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Operations Management: Metrics and Measurement Essay

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Updated: Dec 29th, 2020

Warehousing Job Opportunities

Having searched for employment opportunities in the warehousing industry, I managed to get two managerial positions. The first job was advertised by Wilkinson Green Limited Company. The location was in Cheshire and Stockport in England. The job was titled “Assistant management jobs.” The job qualification was a candidate with a bachelors degree from a recognized university and at least three years of experience in the field.

Key responsibilities included stock-keeping covering goods brought in, supplied, retuned from customers, and stock taking. The candidate was expected to achieve the targets set by the line manager. It was his/her duty to report any discrepancies in delivery to the supplies department, make decisions when there was no buyer consult on deliveries and report this to the purchasing department, co-operate with department supervisors on the storage of overstock and creation of space.

The manager had to ensure that communication with customers is clear, professional, and maintain proper documents of supply. Lastly, the candidate had to be able to work and cope in a warehouse with a fast environment involving voluminous transactions. It was a permanent job with a salary ranging from 18,000€ to 20,000€ plus other benefits.

The other job advertised by Brightwork Company Limited was titled “Warehouse operation manager.” The vacancy was in Glasgow, Scotland. The responsibilities of this job included full control of budgetary and operational responsibilities, management of over 150 operatives in a fast-moving environment, management of consumer service, and the welfare of the staff. The applicant had to have a senior level of warehouse management experience in parcel delivery, retail distribution, food service, or any other relevant field as a basic requirement. The candidate will have an advantage if he/she has accounting skills or previous experience in an accounting environment. Benefits included a salary of 45,000€ plus bonuses, a car, and a pension.

Performance Measurement

Operation management is a careful process that entails the manufacture of goods and services and their supply to customers. Metrics and measurements enable the management to justify budgets according to the returns and come up with strategies that will enable growth and enhance innovation within the organization. This gives an organization a sort of guideline to follow in the performance of its operations to realize its goals and objectives. It also allows the company to know its performance during a specific period.

In operation management measures, and metrics are discussed in the following four different contexts; plan, source, assembly, and delivery (Stewart, 1995). There are various metrics for planning. They include order entry method, order lead time method, and order path method. The order entry method is used to determine how the consumer’s specifications are changed to information that is exchanged in the supply chain. Order lead time is used to measure how long it takes from the time the customers order was received to the delivery of the finished product, while the customers order path is an important measure of how the order traversed and the time is spent in different channels.

In the supply chain, it is important to establish an appropriate measure of performance, which is used to determine the effectiveness and efficiency of the current system of supply that is used. Most companies use a combination of quantitative and qualitative techniques to determine this (Beamon, 1998). In the qualitative measurement, there is no direct numerical measurement, although some aspects of the measurement may be quantified. Factors that are considered here include customer satisfaction, the flexibility of the company, supplier performance, risk management, and material flow integration.

Quantitative measurements in the supply chain are those measures that can be quantified numerically. They can be classified, like those based on cost or customer response. Measurements based on cost include cost minimization, profit maximization, sales maximization, return on investment maximization, and inventory investment minimization. Those based on consumer response include lead time minimization, minimization of product lateness, maximization of functional duplication, and increase in the production time (Beamon, 1998).

Measurement of the supply chain ensures that the company uses the best method to acquire orders, manufacture, and supply goods to consumers. They, therefore, are good indicators of the companys efficiency in production. These measurements aid companies to identify and solve problems in the supply system, which is in place. Due to these measurements, the innovation of new and better systems of supply can be enhanced and implemented to save time and money. Proper application of these measurements and metrics leads to the minimization of costs, thus increasing the profitability of the company.

There are, however, some disadvantages to these methods. First of all these methods are expensive to conduct, thus causing the company to incur an extra expense. In some instances the measure which is calculated is indicators of only one aspect of the supply chain, thus does not truly reflect the true status of the company supply system. At times these measures are difficult to quantify either due to their difficult technicality or as a result of the absence of relevant data which is necessary for quantification.

In Canada, there is a warehouse and supply company known as Quik X Company Limited. It is well known in North America for its quality services in the warehousing and supply of goods. They provide highway and intermodal transportation of goods and also truck loading services. In their operations, over the years, they have employed various metric systems that have helped them in the supply of their goods and services (Quik X, 2010).

In their operations, they have used various measures and metrics to evaluate their performance. By using order entry, order lead-out, and the customer order path, they have managed to improve on the efficiency of receiving orders, processing them, and delivering the goods to their customers. It has increased their reliability over time, making their customers have trust in them. This company also uses the qualitative and quantitative measures of supply to evaluate their system of supply.

The data which they get help them to maintain the standards of operations which they are doing well and improve in places where they are not doing well. These measures and metrics thus act as a guideline that checks their performance ensuring, that they are on track with their management plan.

Conclusion

In the supply chain of operation management, it is necessary to conduct metrics and measurements from time to time. These measurements and metrics act as important indicators in the performance of the companys activity, especially those regarding the supply of goods and services to consumers. Through their application, the efficiency and effectiveness of the operations within a company tend to improve over time, therefore, increasing consumer efficiency, minimizing costs, and increasing profitability.

References

Beamon, B.M. (1998). Supply Chains Designs and Analysis. Models and Methods. International Journal of Production Economics, 55 (4), pg. 281-294.

Stewart, G. (1995). Supply Chain Performance Benchmarking Reveals Keys to Supply Chain Excellence. Logistics Information Management 8 (2), pg. 38–44.

Quik X Logistics. (2010). Quick X. Web.

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IvyPanda. 2020. "Operations Management: Metrics and Measurement." December 29, 2020. https://ivypanda.com/essays/operations-management-metrics-and-measurement/.

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IvyPanda. (2020) 'Operations Management: Metrics and Measurement'. 29 December.

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