Individuals who want to engage in small scale production businesses face with a number of challenges towards the operation of their businesses. Some of the uncertainties include the type of operation system that they should use with the resources and facilities they have. They are also uncertain on the effort and energy that may be required to be able to use the manufacturing system successfully without running out of business. They are also uncertain on their consistency towards the use of that system. Entrepreneurs are unaware whether the system will be easy or difficult for employees, managers and owners to implement. The other challenge is that, the system costs will cause a lot of worries to the entrepreneurs as they would like to know whether the system will be less expensive to afford. They would also like to know if the cost efficiency from the manufacturing system result into reduced costs of production, and increased benefits.
It has been found that entrepreneurs can organize their operations in a certain way that the maximum output gets realized in terms of profit and quality work. This can be achieved without the need to add new equipment and facilities into the existing facilities. Workers can also be made to produce to their maximum ability without the need to employ extra workers. Individuals who produce more than one product at the same place are the most challenged with this problem. Their most serious challenge involves the decision on whether to continue producing those varieties of products using the same facilities or stop producing one product and concentrate on another. Consequently, entrepreneurs have resorted to using a number of techniques to identify the best way forward for the manufacture of their products; For instance, consulting professional students with no experience in the best ways of running production businesses, which involve more than one product. They have gotten unsatisfactory feedback according to their instincts in running businesses and left undecided on the way forward. An example of such entrepreneur is Elizabeth who operates Biddy’s Bakery in California.
This article tries to review how Elizabeth should go about doing her business, in order to avoid disappointments such as, lack of customers, and excess expenses in operation in comparison with the income. This article gives a case of a manufacturing firm Biddy’s Bakery operated by a woman entrepreneur, and had the challenge of which system of manufacturing to develop. Her business needed expansion, but after that, she discovered that a large business needs certain principles in manufacturing system in order to be successful.
Operation and the context in which it operates
Biddy’s Bakery is a private firm that deals with the baking of cakes and pies. The business got started in 1986 by Elizabeth, a retired cook who had been working in one of the famous hotels in California in terms of quality food. Elizabeth decided to use part of her house as the premise of doing business. She did this with assistance from a group of experienced women in the neighborhood to carry out the tasks. Their activities in the business, involved making cakes and pies and selling them to customers who had brought orders for them or supplying the products to the local grocery store which was their main customer. Their operation principle involved using the same facilities to make both cakes and pies. However, the principle was that the first order was to be met before the second. Therefore, if the first order would be making cakes, facilities got organized in such a way that they would be used to make cakes. After this, any other thing could be made which came after cakes. The business operated this way successfully until Elizabeth and her friends decided that there were changes that needed to be made. In 1990, her business had expanded, and she needed to get a bigger building for the operations as well as meet the capacity requirements of her business. Consequently, she contacted a group of business students from a nearby university on the way forward. The advice she got from the students was that she should purchase a new building for her business, and concentrate on producing only one of the products she was producing. She agreed with the proposal and the students further advised her that she should supply the nearby grocery store with the pies which was her favorite product. She agreed, but she was skeptical that her business will face a number of changes that she did not expect.
Describe the operation in terms of process architecture and process management
Biddy’s Bakery operates under the traditional principles where the cakes and pies get baked according to customers’ orders rather than according to stock levels. Consequently, the flow of materials can be said to be intermittent. This is because they use the same facilities to cook both the cakes and pies depending on the one that is in demand. This method got used because the basic procedures for making cakes are different from that of making pies. The business operates under proper storage facilities to allow operations to be carried out independently for effective use of workers and facilities. At Biddy’s Bakery, the demand dictates the nature of the product produced. If the demand for cakes is higher than that of pies, then cakes get made first. Elizabeth and her company of five women are constantly making sure that they keep statistics of the number of orders of each type of product demand for the entire month. This allows them to budget on the amount of resources they need to put into the purchase of requirements for baking either of the products. The facilities can also be made flexible so that when cakes are in high demand, then the use of those facilities get reserved for the making of cakes.
After these products have been made, Elizabeth and her employees supply them to their respective destinations or wait for the customer to pick his consignments. The cakes get packed into carton boxes and polythene bags with the label of Biddy’s Bakery before sending to customers.
This allows the public to become aware of the products that the firm deals with so that even domestic users can come for the cakes or pies. After the sales of the products, Elizabeth and her employees decide on how the income get used; these uses involve the purchase of new materials for use in baking, payment of workers and upgrading of their facilities. These operations have been ongoing since the beginning of the business, and the business has been successful. The only challenge they have come across is the capacity issue which Elizabeth says has been settled. Her only worry is whether to continue producing two products or just produce one in large scale.
The operation capabilities and specific dimensions
The operations can be said to be effective. This is because, the business has been able to grow using the current operation processes until now Elizabeth says the first premises are too small to accommodate her business. The operations are also yielding positive results since she can now afford to buy a building that supports her business. The uses of the same facilities to make the two types of products have not caused any difficulties to her. This is because she did not show any difficulty caused by that operations method. She only complained about capacity of her business premise. This is an indication that her customer’s demands got met despite her using the same facilities to make two different products. Consequently, the idea of business students that she should only produce one type of product is misleading. She should continue producing both the cakes and pies. The advantage is that after purchasing the adjacent building, she will not have capacity problems, which are her main worry at the moment. Furthermore, her employees are content with the intermittent method of operation as she has not shown that they have complained about it. Furthermore, Elizabeth has not complained that she is experiencing difficulties with the production of these two products. Neither her workers have. This is an indication that they are competent enough to handle any challenges caused by producing two different products using the same facilities.
Since she has now purchased a new building to carry out her operations, she can employ additional workers to assist her in production. If she employs additional workers and trains them well, she is likely to expand her production to a higher level than the present level. The workers can also be able to work in shifts so that they do not feel overworked or specialize in either production of cakes or production of pies.
Discuss existing problems and weaknesses or strengths (as the case may be) in the current operation.
Despite the method being successful, there are some limitations associated with it. According to the way the business is operating, this system of operation does not allow the production of goods in bulk, but goods get produced only in small quantities to meet customer demands. When another product is supposed to be produced, the demand, for another product causes it to be stopped so that its production only meets the demands of the customers. Furthermore, facilities and equipment have to be organized in terms of the nature of the product to be produced. This result in wastage of time and effort in setting up these facilities before another product can be produced; furthermore, workloads usually get unbalanced. This is because when a different product has to be produced, the level of production gets determined by the level of demand. Therefore, Workers do not produce their maximum output of work. Furthermore, this operation method requires a lot of a skilled workforce. The facilities have to be reset so that they are able to be used to produce different products at different times. Nevertheless, this method is the most recommended for Biddy’s bakery in order to continue enjoying satisfactory results of its operations. The business is able to alternate between the demand of cakes and pies, which ensures that it is always in operation when the demand for one of the products is low while the other is high. It only needs a few modifications to achieve maximum output from its operations.
How the operation should be redesigned
In order for the firm to minimize costs, enhance flexibility and improve on time wastage, there are a number of measures that have to be put into the intermittent operation used by the firm. Elizabeth and her team of workers should estimate jobs, routing, scheduling, preparation of manufacturing orders, dispatching and production control. When the customer comes with an order of the amount of products he would like to have, the firm comes with a better technique of ensure that the accomplishment of customer demands. The firm should ensure that the costs incurred in the purchase of raw material are just enough to cover that expense. This reduces production costs. Costs can also be reduced by proper training of workers so that they do not use the raw materials carelessly. In addition, because orders will be coming in deferent lot sizes, there should be wise and careful sequencing of operations to allow routing and scheduling complex operations. In order to avoid mistakes by the workers, Elizabeth is required to undertake regulations and close inspection at all stages of production. In order to improve on flexibility, facilities need to be provided at each stage of operation. With the use of facilities effectively, workers become more efficient, and they expend less effort on production while the level of output of their work becomes high.
Since she has now bought a new building where she will be carrying out her business, she should employ more workers who will allow her to make them specialize in either production of cakes or pies. With specialization, workers will become more efficient, and there will be maximum output from them.
Furthermore, operations should be scheduled so that the first order to reach the store gets processed first to ensure customers have confidence in the business. When distribution goes on, customers should be asked about their satisfaction with the products and some of the improvements they would like to be made.
How the changes will work for Elizabeth and how she will be able to sustain the changes
The changes will be more effective after she moves to the new premises, this is because she will have enough space in which to carry out her production operations. When Elizabeth ensures that the costs incurred only cover the recommended costs, and she will be left with enough finance to use in expansion of her business and even increase the allowances of her employees. When the operations get sequenced, she will find easy time in dealing with delays and ensure smooth running of operations. Time wastage becomes minimal in the process as well as fatigue to employees. Routing and scheduling of operations becomes easier by proper sequencing of operations. Thus, she will manage production of more than one product in the same premise without experiencing difficulties such as waste and delay in meeting customer orders. Proper routing and scheduling will also result into ensuring that, her employees are able to set up the facilities to meet production demands such as change from one product to another. Close inspection of all operations will ensure that Elizabeth’s workers are working on orders from customers which will ensure that time wastage gets eliminated. It will also ensure that the operations they are undertaking are the recommended one. The activity will also show her employees her commitment to her business. This will motivate employees to continue working without complains. When her employees get additional training on the best methods to use in production, their skills will increase, and they will be able to use the facilities well. This will result into increased production even in times of high demand.
These changes will be accompanied with certain costs such as costs of training employees and additional cost of payment to employees, but the consequences of these activities will result into high profits, which will accrue to her.
Challenges that may be faced during implementation of this operation process and how to address the issue proactively.
The intermittent operation will ensure that Elizabeth continues to produce both cakes and pies. This is contrary to the advice she received from the group of business students from a local university that she should continue with only one product. However, there are a number of challenges she is likely to face during implementation of the operation process. One of the challenges is that she will have to train her employees to be flexible which will prove tedious and time consuming. To deal with this problem, the employees get encouraged to take the training positively, and motivated of the good outcomes of the operation method. They should also be allowed to have enough rests such as leaves if an employee becomes fatigued. The employees will also find it difficult setting up the facilities when they want to shift from one product to another. Furthermore, setting up the facilities to suit the production of either cakes or pies will be time consuming even if the employees get trained to do the job. It will also result into excess energy expenditure which will case fatigue to them. In order to proactively agrees this issue, employees should be allowed to take the training positively but seriously. This ensures that they understand what should be done once and for all that ensures no repetition of training.
Furthermore, the facilities cannot be used to produce a large number of products because the production is intermittent. Workers have to familiarize themselves with new production method each time to suit the new product. This causes fatigue to the workers and inability to specialize in production of either of the products.