September 08, 2007

Operations Management Lesson 2 Exercise

Take two processes with different volume and variety characteristics. Profile these processes and establish the process choice and layout decision they have taken. Critically appraise the design decisions taken.

The two processes I’ve decided to analyse are both in the food industry: the first one is the “Discovery pizza ( a chain of take away pizza shop) selling process” , and the second one is the “ Skychief on board catering service, for airline CO’s”

The discovery pizza shop is a small open space in which customers could choose two different kind of solutions: for a small order (one/two slice of pizza), they could choose from the exposed pizzas and for big orders (one pizza or more) they could ask for their preferred pizza choosing from a list of ingredients and toppings (obviously in this case there’s a significant waiting time for the customer, who accept it in order to take away his/her preferred pizza).

The Skychief provides the meal on board for several airline Companies; at Skychief they have large laboratories where they pre-cook the food. Once the food is pre-cooked it is then transported to the airports and loaded on every airplane where it will distributed, heated up, to travellers.

Let’s analyses the 4 V’s profile for both these two processes:

Discovery Pizza:

Volume: low-medium volume;

Variety: only pizza, but with hundreds of different toppings and ingredients, well define product;

Variation in demand: medium high variation in demand, it depends a lot from the weather, and the traffic; there is also a seasonality with a decrease of sales during the national holidays and one month in the summer, when the city is empty.

Visibility: High, the process is total exposed to the costumers.

Skychief:

Volume: high, they produce thousand of meals a day

Variety: medium-low since the airline could choose only few different kind of meal with predefined ingredient.

Variation in demand: very low variation in demand

Visibility: low visibility and low contact skill (the personnel never meet the end consumers).

blog_lesson2_img1.jpg

Process choice

For Discovery Pizza, using Slack et al’s process choice model, the process fits into the Jobbing Processes category: high skill employees are used with flexibility to produce one-off item; in my opinion, as the volume of take away pizza is increasing, DP has to move to Batch Process as it could produce more than one product at a time.

For Skychief we could consider the Mass Process Category: they produce high volume with narrow variety. In this industry the main performance objectives can be summarized as follows: good quality, speed, flexibility and of course low cost. In my opinion Skychief is moving in the right way, as in the “Lazy J trend” they stay close to the diagonal.


lesson2 img.2
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Zoe Radnor (2007); «Operation Management »;Warwick Business school

N. Slack, S. Chsmbers, R. Johnston, A. Betts; «Operation and Process Management»; Prentice Hall


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