OPS FPX 5620 Assessment 1 Analyzing Global Supply Chain Infrastructure and Operations OPS-FPX5620 Supply Chain Foundations and Management
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Executive Summary
This report was prepared for Thomson Tools, following their acquisition of Mainland Tools, a small tool company located in China. The purpose of the report is to evaluate Mainland’s processes and infrastructure, as it will now become part of Thomson’s supply chain. The acquired company operates from an older building, constructed in phases as the business expanded. In addition to offering products, the company provides technical support to its North American customers. Supply chains rely on the effective management of internal operations by an Operations Manager (Venkataraman & Pinto, 2018). When internal operations are properly maintained, it adds value to both services and products, leading to lower costs for customers, improved product quality, and enhanced services (Venkataraman & Pinto, 2018). Consequently, operations management within a supply chain involves careful planning and organization of both short- and long-term tasks, with collaboration between internal business owners and external supply chain partners (Venkataraman & Pinto, 2018). Thus, operations management plays a vital role in the success of a business and impacts everyday life (Venkataraman & Pinto, 2018).
Thomson’s Operations Manager will conduct an evaluation and analysis of Mainland’s current operational state and supply chain infrastructure. This analysis is crucial for the seamless integration of Mainland Tools into Thomson’s global market and supply chain. The Operations Manager has been assigned to identify potential issues and recommend improvements. The analysis will employ systems thinking, viewing the company holistically, with a focus on technology, facilities, and inventory control.
Brief Partner Company Description
Mainland Tools is a China-based company that provides goods and services, generating approximately $6 million annually. During the analysis of Mainland’s operations and infrastructure, several issues were identified that are negatively impacting its efficiency. These include unnecessary inventory and the loss of prepared orders, which accounts for 15 percent of total orders, costing the company approximately $900,000 per year. This loss is attributed to the outdated order-taking process. The company’s structure and department layout were not well-planned as it expanded, necessitating the rental of an offsite warehouse five miles away to store excess inventory. These inefficiencies hamper Mainland’s ability to deliver products promptly to its customers, which could affect Thomson’s reputation as a leader in supply chain efficiency. These issues will be further explored in the company analysis section.
Company Analysis
Systems thinking involves a structured approach to understanding complex behaviors and diagnosing systemic issues that may lead to unintended consequences (Ballé, 2018). In a supply chain, any internal or external occurrence, whether directly or indirectly related, can have a significant impact on operations (“Supply…”, 2016). This analysis will use systems thinking to examine the interactions and relationships between the components of Mainland Tools’ operations (“Supply…”, 2016).
Lean manufacturing and agile manufacturing are two practices that can help eliminate waste or enable quick adaptation to changes within a company (Venkataraman & Pinto, 2018). Lean manufacturing, also known as lean production, focuses on eliminating processes or activities that do not add value to the company (Venkataraman & Pinto, 2018). In contrast, agile manufacturing allows for a faster response to external changes using specialized tools and processes (Venkataraman & Pinto, 2018). While an agile approach would be beneficial for Mainland Tools, it is not what is currently needed. Instead, lean manufacturing is recommended, as it will help identify areas that require improvement or elimination. This approach will allow the Operations Manager to increase both the company’s value and profitability (Mirdad & Eseonu, 2014). Lean production and systems thinking work well together due to their similarities and complementary nature (Ballé, 2018).
Infrastructure Analysis
Mainland Tools’ infrastructure was developed in stages as the business grew, resulting in mismatched departments and insufficient storage. The building’s layout has led to inefficiencies in product movement and workflow. Products must pass through multiple departments before reaching their destination, which is not optimal. Additionally, the company has rented a warehouse five miles from the main facility, leading to delays in product movement and inventory issues.