SG-44006 Business Operations And Systems: Supply Chain Network
Supply Network Design
Taylor & Tom Ltd. is a market-leading manufacturer based in the UK. The demand forecast in different regions estimated for next year is as follows:
Region |
Scotland |
Wales |
London |
South West |
Demand Forecast (000) |
180 |
95 |
175 |
130 |
The managers are designing the manufacturing network. Four potential locations are to be considered. In addition, based on the business plans, there are two available capacity options for establishment of the new factories. The capacity of the plant could be 180000, or 250000 units per year.
The costs of producing and shipping a product unit to each of four markets along with the annual fixed costs at four locations are provided as below:
|
Production and transportation cost (£) |
Annual fixed cost of 180000 plant (M£) |
Annual fixed cost of 250000 plant (M£) | |||
Scotland |
Wales |
London |
South West | |||
Swindon |
190 |
130 |
160 |
125 |
4 |
4.40 |
Birmingham |
180 |
140 |
145 |
150 |
3.5 |
3.85 |
Manchester |
150 |
148 |
155 |
163 |
3.9 |
4.29 |
Glasgow |
120 |
160 |
180 |
203 |
3.1 |
3.41 |
Considering the available marking scheme in your booklet (criteria 1.1-1.2), write a report and answer to the following questions:
- How much it cost if the management want to open a plant in all four locations? Advise them the capacity of each plant. Is it a good decision?
- Where should the company establish its plants to minimise the total cost? What is the optimal capacity selected for new plants at each optimal location?
- Discuss and interpret the results obtained. Conduct a sensitivity analysis to extend your discussion. What other factors should they take into consideration to make a more reliable decision?
Task 1: Supply Chain Optimisation
Supply chain design and/or Aggregate Production Planning are two issues that need to be optimised in SCM. Given a case problem, you are required to identify the appropriate model, deploy an optimisation tools namely Excel Solver and to find the optimal solutions. You need to interpret the results and to discuss the sensitivity analysis. You should also mention the model’s limitations and highlight other factors affecting the decision making.
Task 2: Lean Management and its challenges
Lean management has been defined as, "The practice of using scientific methods to solve business problems in order to create value", by the lean thinking pioneer, author and academic Professor Daniel Jones.
With reference to a particular business or organisational problem:
- Describe Jones's statement in the context of your chosen business problem
- Explain and discuss the benefits and challenges, as well as any strengths and weaknesses, of the broader lean management methodology in the context of your chosen organisation
- Illustrate how the relationship between Quality and Performance Measurement could be enhanced by an effective Lean Management intervention.
The final submission will consist of an individual essay, 2600 words (+/-10%).
Your work must be supported by the relevant academic literature related to this field, as well as any necessary or relevant practice-based literature, to develop a fuller discussion.
Your submissions will be expected to demonstrate the following qualities:
- Answering the central focus of the assignment question
- A critical appreciation of relevant literature and its use to support argument, substantiate model(s) and other aspects of the assignment
- Ability to analyse relevant theoretical concepts in a critical manner, evaluation of material, indication of gaps in the literature
- Logical flow of ideas and treatment; imaginative approaches; appropriate selection of real world factors related to the model(s) or specific assignment topic
- Evidence of additional personal research, and the ability to analyse material from a variety of appropriate relevant perspectives
- Presentation, structure, appropriateness of methodology, breaking into section headings/subheadings, tidiness
- A strong and well considered conclusion
Task 4: Reflection
Critically reflect on your own learning in this module, evaluating how the theories and concepts influence your role as a leader and manager and exploring the potential impact on your organisation. As a result, please identify any effects on your personal and professional development, citing actions which you now need to take and any potential barriers.
Answer:
Task 1
Introduction
The main goal of a supply chain network design is enhance access to the policies and programs of the company and meet the obligations that are aimed at attaining long term strategic objectives and numerous business units or the functional areas that are found within the company are influenced by a project on network design. It is of utmost importance to acknowledge that the network of a company is used in determining its supply chain efficiency and the customer satisfaction Zhang (2012). The design of an optimal supply chain network translates to a network that must be in a position to attain the long term strategic objectives of the company in question. The network design project influences most of the business units or otherwise the functional units that are found within a company. A number of steps are followed in the design of a supply chains:
- Definition of the objectives of the business
- Definition of the project scope
- Determination of the form of analyses to be done
- Determination of the tools that are to be used
- Lastly, completion of the project, the best design
Numerous significant benefits are accrued to a business once the path forward has been determined and the completion of the design approach done.
Business and operation strategy which are application in the formulation of the strategies used in driving investment, competitive functioning and investment forms the point of beginning of all the real economic values Wang et al. (2015). Answers to five strategic questions should be achieved:
- Whatare the target markets?
- Whattype of business in the CPG Company in and for what reason?
- Whatabilities are required to ascertain that there is addition of value and differentiation by the company?
- Howshould addition of value to the business be done?
- Whatare the goods and services and what will prompt the customers to buy from the CPG Company?
Methodology
In order to attain the long term strategic and objective plans, the management of Taylor & Tom Ltd would adopt the various optimization tools in ensuring that it attains maximum returns from the investments made. These tools would enable the company be in a position to make the right choice in terms of locations of the new production factories such that they are able to trap maximum profit from the pool of potential customers available. The optimization too that would be adopted in this case is the excel solver Yadav & Dabhade (2013).
Excel Solver
The excel solver is a member of a special set of command that is in most cases known as What-If Analysis Tools. It is mainly used in the simulation and optimization of different business as well as engineering models. The excel solver add-in is primarily useful when it comes to the solution of linear programming problems also called linear optimization problems. The tool is thus other times called linear programming solver. Excel solver may also be used in the handling of smooth nonlinear as well as non-smooth challenges satisfaction Zhang (2012).
In as much as excel solver is not able to crack down every possible challenge, it is of great significance when it comes to handling all different types of optimization problems in which a need to make the best decision and choice arises. An example of such an application is where the tool is deployed in the maximization of the return of investment, minimization of the costs of delivery, making a choice o
n the optimal budget to be used in an advertising campaign as well as making one of the best work schedules for the employees of an organization Wang et al. (2015).
Limitations of Excel Solver
Dealing with Problem Size Limits: There is an upper limit placed by the excel solver on the number of decision variables as well as the number of constraints that can be found within a solver model. While the limit on the decision variable is that which is straightforward, the limit on the constraints in determined by the model type, whether linear or non-linear as well as the constraint form.
Limit of Decision Variable: The limit on the decision variables on a standard Microsoft excel solver is 200 which is applicable to both the linear and non-linear problems Aigboduwa & Oisamoje (2013). The way out of this limit is by changing the model in such a way that some of the chosen cells as the decision variables are eliminated from the By Changing Cell reference and are instead held constant throughout the process of optimization. The what-if analysis is or any other applicable methods are then used in the exploration of the consequences of altering the cells which are no more determined by the Solver.
Discussion
Question 1: It costs £3988 M to the open a plant in all four locations with a capacity of 180000 units in a year while it costs to the tune of £4733 M to a plant in all four locations with a capacity of 250, 0000 units in a year. Following this analysis, it is advisable that the company adopts the option of the plant that generates 250000 units in a year. While this may appear costly at the beginning especially when it comes to the capital costs of purchase and installation, the long term impacts and hence financial significance is felt in the long run. The company will be able to meet its long term obligations and objectives should it adopt and implement a plant with a production capacity of 250,000 units in a year Aigboduwa & Oisamoje (2013). At the same time, looking at the analysis between the two plants of various capacities, it is evident that the difference in the values of what it costs to open a 180, 000 units and 250, 000 units plant in all the four locations us less than £1000 M. this means at a very small difference in the cost, the company will be able to meet the demand needs of its target customers through enough or otherwise more than enough production.
Question 2: In order to minimize costs, the company should set up the plants in Swindon and Glasgow. While the cost of opening a plant in Swindon is £965 for 180000 units per year capacity plant, it costs £1030 for the case of 250000 units per year capacity plant. For the case of Glasgow, the cost of opening a plant of a capacity of 180000 units is £909.3 while that of a 250000 unit’s capacity plant is £1152.23. It is this advisable that the management of the company takes into consideration the costs at the two optimal locations. This should however not be treated in isolation but should also be inclusive of other factors among them the demand forecast which would see the company able to sell out what it has produced from the plants installed satisfaction Zhang (2012).
The optimal capacity of the optimal locations is 250, 0000 units per year. This optimal capacity will ensure that the supply of the finished goods into the market is maintained while the company incurs the least cost in the production process. To this extent, the company will be able to cut on costs while maintaining or raising its profit base.
Question 3: From the obtained results, it is observed that using a plant capacity of 250000 units per year in all the four locations proves to be more economical in the long run. This is in the sense that there is a marginal difference between the cost of opening a 180000 unit capacity plant and 250000 units capacity plants since the variation is barely £1000 M. this means, should the management opt to work with a 180000 units capacity plant, it would incur extra costs at lower production volumes and tris would in the long run lead to diseconomies of scale. Still, the findings from the analysis of the given case illustrate that the regions Swindon and Glasgow are the optimal locations of the plants and would ensure maximum profit. This profit is achieved when the two locations have optimal costs of the plants adopted which in this case would mean having the 250, 000 units capacity in both optimal locations Wang et al. (2015).
Other factors that may be taken into account in the given case is where all the four plants are located in the same optimal location; one of the cases having the 180000 units capacity plant, another having the 250,000 units capacity plant and yet another option of having the two capacity plants in the same ratio of 1:1 which means two of each of the capacities Wang et al. (2015). Still, considering the option of having the four plants in the location with the highest number of demand forecast should be considered. In this case, focus would be on the market availability as opposed to the production cost. In this regard, the high number of the customers would be used as an opportunity to hike the prices of the commodities to meet the cost of production which may not be necessarily optimal in the chosen location.
Sensitivity Analysis
The fixed costs in this given case are the number of units produced by each plant per year. The installation cost of a plant that will depend on the number of units produced by that plant. Having four locations in which the plants are to be installed, a sensitivity analysis can be done to find out the impacts of the fixed variable which is the number of units produced on the dependent variable. Suppose the management decides to have the four locations have the 250000 unit plant in each of them. The management will then need to spend £ 4377 M as illustrated in the calculation below:
Production Cost at 180000 |
Production Cost at 250000 |
965 |
1030 |
1000 |
1042.5 |
1113.7 |
1152.27 |
909.3 |
1152.23 |
3988 |
4377 |
Another possible alternative that the company may try is to have the four locations installed with 180,000 unit’s plants. In this case, the business will incur a cost of £ 3988 M in order to have the business running. While this will be a lower cost compared to that of installing 250, 000 unit’s plants, the returns will be slightly lower in terms of maximization of the profit owing to reduced supply. This may give the business the option of combining the two plants in a ratio of 1:1 among the four locations such that two locations have 180, 000 units plant installed and the other has 250, 000 plants installed. Under such a circumstance, the company would incur almost half the cost of installing both of the plants. This means that the installation cost will be about (£ 3988 M +£ 4377 M)/2=£ 4180 M. this would see the business maximize the benefits accrued from installation of either of the plants.
The management should consider other factors like;
- Market availability -the finished product of the company must get access to the market so as to make the company self-reliant.
- The legislation that governs the country or region with respect to the establishment of companies should be put into consideration.
- The possibility of future expansion in regard to land availability
- Public perception that will translate into labor availability
Task 2
The oil and gas industry in Nigeria
Nigeria is the second largest oil-producing countries in the African continent after Libya while taking position nine in the whole world with the crude oil deposits.
Table 1: Oil and Gas reserves Oil reserves plus condensate (mmbbls) |
Natural Gas reserves (tcf) | ||||||
Associated gas (AG) |
Non-associated gas (NAG) |
Total gas | |||||
2010 |
36,532.97 |
92.945 |
89.872 |
182.817 | |||
2011 |
36,247.41 |
92.904 |
90.530 |
183.434 | |||
2012 |
37,139.10 |
89.729 |
92.529 |
182.258 | |||
2013 |
37,070.83 |
89.652 |
92.298 |
181.950 | |||
2014 |
37,448.00 |
90.094 |
97.904 |
187.998 | |||
2015 |
37,062.06 |
97.208 |
94.857 |
192.065 |
The activities of the exploration take place underground where the hydrocarbon deposits are looked for commercial purposes Tie et al (2015). He the significant deposits are found; the production activities are undertaken to extract it Pickering et al (2013). The fractions of the crude oil are separated using the fractional distillation. The production of the crude oil is currently being produced from the three main areas including Niger Delta, Anambra and the offshore of Benin.
Figure 2: The areas rich in oil deposits in Nigeria extracted from (Keissling 2012)
This corporation is basically involved or engages in the oil exploration and production In the African countries. This company usually obtains the semi-processed properties in the known oil basin Kiessling (2012)
The crude oil distillation process may be done either on the site or to specific companies.
Figure 3: Crude oil separation extracted from (Gibbs 2012)
The ADDAX PETROLEUM industry
The company that is based in the Geneva, Switzerland has solidly established its exploration activities in the countries like Gabon, Cameroon apart from Nigeria. In the past, the company had experienced challenges with its staff Gibbs & Latzko (2012). The workers stormed the company offices chanting solidarity songs while ensuring that the management was denied the access to the premises. These protesters claimed that their health and safety were never properly magnitude delay of their collective bargaining among others. These continuous strikes and go-slows usually paralyze the company's operation and result in losses.
The areas of risk management, the safety of the workers that have become issues of concern in the organization. The organization has been exploring the lean thinking as a way to effectively address the thorny issues. It is observable that prior to the attempts to have these factors put in place, the challenges were so much. Speight (2014).
Figure 6: Areas of operation of ADDAX industry in Africa. Extracted from (2016)
The problems of the staff and the employees at the ADDAX can be addressed using the JONES lean management.
The lean idea originated from the Japan automobile manufacturing industry in the year 2003. The Toyota company developed the production system whose basis was to create the flow in the manufacturing industry while eliminating the wasteful activities in the production process. This process assumes that there exist two types of the activities in the company-the value adding activities and the non-value adding activities which accounts for the 95% of all the activities in the organizations Gibbs et al (2012). The non-value adding activities are the daily operations which do not add any value to the end product and therefore referred to as the waste. It is therefore important to have them eliminated. The main reason for the waste elimination is to improve the value to the customer and also to bring a positive profitability in the products and the services that an organization usually provides to its customers Speight (2014).
Other scholars have described lean as the attention of the organization on what is perceived to be important and thus still includes the customer satisfaction and he wastes elimination. These scholars further argue that lean is not just a waste removal activity but also an improvement tool in the transportation and accounting sections. For today lean finds most of its applications in areas such as hospitals, banks etc.
The types of wastes that lean seeks to eliminate are of broad categorizing the overproduction sector,
The manufacturing of the items that have not been ordered for is can be reflected in the service waste where an item is purchased before it is needed. This includes undertaking an activity just in the case of another event occurring. This process, therefore, is a counterintuitive option to the traditional manufacturing model that solely concentrates on the mass production to obtain economies of scale Buckingham et al (2015).
The processes of lean management
Its processes are based on the five main principles that should be followed in order to realise the effectiveness.
Specification of the value by the product
It basically concentrates on or focuses on the identification of the customers need. The question of what the customer wants if fully and boldly posseted determination of the value can be from the customer’s perspective or the result of the subsequent process. In the lean thinking way, this usually gives the product its desired value, comprehensive service definition through the capabilities that are usually based on the customer needs or the requirements.
Value stream Identification
The identification of the value stream is done in the two steps. The stage or the step which do not add any value should be eliminated as fast as possible Zhang (2012). The value in this case may consist of value creating and the non-value creating actions which collectively bring the end result or the product from the mere concept to the launch and from the order statement to the delivery. It basically focuses on all the actions required for the provision of the goods and the services from the angle of doing the final delivery to the customer in the required nature. The analysis, therefore, will review all the points along the value stream through the process usually identifies or classify the activities as the value adding and the non-value adding ones, the activities that are usually perceived to be non-value adding are deemed to be necessary.
Make the product to flow
According to Jones, this is an interrupted movement of the product or even a service from the system itself to the consumer or the customer Christensen et al. (2013). When analysis of the system is done, the manager pays attention to the challenges and the areas that are likely to be affected in the future. The value-creating steps should strive to ensure that there is a smooth flow of the product from the system to the consumer. The idea behind this is to ensure that the employees actively contribute to the flow besides improving the value without the necessary delays. The batches and unnecessary queues are potentially removed. The provision of the required services in very distinguished silos where there are delays and the communication problems will hinder the flow and lead to subsequent damage to the product are removed.
Supply at the interest of the customer
The focus now shifts to the process that allows the customer to pull the product. The customer will definitely take over when the organisation decides to make only what the customer wants and when it is required. The customer therefore will tend to insist on the existence of the product or the services that they dearly need. The product and the services that have been offered in the market with very low demands will be considered to have been pushed to the customers Christensen et al. (2013). The push comes when the demand no longer exists but the producers continue with their production activities. The result is that the goods and the products will require very huge inventories.
Perfection stage
The perfection in lean is only possible when all the wastes have been eliminated. The other four principles that have already been highlighted will always work together so that the value which flows through a system will identify the possible areas of waste existence. It is important to note that any further pull on the process will definitely be an impending process on its own. The close collaboration with the key stakeholders that include the suppliers and the customers will surely lead to the improvement of the entire process and hence the perfection is achieved.
Lean and Waste in Addax Petroleum Nigeria
The five principles that have already been mentioned according to Jones have been of help to the petroleum industry in Nigeria. The possible remedies to the problems faced were the use or the application of the lean operation Zhang (2012). This is very important improvement that had been suggested in the past by the specialists from Scotland. This method of solving the problems has since spread across the continents of the world in an attempt to address the specific problems in various human service sectors. In the ADDAX industry, lean application has been accepted to be used by the management to enable them to meet the challenges that have been facing them in their daily operation and this has basically been the best way to reduce the variations in waste management and elimination besides reducing the harm caused to the operators or the employees in general. The process identifies different types of wastes and there is an attempt to have them highlighted for the removal.
The waste of overproductions is a lot of overproduction of the petroleum products. Some productions have also been done too soon. This has led to the disruption of the flow of the material and the subsequent development of the inventory. This also applies to the delivery of goods that has often been done too much on the products. Although this has always been done to keep the staff or the employees here busy, it is a clear show that something somewhere needs to be corrected Gibbs & Latzko (2012.
Unnecessary waiting as a form of the Watts waste occurs when the utility of the time is very low within the company. This results in the long periods of non-engagement or inactivity for the people. This has resulted in the interrupted flow for the products negatively impacted the customers. Some of the customers have already been lost due to this waste Christensen et al (2013).
The transportation wastes
The movement of the petroleum products from one point to another has led to the considerable an amount of waste being realized. The carrying of the paperwork from one department to another department has also led to increasing the level of waste. This includes the assembly of the finished products that usually passes through different processes Mills (2013). It was found out that moving the product from one place to another does not add any value to the product itself.
The waste occurrence of the unnecessary processing or the inappropriate processing.
These inappropriate processing processes include those that have been done using the wrong set of the tools, using the wrong procedures or the wrong systems. It may also refer to the process that leads to the satisfaction of the need of the customer according to the laid standards of the customer satisfaction Duke et al (2016).
The waste due to the unnecessary inventory
A lot of the customers have been inconvenient while high costs incurred in accessing the congested stores foot the unconsumed products lot of the storage has been in the demand and this Has led to use of huge sums of money build even bigger storage rooms.
The waste resulting from the unnecessary motion Cortez (2013)
The poorly organized workplaces have resulted in poor ergonomics which causes frequent stretching and bending extra to reach out the various tools. This includes the operators having to walk from one point to another within the workstations.
The waste of the products with the defects
The defects are usually taken as the mistakes that are made by the machines during the production stages. They normally result in the negative impact in the on the efficiency and the continuous interruptions. These problems also lead to too much paperwork those results from the mistakes and the errors.
The benefits of the lean management in the petroleum industry
The just in time tool of the lean management has helped in the elimination or minimization of the raw material inventory and even the work in progress inventory elimination. It has significantly contributed to the minimization of the defects Gibbs et al (2012). The production levels have improved as a result of the Just in Time tool of the lean management. This has been achieved through the simplification of the production process that ensures much flexibility and exploitation of the multi-skilled workers. The manufacturing throughput time can be defined as the time duration that exists between the releases of an order to the floor of the factory up to the time it is given to the customer or it is received as a finished product.
This reduction in the throughput time is usually accompanied by several benefits some of which; the lower costs, the forecasting error is less and the improved quality. The flexibility levels are highly increased and the duration taken to respond to the customer orders are highly reduced Vienažindien?,2012. The chances of the survival of the companies are increased while the profitability becomes high. The scheme will, therefore, favour those firms that usually experience the market pressure for having the short time for the customized products. The lean manufacturing is also called the lean production. It is a practice that is usually interested in the elimination of all the waste in the process line using the relevant tools Panizzolo, et al 2012. It is focussing on lowering the production cost, the increased output with very short time consumptions.
Fig 8: A simple diagrammatic illustration of the organized setup. Extracted from (Gibbs 2012)
The total production maintenance as one of the lean management tools has been thoroughly utilized to improve on the production while enhancing the morale of the employees and job satisfaction in general. The management has been encouraged to organize the activities whose aim is to train the employees and make them more responsible for the machines that they are evaluating or operating Mills (2013). The six big losses including the reduced speed, idling and stoppages, the reduced speeds and equipment failure have been effectively taking care of. Thanks to lean management.
The total quality management that puts the quality at the center of its activities has helped in the improvement in the value of the petroleum products in Nigeria. The TQM shows commitment to meeting the customers need band the possible expectations. This covers all the sections and every individual within the organizations Musa et al (2013). It examines all the quality related costs and focuses on the improvement of Speight (2014). The plan does check and the standard do checks have been exploited and the end result has been the quality of the petroleum products being produced. This is achieved by use of the tried and tested solutions
Figure 9: The flow chart of the similar process
The Human Resource Management (HRM) is probably the final tool of the lean management. The human resources are the expertise and the efforts that are usually provided by the employees within the organization the petroleum industries had been looking for the effective methods of monitoring the performance and the competence or the potential of the employees. In order to achieve this, the lean management tool uses a variety of the practices' practices include the job design, the training programmes, promoting team works, the job enlargement, the employee's involvement. The act of putting these practices in place has seen most of these companies succeed or overcome several challenges of a similar kind.
The challenges of the lean management
Although a lot of aggressiveness has been shown to the use of the existing frameworks to support the processes of the implementation of this technique, a lot of caution must be exercised when there is a transfer of the methodologies of the lean into the public sector. This is because the characteristics of the operation may not lead to the complete transferability of the applications Speight (2014). In some departments within these institutions includes the workers or the staff themselves not feeling much empowered to affect the changes that have been proposed. There is a lot of discomfort in the discussion of the customer services and the demands. A lot of the effort is required in the areas of the applications to ensure there is a smooth transfer of this technique in those areas.
The implementation of the lean management process requires the total dismantling of the previous setup and this has resulted in the lots of costs being incurred. In the petroleum industry, the safety is a very key factor and this has led to the use of huge sums of money to have them trained and adapt to the new system there is a lot of the traffic jams since all the companies deliver using the JIT policy Aigboduwa et al (2013). A lot of money, therefore, is spent on the transportation costs. The lean normally becomes impossible if the company delivers via sea or ocean and an attempt to use the airfreight means an additional transport cost.
The employees have different and diverse cultures. This particular factor affects the performance and the reliability of the employees. Finding the perfect employees has, therefore, become very difficult and when the management tries to put more attention or more focus on the implementation of the ideals of lean S?tk? et al (2012). Which demands the intense participation of the employees then the regular managerial issues are usually neglected.
The lean supply chain provides a lot of risks. When the company relies on just the supplier who operates on the basis of the JIT, there is the likelihood of the company having the low stock level. The consequences are whenever the supplier has a problem like for fire accidents or the power altogether will be no supplies and this has brought a lot of uncertainty within the petroleum industry in Nigeria.
The weaknesses and strengths of the lean management
In the discussion of the weakness of the Lean, the focus shifts to the key concepts and the employees or the commonly referred to as the workers Wang et al (2015). These may include cases where the workers who normally leave their jobs while they are very unsatisfied are some of the key aspects to be considered.
The main advantage of the lean management is that it has increased the competitiveness of the company against those not using the lean management or those not exploiting fully the ideals of the lean management. There has been a significant reduction in the inventories within the premises of the company. The cost and the lead time have been reduced by nearly 90% within several organizations in the ADDAX.
Lean has provided very shorter lead times and this has subsequently led to the increase in the production speed and the general reduction in the production cost. The time deliveries are also tremendously reduced Aigboduwa et al (2013).
The machinery starts up times failure has been reduced by use of the lean technology from 3.5% to less than 1%.
There have been improved cooling tower regulators in the circulating waters to 30%
The systems for the measurement have been improved and the blending systems like butane can be added without risks associated with the vapour pressure limits. The reducing of the mid-distillates inventory by around 36%.
Any of the constraints that that is usually not factored in the JIT planning will always have the sufficient potential to jeopardize the whole system. The margins for the errors involve and the system waste always proves difficult to calculate Kiessling (2012).
The achievement met using the lean methods that result in the squeezed economy usually discourages the workers. This makes it more difficult to balance the static and the continuous improvement in the environment where the lean management is used.
How the quality and the performance measurement can be enhanced using the lean management
The performance of any business can be defined as the ability of the organization to obtain and effectively use the resources that are scarce in the attempts to meet its goals. When the business is considered as an entity that seeks to survive in any competitive environment then the performance measurement will help as the contributor to the control capabilities of the business Aigboduwa et al (2013). The different models and frameworks for measuring the performance of the business have been developed whose origins may not be the same. The frameworks are those approaches that the business uses often with the significant diversity in their design. The defence models are the set standards that usually surround the specific business process and are adopted by the company for specific achievement Liu et al (2012).
The performance measurement is a crucial element in the process of ensuring there is transparency although bits of effectiveness will be determined by the existence of other transparency factors.
The performance measurement creates the moments for the reflection. Such moments are established so as to properly evaluate the results and allow for the development of other plans Mills (2013). The meetings should be held in such a way as to encourage the reflection and the creativity.
The quality and performance measurement usually ensure that there is system thinking which one of the tools of the lean management. Such kinds of thinking should be encouraged so that the factors that affect the performance are easily and effectively understood. The factors that usually cause the problems are separated in based on space and time. When a lot of time is spent on the blame games and the excuses, quality will always be compromise
Task 4
How theories and concepts influence the roles of a leader or the manager
The primary goal of any applied theory or concept on leadership is not just to be the manager who is in charge of the task or particular challenge but rather they should help one to develop that sense of the social empowerment that is geared towards achieving a specific vision. Some of the concepts are highlighted below;
The transformational leadership
This theory is multidimensional procedure that that usually states clearly the guidance for the methods to be used to manage the specific set standards Zhang (2012). The mission and the vision of this leadership theory is to help the leader to have the values and the ethics that are meant to motivate the followers that are within the system or within the organisation’s followers of this particular leader are inspired by the leaders own moral and the characters to aspire to be good individuals within the society. This theory therefore aims to tackle those intangible requirements or needs by the followers Kiessling (2012). However, the inverse of this particular theory in which the leaders exchange the performance with the monetary value is called the transactional leadership.
There exist the sub-subsets within this theory that recognizes the role of each and every individual
- Idealised influence; within this theory of transformational leadership, the manager or the leader is the standard reference for the followersGibbs et al (2012). The idealized influence, therefore, becomes the standard that everyone aims to emulate and become. This, therefore, becomes an ability of the leader in action to create the confidence of finishing the given task in order to accomplish the desired future of the organization.
- Individualised consideration; this usually serves as a subtext of the transformational kind of leadership whereby the leader takes the form of a teacher and then educates the followers on the required craft within the organization. It creates the platform of connection between the leader and the followers where the manager specifically develops the training plans for the follower.
- Inspirational motivation; this is a segment in which the leader puts the urge for self-fulfilment into the followers. The followers may occasionally be rewarded not necessarily through the monetary method.
- Intellectual simulation; it focuses on the leader's practices of making the followers think outside of the box by organizing the forums of criticism activities.
Servant leadership
This theory advocates for the followers to be given the first priority. The leader or the manager, therefore, gets a lot of respect from the followers. In order to get this kind of trust and respect, the servant leadership is of very important consideration Hughey et al (2012).
The use of the Gibbs reflective Cycle model can really help the leader of the manager to do the self-reflection. The reflection on the experiences is usually structured in the stages or phases. The leader is therefore made to think about the event in a more detailed manner thus making them aware of their practices and be able to adjust or change on their behaviour. The stages of the reflection of an individual will always begin by the description, feelings, evaluation tasks, performance of analysis, driving the conclusion before the action plan is put in place Bian et al (2012). The process of my self-reflection ideally started with the description of the situation that presented itself while posing the questions such as what happened. This was followed by the second step that focussed on the feelings. The stage focussed on the feelings that were triggered by the past event Dooren et al (2015). Though the major aim was not to discuss the feelings directly just creation of the awareness' was quite evident that talking about personal feelings was never easy but with the Gibbs model, this phase was actually tacked when the questions such as personal feeling and the feeling of other people were factored in in the refection act.
Figure 10: Schematic illustration of the Gibbs cycle extracted from (Venn 2010)
The evaluation stage was key during the self-reflection because the questions touching on the nature of the experience were handled here whether the experience had been good or bad Bianchi (2012). The analysis of what had been previously learned has now made it much easier to predict the future. The experience that has been obtained in the entire module during which the management practices were tacked has greatly improved my situational analysis skills. The knowledge of lean management takes the center of the newly learned skills that will definitely change the management practices Bednall et al (2014). This is a positive experienced as per the Gibbs model of the self-reflection. The challenge, however, remains to be putting some of the theoretical concepts into the practical shape.
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