PROCESS DESIGN AND ANALYSIS

PROCESS DESIGN AND ANALYSIS

Instructions:

Using some of the concepts and tools of Process Design and Analysis, evaluate a process and provide recommendations on how it can be improved in terms of one or more operations performance objectives (i.e. cost, quality, speed, dependability and flexibility). The identified process can be in your organisation, or in any organisation that you are familiar with.
In the assignment, you are required to:
◾Describe the organisation. Keep the description brief but make sure that the reader can clearly understand what the organisation does and the organisational context.
◾Describe the process and include its process map. Again, keep this brief but ensure the reader understands what the process is, how it affects the organisation’s overall performance, and how it is currently designed. Lastly, provide a high-level process map if the process is large.
◾Evaluate the process’ current performance in terms of all five performance objectives. Given the organisation’s strategy and needs, identify and discuss the performance objective or objectives that need to be improved.
◾Analyse the process and provide recommendations on how it can be improved in terms of the identified operations performance objective (or objectives). If your recommendations include the reconfiguration of the process, make sure to include the new optimized process map.

Solution.

PROCESS DESIGN AND ANALYSIS

Introduction

Process design and analysis are some of the essential tools that organizations use to be able to cater for a certain operations performance metric such as cost, quality of service, speed dependability and flexibility. This paper will look at an organization called Royce Company It will view at its process design on delivering quality products to the customer and analysis of the process model put forth. Processing is an important factor in an organization if an organization cannot describe how they have come up with their products than they are simply doing nothing. In any company, there must be inputs, the process, and the outputs. This was solely based on how efficient they were in coming up with their unique process to reach the customer. The aims of coming up with a method are to reduce costs, maximize profit, making the process flexible and time efficient and. Royce Company is a limited liability company concerned with the manufacturing of sports garments and other wears for sportsmen other athletes.

Organizational context

An organization context of a business is operating environment of the firm. Royce Company is engaged in  production of shoes and sporting garments around the world. The body structure is composed of an overall Chief Executive Officer. Under the CEO there are there are six official responsible for Finance (Chief Financial Officer), a general engineering officer, a human resource manager, a sports marketing director, global designer and a creative designer. Each department has their specified duties with a general purpose, to satisfy the needs of a customer. Royce company principal products include shoes for sportsmen players such footballers and athletes. The organization has a digital platform, and they use this platform to market the products. The major sectors in the organization are the manufacturing section, Engineering section, and the marketing section. With the help of their website, they can post their products online, and customers can view them. However, the purchase transaction has to be made at the company and not online.   

Objectives

Royce Company is one of the upcoming manufacturers of sporting shoes and garments. Their primary purpose is to a profit for the shareholders of the enterprise. Additionally, for them to accomplish higher profits to the stakeholders, currently they have come up with aims to maintain their brand, innovation in areas of product design, cutting water use, cutting down on costs, reduction of waste and also uniting communities around the country and worldwide. The operations management department is concerned with controlling, designing, forecasting and scheduling business operations of its products. With the excellent management, long-term operations have enabled the firm to minimize the use of resources. The company is also useful regarding meeting clients’ needs.

Process Design

A process is any activity that integrates input to form an output. At Royce Company, the major organizational processes include the manufacturing phase and the marketing phase mainly in advertising and product delivery to the final consumer. This paper will deal with how Royce Company has come up with a design to reduce cost and conserve the environment. The current general process map of the Royce Company is as follows

General Process map for Royce Company (fig.1.1)

The above diagram can also be redrawn using a high-level process map as follows

High-level process map of  Royce Company(Fig 1.2)

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Process Analysis

Process analysis is an evaluation of how a firm takes on its activities to arrive at a final product. Process analysis is an important part of a researcher in that it helps one in identifying areas that need to be rectified and improved (Slack, et al., 2015). Currently, in this Royce company, the first phase is a primary process of collecting raw materials for the specified product. Every product produced by this business is subject to a particular raw material. Shoes are major made from rubber materials, and the garments are made from cotton or silk. At this phase mostly the engineers are involved in determining the product’s raw materials, and they make decisions on what raw materials to buy. A report is formulated by the engineers in the and is forwarded to the CEO for approval. After approval, the raw materials are purchased to begin the processing. The rectangle box shows the process.

At the second phase, manufacturing and processing take place. The group responsible at this stage are the manufacturers and their machines. After producing the final product, the firm will make direct sales if only the products meet the required standards. Royce Company is one of the companies that sell their product either online or directly to the customer. Since it is situated in the central business district, there is a department of sales just within the company where customers can access newly made shoes or garments. The last process in the design is the selling of the product. They also have a platform for clients to post feedbacks Currently the company has been making sub-standard returns. The current procedure that the business is undertaking is a little bit more direct, and there are some flaws in the process design.

The following metrics have been necessary for any process design to be efficient. Process analysis will majorly focus on the important metrics such as the cost of production, efficiency, quality and the flexibility of the process design. First metric to be analyzed for this firm is, what is the maximum process capacity. Maximum capacity is the number of units that a company can produce by the detailed process design in a given time. Case in point, Royce company has only two machines that are responsible for the production of their final product. If both of the machines work efficiently, they can produce 200 units of their combined products in three hours. Secondly, according to the engineers at Royce company the devices are capable of producing 400 units of their combined products in 3 hours. Therefore, the capacity utilization of the two machines at Royce company is 50%.

The throughput rate and the flow time are another important metric in analyzing process designs. The throughput rate is a measure of units’ average that flow on a particular point in the process design during operation. Throughput rates are important in determining the efficiency of the process model. For Royce company the throughput rate is. Since these products at Royce are produced simultaneously, the flow time is three hours. The product takes three hours to be fully produced and ready for market. The direct labor content at Royce company is lower than 70 personnel. Cycle time is the interval time taken for one product to be produced. It means that how long will it take for one to produce another product just after producing the other product. At Royce LLC, the cycle time is rather unspecified as it depends on the available materials at the first phase.

Lastly, a look at the process time and the direct labor content of the company are also other important metrics to consider in process analysis. The process time is the time taken for the company to produce one product. Process time means as flow time minus the idle time of the machine. The process time for Royce’s products is essentially 2.5 hours. Additionally,  other important metrics that need to be observed in the company are the direct labor content and utilization and set up time. The employees at Royce company are totaling to 70, with only one CEO, six managers, eight professional engineers, 40 packaging personnel, ten drivers and only five sales representatives.

Recommendations and Improvements

Most businesses look for different methods to improve on cost, efficiency, flexibility, speed and quality (Climent, et al., 2009). They focus on the bottlenecks in the process and find potential ways that can solve the problems. There are ways that companies employ to improve the process so as to be able to meet future goals. To begin with the company can add additional resources either in the form of machines or laborers to increase the maximum capacity of the firm regarding output and profits. Also, the company can improve efficiency through the use of efficient and technological based machines that are fast enough in producing authentic and a standard product. There is also another way to increase production majorly by working overtime or shifting of workers in the organization. Lastly, outsourcing some activities to an outside firm, removing activities that do not add value to the product and redesigning the product itself are some of the significant process improvement activities that can make a company change into a profit-making machine in Australia. 

After keenly analyzing the process design in Royce company some important improvements need to put forth to achieve more outputs and profits. To begin with, the company has to improve on the inputs. For a firm to get more outputs it has to allocate equivalent input (Collier & Evans, 2010). For Royce company, the number of inputs needs to be allocated in the first phase, after thorough analysis by the engineers on the inputs that need to be bought. They should employ raw materials research assistants that can look for new raw materials that match the engineer’s requirements. With doing so, the company can spend more on the raw material. Henceforth, they will be able to make a significant amount of output. The only market that Royce company is targeting the current raw materials is in Sydney and Queensland only. They should be able to look for other markets across the country so as to maximize outputs for more profits.

Secondly, another important sector that the company has to improve on is adding more machines to the processing phase. As additional raw materials will be channeled through the company the machines’ number, need to be increased to cater for the raw materials. For example, since both machines at Royce Company have the ability to produce 200 units of their products in three hours. If the number of raw materials is increased by fifty percent, then they will need to add two more machines so that they can have an output of 400 units in 3 hours. This method can boost their productivity levels.

Additionally, the company has to focus on the receiving end of the product market and customer satisfaction and feedback (Johnston, et al., 2012). To begin with, marketing is a form of communication between the firm and the client in the process of selling their product. At Royce company, after goods are produced and are then taken to the department of sales within the company where customers can be able to buy the products. Also, the products can be cataloged online to reach customers around the country. The marketing department at Royce still lacks concrete marketing strategies. Therefore,  there is room for improvement in this sector to avoid loss of clients. In the past two years, Royce has reported that the number of customers has shown no increase, only in 2014 there was an increase of 5 customers. What might be the reason for this phenomenon? For Royce Company to improve their marketing superiority, the company has the responsibility of developing and promoting marketing through massive advertisement. This can help to reach more people in the country and around the world.

Also, customer satisfaction and feedback is a backbone to the prosperity of a given firm (Johnston, et al., 2012). As managers, we are supposed to know what and how the customer feels about the product we produce so that more improvement can be put forth to come up with a quality product in the market. For Royce company, they need to have an integrated platform that can depict more about what customers say about the product. In the past five years, the company has never made any improvement on the product. Even though they receive a few feedbacks from the client does not mean that they should just leave the goods produced in the same state when they formed the industry. Therefore, Royce Company has to come up with an integrated response platform that will be able to reflect on the improvement of the product and attend accordingly to customer’s complaints.

Lastly, an important metric that the company should improve on the expansion of the premise through coming up with branches across the country and even outside the country to be able to sell their products (Ferdows, 1997). Royce company has recently reported that after a huge sale, they are left with 40% of their product. This scenario can be dealt with through forming the branches across the country. Currently, they only have one station in Sydney. Therefore, they should look for more marketing of the product in other states in Australia through these branches.

It is recommended that Royce Company must employ more capital to achieve all the above recommendations and improvements. Capital as an input is a contributor in controlling the amount of output that the firm has to make. With little capital they will stagnate and make losses. Increasing the number of workers will require more capital. Capital allocation at first at Royce company was $116888. To buy new machines and pay for advertising their product they will need more capital to be to balance their books. After outlining all these improvement and recommendations, Royce company can change their process design to a more efficient design that will cater for the recommended improvements and modifications. Figure 1.3 shows the new high-level process design for Royce company

Conclusion

Conclusively, process design and analysis is an important part of operations management. Managers will look for bottlenecks in an organization using this method so as to be to improve on the flaws that the company undergoes. Royce Company is an upcoming company in Australia majorly deals with sports’ shoes and garments. Though it is a small company it has been able to gain a market for its product. Through thorough process analysis, the company is yet to establish standards that can make it a better profit-making firm. After these studies it is recommended the company should employ more staff and more materials to improve its productivity. Also, they need to take key attention to customer’s feedback and focus on product improvement. 

New High-Level Process Design (Fig 1.3)

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List of References

Climent, C., Mula, J. & Hernandez, J., 2009. Improving The Business Process of a Bank. Business Process Management Journal, 15(2), p. 201–224.

Collier, D. & Evans, J., 2010. Operations Management: Integrating Manufacturing and Services. 5th ed. New York: McGraw-Hill.

Ferdows, K., 1997. Making The Most of Foreign Factories. Harvard Business Review, 75(2), p. 73–88.

Johnston, R., Clark, G. & Shulver, M., 2012. Service Operations Management: Improving Service Delivery. 4th ed. New York: Prentice Hall.

Krajewski, L., Ritzman, L. & Malhotra, M., 2010. Operations Management. 9th ed. s.l.:Prentice Hall.

Slack, N., Brandon-Jones, A., Johnston, R. & Betts, A., 2015. Operations and Process Management. 4th ed. Harlow: Pearson Education Ltd.