Executive Summary.
Operational management is a field of management that deals with overseeing, controlling and designing operations in the manufacturing process design of goods and services. Some industries manufacture products, for example the oil and gas industry, clothing and textile industries, petroleum, chemicals and plastics industry, Electronics, Computers and Transportation industry among others. In these industries, the production of goods and services is affected by various factors which either boosts production or lowers the level and rate of production. Service industries such as health care and social assistance industries experience numerous challenges, especially in their employee turnover due to the quality of service they provide directly influences capital inflows. Because of the factors that affect the manufacturing of goods and process design of services, Lean came up with principles that, when implemented, will help managers cut on waste while increasing profits. This paper focuses on the factors affecting manufacturing of gasoline and how the implementation of Lean principles will help in maximizing efficiencies, minimizing cost and improving customer service levels.
Introduction.
A product is predominantly considered as a substance that is manufactured or refined for sale and possibly with profit making motive. Narrowing down to the Oil and Gas Industry in North America and selecting gasoline as the product, a vivid description of factors affecting manufacturing of a product are made and discussed:
Body
The price of gasoline in the market is the primary factor determining the volume of gasoline manufactured. According to Gothelf, J. & Seiden, J. (2013), changes in prices for a particular product or related products in the same industry significantly influence the manufacturing process. For example, if the global price of oil rises because of a decrease in supply then Organization of Petroleum Exporting Countries (OPEC) can restrict production of gasoline affecting its manufacturing process. Another factor affecting the production of gas is proximity to the market: This is when technology is used to communicate directly with the customers and suppliers via their portable devices. Availability of such modern science positively influences and makes the manufacturing process more efficient. Availability of efficient and cheap labor is yet another factor affecting the production of gasoline. Energy is critical for the performance of any industry and gasoline product is not an exception. According to Stevenson, W. J., & Sum, C. C. (2009), cheap and readily available labor leaves the management with large profits and a latter possibility of growth. The presence of adequate labor in the manufacturing of gasoline ensures consistent production to the larger American economy and surplus gasoline for exportation. In continuation of the factors, environmental and atmospheric conditions due to the high volatility and flammability of gasoline are factors affecting manufacturing of gasoline. The science of this reasoning is the possibility restrictions being imposed all manufacturing firms interested in gasoline manufacturing, a factor that may leave a few manufacturing firms in the industry and eventually lower the volume of production. Finally, availability of power is essential to the manufacturing process of gasoline. Power is used throughout the stages of exploration, drilling, recovery where power is used to expand the natural pressure of the well and in the final stages of fractional distillation, refining and addition of additives. Availability of power is, therefore, essential for an efficient manufacturing process to be achieved.
Conclusion.
Operation managers, especially in the oil and gas industry, can implement the lean principles to hedge against the risks running in losses. The implementation of Lean principles can also help Companies to respond to changing customer desires with high variety and understand how to positively manipulate factors affecting the manufacturing process.
References.
Gothelf, J., & Seiden, J. (2013). Lean UX: Applying lean principles to improve the user experience.
Stevenson, W. J., & Sum, C. C. (2009). Operations management (Vol. 8). Boston, MA: McGraw-Hill/Irwin.
Heizer, J. H., Render, B., & Weiss, H. J. (2004). Operations management (Vol. 8). Pearson Prentice Hall.
