Operation Management for Classic Cabinets - Literature review Example

Operation management for classic cabinets Name Course Tutor Date Operation management classic cabinets Business opportunities in the global world are so many and it only needs the act of a focused mind to identify, develop a practical business plan, and work on it with desire to achieve more. Most people in the society think that great businesspersons started their operations on a high note. That is not true for initially all people are the same and it only depends on how an individual does his responsibilities. If one is focused and dynamic, nothing can prevent him from achieving success. Small entrepreneurs start as small business and develop into strong and significant companies when there is proper operation management. Opportunities prevail themselves right into our daily lives but we are not aggressive and committed we cannot identify even a single opportunity. Managers of different organizations need to be in the forefront and put things in order for others to assimilate and work towards achieving a common goal. To be successful does not mean being a manager of large corporation like GE or Toyota Company. In fact developing your own idea into a big organization is more satisfying than anything else is. The society is changing and we need not engage or rely on being employed starting up a business is easier and brings in the gains that we deserve. Furniture shop was not considered to have much importance but nowadays people are beginning to see the need to classic wares and decoration of all kinds coming form the industry. For the last few years, the industry has seen great development with more people preferring costumed designed furniture for their homes and offices. All these come from the industry, which was once considered as low and poor industry (Gold et.al, 2001, pp 66). Most entrepreneurs achieve their success through the application of appropriate operation management techniques and having strong virtues of business such as creativity, innovation, dedication, commitment, and the desire to grow. These combined with qualified management can drive the enterprise to greater heights. Most individuals as well as small-scale crafts persons enter into this business to earn a living. What will differentiate them as time pass by is how much effort do they put into the business and what their objectives are. Entering into artisanship needs a lot of patience and sacrifice for most of the time there is lack of resources and other essentials to establish and grow. However, with determination and courage, entrepreneurs usually manage to negotiate their way through different obstacles. For focused entrepreneurs, they need to carry out proper market research before establishing and carrying out their operations. In addition, there are so many untapped talents that can be employed tom provide cost saving, pulling, and conserving functions in the process of expansion (Williams & McWilliams 2010, pp. 45, 56-57 & 247). Classic cabinet is an example of a company that started as a craft shop. Its initial goals were to cater and address the requirements of the growing Vietnamese community in the Southeastern Suburbs of Melbourne. Chinh and Anh used the initial resources to kick-start the operations. The available resources were their skills and trained abilities. Chinh was a master cabinetmaker while Anh was a professional interior designer. With these together with their basic experiences, they took measures towards their fist implementation of operation. Starting with manufacture of ordinary furniture and serving the local market. The concept of applying available resources in business results to cost advantage in production because of reduced expenses incurred on salaries and wages. They manufactured their products perfectly and with the best designs. These earn them good reputation and more customers came to see their products and even make orders. Because of this growing need for more products, they had to change their production plans to include economies of scale to enable them increase and meet the growing demand. The change also resulted to more customers requesting for more personalized products at a considerable prices. The two were efficient in their operations and were able to adapt easily to the to customer’s request. The enterprise was now beginning to develop prompting the two to employ short customer response, increased flexibility in operation planning and control into their system to increase effectiveness and handling processes. Efficiency is seen from the way the two managers handle their responsibilities. Apart form their skills; each had some other derived responsibilities, which came as a necessity of operation. This enabled them have proper organization, control, and harmonization of activities enabling the organization to enhance its efforts aimed on individual production (Stich et.al, 2009, pp 4). Individualized products enabled the organization have a better competitive advantage, which ensured manufactured goods were achieved at the cost of mass production. This scheme of production is intended to reduce the workload, inconsistencies in production, and attempt as mush possible to eliminate wastes. To attain economies of scale, the production scheme is significantly recommended leading to slight cost per piece and was accomplished through division of labor, a linear flow of items, and high rate of redoing the work, and steady actions, which preceded the standard skill. Furthermore, because classic cabinet undertakes a single manufacturing capacity, the cabinet-making tools entails mainly of multipurpose machines to facilitate flexibility needed for production of a wide variety of custom-designed cabinets. The factory environment is set with several types of tools placed together. For accessibility, saws and other cutting tables are in location; shapers and routers in another; lathes and other tools that are not used frequently are kept away from the working area. In addition, assembling areas are strategically located throughout the factory. Finished goods are displayed and kept safely in a rented warehouse awaiting collection by the clients. These particularly current designs facilitate good organization and reduce time wasted in moving from one location to another (Stich et.al, 2009, pp 7). Generally, the organization begins its roles with some given or well-defined goals and approximates the time that each task would take so that other orders could be taken or increase the amount of resources needed to accomplish the given duty. The company believes in investing in resources that help facilitate the operations rather than spending a lot of time on one thing that can be finished faster with use of better equipments. Nevertheless, while the organization develops, new inventions surfaces, which need close supervision and time from the management. Because of increase in order placement and as well as associated demand for the products, the organization will be on its toes switching from one activity to another an attempt to finish all the tasks. This calls for hiring more workers to help in carrying out other duties without which some duties will not be finished in the designated time. Qualified labor force is essential at this stage of the company growth because of the increased workload. Usually, this is the period that the organization starts experiencing challenges resulting from the customers’ pressure, and the desires to maintain its reputation through quality provision of services (Thomas & Mason, 2010). Problems are part of any organization and they assist them to be strong in future while addressing some upcoming issues. The diversification by classic cabinet from customs kitchen to new builders’ kitchen line was the beginning of challenges. Initially, the agreements required classic cabinet to manufacture a limited variety of kitchen cabinets in small batches. Customers were now specifying their taste as well as how should the products be designed. Being under customers, no one can try raising an option since they wanted to maintain their name as the best furniture-producing factory; therefore, they had to comply with all the customers’ details. The matter now with classic cabinet was that more customers were demanding different products from the ones they had produced and were on display. New specification needs extra and special resources to obtain the required standards with little restriction. Nevertheless, because Chinh and Anh needed to improve their financial capital they never hesitated to carry out the duties as specified. It made Anh, the company’s accountant to be quick in receiving money without considering the impact it would cause to the company. The required batch size for these builders’ kitchen line varied from single kitchen to even more than five kitchens. The advantage of this was that the company inflicted more strict delivery conditions that enabled the company to finish on time and they were charged a bit higher than the custom-made kitchenware. This increased their profits, but the custom-made cabinetry persists as the main contributor of the majority sales (Staw, et.al 2000, 17). Increased sales resulted to improved revenue from the builders’ line. At this point, Chinh and Anh saw a progressive increase in sales volume from both lines of operations, but builder’s line brought in more income. This changed the management strategy leading to more regular scheduling of this line of operation. These types of problem created a threat to the company’s hub of focus. This implies that it will mechanically result to administrative challenges because the two were not consistent in handling responsibilities beyond their means. Nevertheless, because of desire and need for more money, the two managers had to take up the challenge and handle productions as though they were able to manage everything. In fact, they were specialized in different areas therefore to accomplish the tasks; they were forced to work together in this line of production, hence reducing individual’s efficiency. Furthermore, there is also struggle for functional resources by the two lines of productions imposing shifting of resources from one division to the other. This modification developed challenges and administrative problems between the divisions. In such circumstances, caution should regularly be exercised before entering into a business line that looks promising, especially if the management team has no skills or experiences in the new line of production. Appraisal of the business has to be carried out to avoid preventable inefficiencies in the major line of production (Thomas & Mason, 2010). Additional consequences due to introduction of new builders’ line of production include the prolong period of finishing task. Many items at different stages of accomplishment lay allover the work place in an un-orderly manner. This situation having too many structures in unfinished state raised the amount of waste because not any structure was dealt with until completion hence difficult to determine the actual cost of producing a single piece. Furthermore not all the workers can estimate precisely extend of work remaining on a job. Instead, they can underestimate the work or over estimate. This inaccurate estimation result to superfluous cost being incurred by the company hence minimizing profits. The unfinished goods also made the company rent another expensive warehouse. Customers would have collected their products as soon as they are ready but too much work lead to these situations, thus increase operational cost of which initially was not visible to the management. Without some type of strategic planning, the joined performance of the single unit will definitely not surpass the performance of the units functioning separately. In fact, joined operations with limited labor can depreciate due to controls put on single units by the key business. It resulted to slow rate of decision making because of anticipated periods and complex accounting systems (Gold et.al, 2001, pp. 69) Organizations’ efforts to diversify and coordinate their operation well have to be made regularly and the constant modification is in line with its goals and objectives. They should also ensure the systems are up to date to remain functional all thorough. Frequently, these modifications are dependent on the decisions of the supervisory team in relation to their strategic analysis of the business. This entails determination of both long-term and short-term decision that will be applied to push the organization towards attaining their goals. To be effective and efficient in production, Chinh Chu had to ensure different operational decision that sustained the organization’s production and satisfactory of clients. Some of these decisions include how to use material, plant facilities, and in-house abilities of the organization’s labor force. These short-term decisions need the estimation of costs associated to different production and manufacturing practices. The cost provides the outline of developing a winning business and planning future objectives. All these factors were the main responsibilities of Chinh as he carries out the daily activities of the organization. In addition, he had to establish the economic analysis and expansibility of the organization. This was depended on differential cost for the alternative being carried out. For instance, Chinh had to choose between specializing in custom-made cabinets and manufacture builders’ line once there were special assignments from clients. This decision led to increasing sales of fast moving items and at the same time retaining clients from both lines of productions (Staw, et.al 23). Chinh Chu being the production and operation manager of the company, he had to make sure that everything was working according to the objective. Despite there being no official identification of duties, he ensured that the business was moving and expanding. He forced the stringent delivery requirements when he realized how the company was expanding and the growing demand for the builders’ line was about to hinder the production of custom made cabinets. This decision was reached after the consideration of sales volumes that each line of the operation was contributing. As a manager, everything depended on his decisions and therefore, he had to ensure constant flow of raw materials that was used by the company. This was not an easy task for him since coordinating the supplies and at the same time ensuring smooth day-to-day activities, function well needed the efforts of a determined person. All these he provided without contemplating on his decisions. He also ensured that all the necessary tools was accessible and in good working condition (Holmen et.al, 2002). For customers’ satisfaction, Chinh Chu develop a technique of making sure all the goods are produced with the right quality i.e. finished products was revealing some high esteem. This was attained through the application of the right skills, and employing highly qualified artisans. In addition, when orders increased and all of them fight for processing time, Chinh laid down a well-illustrated work schedule that was used to beat dead lines and ensure full utilization of available resources. This was successful because Chinh prioritize activities as per their urgency, sales and profits margins, and availability of raw materials. In addition, successful companies ensure that there is efficient means of communication and teamwork of which Chinh never missed to put in place. This helped in sharing ideas and developing mechanisms of combating crisis. Chinh ensured that he worked closely with Anh the company’s accountant in all areas as well as sharing ideas on how to carry out the various functions of the organization without duplication of duties. Each had a role to play and keep each other informed of what was happening. Without teamwork, realization of goals and objectives would take long since there is no standardization and approaches of taking tasks vary considerably. This harmonization of activities spearheaded the organization’s goals and hence its efficiency, effectiveness, and success in the operation of day-to-day activities (Thomas & Mason, 2010). Consequently, classic cabinet had different consequences on the company’s financial structure on the move to producing builders’ kitchens. The initial decision of choosing this line of production was generally to raise the company’s profits and expansion. This is observable as a progressive growth and the management of any company will work hard in trying to ensure that there is at least some improvement on the company. Chinh and Anh Chu pursued this line of operation with the expectations of increasing revenue and improving the company’s financial structure. At the same time as the custom-designed cabinetry constantly account for the bulk of the organization’s sales, the builders’ kitchen ware were beginning to gain its thrust in association with sourcing in huge amount of profits and hence developing the image of the financial structure (Holmen et.al, 2002). Modern communities have also diversified their activities while others are dynamic moving from one point to another. The dynamic nature of the societies has led to so many changes in current companies necessitating consistency in expansion. The achievement of the companies is evaluated in terms of how fine is its financial structure as well as how appropriate the inflows are created in relation to the company’s production capacity. To enhance their assets, the company decided to initiate this line of action with the prospect of capacity expansion and successive benefits, which will be derived from participating in such lines of production. People view the company’s financial structure and management systems when they want to invest or make contracts. This apparently for the classic cabinet was one of their indicators to the outsiders that the company was growing and was worth to other shareholders’ interests. As the financial structure improves, the organization ought to be ready to boost staff, application of technology, superior tools, and hunt for other sources of funds such as borrowing bank loans, mortgage, and grants (McNamara, 2010, 248). Most company’s functions rely on its financial position. If a company has adequate resources, then its functions together with other systems will be coordinated effectively. This therefore implies that the expansion of classic cabinet to include production of special units would mean a lot in terms of cost of production, operating expenses, and other petty activities that may result from the day-to-day functions of the company. The employees will be required to work under pressure because the company has so many orders to finish with its constant resources. Furthermore, the company will also have to under tight operation and use of other resources to accomplish the underlying tasks. More funds need to be available to cater for the increased demands. Thus, in spite of the idea that revenue will improve, the company will also be spending a lot. For example, when classic cabinet joined this line of operation, there were increased contracts leading to scheduling of activities. However, there were still some unfinished contracts at the end of the day. This led to using some other resources in hiring the external warehouse that the uncollected and unfinished products would be stored (McNamara, 2010, 252). Lastly, it is the desire of every company, individuals, or group partners to work hard and achieve its objectives while at the same time satisfying its customers. Business projection is one of the main pillars that will drive an organization greater success. Despite the fact that not all organizations are equal, most of them usually go through the same stages of development. Proper application of operational management and administrative principles will always differentiate success from failure in any given organization. There are several theories and techniques, which have been put forward to explain the success of different organizations, but overall, determination, dedication, innovation, and creativity are some of the factors that facilitate the success of these companies. Regardless of the size of the company, managers should always endeavor to be dynamic be ready to encounter different challenges and cope with the rising market demands. Chinh and Anh Chu for example changed their business from a small-scale craft shop to one of the most fast growing factories since they were flexibility and had the desire to succeed (Morgan, 2010, pp 64). References: Gold, A., Malhotra, A., and Segars, A. (2001). Knowledge Management: An Organizational Capabilities Perspective. Journal of management information systems. 18 (1) pp. 65-107. Holmen, M., Knopf, J., and Peterson, S. (2002). Trading-off Corporate Control and Personal Diversification through Capital Structure and Merger Activity. Retrieved from Lau, L. (2005). Managing business with SAP: planning, implementation and evaluation. USA: Idea Group Inc. publishers. McNamara, C. (2010). Organizational Change and Development (Managing Change). Human resource development international. 7 (4) 247-262. Morgan, P. (2010). Capacity Development and Public Private Partnerships. Retrieved on March 25, 2011, form St. John, C., and J. Harrison, "Manufacturing-Based Relatedness, Synergy, and Coordination." Strategic Management Journal 20 (1999): 129–145. Staw, B., Sutton, R., and Sutton, L. (2000). Research in Organizational Behavior. USA: Elsevier publishers. Thomas, J., and Mason, W. (2010). Diversification strategy. Retrieved on March 25, 2011, from Read More