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Operation management is the process which is highly concerned with the designing and controlling the process of production (Tweedale and Howlett, 2015). Along with this, such area of management also places high level of emphasis on redesigning the business operations with the aim to get the desired level of outcome or success. It also makes focus on converting material and labour into goods more effectively and efficiently to achieve the objective of profit maximization. The present report is based on IKEA which design and sells furniture and other home accessories. In this regard, report will describe the role of operation management and the factors that helps in designing the good process. Further, it will develop understanding about the extent to which effective supply and material chain management is essential for the growth of firm.
High level of interrelationship exist between operational management and other functions of an organization. In all kind of organizations such as public, private (IKEA) and voluntary operational management is highly co-ordinated with the other aspects. Besides this, operational management professionals also provide other decision making authorities with the valuable input for decision making (Christopher, 2016).
For instance: Operational manager of all the organizations provides information to the high management about the availability of high-tech equipments and skilled workforce. Hence, by taking into consideration such aspect higher management become able to frame suitable strategy for the long term growth and success. Along with this, such input also enables finance manager to prepare suitable budgeting framework regarding the equipments. In this way, operational management is highly linked with the other departments of the firm to the large extent.
In the business organization, operational manager is assigned with the role and responsibility to ensure proper management both material and human resources. Hence, in IKEA, operation manager plays a vital role in ensuring smooth functioning of the business operations and activities by framing competent strategic framework (Christopher, Magrill and Wills, 2013). Moreover, operation management of manufacturing company includes designing of efficient process of production, acquisition of raw material, contaminate of equipments and ensuring that trained workers are available with the firm. On the basis of this aspect, by undertaking all the aspects of operation management IKEA can make contribution in the attainment of organizational goals and objectives. Moreover, company can design furnitures more effectively only when they have highly skilled and competent workforce (Dekker, Bloemhof and Mallidis, 2012.). Further, to increase the production company must have latest and effective equipments. Along with this, operational manager also ensures that there is enough material is available within the firm for production purpose. In this way, operation management helps company in getting the desired level of outcome or success.
Product, process, fixed position, combination and cellular are the main layouts which business unit can use for the effective operation management (Waters and Rinsler, 2014). IKEA operates in the furniture sector and follows product layout to offer standardized products or services to the customers. In such layout, all the parts of the furnitures are manufactured separately. Thereafter, business unit assessable all such parts to get the finished product (LAYOUT, 2016). Besides this, IKEA can also consider process layout as an alternative option for manufacturing the furnitures more effectively (Gilmour, 2013). Moreover, process layout ensures flexibility and reduces the transportation cost to the large extent. Hence, by using such layouts company can attain success to the significant level.
There are several factors which IKEA needs to consider while designing the process are:
Ease of future expansion and change: IKEA should design process in such a manner which facilitate changes with the ease. Moreover, in the present era, to meet the expectation and demand of the customers business unit has to make changes (Ellram and Weber, 2013). In this regard, by developing flexible process design IKEA can make changes on it more quickly.
Flow of movement: Business unit needs to undertake U shaped and parallel flow for converting raw material into finished product. Moreover, effective conversion of raw material into product is highly required for meeting the customers demand on time (Dyckhoff, Lackes and Reese, 2013).Hence, by following all such aspects IKEA can design good process and thereby fulfil their aims and objectives.
In the manufacturing sector, effectual material management is highly required for performing the business functions more efficiently (Jaber, 2016). Moreover, in the absence of enough raw material such as wood IKEA would not able to design and sells furniture within the suitable time frame. In this way, lack of enough raw material may result into loss of productivity and profitability to the great extent. Hence, operational manager of IKEA is required to ensure that enough inventory is available within the firm for production purpose.
Thus, by making use of inventory control techniques such as economic order quantity etc. manager of the firm can facilitate proper material management. This in turn enables business unit to maximize the profitability by making effectual utilization of the resources (Seuring, 2013). Along with this, effective supply chain management is also needed for organizational growth. Moreover, personnel involved in supply chain plays a vital role in making delivery of furniture to suppliers. In this way, by offering the designer furnitures on time IKEA can develop high level of satisfaction and loyalty among the customers.
Quality management is highly essential for making improvements in the operational aspects on a continuous basis (Stadtler, 2015). In this regard, manager of IKEA can build and maintain high level of quality by using benchmarking as well as total quality management (TQM) technique. Moreover, benchmarking technique offers opportunity to operational manager to find out the deviations take place in performance aspects. For instance: By comparing the actual production of human resources with the standard aspect manager of IKEA can find out the deviations. It enables manager to take strategic action for improvement within the suitable time frame and thereby enhance the quality aspect (Dekker, Bloemhof and Mallidis, 2012). Along with this, IKEA also makes use of TQM technique with the aim to offering the high quality furnitures to the customers. For this purpose, IKEA makes evaluation of the quality aspect at each stage of manufacturing. This in turn provides opportunity to remove the deviations at early stage of production and thereby maintain high quality.
Performance measurement system is highly required within the firm to exert control on undesirable activities that take place at operational level (Fernie and Sparks, 2014). In this context, IKEA can measure its operational performance by taking into consideration the five factors namely money, output, customer emphasis, innovation and human resources. All these are the main elements which exhibits the effectiveness of operation performance (Performance mesurement, 2016.). Hence, IKEA monitors its monetary performance by comparing the actual profit with standard amount. For instance: By giving target to the human resources IKEA measures the performance level of employees. In this, by assessing the deviations and their causes business enterprise organizes training event for the personnel (Waters and Rinsler, 2014). This aspect clearly shows that performance measurement system enables firm to enhance employee productivity by undertaking corrective managers within the suitable time frame.
In the present time, customers prefer to purchase the furnitures and home appliances from the retailer who maintains high level of quality of the products or services (Christopher, 2016.). Usually, at operational level personnel face difficulty in maintaining the standard quality aspect. In this regarding by adopting both TQM and Kaizen process operational level professionals of IKEA can raise and maintain the quality of furnitures to the large level. Moreover, under TQM business unit places high level of emphasis on making close monitoring of the every stage of production. This in turn helps company in removing the deficiencies within the suitable time period. Along with this, Kaizen is also one of the most effectual techniques which can be undertaken by IKEA for the continuous improvement (Tweedale and Howlett, 2015). Moreover, in this, business unit involves their employees and encourage them to assess the deviations take place in the manufacturing aspects. In this way, by taking strategic competent action of time IKEA can enhance and maintain the quality aspect to the significant level.
There are several decision making tools which can be applied by IKEA to overcome the problem which is facing by the manager. Hence, to overcome to issues like material inadequacy inventory control techniques such as just in time, economic order quantity etc. can be used by IKEA to resolve it (Dekker, Bloemhof and Mallidis, 2012). Further, by making use of simulation technique and drawing decision tree business unit can make suitable decision in an appropriate manner. For instance: by undertaking simulation technique IKEA can assess the difficulties or issues which they will face in the near future while manufacturing the furniture according to the unique designs. Thus, such technique provides information to the personnel at operational about the arrangements which they need to make for overcome the issues. Hence, by applying such tools and techniques business enterprise can make suitable decision.
Operational concept and techniques include TQM, Kaizen process, benchmarking etc. which helps in reducing the operational problems to the large extent. For instance: IKEA is facing problem in relation to making optimum utilization of the material (Stadtler, 2015). Due to the high wastage of material business unit is suffering from the issue of high cost. Hence, manager of IKEA can address such problem by taking into account the benchmarking technique. In accordance with such aspect, by preparing the suitable budgeting framework and making comparison of the actual performance in against to it operational level manager can assess the deviations take place in performance level (McKinnon and Piecyk, 2015). Further, if low level of motivation and lack of competencies among the personnel are the main causes then business unit can take corrective action for making improvement on it. Hence, in this by giving training to the personnel business unit can motivate them to make their best efforts while performing the business activities and functions. Along with this, by conducting training session IKEA would also become able to raise the competency level of personnel to the large extent. Hence, by adopting such measure business unit can reduce the level of material wastage and thereby become able to manage the cost more effectively.
Researcher can access the journal articles through the means of on-line by writing the keywords on Google (Stadtler, 2015). Further, researcher can also search the article with the title name. For instance: Researcher requires article on operation management for getting deeper insight about the varied aspects such as inventory, quality, material and supply chain management. In this regard, by writing the topic such as operation management in manufacturing sector and other keywords such as inventory, quality management etc. researcher can access the suitable journal of the latest years. This in turn helps scholar or learning in getting deeper insight about topic which is searched them.
From the above report, it has been concluded that operational and other functions of an organization are highly related with each other. Further, it can be revealed from the report that operational level manager play a crucial role in ensuring the effective functioning. Besides this, it can be inferred that manager of IKEA needs to undertake variety of factors for making good process design. It also has been articulated that by making effectual arrangement of material and supply chain IKEA can build and sustain competition position at marketplace. It can be seen in the report that performance management system is highly significant which helps company in enhancing both productivity and profitability.
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