QATs Quality Assessment s UNIT 3 OUTCOME 3 VCE Business Management SCHOOL-ASSESSED COURSEWORK Introduction Outcome 3 Discuss and analyse strategies related to operations management. Case study This task has been designed to allow achievement up to and including the highest level in the Performance Descriptors. It contributes 100% of the total marks (40) allocated for this outcome. This task will be marked out of 40. The marks for each question are indicated in brackets. You have 60 minutes to complete the task. You can access a one-page cheat sheet. Answer in the space provided. Your teacher will advise you of any variation to these conditions. The following key knowledge is the focus of this assessment task: characteristics of operations management; operations, productivity and business competitiveness in terms of cost, quality and delivery; key elements of an operations system; strategies adopted to optimise operations including: facilities design and layout materials management management of quality use of technology ethical and socially responsible management. The following key skills are the focus of this assessment task: accurately use relevant management terms; analyse business information and data; apply operations management knowledge and concepts to practical and/or simulated representations; discuss key aspects of operations management theory; analyse strategies that arise through practices within operations. NAME: Page 1 of 10 2012 Published by QATS. Permission for copying in purchasing school only. Ser5BMU303C
Read the case study and answer the questions that follow. Hopranos is a large private company that has two major operations functions. Firstly the Food Production Division, based in a major country city, which manufactures packaged food including pastas, quiches, soups and frozen desserts. The factory employs 280 people using the process production layout and has obtained a Quality Assurance (QA) accreditation under the food industry standard. Hopranos sources food from several suppliers including from farms (vegetables, fruits) and abattoirs (fresh meat). This division has achieved high levels of productivity, mainly through the introduction of new production technologies. The second division, Food Services, provides a range of consultancy services to new businesses in the hospitality industry (restaurants, canteens and food production facilities). The services provided by its consultants include advice on hygiene, health and safety and facilities design and layout. This division has several offices throughout Victoria and currently employs 80 staff. Question 1 Define the following terms. a. Operations function b. Productivity (2 marks) Question 2 Explain, using examples from the case study, how inputs, processes and outputs apply to an operations system. (3 marks) Page 2 of 10 2012 Published by QATS. Permission for copying in purchasing school only. Ser5BMU303C
Question 3 Hopranos provides both production and serviced based operations. Explain two points of difference between a service and a product based operations system. (2 marks) Question 4 Describe how a Quality Assurance (QA) system could assist with optimising operations in the Food Production division. (4 marks) Page 3 of 10 2012 Published by QATS. Permission for copying in purchasing school only. Ser5BMU303C
Question 5 The Food Services division has been asked to provide advice on the best design and layout for a new restaurant. Identify and explain three important considerations (or steps) that would be included in that advice. (9 marks) Question 6 Identify and explain any two manufacturing and/or service technologies that would apply to Hopranos. (6 marks) Page 4 of 10 2012 Published by QATS. Permission for copying in purchasing school only. Ser5BMU303C
Question 7 Early in the year, one abattoir that supplies meat to Hopranos was accused by the media of using slaughtering techniques to kill animals that were considered cruel, although not illegal. However because Hopranos had built a strong supply relationship with the abattoir and had full knowledge of work practices and other aspects of the supply process, it was able to able to satisfy themselves that the meat supplied to them was not subject to any such cruel techniques. a. Analyse key aspects of supply chain relationships as they would apply to Hopranos. (6 marks) b. Discuss the significance of ethical and socially responsible management (ESM) to the operations systems of large-scale organisations, using the issue of animal cruelty at the abattoir, where appropriate, to illustrate your discussion. Page 5 of 10 2012 Published by QATS. Permission for copying in purchasing school only. Ser5BMU303C
(8 marks) Total marks: 40 Page 6 of 10 2012 Published by QATS. Permission for copying in purchasing school only. Ser5BMU303C
Teacher Advice The grid below demonstrates the relationship between the highest performance descriptor and the questions in this QAT. Aspect of Highest Performance Descriptor Question/s High level discussion and analysis of strategies related to ethical and socially responsible management of an operations system. Precise, comprehensive and accurate application of knowledge of specific operations strategies to practical and /or simulated situation. Consistent and accurate use of operations management terms and concepts. Comprehensive analysis of relevant information data. 7b 2, 4, 6 and 7a ALL ALL Page 7 of 10 2012 Published by QATS. Permission for copying in purchasing school only. Ser5BMU303C
Solution Pathway The following provides marking advice on the questions in the case study. Teachers should consider the merits of varied responses from students. Question 1 a. Operations function Operations is the function in the organisation that produces its goods and/or services by transforming intputs into required outputs. b. Productivity Productivity is an efficiency indicator that shows the level of output for a given level of inputs. It is expressed as ratio and it is a measure of how well an organisation is using its resources. (2 marks) Question 2 Students need to apply the three key elements to the case study. One mark for each element. Inputs are the resources required to supply the food products or service and would include plant (factory), power, staff such as production and consultancy employees. Processes involve the transformation of inputs and include activities such as food production and packaging. Output is the outcome of the operations process such as the final advice provided by the Food Services division. (3 marks) Question 3 Students need to distinguish between the two operations system with two points of difference (one mark each), not just define each. The first difference is that a service does not require storage where as a product does. As a result services are usually consumed when purchased- other businesses take the advice immediately when it is provided by the Food Services division. The second difference is that a service is intangible while a product is tangible- you cannot touch the consultancy service but a product such as a frozen dessert can be. Question 4 A brief description of Quality Assurance (2 marks) should precede a brief analysis of how it will optimise operations at Hopranos (2 marks). (2 marks) Quality Assurance (QA) is worldwide system that involves the certified achievement through external assessment of the level of quality achieved in the production of a good or service. Organisations have to meet certain standards for their industry in relation to areas of the business such as procedures used, controls put in place and documentation kept. Once achieved the business is accredited and can then display the quality logo or standards mark. For Hopranos this would mean their operations system is working effectively and efficiently, as the standards set have to be achieved. It provides a clear direction for how to best operate the production system of the business. (4 marks) Page 8 of 10 2012 Published by QATS. Permission for copying in purchasing school only. Ser5BMU303C
Solution Pathway Question 5 Students need to consider the use of facilities to carry out operations of a new restaurant. They could take different approaches including planning the operations relative to three selected steps required or focus on particular aspects of the system. Facilities design and layout is about the best use of plant and equipment to deliver a service. In relation to the proposed new restaurant, thought firstly needs to be given to the exact service that will be provided- product/service selection. This could include the type of food and drinks that will be offered to customers and whether there is full table service or a self-service model is to be used. Secondly once the product selection is known the next consideration would be a forecast of the volume/number of customers expected. This will provide an indication of the size of the operation and the required equipment (eg. number of stoves). A final consideration would be the amount of space required to house the restaurant and its components such as dining area, kitchen and storage. (9 marks) Question 6 Identify and explain any two manufacturing and/or service technologies that would apply to Hopranos. Students could choose to identify and explain either production or service technology (one of each or two of a particular type). In the Food Production division one technology that could be used is a flexible manufacturing system (FMS). This offers flexibility in that computers automatically control the machines and the production process so that the same line can handle different inputs. It would be possible to have the same line producing different foods. In the Food Services division could use mobile communications technology could be used. Consultants who are at a particular location (called remote-site ) can use their mobile to connect to the main office system as they need. For example a consultant could access information given to a similar client (stored centrally at the office) to help a current client. (6 marks) Question 7a Students need to analyse a couple of the key aspects of supply chain relationships for full marks. A range of points could be discussed including the need for strong contact, use of QA systems by suppliers themselves, using the JIT system and use of technology. Building sound supply chain relationships with suppliers is crucial to the success of operations. This could involve having constant contact to ensure supply processes are continuing to be at the required standard. This could see visits to the supplier or at least personal contact with key people at the supplier. Another aspect could be to put in place the Just-in-Time (JIT) system. This means that inputs are delivered just as they are needed in production, saving the need for storage and all its associated costs. This would particularly apply to the use of fresh produce at Hopranos. (6 marks) Page 9 of 10 2012 Published by QATS. Permission for copying in purchasing school only. Ser5BMU303C
Solution Pathway Question 7b Students are required to discuss (examine arguments for and against) ESM as an issue in operations. A definition and brief explanation (2 marks) should precede a discussion of its significance with reference to Hopranos (6 marks). It would be appropriate for students to express and support a personal view on the issue of ESM. Ethical and socially responsible management (ESM) is argued to be significant to operations systems at a company such as Hopranos. ESM relates to the moral standards that guide management behaviour and the general concern it has for the impact of its activities on the general community. There has been a concern for ESM in recent years in light of operations issues such production waste and resource use and the behaviour of suppliers. It is believed that companies such as Hopranos must be ethical and socially responsible. This could relate to the different activities such as practicing the highest ethical standards by management, using environmentally sustainable inputs, ensuring high safety standards for employees and ensuring responsible disposal of waste. Indeed the issue of cruelty to animals at the abattoir is a case in point. Of course the law ensures many of these activities reach a certain standard and it was stated that the abattoir had not done anything illegal. However it might be appropriate for Hopranos to take some action with this supplier if it believes their activities are unethical, eventhough these activities might not directly relate to their specific relationship. I would think they should at least investigate the claims and review the practices used by the supplier. Certainly ESM is significant for companies like Hopranos and they need to work out their position on certain issues (such as the one in this case) based on the moral standards and practices they set. (8 marks) Page 10 of 10 2012 Published by QATS. Permission for copying in purchasing school only. Ser5BMU303C