Understanding Operations, Logistics and Supply Chain Management

MAIN BODY

Introduction

Operation management is process of managing and controlling operations of business in order to ensure efficiency and productivity. Logistics is movement of resources from region to another and to coordinate such activities is objective of this. Supply chain management is management process to handle production and relation resources so that efficiency can be increased. All these activities of organisation have basic objective to increase outputs, higher profits margins, enhance productivity and competitive advantage in the industry.

Company Profile

Audi AG is member of Volkswagen group and deals in manufacturing of luxury cars and promotes it in international market. It is one of the largest German Auto-mobile brand which has strong image at global level and has good market share in industry as well (Audi, 2019.). First topic is Quality Management is process of determining and controlling operations of organisation so that desired or set standards of quality can be achieved. This is management process which includes determining policy, systems, planning, measuring, tools, techniques, etc. to ensure that quality is controlled and managed effectively. It focuses on short and long - term objectives by implementing quality initiatives in operations Example of assignment  with the help of Total Quality Management. Another is Just - in - Time which was introduced by Toyota corporation to minimise the cost related to maintaining inventory in company.  This is process which will help organisation to eliminate need arise to keep stock in business. In this part of operation will arrive when it is required by manufacturing process to meet demands of customers. Lean Manufacturing is concern with value of customer in terms of product or services they avail in market. This helps company to find out what is real value of goods or services that business is offering in targeted market for customers.

Quality Management and theories

Quality is refer to as inferiority and superiority parameter of product or services according to the specifications. Whenever, any product or service meet expectations of customers tends to be qualitative for consumers. Managing this aspect is one of the critical and significant process in context of  Audi AG. Quality can be effectively managed and controlled with the help of Total Quality Management theory (TQM) and related principles of it. Total Quality Management can be define as customer - oriented management process which have basic objective of improving quality of business operations. This is concept which states that workforce should work in direction of continuously improving services, systems, culture and processes to ensure that organisation have successful sustainability (Heizer, Render and Munson, 2017). It is the management approach to increase internal procedures and satisfaction level of customer. If it is implemented with effectiveness can lead to reduce cost of operations and overall performance will be enhanced. For this Audi AG will apply different principles of Total Quality Management to create base for quality improvements, are as follows:

Manage Quality: This is one of the important principle that states that it is necessary that companies realise that there is some problem in business and its operations. Many big organisation believes that operations are so widely spread that they are not able to control it effectively. Just in case of  Audi AG management needs to understand the problem and find out solution so that quality can be improved.

Processes are problem: In case if business operations is causing issue in the organisation then no matter how much management tries to solve this challenge. Changing employees or providing training to them will never address the issue instead of this, process need to need so that it become effective (Prajogo, Oke and Olhager,  2016). So there is a need that   Audi AG take corrective actions for processes and operations in the place of personnel.

Identify Cure: It is equally important that organisation tries to find root cause of the problem and identifies solutions. But just finding out causes or reasons for a problem prevailing in business will be the cure. Instead of this company need to find corrective solutions so that it can be improved. In case of Audi AG it is advice by this theory that it is essential that management reaches to source and them correct issues that are hindering quality of products and operations.

Employees are responsible: It is not just the duty of management or managers to improve operations and quality in businesses. Every employee should be held liable in ensuring qualitative aspects in products and services (Schönsleben, 2018). Audi AG needs to empower employee to take responsibilities in order to improve quality so that customers are delighted and organisational objectives can be achieved.

Measuring Quality: This is one of the important principle laid down by Total Quality Management in Best Geology Research Topics improving qualitative factor in business operations. Theory believes that effectiveness of quality management systems can be measured by analysing desired results. This will help Audi AG to set future goals in seeking perfection and make sure that each functional unit is working in direction towards it.

Continuous Improvements: Applying Total Quality Management is just not the task which can be done only once in organisation. This process does not stop with the last phase of implementation, instead it should be continuous process in operations. Audi AG need to ensure that improvements occurs continually so that customer satisfaction can be increased.

Long - Term Investment: Issues arise in business and its operations can be fix over - night or in one slot. On the other hand Total Quality Management is investment of long - term and designed accordingly to bring success and improvements (Baker, Croucher and Rushton, 2017). Audi AG need to develop skills and empower employees to come up innovative idea for business issue of managing quality.           

It is important that business and employees are ready to bring changes and improve quality of processes and products. This requires commitment of every employee and management to remove barrier and work collectively to enhance quality. It is needed that there should be proper training given to employees to change their attitude and working culture of Audi AG. It is customer - focused process which requires continuous improvements. This approach also requires regular monitoring and controlling actions by management to correct deviations in quality. After applying Total Quality Management Audi AG will be able to see changes in awareness about qualitative aspects in working culture of business. Teamwork will improve and there will be continuous improvements in terms of quality in operations.

Just - in - Time and Lean Principles

Another topic is Just - in - Time and Lean Principles which need to apply by  Audi AG so that it can help it in reducing cost and increasing sustainability in industry. These are principles that helps organisation to decrease operating and manufacturing cost so that company can have competitive advantage in industry.

Just - in - Time is a strategy related to production process by reducing inventory cost with the help of estimating demand of customer accurately. This is management approach, firstly developed by Toyota manufacturing to meet demand in minimum number of days. The main focus is to identify and correct factors that create hurdle in process of production. It provide assistance in preventing excessive storage of stock so that manufacturing function can be smoothly carries out (Christopher, 2016). This approach has main objective to increase turnover of stock and decrease holding of inventory and related cost. There are elements involved in  Just - in - Time are:

Continuous Improvements: In this fundamentals of issues are identified and tries to eliminate activities that does not add value to product. Systems should be simple so that they can understood easily and manageable without any complexity. Layout should be product oriented so that less resource are spent on materials and equipment.

Eliminating Waste: Main objective of  Just - in - Time is to eliminate waste by making supply chain effective in its processes and delivery (Alicke,  Rexhausen and Seyfert, 2017). In starting it can be done by reducing inventory and increasing efficiency of production, this can be done by Six Lean Principles.

There are different advantages and disadvantages of implementing Just - in - Time systems in Audi AG. Some of them are as follows: 

Advantages: This system is effective in keeping cost of inventory upto minimum level by eliminating waste. Only important resources are stores in warehouses that are required for production process thus requirement of working capital is less. It leads to products of higher quality with the help of continuous improvements in operations of business.

Disadvantages: This approach can make business to highly depend on suppliers for raw materials and other resources which can create a problem. This is not effective in case of meeting higer demands than estimated by department which can lead to negative brand image (Taticchi and et. al., 2015). This can lead to higher cost of transportation as transaction will be frequent which can also lead to environmental issues.

Lean Principles encourages practice of continuous improvements and is based on basic ides of respecting individual at workplace. There are different 5 principles that comprise approach of Lean Principles, explained as follows:

Define Value: Value can be define as amount that consumer pay in exchange of Assignment Help products or services (Mangan and Lalwani, 2016). This first principle is concern with identifying customer value so that goods or services delivered by Audi AG so that it can meet expectations of consumer. This can be done by tools like interview, web analysis, market trends, surveys, etc.

Map the Value Stream: The second principle is identifying value stream, in this all activities that works in direction of providing value to product of Audi AG. Such operations are identified which does not add value to end product and eliminated to ensure qualitative aspects in the operations. This will help in reducing cost of production and meeting expectations of customers. 

Create Flow: This includes removing activities identifies ad waste in above principle so that production functions can be run smoothly. The strategies to create flow is breaking down steps and create cross functional departments.

Establishing Pull: Storage of stock is treated as one of the biggest waste in manufacturing industry and to overcome Audi AG need to adapt this principle. For this concept of Just - in time will be applied so that resources are procured at the time of production and demand is meet on time. By following this company can ensure that manufactured products are effective in achieving expectations of customers.

Seek Perfection: First four steps in Lean Principles will help Audi AG to reduce waste and be cost-effective in production processes (Grant, Trautrims and Wong, 2017). Lean thinking and continuous improvements need to be include in working culture of business. Employees should tries to pursue perfection in every task so that quality can be enhanced and company is able to meet expectation of customers.           

Triple Bottom Line

It is theory that suggests companies to focus on different aspects like social, environment and economical of the organisation. The basic idea behind this concept is to look beyond just earning profits and tries to improve social and environment positive impact of business. The elements are as follows:

Social Impacts: This is concern with treatment that company does with its workforce which also have impact on community in society. This states that Audi AG should produce that safe and secure vehicles which does not harm customer in terms of health. Management of  Audi AG should look into HR practices so that there is no discrimination and competitive wages or salary are paid. This factor also ensures that there are proper arrangements of safety and security, flexible working hours (Trkman, Budler and Groznik, 2015).

Environmental Impacts: Global warming is one of the biggest environmental issue that need to be address by organisation to reduce the negative impacts. Audi AG should design its operations in such a way that wastage of natural resources while manufacturing vehicles is less and it is sustainable in nature. This need to ensure that management of Audi AG closely so that company has positive impact on environment and it will result in increase in brand value at global level.

Economic Impacts: This takes into consideration the external impact on economic factor related to society. In case of Audi AG employing regional and local suppliers for raw materials will provide benefit to local community by increasing their standard of living and increase their consumer spending as well (Hugos, 2018). This factor ensure that economic benefits are generated for individuals in society.     

Applying triple bottom line will help organisation in increasing its reputation, recruitment and retaining talented workforce, improved productivity and customer loyalty. This will also help Audi AG to get skilled and talented workforce and will be able to retain them for long. This will also ensure that brand image of company is enhanced at international market as company is engaged in activities related to social and environment benefits.

Recommendations

It can be recommended from above discussion that Audi AG can manage quality and different approaches of management effectively. In case of managing quality company can apply Total Quality Management and its principles so that quality factor can be maintained in operations and products. This will organisation to find out solution for problem, taking corrective actions, empower employees, Geology Topics improvements, etc. which create culture of improving qualitative factor in operations. Just - in - Time is another approach that focuses on increasing cost related to storage of stock and waste inventory. This will make Audi AG more cost - effective and thus can become leader in respective industry. Lean Principles will help in finding out waste activities that does not add value to end product and eliminate them. This also ensure that production functions runs smoothly by creating flow in steps that makes addition in qualitative aspect of product.

CONCLUSION

It can be concluded from above report that operations management is managing operation of organisation in effective manner so that customer expectations can be meet. Logistics is concerned with controlling and moving actions of resources for company in different region. Supply chain management is managing flow of products or services that are included in production function. Quality management is concern with activities that focus on increasing qualitative aspects with the help of Total Quality Management and its principles. Just - in - time is helpful in reducing cost of inventory and Lean Principles comprises of seeking perfection with continuous improvements.

Read More- Customers Relations Manager

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