Case Study of Toyota: Significance of Operation Management in Manufacturing Sector
Number of words: 10103
In the next section of the study, problem exploration and analysis will be elaborated. Problems and challenges faced by Toyota in account of Covid-19 pandemic in 2020-2021 will be explained. There are many automobile manufacturing companies including Toyota that are unable to sustain consistency in their business due to heavy restriction by the government with respect to working places. For this reason, Toyota has decided to improve its operation management. This will significantly help the organization to deal and overcome this problematic condition and, at the same time seek opportunity to increase the customer demand. Relationship among operation management, change management with the organizational success will also be demonstrated to overcome the problem. The section has also delivered a few theoretical framework and models by considering the problems faced by Toyota, in its manufacturing facility. The themes mentioned in here are based on the importance and effectiveness of the process of operational management in the better management of the automobile sector productivity. Along with that, the second theme is also associated with the utilisation of Robot Assisted sensing as a potential approach in the course of the development of organisational productivity and management. The discussion of the based on a vivid and descriptive analysis of the collected themes and thereby helps in providing a detailed understanding of the topic of operational management.
According to the published report of Statista.com (2021), it is noted that in the financial year of 2021 total sales of the automobile industry have increased by 71 million units. This fact is clearly indicating the people prefer to use personal vehicles in order to prevent the spread of Covid-19 infection. It is also noted that sales of Toyota have also increased by 39% across the world but the authority is failing to meet the demand of consumers (Theguardian.com, 2021).
Sudden hike of demand in the automobile industry is creating challenges in the operation management process of different organizations. Toyota is one of the organizations that is struggling to fulfil demands of consumers because of the lack of productivity (Ravalet al. 2020). Health crisis created by Covid-19 pandemic and norms of social distancing are the main reasons behind the sudden demand hike. According to the published report of Theguardian.com (2021), it is noted that Toyota is not being able to meet the demands of consumers because of the absence of a significant operation management system. Considering this situation, this report is aiming to find the importance of operation management behind the success of the manufacturing sector.
Demands of automobile products are increasing across the world in present days. According to the study of Ravalet al. (2020), it is noted that due to the reason of Covid-19 pandemic and health concerns people are choosing personal transportation. High demand for Persian transport is automatically creating a high demand in the automobile manufacturing sector. Sudden hike of demands is influencing manufacturers to restructure the operational management system. As this study is aiming to find out associated challenges of operation management in the manufacturing sector, that is enlarging the scope of the research. Clear outlines of challenges in relation to the operation management process will help managers of the manufacturing sector to prepare a follow up. Along with that, determinations of prospective ways to resolve challenges of operation management can help the manufacturing industry to mitigate challenges and to meet success.
Aim of this report is to find out the significance of operation management in the success of the manufacturing sector.
- To determine the importance of operational management in the manufacturing sector
- To develop understanding about the concept of operation management and associated challenges
- To determine prospective way to resolve operational challenges in the international company
- To recommend effective operation management strategies for the manufacturing company
Q 1- What is the importance of operational management in managing the business of Toyota?
Q 2- What are the critical challenges incorporated to the business of Toyota?
Q 3- What are effective measures and methods needed to be considered for resolving the operational challenges of Toyota?
Q 4- What are the effective operation management strategies that can support the future growth for the company in international business?
H0- Operation management processes improve the overall success rate of business.
H1- Operation management processes do not improve the overall success rate of business
Problem exploration and analysis
Problem in the business context
Demand for automobile products is growing significantly over the time. Automobile industries had encountered difficulties to fulfil this growing demand that affected their business performance. As per the latest reports it is expected that the worldwide sales of automobiles will grow over 71 million units in 2021 (Statista.com, 2021). Therefore, to match the huge demand increase it is essential for the automobile industries to adopt suitable practices that will enhance their productivity. It might also be the biggest opportunity for the top automobile manufacturers like Toyota, Ford and Volkswagen to earn significant profit by boosting their revenue to a great extent. As per the views of Laato et al. (2020), the recent pandemic of Covid-19 also had an impact on the consumer purchase behaviour. Due to the social distancing norms and guidelines people more prefer to use their own vehicle that also resulted in a certain demand hike of the automobile products. However, on the other hand, automobile manufacturing organisations are unable to maintain consistency in their business process due to the restrictions by the Government for workplaces for pandemics. Therefore, in this situation consideration of operation management becomes essential for audible industries to overcome the problematic situation and capitalize the opportunity of high demand of automobile offerings. Toyota is one of those organisations that encounter issues related to inability to fulfil the demand of the customers due to the lack of productivity. Therefore, this study will illustrate the significance of operation management in the business context of Toyota that can help the firm to gain back its business position by meeting their consumer demands efficiently.
Figure 1: Global car sales statistics
(Source: Statista.com, 2021)
Concept of operation management
Operation management can be defined as the administration of all the business processes and practices for the establishment of the highest possible level of operational efficiency in the organisation. Therefore, in simple words it can be said that operation management can be termed as the optimisation of business attributes for delivering best possible performance in business. This concept can be useful for Toyota to streamline their operational activities and business processes which might be helpful for the productivity enhancement of the company. As stated by Shad et al.(2019), operation management can be useful for organisations to establish proper balance between all the organisational attributes which is crucial for improving the ratio of converting labour and products into goods that is related to the achievement of better profitability. Therefore, consideration of the operation management concept can enable Toyota to make possible improvements in their internal attributes that will deliver a noticeable boost in organisational productivity and can resolve the business problem of Toyota permanently.
Importance of operation management in business success
Operation management process ensures utilisation of business resources in a planned and organised manner that can deliver better return to the business in terms of both efficiency and profitability. Therefore, for organisations like Toyota, operation management can be very helpful to deal with productivity crisis. As mentioned by Cousins et al.(2019), operation management improves the supply chain management process of business. Therefore, it might be helpful for the automobile industries like Toyota to make their procurement process more responsive which is crucial to eliminate the issues related to productivity crisis. Moreover, resolution of the supply chain issues might be also helpful to control the overall cost of the final products that might be helpful to offer products at lower price. It is associated with the chances of establishing cost leadership that can attract more customers. According to Gemündenetal.(2018), operation management greatly helps organisations by delivering better control in their operational activities. It ensures minimal defects of productivity errors. It is also associated with the enhancement of organisational productivity at Toyota. Moreover, operation management principle is able to manage and optimise inventory better which is essential for performance betterment of business by facilitating the logistic operations. Hence, it can also be a crucial aspect for the business of Toyota to overcome from the issue of productivity crisis.
Factors associated with operation management
Operation management in business is a vast area as it covers optimisation or regulation of the entire business to make it more responsive and goal oriented. As stated by Ferràs-Hernández et al. (2017), availability of technology is one of the factors associated with operation management in automobile industries. Modern and effective technologies such as AI-based equipment, automated machines can complete production related tasks with better efficiency and accuracy. Therefore, it might resolve the productivity issue of Toyota with ease. Moreover, the skills of employees are another crucial factor associated with operation management. Better skills of employees ensure minimal operational error and greater operational output. So, it is also highly interlinked with operation management. As stated by Basheer et al. (2019), operation management of business heavily relies on operational planning. Better operation planning helps in organising the business resources, scheduling activities & operations which are essential for cost control. Hence, operational planning must be considered as a key factor of operation management. Change readiness of an organisation is a key factor in operation management. Application of operation management principle leads to change in certain business aspects therefore, it is crucial for the organisation to become ready for the change. In the case of the automobile industry, Toyota application of operation management principle might require change in workforce distribution, change in schedule etc. therefore, organisations must be ready to adopt those changes easily.
Interrelationship between operation management and organisational success
Operation management greatly helps organisations to establish proper balance between all the organizational aspects which is one of the key success criteria of business. As mentioned by Lim et al.(2017), operation management helps organisations to control their operating cost. Therefore, organisations are able to earn more profitability through operation management which finally leads to organisational access. Operation management process ensures better utilisation of resources, technologies with proper planning that ensures better output conversion. It might be helpful for automobile organisations to fulfil the growing need of consumers that can deliver business success. Automobile manufacturing organisations can be benefited through the planning improvement and implicational viability enhancement for operation management. It also helps organisations to achieve a better level of productive efficiency which is directly associated with business success. As outlined by Sklyaretal.(2019), operation management helps to organise the tasks or activities in a structured way. It can deliver better operational results with optimal accuracy. Thus, it also leads to organisational success.
Relationship between operation management and change management
Change management is one of the essential aspects in business that make possible improvements in the operational process for the improvement of business stability and flexibility. As opined by Ravaletal.(2020), operation management principles in business basically integrate certain activities and eliminate unnecessary operations for the performance betterment. Thus, basically a change has been initiated at the workplace which links operation management with change management at an organisational context. In the automobile industries in most of the cases operation management has been considered in terms of making improvement in the manufacturing operations. Therefore, possible changes have been considered related to the technological improvements, scheduling of operations, elimination of operations wastes etc. all of these processes are associated with changes therefore, it is quite obvious that operation management is highly interlinked with organisational change management in the case of the automobile manufacturing industries. Hence, it can be said that the higher authorities of Toyota must concentrate on the change management to eliminate their productivity issue, to which the company is unable to fulfil the growing demand of the market.
Operation management and key performance indicator
Key performance indicators are basically the indicators that represent the progress or improvements in certain areas. It basically helps the supervisors or operational managers to monitor certain activities which is essential for the all-round betterment of the aspect. The main aim of operation management is to make best possible improvements by which the firm can deliver best possible output. Key performance indicators basically shed light on those areas that facilitate operation management in business. Key performance indicators also demonstrate the current progress on certain aspects that helps the business authorities to prioritise their business activities. It helps in operation scheduling which is one of the essential aspects of successive operation management. It has been found that, operation management relies on distribution of tasks as per the resources and workforce. Key performance indicators enable the operation manager to distribute task resources as per the requirements. Thus, operation management and key performance indicators are also linked with each other. It is found that key performance indicators are also able to deliver detailed insight about the current condition of business and how the executives can understand any improvements. It is suitable for the application of effective operation management practices.
Theories and models associated with operation management
Six Sigma is a methodology-based theory that consists of different ideas of quality control within the operations management of an organisation. This theoretical framework was developed by an organisation named Motorola Inc. in 1986. The method considers using a data-driven approach and review to limit defects and mistakes within a corporate business process. The Six Sigma approach does emphasize the cycle-time improvement whereas at the same time, it decreases the manufacturing defects to a certain level of no more than 3.4 occurrences in million units (Bhaskar, 2020). While most business associates consider undertaking this framework in manufacturing facilities, it can also be applicable to each type of business within any market industry. As per the problem analysis in the current study, it is identified that Toyota, being a famous global car manufacturing company, is struggling with its production facility as it is failing to meet the market demands, especially during the Covid-19 pandemic period.
Figure 2: DMAIC method in Six Sigma methodology
(Source: Influenced by Bhaskar, 2020)
In this concern, the Six Sigma approach can be useful for the organisation as the successful implementation of the framework depends on a key component such as buy-in as well as support from business executives. In this framework, the most prominent method of improving operations management is the DMAIC method. This method depends on a few procedures such as defining problems in an operation along with goals, measuring various aspects of current operations management, analysing data to find the root defects within a process, improving the operational process and controlling how the process is delivered in the future (Pugnaet al. 2016). Eventually, the Six Sigma framework has become an industrial standard containing legal certifications offered to operations managers and other business practitioners. With this theoretical framework, Toyota can improve their operations management by identifying the issues they are facing and the ways to improve the production process.
The Just-In-Time framework or concept refers to a manufacturing workflow methodology that is aimed at diminishing flow times as well as costs in the production systems and distribution system of an operations management. The concept was popularized by the organisation itself, which is chosen for the problem exploration and analysis in the study, Toyota. The company chose this framework because they wanted to meet customer demands in the market with minimum production delays. The primary goal of the JIT approach is for zero inventories across the operations management and its logistics and supply chain management (Xu and Chen, 2016). This completely utilizes the capabilities of an organisation and it also maximizes the ROI. As per this framework, successful implementation and operation depends on creating business initiatives, encouraging increased staff encouragement and developing mobilized strategies and policies.
Figure 3: Just-In-Time manufacturing model
(Source: Influenced by Khaireddinet al. 2015)
As per the consultancy report, the identified issue in the chosen case-study company is lack of improvement in the production facility and failure to meet the rising demand of customers in this pandemic period. Therefore, the JIT framework can be crucial for the operations management as it helps establish a long-term supplier-consumer relationship and it also creates a stabilized work schedule. It means that by successfully implementing this framework, Toyota’s operations management can ensure more control and improvement in the manufacturing process. For instance, Toyota does not usually purchase raw materials for products until orders are received from the market.
4Vs of operation management
Business operations management can be described as the main focus of a corporate firm where the majority of direct labour system takes place. Within a manufacturing business, operations are basically task-oriented where management does follow some basic steps until the manufacturing and distribution are accomplished. All kinds of operational procedures have a common aspect as they all consider their inputs such as raw materials, knowledge and skills, equipment and time. On this note, the operations management can be classified into four ways such as Volume, Variety, Variation and Visibility. All together, this is called the model of 4Vs of Operations Management.
- Volume within the operations management is key to how the business is organised. Essential to the operation is an ideal repeatability of the tasks along with the work systemization.
- The variety dimension of the operations management is usually based on service organisations within the global market. Whilst service operations offer a similar service, flexibility and variety, the difference of service quality may depend on the size of an operations management.
- The dimension of variation refers to how much the demand level changes over time due to various external factors (Chircuet al. 2016). Different market factors may sometimes make it hard for the operations management to predict variation. For instance, the current production issues and market demand failure in Toyota are occurring due to the current Covid-19 pandemic period.
- The visibility dimension refers to the value chain of an operations management. Consumers need to experience an organisation’s products or services. Service industries have a higher level of visibility, as compared to manufacturing industries like the automobile industry.
Scientific management theory
It is a management-based theoretical framework advocated by Federick Taylor. It uses the scientific methods for analysing the most effective and prominent manufacturing procedure, in order to enhance productivity. The scientific management theory has argued that it is the duty of workforce managers to develop an ideal production system to achieve economic efficiency. The author of this theoretical understanding devised a few key principles for the scientific management within an operation.
Figure 4: Scientific management and modern management
(Source: Influenced by Uddin and Hossain, 2015)
- Selecting methods on the basis of science is essential, rather than allowing individuals in the workforce the freedom to utilise their own ‘rule of thumb’ method for accomplishing a task.
- Assigning jobs among workers is beneficial when it is done by understanding their aptitudes. It always helps an operations manager to assess the skills, knowledge and competency of each worker (Uddin and Hossain, 2015). This ensures efficient work distribution within an organisation.
- Efficiently monitoring the performance of workers is another key principle of scientific management in which workers’ efforts and engagement is closely monitored by operations management. It increases the productivity level of an organisation.
- Ideally dividing the workload between workers and operations managers is another scientific management principle in which workers are trained and then asked to imply what they have been taught.
Different approaches to operation management
Operational management serves the functions of sustaining the procedure of transforming the inputs in terms of materials, energy and labor into outputs in the form of final products and services. In order to do so, various approaches are developed and incorporated into the operation management. As per the views of Bag et al. (2020), it is crucial to make sure that the strategic objective of the firm is maintained by making tactical decisions in terms of utilization of the resources to make sure that the competitive advantages is maintained effectively within the current market. The approaches to operation management consist of contingency approach, system approach, operational approach, decision theory approach, socio-technical system approach and empirical approach. All these approaches are crucial and imply that operation management cannot be successful without an appropriate strategic plan, coordination of various activities and proper direction and reasonable control over the decision-making processes. As a result, managers of the operation management are equipped with a right skill set in managerial competence along with effectiveness of the human resource management, leadership and problem solving.
Operational approach is crucial of all approaches that is borrowed from the work of Bridgman as it attempts to bring together all the knowledge and understanding of the management that is associated with the functionality of the operation management. On the other hand, the operational approach gathers all the management principles, concepts and techniques within the management practices as said by Bastas and Liyanage (2018). As a result, the operational approach is seen as the most effective and modern approach to operation management.
Suitable practices to mitigate operational issue in Toyota
The outbreak of the novel corona virus has brought a severe and negative impact on every aspect of society that also includes the automotive industry. The suppliers of Toyota in January and February have been scrambling to keep the automobiles in an organized line, but unfortunately March has allowed the Toyota to take concerted action by aligning with the governmental advisories in order to keep its operational management safe and secure. The employees of Toyota were furloughed on account of economic conditions that the company was facing (Billedeau and Wilson 2018). In order to maintain the protocols and maintain social distancing, the whole workforce was not allowed at work at a time. This was the biggest operational issue in Toyota. On the other hand, it has been observed that due to the crisis, no customer was willing to purchase an automobile, as it was a time when people were laid off from their jobs, people did it had enough to even buy necessary things. In such scenarios people only focus on efficiently spending money. For this reason, Toyota has introduced a “customer connect” program to mitigate the operational issue and alleviate inconveniences for the Toyota owners. Toyota has announced the extension of free emergency support to the customers that do not have coverage till 15 days post the lockdown. Moreover, a series of measures was also announced in 2020 for dealer partners (Autocarindia.com 2020). This has targeted to ensure the liquidity to manage the business by securing the dealers for approximately 38-75 days by offering cash flow support.
Methodology and justification
Research methodology refers to the specific process and techniques of selecting processing and analyzing data. Clear outline of research methodology guides new research to complete the research 0bjectives in order to obtain results. In this regard to gain great understanding about the operating management process of Toyota research philosophy, research approach, design of research is presented. Further discussion is based on data collection methods and the process of data analysis. Sampling methods and ethical consideration of this research is highlighted along with the research limitation.
Research philosophy refers to the development of assumptions. According to the statement of Novikov and Novikov, (2019), it can be said that research philosophy determines the research activity. Research philosophy is a particular belief that has been discussed in developing this consultancy report. Positivism, post-positivism, interpretivism and realism are major four types of research philosophy that can be used in developing consultancy reports regarding the performance management of Toyota and Kampen, (2019) commented that interpretive research philosophy is based on the principle which plays an important role in observing the social world. On the other hand, realism research philosophy guides to describe specific phenomena that happened recently. In this regard to analyze the operation management process of Toyota and to understand the role of operation management in the success of manufacturing industry interpretivism and positivism research philosophy have been selected. Positivist approaches help to develop hypotheses in order to test the research objectives through empirical experimentation.
Inductive and deductive are two main research approaches which are being followed by researchers. According to the comment of Žukauskas et al. (2018), it can be said that inductive research approaches help to develop a theory and deductive research approaches guide to test an existing theory. In order to test the research hypothesis regarding the operation management system deductive research approaches have been selected. This consultancy report about the operation management process of Toyota is relying on deductive research approaches because it is providing the opportunity to test the research hypothesis. Inductive research approaches are not selected because this is a complex method where research findings can be invalidated. Along with that it is needed to mention that deductive research approaches enlarge the scope of success because it tests existing theories.
In order to develop the consultancy report regarding the operation management system in manufacturing industry exploratory, explanatory or descriptive research design can be followed. As per the views of research design focus on the aims and objectives of research to obtain results. Exploratory design generally determines cause and phenomena by highlighting the cause of the phenomena. On the other hand, descriptive design of research generally focuses on describing phenomena rather than highlighting the factor associated with the phenomena (Doyle et al. 2020). Considering the particular characteristics of above mentioned research design, descriptive research design has been selected. Descriptive research design is helping to identify and explain important factors that are related to the operation management system of the manufacturing industry. Along with that, descriptive research design holds the capability to determine the importance of the operation management system in organizational success because it is describing all important phenomena considering literary evidence.
Data collection method
In order to find out challenges of the operation management system of the manufacturing industry and to recommend effective operation management strategies secondary data have been collected. From the literary evidence secondary qualitative and quantitative data is obtained to develop the understanding about the concept of operation management system of the manufacturing sector. Along with that, it is needed to mention that both qualitative and quantitative data is providing all required information related to the sales and demand of products manufactured by Toyota. Secondary data collection method have been selected because it guides researchers to complete research and to develop consultancy reports within the time (Ong and Puteh, 2017). Moreover, it can be said that the secondary data collection method takes less time to complete reports regarding research topics. On the other hand, research by collecting primary data takes more time because the data synthesis process is time consuming. In relation to reducing the time of preparing report secondary data have been collected.
There are three main types of data analysis which include quantitative analysis, qualitative analysis and mixed data analysis. Secondary qualitative analysis process is being followed to complete the consultancy report. On the basis of qualitative data, thematic analysis is conducted to test research hypotheses. Thematic analysis is conducted because it helps to meet the research objective by synthesizing secondary qualitative data. According to the study of Ong and Puteh (2017), it can be said that quantitative analysis is a complex method as compared to qualitative thematic analysis. On a similar note, it can be commented that quantitative primary analysis can create volatility in meeting research objectives because success of qualitative analysis depends on authenticity of research questions (Sattar et al. 2017). Considering this fact, secondary thematic analysis has been selected to develop this consultancy report regarding the operation management process of Toyota and manufacturing sector.
Sampling size and method
This consultancy report is based on the secondary data obtained from journal articles to determine operational challenges in the manufacturing industry. Along with that, it can be highlighted that 4 research articles and 4 themes have been selected to conduct thematic analysis regarding the operation management process of the manufacturing industry.
Data protection Act 1998 is followed to protect the data confidentiality and to complete the research in an ethical way (Legislation.gov.uk, 2020). GDPR principles are also abided by at the time of conducting research. No personal data of human beings involved in the research. As this research is completed on the basis of secondary data there are less amounts of risk related to the data breach.
Research is based on secondary data collected from peer reviewed articles or published newspaper reports. Secondary data collection methods may limit the viability of research because it lacks practical and direct observation.
Findings and analysis
Importance of operational management within the automobile manufacturing sector
The concept of operational management is based on the effective deals and decision making which is further identified to be directly associated with that of the production procedure. The concept of operational management is considered to be closely aligned with that of the specific production of the goods and services. Operational management is known to be utilised in various manufacturing sectors. Hence, based on the requirement, the automobile manufacturing sector can be considered to be the most suitable for the sustainable incorporation of the operational management. Various automobile manufacturing organisations have been manufacturing products and services as per the demands and requirements of their target customers. The cost of the automobiles also tends to alter and differ based on the customer requirements as well. In the current situation of technological advancement and escalation of demand and productivity, the automobile makers are providing their sustainable emphasis towards the operational management process. As mentioned by Jung et al. (2018), the organisations are also known to introduce the concept of modular platforms based on which the better management and operation of the organisations are taken into consideration.
The importance of including operational management within the automobile sector is further known to be based in the different aspects and factors including the ethical behaviour within the workplace, the environmental factors, social factors as well as the people factors like the employee involvement training acquired by the employee’s supplier customer relationship, team performances and so on. The potential importance of the automobile industry based on operational management is quite a few. A sustainable involvement of operational management helps to ensure profitability within the automobile sector. It is further known to be a sustainable reason based on which the customer retention is maintained. As per the findings of Lampón et al. (2017), the automobile industry is often known to be involved with customer complaints and warranty claims. The concept of operations management also helps to accurately sort them and mitigate the complaints as effectively as possible. Furthermore, incorporation of an effective operational management is also known to lower the wastage of the resources and raw materials within the firm thereby causing a steep decline in the company’s financial expenditure. It is also capable of providing the organisation with a greater percentage of market share as well as sustainably increase and escalate the employee and customer engagement.
Therefore, it can be stated that a sustainable and satisfactory utilisation of the operational management process can provide the companies with a detailed understanding regarding the organisation’s internal environment as well as the existing market condition. The concept of operational flexibility is also known to witness a steep escalation as a result of direct implementation of this concept. As mentioned earlier, operational management also helps to better align with the cost reduction as well as ensure a much better scope and sales economy.
Approach for improving scale of production in automobile industry by Robot Assisted Sensing
The comprehensive structure of the automobile sectors tends to change and alter based on the requirements of the customers. The production of the vehicles and automobiles are also considered to be an essential aspect based on which the position of the automobile industry tends to escalate and diminish over the course of time. The current advancement of technological aspects has led to the inclusion of various technological features within different manufacturing sectors and it has also led to the sustainable growth of the industry as well. Based on a similar factor, a newer technological aspect known as the Robot Assisted Sensing (RAS) has been widely used in the automobile manufacturing industry. As per the identification of Smys and Ranganathan (2019), robots are known to be used to a wide extent in the automobile manufacturing industry. This particular system is further known to add various flexibilities and safety within the different stages of the production process. Along with the escalation in the production capacity, the inclusion of Robotics within the manufacturing process also helps in keeping the employees safe from any types of dangerous accidents. It also helps to improve the peer production quality, relieve the bottlenecks within the organisation as well as accentuates the organisational capacity.
The incorporation of robotics is known to provide an immense competitive advantage to the organisations based on the automobile sectors. The automobile sectors are considered to be entirely based on the preparation of the cars and their parts. The implementation of robotics can provide a sustainable aid in the process by helping in welding, painting, assembly, removal of the materials, sealing process, coating of the cars, parts transfer and so on. The inclusion of robotics is also known to sustainably reduce the variability of the parts. As stated by Kangru et al. (2018), there are different types of robots that are used for different functions as well. More specifically, the pick and place robots are predominantly used within the automobile industry for the purpose of assembly, packaging, bin packaging and in the inspection process as well. The predominant utilisation of the robots and robotics within the automobile manufacturing industry is based on the fact that they can be used for transferring and relocating the materials and car parts that are heavy and thereby difficult to handle and move. Furthermore, it can be depicted that the robots can also be customised by the organisations to perform the activities as per their requirements.
Hence, a comprehensive analysis and understanding regarding the incorporation of Robotics within the automobile manufacturing firms provides with a general idea that it can actually enhance and escalate the peer production rate and scale of a firm. It can also be mentioned that the enhancement of efficiency within the process of manufacturing and production of the vehicles are also an essential aspect in terms of the Robotics implementation. Although, the implementation of robotics can be costly, the improvement in the technological aspects and innovative features can be turned into a more affordable and user-friendly experience.
The concept of operations management and its associated challenges in the global manufacturing sector
The concept of operations management refers to the administration of various business practices that creates the higher level of efficiency within a business operation. It is highly concerned with converting labour and raw materials into finished products and services. In global manufacturing industries, the operations management concept has become more viable as it helps organisations maximize their profit margin. Associate teams of operations management make attempts to balance costs with organisational revenue for achieving the highest possible net operating profit. The concept of operations management does involve utilising resources from labour, materials, machines and equipment and innovative technologies (Atasu et al. 2020). Managers within an operations management team acquire, create and deliver products and services to their clients based on market needs and organisational capabilities. Operations managers handle several strategic issues such as determining the size of production plants and the project methods as well as executing the structure of software applications and information technology networks. With various operational methods and processes, operations managers ensure minimal waste occurs within the use of raw materials and equipment and manufacturing goods and services. Apart from the manufacturing, operations management is also concerned with the logistics and supply chain management within an organisation. To ensure better supply management, operations management professionals understand local, regional and global market trends, consumer demand and available sources for manufacturing and distribution. Operations management does approach the acquisition of manufacturing materials and labours from the market and eventually, manufacturing operations like the automobile sector releases finished products such as commercial and personal-use vehicles.
In the operations management, a few general challenges can be recognised that mainly affect the manufacturing operations. One of the major challenges in operations management is in balancing tactical and strategic concerns. It is based on the movement of the practices away from different tactical concerns, towards strategic, societal, financial and global concerns. For instance, when manufacturing industries have to deal with mega-projects, dozens of business operations, varieties of stakeholders like regulators, multiple agencies, public and other profit-making operations are involved (Meredith and Pilkington, 2018). Therefore, challenges can be seen in the communication and coordination between those stakeholders and organizations. As the operations management consists of the engagement of several organisational departments, consistency in communication has become a major challenge which reduces efficiency in areas like demand planning and forecasting, developing and implementing production plans, and monitoring the manufacturing activities. Apart from that, globalization has become a massive external challenge for the operations management where trade barriers, social and cultural barriers and inaccurate understanding of technological advancement in different areas can pose adverse effects in manufacturing and distributional operations, within an automobile operation. In several cases, it is recognised that operations managers find themselves struggling with high-extent market competition not only from the county of origin, but from countries all around the world.
Operations management strategies to prosper in production facility within automobile manufacturing operations
Operations management within an organisation refers to an area of management that is concerned with designing and controlling the manufacturing and redesigning processes in the production of products and services. In simple words, operations develop products, manage quality and generate effective services (Walker et al. 2015). Thus, operational departments in business management consist of production or manufacturing, supply and logistics support, marketing and finance, sales and service. Operations are considered as the current chain of business activities, which eventually leads to efficient delivery of operational objectives and missions. The global manufacturing sector is under a critical juncture where multinational manufacturers are facing tough competition in their markets. In order to deal with the competitive challenges, manufacturers are continuously working on developing manufacturing capabilities as well as quality standards by introducing latest software and technologies and applying new innovative business tools. The automobile industry falls under the global manufacturing sector which is holding a massive market share, even if the current Covid-19 pandemic has disrupted the overall production. In the contemporary market, demands for vehicles with innovative features and technologies are being acknowledged and demanded by most of the customers. Manufacturers like Toyota are facing issues in developing their production facilities and units during this pandemic period, to achieve the market demand all over the world.
To prosper at automobile production level, “Total Productive Maintenance (TPM)” is a methodological framework which can help a manufacturing operations management enhance productivity and quality and reduce manufacturing costs (Gupta and Vardhan, 2016). The TPM method is being executed within manufacturing industries as a team activity by which an operation can reduce equipment maintenance, enhance production quality and develop profit margins. With this method, operations management increases production efficiency by involving all workers from top management to operatives for carrying out the maintenance tasks. An operations management can reduce the production costs through the TPM initiatives. Product costs usually include material costs, manufacturing costs and profits where manufacturing costs incorporate machinery or processing costs and costs regarding production losses. With the TPM methods, production losses within an automobile operation can be controlled and decreased to a large extent and it can help the management reduce the overall costs of production. To generate an action plan for reducing production loss, the Loss-cost Matrix” can be prepared as it delivers a clear understanding of the cost effects associated with several major losses. A production loss register can be maintained by the production team and manager of an automobile operation in order to record the overall losses gained during the production cycle of each vehicle (Gupta and Vardhan, 2016). For instance, if a production unit is having the loss type of measurement adjustment, an action plan must be made to rectify the machine failure, and resolve quality issues. On the other hand, when there is a loss-type of high set-up time, the action plan should be developed for reducing set-up facilities and activities. Therefore, it can be stated that the automobile manufacturing sector with production issues can initiate the TPM method by which the concerned operations management can look after the technical activities in vehicle production and quality adjustment.
Operation management is one of the essential criteria for the automobile industries like Toyota to enhance their productivity level to the desired level which will help the firm to meet the growing demand. Moreover, operation management is quite effective for the organisation to control their operating cost to a great extent that is essential in order to achieve better profitability which will help business to grow further (Dubey et al. 2020). The concept of operation management might be greatly helpful for Toyota to improve their operational planning which enables the organisation to maintain their consistency in the manufacturing process during the restrictions of pandemic. Operation management makes organisations more stable and flexible in the changing business environment which is useful for business to maintain its competitiveness. As commented by Ivančićet al.(2019), the operation management process ensures proper resource handling. It also contributes towards the betterment of operational efficiency which is a key success criterion for business. Organisations need to be concerned about numerous factors for successive operation management. According to Dalenogareet al. (2018), technological integration is one of those factors in which operation management is heavily dependent on. For instance, automation in manufacturing facilities, utilisation of AI-based machineries not only improve working efficiency but also improve operational accuracy & safety which are primary goals of operation management. Moreover, management information systems help to streamline the business process through accurate operational planning by analysing all the business aspects. It also widened the scope of successive operation management at automobile manufacturing organisations like Toyota to a great extent.
Automobile industry is more prone to the integration of modern services with maximum accuracy. Therefore, skills and experience of the staff plays a crucial role in the operation management of automobile industries. Therefore, it is highly essential for the management of authorities to emphasize more on the training & development programs, workshops etc. to enhance the practical knowledge of the employees and keep them up to date. It can facilitate the operation management at Toyota to a great extent. Operation management enables the organisations to extract best possible output from their operational process. It is essential for organisations to serve their consumers efficiently which can also enhance the revenue generation. As outlined by Kurilova-Palisaitieneet al. (2018), operation management can help the automobile manufacturing industries to identify and make possible improvements in the key activities that can enhance the productive efficiency to a great extent. Hence, it might be useful for Toyota to deal with their issue of surplus production in the pandemic situation when the demand of automobile products continuously rises. The concept operation management is very good and effective for organisations. However, organisations need to be completely prepared for the change for successive execution of the operation management. As mentioned by Agrifoglio et al.(2017), operation management changes the operational process, used technology, activity schedules etc. Therefore, organisation must be capable to handle those changes otherwise the productivity of the firm will be disrupted for a longer time. In addition to that, for effective execution of operation management plans organisations also need to adopt suitable theoretical principles such as Six sigma, Just-In-Time, 4Vs of operation management, Scientific management theories etc. it will help to execute the operational management process by applying properly guided strategies which can enhance the productive efficiency of the organisations easily.
Operational management process plans, executes, supervises and controls all the production or manufacturing related activities in the manufacturing sector. Therefore, it can be said that incorporation of suitable changes can be only possible through the operation management process. As per the knowledge of Wamba-Taguimdje et al. (2020), the operation management process ensures better conversion of business resources and labour into assets that will make business more responsive in meeting the market requirements or demands. Thus, it might be very helpful for the organisation.
Managing large projects becomes easier for the operation management process. It basically enables the organisations to establish balance between all the business attributes that is crucial in order to achieve the desired success level in projects. As stated by Hong et al. (2018), the automobile manufacturing industry can be also benefited through operation management for its capability of supply chain management. It basically, helps organisations to stem line their supply chain related activities and optimise inventory operations also which is essential for the consistency in the manufacturing process. Hence, it might be also useful for Toyota to overcome their productivity crisis related business problems. Operation management greatly helps to control operating costs which might be useful for the procurement process in business. Thus, it might be useful for Toyota to offer low-cost products or services which can further increase their demand for the offerings. It might be a great opportunity of success for the firm if it is able to capitalise the opportunity of high demand through effective operation management.
From the entire discussion it can be said that operation management is basically a key emulator for the business which steps up the business performance by making possible changes in business. It makes business contemporary, table and flexible as per the competitive business environment and market conditions. Therefore, it can be said that multinational organisations like Toyota need to concentrate on operation management to a great level as it will help those organisations to retain their business position successfully. Moreover, operation management can deliver better control to the business attributes which might be useful for the achievement of corporate goals smoothly. Operation management process also ensures proper distribution of products through regulating the logistic operations. It also ensures better availability of products in the market. It also helps to reduce the load of inventory that is crucial for the automobile industries like Toyota. Moreover, operation management process greatly facilitates the R&D of products which can enhance the product design. It might be also useful for the automobile manufacturers to serve their customers as per the market trends. It will also helpful to offer most innovative offerings to the customers which is essential to attract more customers easily towards the brand.
This research study has addressed the significance of operation management in the manufacturing sector. To support this statement, a case study of Toyota Company has been considered. It has been observed that in 2021, the sales volume increased by 71 million units. The reason was that the majority of people prefer personal vehicles to prevent the spread of Covid infection. Health crisis due to Covid pandemic was the key reason for high customer demand. Therefore, Toyota struggled to accomplish the customer demand even though there was a lack of productivity. Considering this crisis situation, the study has demonstrated the significance of operation management in Toyota for bringing success in the manufacturing sector. The key aim is to understand the operational management and identify challenges and issues. Based on the challenges identified, the researcher will be determining a prospective method to mitigate those challenges. In the next section of the study, the problem in the business context of Toyota has been identified. Here it has been observed that Toyota is unable to sustain consistency in their business process because of restrictions imposed by the government especially on the workplace such as manufacturing units and production units. As a result, the role of operation management within the business is explained in the study as the vast area that covers up optimization or regulations of the whole business to make the business more goal oriented and more responsive. In the next section of methodology as illustrated relevant methods and approaches that are suitable to derive reliable data and optimum results. Secondary data collection was used to derive data from the available sources. Based on the collected data, themes were framed.
Objective 1: This objective is linked to a literature review section where the concept of operation management and its importance in the business sector is explained.
Objective 2: This objective is linked with factors associated with operation management that is elaborated in the literature review section. Elaboration has allowed the researcher to meet the objectives.
Objective 3: This objective is linked to a literature review section where different approaches to mitigate the challenges of operation management are identified.
Objective 4: This objective is linked with theories and models related to operation management.
While conducting this research study, the researcher had faced a lot of limitations of time restriction. In order to derive reliable and relevant data related to operation management, the researcher consumed a lot of time, due to this reason, other activities were delayed. Moreover, collected data was analysed and arranged. In spite of framing, it properly, plagiarism occurred; researchers again reframed the context and then considered it as final data.
There are many issues and challenges identified in the operation management in Toyota. Considering these, it is highly recommended to team up with the customers and try to comprehend their taste and preference. Later organize product families accordingly. Moreover, it is also recommended to aim for non-stop advancement to deliver superior quality. Engage the frontline employees to make strategic decisions and ensure the organizational goal is accomplished. Acknowledging the core customers, their best practices and their competitive edges is relevant and recommended to make proper business decisions and alter as per the customer demand.
This study was prepared with utmost care and perfection. Concept of operation management and its issues and challenges in Toyota are elaborated in detail. Hence, this study can be used as a secondary source in future events. Moreover, a comparative study can also be conducted for any other automobile manufacturing organization.
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