Introduction
Albatross is currently suffering from a range of operational issues which ranges from restrictive floor design to other inefficient administrative functions. These operational issues and other lacking have significantly affected the overall productivity of Albatross and have impaired its ability to compete effectively with its various competitors. However, Albatross does have the scope and the resources to establish it as a profitable organisation. To do so, it needs to focus on its long-term and short-term operations. By finding the problems in its short term and long term operations; Albatross will certainly become more efficient as well as effective and will be able to better compete with the other players in the market.
Operations are not the only issue that the company should focus on. It also fails to provide a high-standard working environment to its employees. This sub-standard working environment also has an adverse affect on the employees. As a result of this employees may suffer from poor morale which makes the employee less dedicated to their work as well. By addressing on some of these key issues Albatross will certainly gain a competitive advantage over the rest of the competitors. Further insights into these problems and their likely solutions have been suggested in the following answers.
Question One
Carefully review the assignment scenario/case study. From the limited information in the scenario/case study, along with your answers to the unit three written assignment, identify at least three direct and specific long-term and three direct and specific short term operations changes that Albatross Anchor must make to gain a clear and sustainable competitive advantage (provide detailed information to validate and support each recommended change)
Long-Term Operational Changes
(01) Contemporizing the manufacturing technology should be considered by Albatross. Improved technology can make the entire product manufacturing process safer as well as quicker. Currently, Albatross focuses on producing in batches only and an entire batch of products may take up to 4 weeks to make. This is time consuming and it also slows down the production process. By implementing a quicker and efficient production process with new technology will help in producing a larger batch of products at a time. This means that they will also be able to cater to the demand of a greater customer base at once. Production in larger batches may also enable the company to benefits from economies and scale allowing them to reduce their prices and stay more competitive.
(02) Dividing the manufacturing area is also a good option. Albatross should consider separating the production facilities that deals with the production of both the types of anchors. By separating the production line for both anchors, they will be able to cut-down on the 36 hours of down-time which is dedicated to changing and switching from one manufacturing process to another. While the space required for the production of these products will be reduced significantly, it cuts down on the down-time consumed for switching. Therefore, Albatross will be able to make more anchors in lesser time. This may translate to an increased ability to satisfy customer demand and ultimately greater profits for the business. This will also allow them to further reduce their prices to a significant extent.
(03) Albatross should also consider shifting their shipping to the western side of the building. Since, beforehand they did not ship products internationally, having the shipping on the eastern side seemed justifiable. However, since now they are shipping products abroad, moving the shipping towards the Western Side seems more justifiable to facilitate the overall shipment process. Now, Albatross gives out orders through rail and truck and the rail road is located towards the Western Side of the building. This will also free up space and allow them to receive materials from one specific side. As a result of this the receiving department will no longer be responsible for taking care of both receiving and given out the orders. Increased efficiency means that it will take less time as well as labour and products will be produced and delivered more efficiently. This will reduce the costs incurred and make Albatross more competitive.
Short-Term Operational Changes
(01) Institute safety protocols and procedures are not met. In fact Albatross does not even qualify for US environment and safety standards which topped with antiquation results in slower batch production and off course larger lead times. By implementing greater safety standards, Albatross will be able to comply with the US environment and safety procedures and which in turn will increase the efficiency of its workers to a significant extent. These benefits will be further maximized if Albatross is able to fulfil its long-term goals of implementing modern technology throughout the organization and establishes strong compliance with the US safety and environment standards.
(02) Albatross should also consider upgrading and re-organizing its administrative office. The current administrative offices are quite shabby and unorganized, which has also made the quite inefficient. Updating the administrative offices by introducing new technology in terms of computers and faxes etc may help Albatross operate more efficiently. When offices are unorganized, it may make the overall operations quite sloppy and billing process may be further slowed down. Poor communication, poor customer service and mismanagement are just some of the drawbacks of an unorganized office. By implementing new technology in the administrative office, billing and customer service would be quicker; which may allow them to enjoy a competitive advantage over the competitors.
(03) Albatross should consider separating the administrative office. Currently it handles both the type of anchors and the customers; although they are clearly quite different. Administrative staffs should have dealt with the two key types of anchors that are been produced by them. When the staffs are dedicated individually to the tasks, they will be better able to cater to the needs of both the parties. The files and records for the two types of anchors will also be separate which will ensure smoother operations and to strategically focus on each anchor business. This will allow them to have greater product insights and greater knowledge of the customers that are been served by them. By carefully nurturing customer relationships, Albatross will be better able to cater to the needs of their customers and therefore increase customer loyalty and retention.
Question Two
Operational Issue One: Cross-Training
Job-retention: Cross training will allow the employees to have a sense of security and greater job opportunities in Albatross. With greater cross-departmental expertise, the employees will be able to apply for vacancies in different departments of the same company instead of applying somewhere else, thus, leading to greater job retention.
Employee morale: Cross training employees will allow the employees to feel more secure and therefore increase employee morale. This causes the employees to feel more secure with the employers and increases their morale.
Employee dedication: Cross training makes the employees feel more valued and they get a feeling that Albatross is investing in them. This makes the employees place extra effort and whenever they feel that they are being appreciated.
Operational Issue Two: Gain sharing and Profit sharing
Job Retention: Profit sharing lets the employees feel that they can benefit from the success of the company. This makes them more productive towards increasing the profitability of the firm they are working for.
Employee Morale: Benefits like profit sharing and gain sharing obviously have a positive effect on the morale of the employees as they feel more appreciated.
Employee Dedication: Profit sharing makes the employees feel more accountable and responsible towards the success of the business and hence increases their dedication towards the firm, because they know they will also benefit from the success of their business.
Operational Issue Three: Ergonomics
Job retention: The production process in albatross is heavily dependent on manual labour. This means that the employees need to toil for hours at a stretch. Ergonomic can enable them to have greater safety and may also increase their productivity.
Employee Morale: By introducing ergonomics in the company, employees will get a feeling that the company cares about them and therefore they will have higher morale.
Employee dedication: When employees feel that the company is working towards their safety they not only have higher morale, but they also feel inclined towards increasing their own productivity towards the company.
Operational Issue Four: Technology and Automation
Job retention: Improvements in technology will help the employees by providing a safe working environment. This will also allow Albatross to comply with the US environment and safety regulations. Up-to-date technologies will also succeed in attracting and retaining more employees.
Employee Morale: Workers obviously take less pride in a filthy working environment. Therefore, updated technology can certainly help in increasing the morale of the employees.
Employee Dedication: Employees feel more dedicated towards there company which uses new technology. This is because it becomes easier for them to maintain the records and the production process more efficiently.
Conclusion
Albatross has many possible ways to improve their position against those of its competitors and to improve employee relations. Long term solutions such as contemporizing manufacturing, dividing the manufacturing floor and moving shipping all require significant investment and will take time to implement, but will result in much more efficient and competitive operations for Albatross. Solutions such as instituting better safety standard procedures and protocols, updating and re-organizing the administrative office and creating dedicated administrative staff per product can be completed in the short term and will also have a positive impact on operations. Lastly, Albatross should directly address operational issues that can positively impact employee relations such as employee cross-training, profit-sharing, ergonomics and technology and automotive improvements. Investing in these areas will bring improved retention, positive morale and increased dedication.
References:
1. Stevenson, W.J . (2011). Operations Management. United States. McGraw-Hill Irwin.
2. Kotelnikov, Vadim. (n.d). Efficiency Improvement, Retrieved from http://www.1000ventures.com/business_guide/effectiveness_operational.html
