Operations management is concerned with designing, overseeing and controlling the production processes. It deals with designing and management of processes, products, services and chains of supply (Cornett, Saunders, 9). The acquisition, utilization and development of resources to be delivered by firms to their clients are considered here. Its purvey ranges from tactical to strategic and operational levels. Therefore, the responsibility of ensuring optimal efficiency of operations in a manner that utilizes minimum resources while effectively meeting customers' requirements lies here. Operations management thus directs and manages physical or technical organization functions. These functions relate to development, manufacturing, and production. Operations management involves strategic, tactical and operational issues (Cornett, Saunders, 9).
The strategic issues could consist in determination of the location and size of manufacturing plants; making decision on the service structure, technology and supply chains. Tactical issues, on the other hand, may consist in layout of the plant, its structure, methods of management, selection of equipment and placement. Operational issues as well would include scheduling of production, managing inventory, controlling quality and policies for equipment maintenance. Understanding what operations management entails, this paper, therefore, seeks to explain why I would put emphasis on balancing all five performance objectives (quality, speed, dependability, flexibility, and cost,). Further, the paper shall explain based on a comprehensive literature review the management performance objectives using two contrasting examples from manufacturing and service. Finally, it will illustrate with an example how a balanced approach can best solve the performance issues identified in this paper.
As an operations manager in Air Canada, I would put emphasis on balancing all five performance objectives (quality, speed, dependability, flexibility, and cost,). This is because all the five operation objectives impact broadly on the stakeholders of the organization (Clarkson, 99). This stakeholders may include: the customers, who the objectives apply primarily on; suppliers, who are impacted in terms of their prosperity and effectiveness in operation supplies; shareholder, who target the prosperity of the business and are thus are the beneficiaries of the operation objectives; employees, who will be at a better place if the company gets prosperous. The design of operations affects their working conditions and likelihood of future employment.
Air Canada is the largest airline of Canada. As a service company, it provides both scheduled and chartered air transport for cargo and passengers to 178 destinations globally. It is also the ninth largest airline for passengers in the world. Its regional service is called Air Canada Express (Doganis, 7).
The five operation performance objectives that include quality, speed, dependability, flexibility, and cost are prudent when applied wholesome (Slack, Chambers, Johnston, 21). However, various measures need to be taken with each of the performance objectives. Quality as an objective should be part of the focus. Quality is valued by authorities and customers and is, therefore, very important. Quality includes conformance. The products and services provided should meet the expectations or rather conform to the specifications of such. Two aspects of quality are important. First is the external quality effect which relates to customer's satisfaction. It would lead to less or no complaints from the customers who would imply more consumption of the product and services offered by the organization (Neely, Adams, Crowe, 7). This would result into more revenue for the firm. Internally, quality has a different effect. If all the operation processes conform to quality, little mistakes will be made. This would in effect reduce the cost, increasing dependability and speed of response. Organizations that consistently grapple with correction of mistakes experience difficulties in responding quickly the request of customers (Monden, 13).
Measures that are supposed to be taken with regard to quality are supposed to ensure fidelity to conformity with the expected standards (Wee, Wu, 337). The organization should, therefore, invest in appropriate technology that will ensure product and services are of expected quality. The organization should also have a quality measure which will enable a qualitative characterization of service delivery. Goals should be set with regard to the quality of output to meet customers' demands. Additionally, customer feedback system should be put in place to ensure feedback from the customers regarding the quality of services and products are assessed.
The second objective is speed. These are basically the speed of response. It refers to the time between the internal and external customer making request for products and services and then getting it done. Speed also has internal and external effects. Speed is important externally because it helps in quick response to customers. This gives a positive image of the business to the customers who would be pleased to return. Internally the effects of speed reflect in the reduction of cost. Speed reduces cost majorly on two areas: reducing inventory, and reducing the risks. This is well experienced in manufacturing firms (Schefczyk, 313). When information is fast put through, it will reduce the cost. Slow speed has a knock effect on dependability of the organization.
The measures to put in place include proper communication systems that enhance speed of communication between the customers and the firm (Kohl, Karisch, 234). Proper technologies in clearing of passengers at the airport terminals to enable reduced turnaround time for the aircrafts. This increases utilization. Additionally, appropriate technology should be applied in services delivery. This includes ticketing process being made simpler to enable fast processing via technological advancement.
The third performance objective of focus is dependability. Dependability applies to being on time. It affects how customers receive their products in time. It is however a difficult definition to measure in practice. But in understanding what is exactly implied as on time, focus should be put on when or what exact time the customer needed the service delivery. It was about when the firm promised them delivery of the expected service. It was also when the customers were promised the delivery when the initial delivery failed. Dependability as well has both internal and external effects. No matter how dependability may be defined, externally it is generally regarded as good by customers. Being undependable or rather being late to deliver customer's services irritates the customer. In most cases, dependability determines the chances of getting one's contract renewed for service delivery. The external effects are majorly to widen the probability of a client returning with more deals (Ahmad, Schroeder, 23). That would imply more business the organization. Internally, dependability affects cost. The costs in an organization are affected in three ways by dependability: time-saving ensures money is saved; directly saving money and providing stability to the organization that ensures improvement of its efficiency. Highly dependable systems within an organization have great chances of increasing the speed of performance. Therefore, the implication is manifold. An undependable firm cannot promise its clients a fast response. Thus, dependability directly affects business prospects of an organization.
Various measures can be taken to address the issue of dependability within the firm. Employee training is necessary to ensure prompt delivery of services (Bititci, Carrie, 527). Unskilled or semi-skilled employees will lead to slow service delivery. Communication systems as well should be improved to ensure proper communication thus enabling faster processing of customers’ services. A communication system that is faulty will delay, or distort communication subsequently delaying service delivery. Further, up to date technology is necessary. To ensure timely service provision, the technology applied in processing the services should be adequate and appropriate to reduce the time taken.
The fourth is flexibility. This is rather complex objective since the word flexible can be very ambiguous. However, important to be understood is that a flexible system is able to in some way change its operations. Flexibilities may include service flexibility, volume flexibility, mix and delivery flexibility among others. Flexibility has significant effects on the operations of an organization. It is however affected both internally and externally. Externally, different kinds of flexibilities allow for operations to fit services to their customers. For example, mix flexibility will enable delivery of variety of services that customers can choose from. Service flexibility, on the other hand, allows for development of new services that incorporate new ideas that customers might find attractive. Delivery and volume flexibility will allow adjustment of operations to output levels required, and delivery procedures preferred thus allowing a firm to cope with unanticipated changes. It thus will enable delivery of services and production of products where, when and how the customer's want. Internal effects on flexibility however are: flexibility speeding up response; flexibility saving time and thus saving money; and flexibility enabling maintenance of dependability.
Various measures can be put in place to achieve flexibility as an operation objective. Effective staff training can be employed to enable multi-skilled personnel within the organization. There need to be strategies laid down to diversify service delivery. Quantitative characterization of services should be conducted to ensure diversity (Bititci, Carrie, 527). The technology adopted as well need to be flexible to enable adjustment to shifts or changes in services delivery.
Cost is yet another objective of operation that should be part of the focus. Costs factors vary across organizations, and all the other four objectives of performances internally contribute to cost reduction. Proper management of high speed, high flexibility, and high dependability will not only result into external reward but equally save the costs of operation. This will ensure an organization is able to minimize inputs and maximize outputs, the core goal of any firm.
Cost as an objective of operation can be realized by ensuring that the following measures are put in place: properly skilled personnel who reduce errors and improve quality of service delivery. The better the quality of service, the faster the speed of operation. This is because the organization will not be troubled with problems of addressing customers’ dissatisfactions. Secondly, appropriate technology that reduces wastefulness will reduce the cost. Organizations thus need to identify the most appropriate technology that will be efficient in resource use and thus reducing the overall cost (Kohl, Karisch, 234). Communication systems as well should be effective. This reduces errors in delivery of services and production of products that will further the cost involved due to redoing the same activity.
These performance objectives are all critical as they are the factors for success of an organization. The vision and mission of an organization can only be achieved when there is a decrease in customers' satisfaction, performance of systems, employee satisfaction, and ineffective financial management. Therefore, certain levels of activities that are the actual measure needed to be taken to enable achievement of the operational goals. The performance measurement should be conducted to effect positive changes in the organization culture, processes, and systems. The output of the organization needs to be given well to the clients to their satisfaction, and the activity program results should be compared to the intended purpose.
Toyota as a manufacturing company has applied use of all the five operational objectives and transformed it to a multinational company (Kamiya, 133). The five objectives has enabled the company do things right in terms of providing goods and services that are free of error. This has enabled Toyota vehicles to rank top worldwide in customer satisfaction. For instance, Toyota was rated the best car in the Middle East in 1995 (Kamiya, 133). Toyota has employed speed in production minimizing the time between customers order and availability of their product. This has given Toyota speed advantage in the market. By focusing on reducing complexities in their operations through utilizing simple robust and flexible machines, they have kept on top of their game.
The dependability of Toyota as a company in manufacturing has been positive. The utilization of multi-skilled personnel and team spirit between its employees has seen success in the production (Ahmad, Schroeder, 23). This has improved quality and efficiency of Toyota products expanding its market share. Therefore, the dependability advantage that Toyota has given to his customers has been instrumental in scaling its production across the world. An organization should be able to change their service and products as changes occur in their environment. This is referred to as flexibility. Toyota has come out as a flexible and responsive organization with an ear to the customers’ demands. It has adopted manufacturing resources to enable launching of new products into the market. Toyota by producing relatively small batches of variety of models has been able to achieve high level of flexibility. Toyota has, therefore, over the years provided a range of options allowing customers to choose from them.
Cost as an operation objective has seen companies compete with prices. Customers all over the world are attracted to low cost of a quality product. Toyota thus has sought to influence the costs of services and products in order to achieve low-cost products. It thus plans to in future shift its production of multi-purpose vehicles to various parts of the world. This will further reduce the production cost making their products very affordable. This strategy is expected to earn Toyota even a better competitive age against its rivals.
The holistic approaches of Toyota Company in focusing on the operational objectives indeed show immense advantages to the company. Toyota has satisfied its customers’ needs by providing quick and dependable services at affordable prices. The five objectives are interrelated in how they are affected. Thus addressing all of them even makes it easier to achieve than focusing on one.
In conclusion, having exhaustedly analyzed the five operation objectives (quality, speed, dependability, flexibility, and cost), I would emphasize on balancing all the five objectives rather than focus on one. The paper has found out that the benefits of balancing all the five objectives are immense. They can transform an organization to high economic levels. The five objectives reduce the inputs and maximize output. They result to customers’ satisfaction granting loyalty. Further balancing the five objectives reduces the product or service delivery cost giving a firm a price competitive edge. The paper has further identified the key specific measures for the five operational performance objectives that are being used for the operations in the industries or sectors in Canada Airline as training of personnel; application of appropriate technology; effective communication system; team work; diversification of services among others. It has also highlighted the current performance issues within the industry.
References
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