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Sustainable development is vital in a business environment. Reflectively, this concept defines the feasibility of a company and its solvency within a specified period of time. In the contemporary society, the term sustainability refers to the ability to survive within a profitablemodel.
In business environment, sustainability is affected by forces in the market, decision science, corporate structure, and real financial management, in short and long term.
Therefore, a business organization must put in place stringent measures and strategies aimed and monitoring expansionary modules within feasible levels. This paper reviews the current issues in operations management of the Luen Thai Company and develops an operations performance measurement system.
Overview of Luen Thai Company
Culture in a corporate organization is the key upon which management uses to make such an organization succeed. However, sometimes, it becomes harder to translate the theoretical perspectives into practical elements that help to strengthen the firm’s operations. The issues also extend to complexity when the entire working environment is taken into considerations.
As businesses are opting to merge up, the key factor of emphasis is how communication culture is to be maintained by such organizations. The main challenge facing the global Luen Thai business is the adoption of proper communication and operations management models that can be more flexible to change operation of this organization.
As a matter of fact, quality operations management model is the backbone of a promising company since it determines survival and productivity in terms of flow of operations and streamlining overhead costs. For instance, the coordination between the production and marketing team is wanting.
Nature of operations systems
Reflectively, relaying information on the success of a production is dependent on labour and operating costs, which are often balanced for value maintenance. In the process of balancing the act, a quality operations management system should be capable of applying the scientific skills in an artistic manner through informed and perfectly framed use of soft skills to address technical aspects of production management.
In every business field, the question of factors facilitating success is often posed. In order to present a comprehensive answer to this question, it is of essence to measure success as a component of the existing operation system (Lin, 2010). Generally, a quality operations management system is that which satisfies requirements within the budget and time schedule without disintegrating initial goal projections.
Thus, changes in the weights of labour cost and operating cost have substantially altered the final weighted average rating for the four locations.
Basically, a quality operations management system performs optimally via integration of appropriate scientific factors of production. To enrich artistic managerial talents, a balance in the factors of production comes in handy to not only magnifies the margins of success but also to ensure a smooth transition of an idea or an event after another, as is the case at Luen Thai.
Besides, to avoid an imminent failure, it is vital for the operations management system to focus on a defined edge in balancing the labour and operation costs.
Therefore, the company has put in place stringent measures and strategies aimed and monitoring expansionary modules within feasible levels. This includes techniques that are in use in the company to monitor sustainability by application of scientific management of balanced factors of production matrix (Lin, 2010).
Generally, production mix strategies proposed by the company are to ensure long term operation. For implementation of the strategy, the management is to balance both the short term and long term consideration towards decision making. Management that ensures long term obligations is fulfilled.
They consider the role played by planning for resources in technology, continued innovations in the production of new products, and conducting researchers to ensure that the production process is efficient through maximization of output within the least possible costs (Bowman, 2003).
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Operations Performance Measurement System
Production efficiency is critical in the production line since it is characterized by optimal utilization of allocated factors of production within the least possible cost. From the above refection, it is apparent that the company will gain in the long run through the FMS proposal. Despite lower returns on investment below the projection, the overall effect of adopting this proposal will have benefits that will outweigh its limitations.
For instance, when the FMS is fully adopted as proposed, the reduction in cost of factors of production, such as labour and reduced actual production costs will result in accumulated gains as a result of controlled costs that are recurring (Lewis, 1999).
When the recurring costs such as labour, production space, and cost of machinery are curtailed within a manageable level, the company will increase its returns on investments. Besides, the excess labour may be channeled to another line of production besides the extra production space.
Even though the return on investment is lower than projected, the project is viable since it will permanently reduce the recurring cost by a margin of more than 10% of the company’s current production cost. Moreover, the aspect of efficiency as a result of FMS will push the production frontier curve towards sustainability in the long run.
Basically, the immediate adaptation of the proposed FMS will contribute towards sustainability in the aspect of cost, dependability, speed, quality, and flexibility (Slack, 2012).
Specifically, the reduced production floor space will give room for expansion and production without having to expand the infrastructure of the company. More space means more products being produced within the same production bundles. Due to increased output, the market will eventually expand and the company will get more revenues.
Through improved orders throughput, the company is set to immediately and substantially gain from the reliability aspect as compared to its competitors. Since clients will be able to receive their orders within a shorter time, the company stands to gain from customer satisfaction and referrals.
Since the duration of delivery will decrease by almost a third of its present rate, the company is geared to reap maximum benefits from economies of scale due to increased capacity to produce and distribute within a short period of time (Deflorin, 2010).
At the China location, the quality system is certain. Thus, when the system is quality-oriented, the entire chain coordinating these segments would result in optimal operations. Although operations management systems experience constant metamorphosis as a result of short term, midterm, and long term goal planning, no company can operate efficiently without quality system functioning.
Thus, quality will quantify optimal functional within a competitive advantage parameter for the company. Besides, high standard operations management score acts as the engine that supports implementers of business strategy in order to comprehensively verify rationale for supporting current, predicted, and actual results for every step upon introduction of a functional system (Lewis, 1999).
Therefore, the probability of success is far much better than that of failure when the system is properly designed as indicated by the high scorecard at the China location. Moreover, balancing act between having to perform optimally at minimal operation and overhead costs is a component of quality in system modelling.
Thus, the success of an operations management system is dependent on soft artful skills, which are part and parcel of efficient system management. The company should adopt the six-sigma approach in quality control and assurance in the maintenance department. Six-Sigma is an experience of operations management that is used to develop business operations that ensure efficiency through optimal and timely production.
Six-Sigma is adopted to attain significant effects of production efficiency through periodic review of the production matrix. Actually, Six-Sigma is a sequence of business events that delivers positive outputs that develop business aim of reliability in the production chain.
Six-Sigma ensures that production processes that are necessary are improved “through proactive management of the factors of production such as labour, time, and optimal production capacity” (Slack, 2012, p. 39).
In fact, Six-Sigma is aimed to reduce wastage of production resources that can be experienced in long queues and ineffective task outputs. Quality control is commonly utilized to promote quality of business products. Six-Sigma usually integrates employees to provide the highest quality of products through self-assessment and proactive approach to skills tests.
Six-sigma is done to prepare, synchronize and manage the multifarious activities of company through efficiency module. This alternative can be compared to the three balls that are juggled by the circus performers.
By implementing the six-sigma alternative, the company can visualize the future risks and hurdles in the implementation of any production plan and can take suitable remedial measures for unforeseeable risks such as machine breakdown.
The initial step towards actualization of a quality operations management system involves research and the creation of an informed and practical business plan. As a matter of fact, operations management actualizes a business plan.
Besides, the system monitors financial constrains and progress of each of these segments. The consideration of this is, however, based on the contributions they make towards ensuring that the organizations continue to gain a competitive advantage in the market.
Performance measurement variables
In order to achieve quality operations management, Luen Thai’s existing forms of system monitoring should be periodically upgraded to introduce multiple operating system models such as ratio analysis in operation management that is compatible with tracking and analysis within and without the company across the three major segments.
Basically, the operations management systems at Luen Thai include an aspect of cost, dependability, speed, quality, and flexibility. These variables determine success or failure in business. These variables are achievable through value delivery, value addition, and creativity. Reflectively, these concepts are techniques and tools essential in the art of operations management.
This process is inclusive of the scientific aspects such as a technical process of understanding the operations involved in operations management, their application, and evaluation criteria, which is monitored by the support department.
Despite having this efficient operations management system, the company has not fully established a mechanism of monitoring progress at micro level and majorly depends on macro auditing in decision making and still has to deal with the risk of internal redundancy (Lewis, 1999).
The second strategy for performance measurement should be aligned to communication channel in the company. For implementation of the strategy, the management balances both the short term and long term consideration towards decision making.
Management that ensures long term obligations are fulfilled and considers mostly the role played by resources invested in technology, continued innovations in the production of new products and conducting intensive researchers in the market to identify fresh market niches. Customer satisfaction is the focal point of the company in attaining a competitive advantage in the market above other players.
Specifically, operation systems are employed in the Luen Thai Company to monitor and increase productivity at minimal error margins. This is possible because this model of operations management system allows for “operations process competitiveness as it cut down unnecessary overhead costs from waste and under-utilisation” (Slack, 2012, p. 43).
In the marketing and distribution channels that are run from a central point, it is apparent that company structure, operations management, and efficiency of the advertisement department determine sustainability of its business. Besides, the ability to customize products and offer competitive but high-quality services determine success and profitability in the short and long run.
Skills required in supporting a business strategy plan are found in the integrated management model, which functions as an implementer and driver of business decisions. The company’s operations management systems incorporate planning, development, implementation, and discovery.
Reflectively, the process captures organization chart, status reports, process map, compliance requirements, review structure, activities, dates, and resources employed within a specified period of time. The system has remained efficient due to consultative decision science, which has ensured the company’s survival for more than three decades.
Basically, a quality integration management system performs optimally via integration of appropriate scientific methods and techniques. To enrich artistic managerial talents, scientific techniques come in handy to not only magnify the margins of success but also to ensure a smooth transition of an idea or an event after another.
Besides, to avoid an imminent failure, it is vital for the integrated management system to focus on a defined edge since “proper tailoring of techniques and tools assume as an essential part of the regulatory strategy” (Deflorin, 2010, p. 32).
Reflectively, the vertical integration management system in the Luen Thai Apparel has improved on the supply chain, production and distribution processes, which are centrally stationed and controlled from one building.
The success and failure of a business entity are dependent on the effectiveness and quality of the operations management since it determines how planning, integration, implementation, and control are integrated.
In order to strike an optimal performance balance, the process of designing a quality operations management system should commence with a clear overview of budgeting, objectivity, and scheduling. In addition, this part should include control procedures and assessments.
In order to come up with a viable operating system, it is of essence to include quality control, progress measurement, and flexibility in planning to accommodate any eventuality in the Luen Thai Company. Quality in operations management determines the success of goal planning and analysis.
As a matter of fact, quality ensures smooth operation and coordination of different variables that function simultaneously in the production chain. Despite constant metamorphosis of operations management designs in the market, determinant of quality basically remains unchanged.
Irrespective of the size and nature of a business entity, quality in operations management is the major verification factor for success of a short term, middle term, and long term projections.
Bowman, S. 2003, “Corporate restructuring: Reconfiguring the firm”, Strategic Management Journal, vol. 1 no. 4, pp. 5–14.
Deflorin, P. 2010, Operations management: a supply chain approach. Web.
Lewis, H. 1999, Environment and operations management face the future. Web.
Lin, J. 2010, New structural economics a framework for rethinking development. Web.
Slack, N. 2012, Operations and Process Management: Principles and Practice for Strategic Impact, Pearson Education Limited, Alabama.