ASSIGNMENT

Government College of Commerce and Business Administration

Submitted to - Submitted by -
Mr. Suchintan Singh Student's name: Aditya
Roll Number: 2132038/21
Class: BBA 3B
Assignment of Production and
Operations Management

Solve the following case studies.

Case 1:

Product Development

You have the opportunity to invest INR 100 billion for your company
to develop a jet engine for commercial aircrafts. Development will
span 5 years. The final product costing Rs. 500 million / unit could
reach a sales potential, eventually of Rs. 2500 billion. The new engine
can be placed in service 5 years from now, but only if it qualifies four
years from now for certification clearing commercial use and only if it
meets America’s Federal Aviation Administration’s (FAA) ever
tightening standards for noise reduction. Certification also has to be
obtained from India’s Director General of Civil Aviation (DGCA). There
is competition from world-class manufacturers like Pratt and Whitney
and Rolls Royce who are developing competing engines. If you
decide to proceed with the project, you must also determine where
the new engines will be produced and develop the manufacturing
facilities. If you decline to proceed, your company could invest its
resources elsewhere and based on its track record, get attractive
returns.
(a) What would be your line of action?
(b) In case of lengthy product design and development time, what
kinds of risks are there?
ANSWER:

(a)Choosing to move on with the development of a jet engine for

use in commercial aircraft means giving careful thought to a
number of factors. The actions I would take to decide on the
best course of action are as follows:

1.Market Analysis: Evaluate the need for new engines, the

competition from current manufacturers such as Pratt & Whitney
and Rolls Royce, and the potential market share of the new
engine by conducting a comprehensive analysis of the
commercial aircraft market.

2.Technical Feasibility: Determine whether it is technically

possible to create a jet engine that satisfies FAA noise reduction
requirements and receives certification from the DGCA and FAA
in the allotted period.

(b)3.Financial study: To determine the whole cost of

development, including R&D expenditures, manufacturing costs,
and any other related costs, conduct a thorough financial study.
The potential return on investment can be calculated by
comparing these expenses to the estimated sales potential of
Rs. 2500 billion.

4.Risk Assessment: Determine and evaluate all project-related

risks, such as those related to technology, regulations, markets,
and competition. Create plans to reduce these risks and
guarantee the project's success.

5.Making a Decision: Evaluate the market, technical feasibility,

financial, and risk factors to make an educated choice on
whether to continue developing the jet engine or to divert funds
to other projects.
(c)
(d)Protracted product design and development periods present a
number of dangers to the project's success:

1.Technological Obsolescence: If technology develops too

quickly, the new engine may become obsolete before it reaches
the market, which would lower its competitiveness and possibly
limit sales.

2.Cost Overruns: Prolonged development periods may result in

greater R&D and manufacturing costs, which could lead to cost
overruns and decreased profitability.

3.Regulatory Shifts: Modifications to the engine's design may

be necessary in response to changes in rules or standards, such
as the FAA's noise reduction requirements, which would further
postpone certification and market introduction.

(e)4.Competitive Pressure: By releasing their engines ahead of

schedule, rivals like Pratt & Whitney and Rolls Royce may take
market share and lower the potential sales of the new engine.

5.Market Dynamics: The sales potential of the new engine may

be impacted by changes in the commercial aircraft market, such
as shifts in demand or the entry of new competitors.

It's critical to continuously assess how the development process

is going, adjust as the market and regulatory landscape shift,
and keep lines of communication open with all project
stakeholders in order to reduce these risks. Additionally,
investing in R&D capabilities and putting agile development
approaches into practice can assist speed up the process of
designing and developing new products, cutting down on time to
market and improving competitiveness.
Case 2:

Asynchronous Management

The GM (Works) has problems with manufacturing budgets, meeting

cost reduction targets, and dealing with new products manufacturing
schedules. When an indepth interview (non-directive type) was
conducted between the GM (Works)and the Chairman of the
Company, the GM (Works) explained that many things are happening
in the Company about which he is ignorant, particularly the
preparation, new product integration, etc. He agrees to the view that
the Company is interested in high-growth and high-profit, but he has
never been given an opportunity to review his own scheme of things
and explain to the top management. The production culture of the
company has never been assessed whereas the stringent rules are
being directed by the finance and personnel departments. And
sometimes, show cause notices are being served to supervisors and
senior employees. The Company is introducing new products without
assessing the capability of the manufacturing system and the
resources.

(a) Under the above situation, if you are asked to work as a consultant
to show the perspectives to the Board of Management, what action
plans would you suggest?

(b) How Operations Management helps in situations like these?

ANSWER:
(a) In my capacity as an advisor entrusted with offering
viewpoints to the Management Board, I would suggest the
subsequent action plans:

1.Comprehensive Assessment: Perform a comprehensive

assessment of the current production culture, taking into account
the routes of communication, decision-making structures,
processes in place, and staff morale. To ensure a thorough
awareness of the challenges, frontline workers and managers at
different levels should contribute to this assessment.

2.Strategic Alignment: Arrange for a meeting between the senior

management and the general manager (Works) to discuss the
company's high-growth and high-profit goals. This would entail
outlining goals, assessing the manufacturing strategy as it stands,
and pinpointing areas in need of development.

3.Empowerment and Training: To improve the GM (Works) and

other pertinent staff members' comprehension of new product
integration, manufacturing schedules, and cost-cutting tactics,
offer training and development opportunities. Giving the GM
(Works) the authority to assess and improve his own plan will
increase ownership and accountability.

4.Encourage cross-functional cooperation: across various

departments, especially operations, finance, and staff, to make
sure that manufacturing budgets, cost-cutting goals, and initiatives
to integrate new products are in line with each other and have the
backing of all relevant parties.

5.Continuous Improvement: To continuously evaluate the

manufacturing system's capabilities, spot bottlenecks, and
maximize resource use, put in place a continuous improvement
 process. This could entail measuring performance indicators,
kaizen events, and the use of lean manufacturing principles.

6.Risk Assessment for New goods: Evaluate the manufacturing

system's capacity and available resources by conducting a
comprehensive risk assessment prior to launching new goods. By
doing this, possible interruptions would be lessened, and the
success of new product launches will be guaranteed.

7.Performance Management: Examine the present procedure for

giving senior staff members and supervisors show cause notes. To
address any performance concerns and promote improvement,
instead concentrate on coaching, performance management
strategies, and constructive criticism.

(b) In order to solve the problems that GM (Works) and the business
at large are facing, operations management is essential:

1.Strategic Planning: Operations management ensures that

production activities support the company's growth and
profitability goals by helping to match manufacturing plans with
overall business objectives.

2.Resource Allocation: In order to reach production targets while

minimizing costs, effective operations management entails
optimizing the allocation of resources, including labor, machinery,
and materials.

3.Process Improvement: Continuous process improvement is

made possible by operations management approaches like Six
Sigma and Lean Manufacturing, which aid in locating and
removing inefficiencies in manufacturing processes.

4.Risk management: To maintain efficient production and reduce

interruptions, operations managers evaluate and reduce risks
related to manufacturing processes, including the introduction of
new goods.

5.Operations management, which helps to preserve customer

happiness and loyalty, makes sure that quality standards are
fulfilled throughout the manufacturing process. This is known as
quality management.

The organization can overcome the difficulties mentioned by the

GM (Works) and raise the efficiency and profitability of its
production process by utilizing the concepts and procedures of
operations management.