb.princeton.edu/perl/webwn accessed on 28th December 2009.
  • Available at http://www.saiconsulting.com/about.shtm accessed on 27th December 2009.
  • Slack, N , Chambers, S and Johnston, R ,2004 . Operations management. Prentice hall .chapter 5 pg 133-160.

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