operations management assignment
TRANSCRIPT
UGB 233; Operations Management; Michael Winship
Operations Management – Holly Farm
‘Operations Management is about how organizations produce goods and services.
Everything you wear, eat, sit on, use, read or knock about on the sports field comes to
you courtesy of the operations manager who organized it’s production’.(Slack and
Chambers 2007)
This report will look at the questions that have been raised supporting the case study of
Holly Farm, the report will be structured in the format of a report through listing the
various questions in turn.
Question One – Identify the main micro-operations to be found at Holly Farm .For each one identify the
transformation process including the transforming inputs, the transformation processes
and the transformed out puts.
From reading the case study into Holly Farm it can be said that it is identifiable what the
main micro operations within Holly Farm are which are the following;
Farm Parking
Tours Of The Farm
The Milking Parlour
Ice Cream Production
What are Micro Operations?
Micro Operations can be defined as ‘the major external and uncontrollable factors that
influence an organizations decision making,and affects its performance and strategies.
These factors include the economic factors, demographics, legal, political, and social
conditions technological changes and natures forces’ (www.businessdictionary.com)
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UGB 233; Operations Management; Michael Winship
What are Macro Operations?
Macro Operations can be defined as ‘conditions, entities, events and factors
surrounding an organization that influence its activities and choices, and determine its
opportunities and risks, also called operating environment.
(www.businessdictionary.com)
Source; Slack and Chambers, 2007
The diagram above shows the transformation output model of operations it shows that
before goods and services and sent out for the customer to buy there is a
transformation process that must be undertaken first. This diagram also shows that
there are both transformed resources and transforming resources that go into the
transformation process. The transformation process itself as it says on the model must
conform to the model otherwise the process will not be complete and problems will begi
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UGB 233; Operations Management; Michael Winship
The transformation processes within Holly Farm are detailed below;
Micro Process Input Transformation Output
Ice Cream
Manufacturing
Transformed -
Ingredients, Cream,
Sugar, Packaging,
Cleaning Products.
Transforming –
Manufacturing
Equipment,
Freezers,
Mixers,Labour
Mix Product,
Package and Label
product, Freeze
Product, Clean
equipment,
Distribute product
Finished Ice cream
tubs ready for
customers. Various
sizes and flavours
for customers to
enjoy. 350 ice
creams made each
day for customers to
enjoy. One flavour
of ice cream is
made each day.
Milking Transformed – 150
cows to be milked.
Turntable for these
150 cows to be
milked on.
Transforming-
Carousel Parlour in
which the cows are
milked. Purpose
built gallery for up to
twelve visitors to
watch the milking
process.
Cows are milked for
about 2.5 hours
during the time of
4.30pm and 7pm.
Spectators like to
view for ten minutes
and can view an
explanatory tape for
five minutes.
The milking process
is complete, with
milk being produced
from the cows.
Tours Transformed –
Trailors for the
visitors to be able to
The trailor allows
visitors to be able to
access all areas of
Visitors are able to
see all aspects of
the farm, and be
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UGB 233; Operations Management; Michael Winship
tour the farm.
Transforming- The
farm staff are
needed to drive the
trailors so visitors
can get around the
farm.
the farm. able to see what the
day to day running
of the farm is like.
Visitor Parking Transformed –
Various coach
companies that are
escorting visitors to
the farm need to be
made aware of how
to get to the farm..
Visitors to the farm
arrive at 11am when
the farm opens to
visitors.
Transforming –
Space for 40 cars in
the car park. A six
space park for 40
seater coaches
The entrance fee to
visitors is four
pound.
Enough space for
visitors to be able to
park at the farm.
Children and
families can use the
adventure
playground and
picnic area. Visitors
will need to leave at
7pm this is when
the farm closes.
Question Two; Holly Farm has both service and manufacturing operations. What do you believe are the
order qualifiers and order winners of the 2 operations (Farm Visits and ice cream
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UGB 233; Operations Management; Michael Winship
manufacture)? Outline the farm visit service operations and the ice cream
manufacturing operation in terms of the five performance criteria outlined by slack et al
(2010). Justify the relative importance of the criteria and explain the relationship to their
order qualifiers and winners.
What are order qualifiers?
‘Qualifying factors may not by the major competitive determinants of success but are
important in another way. They are those aspects of competitiveness where the
operation’s performance has to be above a particular level just to be considered by the
customer’ (Slack and Chambers, 2007)
What are order winners?
‘Order winning factors are those things which directly and significantly contribute to
winning business. They are regarded by consumers as key reasons for purchasing the
product or service’ (Slack and Chambers, 2007)
Figure 1.0 – Order-winning, qualifying, and less important competitive factors
The diagram in figure 1.0 shows clearly the different ways in which order winning and
order qualifiers are in trying to attract customers to want to use the products and
services that they have again.
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Source; University Of Sunderland Lecture Slides 2011
UGB 233; Operations Management; Michael Winship
Slack devised five main performance objectives for operations, the diagrams below
illustrate what these objectives are and also what each of the objectives mean.
Five Performance Objectives
Source; Slack and Chambers
Obtained From; University Of Sunderland Lecture Slides
The next diagram shows what each of the performance objective outlined by slack are
and also what they mean to a business. If a business gets all of the five performance
objectives correct this will mean customers will be happy and will use the business
again.
Performance Objective Analysis of Objective
Quality Quality is all about the overall product and
service that is being offered to customers.
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UGB 233; Operations Management; Michael Winship
Quality needs to be of a standard that
customers are happy with so that they will
come back to use the products and
services again. In terms of Holly Farm if
Holly Farm delivers the services that they
say that they will and the four pound
entrance fee offers value money this will
represent good quality.
Speed Speed is all about how long it takes for the
customer to get what they are wanting.
Speed is a key performance objective as
customers do not want to be waiting
around for a while. Speed needs to be
quick enough so that customers are not
wanting longer then they would want to
wait. If terms of Holly Farm if Holly Farm
rushes people around the farm during
tours this will result in visitors not coming
back to the farm as they want to be able to
go round the farm and at relaxed pace.
Dependability Dependability is all about trust, can the
business be trusted to do what they say
they will do. If dependability is good
enough for the customer to be happy with,
the customer will return again and again
and make frequent business. In terms of
Holly Farm if the farm delivers on
everything that it sets out in its programme
for the farm this represents good
dependability. Good dependability within
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UGB 233; Operations Management; Michael Winship
Holly Farm also relies on whether there is
enough space for visitors to park and
children to play.
Flexibility Flexibility is all about the firm changing
things to adapt to certain situations. The
company differentiating in what products
and services they offer will help them to be
flexible. In terms of Holly Farm being able
to be flexible allows them to offer
customers more activities for them to do at
the farm at short notice, a measure that
will appeal to customers and make them
want to visit the farm again.
Cost Cost is all about doing things that are not
expensive to the customers to the
business. If cost is cheap enough
customers will return and use the services
again. Cost is arguably the most important
performance objective due to the overall
impact to the customer. The business
needs to set a price that allows them to
make a profit on every customer that uses
the services that they are providing. In
terms of Holly Farm cost is what the
customer pays to visit the farm.
As Holly Farm has many parts and operation to it, it can be said that there are many
forms of order winning criteria within the farm. One of the biggest order winners will be
the price that it charges to visitors, Holly Farm is in direct competition with other farms
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UGB 233; Operations Management; Michael Winship
and therefore visitors will look at the four pound entrance fee and compare this to what
other farms are charging before they decide to go to Holly Farm. As Holly farm is
charging four pounds this would be considered to be quite cheap and therefore may
encourage visitors to use this farm rather than others, however if competitors offer free
entrance this would deter visitors going to Holly Farm. In order for Holly Farm to make
the price a sure order winner Holly Farm need to ensure that they are keeping an eye
on the competition and continuing to offer a competitive price and attractions for visitors
to enjoy.
Another major order winner qualifier would be the type of ice cream that Holly Farm
sells, Holly Farm currently manufactures four types of ice cream and therefore some
customers might be happy with the choice of flavors that are being sold. Some
customers might not prefer what is on offer and may appreciate a different choice
meaning that whilst the ice cream may please some customers it might not please all. In
order for Holly Farm to make the ice cream that it sells a definitive ’order winner’ it may
want to look at introducing some other flavours to the product range this will ensure that
all visitors to the farm will be able to pick a flavor that is suitable to them.
The Hill framework as detailed below, illustrates how there are seven main reasons why
products win orders. In terms of holly farm it can be said that out of the seven main
reasons the Hill framework identifies the farm do four of these effectively which are;
Price
Quality
Delivery
Service
Hill Framework
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UGB 233; Operations Management; Michael Winship
Obtained From; University Of Sunderland Lecture Slides.
Polar Diagram For Holly Farm
Performance Objective Farm Visits Ice Cream Manufacturing
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UGB 233; Operations Management; Michael Winship
Quality 3 5
Speed 1 3
Dependability 3 3
Flexibility 3 2
Cost 5 4
The cost of the visits to the farm have the potential to be the order winning criteria for
Holly Farm this is because of it being quite cheap at only four pounds. The price to visit
the farm will be overall what entices visitors to use the farm this is why this has been
given the maximum score. The ice cream manufacturing has been given a score of four
this is due to like the cost the ice cream manufacturing could be the order winning
criteria as visitors may want ice cream that has just been made rather then it being sat
in a freezer for some time.
Speed has been given a low order winning criteria score this is due to visitors to the
farm wanting to take their time around the farm in order to see all that it has to offer.
Speed will not be an order winning qualifier because visitors to the farm would rather
take their time then be rushed about. The speed for ice cream manufacturing has been
given a satisfactory criteria score this is due to the fact that visitors would be prepared
to wait for their ice cream but would not want to wait a long time for their ice cream to be
produced.
Dependability has been given an order criteria score of three this is because the
dependability of the farm to visitors will be determined once visitors have been and
visited the farm. If visitors can depend on the farm to deliver what they say they will this
will help the farm to achieve a more sustainable order criteria score when it comes to
dependability.
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UGB 233; Operations Management; Michael Winship
Question Three;
What is the current design (maximum) and effective capacity of 2 of the Micro Operations;
Parking and Milking Parlour Viewing? Are there any problems in meeting demand?
Capacity can be defined as ‘the maximum amount that can be processed within a
specific time’ (Waters 1991)
Total production time available
Capacity = -------------------------------------------------
Time for one unit
Source; University Of Sunderland Lecture Slides.
Type Of Operation Design Capacity Effective Capacity
Parking Car Parking = 40 Cars in
total with 5 people in each
car = 200 people
Coach Parking = 6 coaches
with 40 people in each =
240 people
200 + 240 = 440 people
4 people normally in a car
(this would be a family
based on 2 adults 2
children) = 40 x 4 = 160
Rounding the coach
parking to the nearest ten
which would be 30. (note
30 has been used as this
would be more suitable for
the farm to estimate how
many people are visiting)
30 x 6 = 180 people visiting
180+160 = 340 people
which mean that there is
100 visitors less than
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UGB 233; Operations Management; Michael Winship
normal and the capacity
utilistion is 77%
Milking Parlour Viewing Milking Parlour has space
for 12 people in each 15
minute viewing slot. The
milking process lasts two
hours 30 minutes between
4.30pm and 7pm.
There are ten 15 minutes
periods in 2hr 30 minutes =
12x 10 = 120. Therefore
120 people can view the
milking process between
4.30pm and 7pm
The effective capacity for
the milking parlour can’t be
measured this is due to the
effective capacity being
locked at 12 people in each
time slot. This is due to the
amount of headphones
available to view the milking
process.
Question Four; Gillian intends to increase the number of Farm Visitors by 50% how can capacity/demand
be managed to meet this increase?
Holly farm is a seasonal business and therefore only operates during certain times of the
year this is because demand is too low during other times of the year. Demand for visiting
the farm can be best determined through the busiest month of the year for the farm which
is august. The following diagram below shows the demand for the farm during the busiest
times of the year, the diagram will help to illustrate whether the car parking and milking
parlour is able to handle demand during the peak times.
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UGB 233; Operations Management; Michael Winship
Demand per Week is 3400/4 = 850 visitors per week
The farm is open four days per week = 850 visitors / 4 days = 212.5 = 213 visitors per
week
Demand is double that of Monday and Friday = 850/3 = 283.33
Friday = 142 Visitors
Saturday 283 Visitors
Sunday 283 Visitors
Monday 142 Visitors
850 visitors in total
What the demand figure shows is that if the if the farm was in peak period of 283 visitors
per day then the car parking can handle the demand however the milking parlour can
only handle 12 people in the 2hrs 30 minutes due to the limit of headphones available to
view the procedure. If Gillian intends to increase the capacity by 50% further car parking
spaces would need to be constructed as the current structure would not support the
increase. Further headphones would also need to be bought so more people can view
the milking process as currently even though there is over 850 visitors a week only 12
people can view the milking process during the hours of 4.30 and 7pm.
References
Books
Slack N and Chambers, Fifth Edition, Operations Management, Prentice Hall,
2007, Operations Management, Page Two
Slack N and Chambers, Fifth Edition, 2007, Operations Management, Prentice
Hall, Page Number Nine
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UGB 233; Operations Management; Michael Winship
Slack N and Chambers, Fifth Edition, 2007, Operations Management, Prentice
Hall, Page Number Sixty Nine
Websites
http://www.businessdictionary.com/definition/macro-environment.html - Date
Accessed 5th May 2011
http://www.businessdictionary.com/definition/external-environment.html - Date
Accessed 5th May 2011
Lecture Slides;
University Of Sunderland Lecture Slides, Operations Management, Assignment
Guidance, Slide Number Four, 2011
University Of Sunderland Lecture Slides, Operations Management, Assignment
Guidance, Slide Number Seven, 2011
University Of Sunderland Lecture Slides, Operations Management, Assignment
Guidance, Slide Number Nine, 2011
University Of Sunderland Lecture Slides, Operations Management, Assignment
Guidance, Slide Number Thirteen, 2011
University Of Sunderland Lecture Slides, Operations Management, Assignment
Guidance, Slide Number Seventeen, 2011
University Of Sunderland Lecture Slides, Operations Management, Lecture
Week Three, Slide Number 10, 2011
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