Regal Marine questions

TURTLES

10 critical decisions in OM (Regal Marine)

Design of goods and services
What good or service should we offer?
How should we design these products and services?
The company designs, manufactures and markets 22 different boats in a luxury category. The
goal of the company related to the product is to provide value, quality and satisfaction to the
customer.
Managing quality
How do we define quality?
Who is responsible for quality?
The product should be distinctive, that means that the product has features and benefits to
stand out from other similar products.
Mainly the management is responsible for the quality. Usually managers make the decisions
to achieve their goals. Another important item for quality is the communication and the
team-spirit within the company.
Process and capacity design
What process and what capacity will these products require?
What equipment and technology is necessary for these processes?
The company follows a differentiation strategy to persue its mission (differentiation-better,
response-faster, cost leadership-cheaper).
Location strategy
Where should we put the facility?
On what criteria should we base the location decision?
The distributors should have the calibre to represent the product in a way which will sell in a
market place. It is also an important question in which country the production will take place.
If the production gets outsourced in low- wage countries probably the quality decreases,
which can have bad effects on the company image.
Layout strategy
How should we arrange the facility?
How large must the facility be to meet our plan?
Different models should be produced on different assembly lines in separate buildings. It is
also important to have some alternate space to expand if there is a need for it. Furthermore the
facility should be close to the suppliers of the company.
Human resources and job design
How do we provide a reasonable work environment?
How much can we expect our employees to produce?
It is important to let the employees participate in the success of the company. The
management is committed to its employees in the same way how they are committed to the
company. That means that they have to invest in its employees to raise the level of
competence.

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Regal Marine questions

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Supply chain management

Should we make or buy this component?
Who are our suppliers and who can integrate into our e-commerce program?
Volvo Penta is a world-leading supplier of engines for marine and industrial applications and
Mercury is the world's largest manufacturer of marine propulsion engines. These two
company are leading in quality in the respective market segments, thats why these companies
are the right suppliers for Ragal Marine to fullfill there quality needs.
Inventory, material requirements planning, and JIT
How much inventory of each item should we have?
When do we re-order?
Manufacturing organizations, whatever their products, face the same daily practical problem that customers want products to be available in a shorter time than it takes to make them. This
means that some level of planning is required. Nowadays there are a lot of different software
programs to plan inventory and material requirements.
Intermediate and shortterm scheduling
Are we better off keeping people on the payroll during slowdowns?
Which jobs do we perform next?
Maintenance
Who is responsible for maintenance?
When do we do maintenance?
The different Regal dealers and the company itself are responsible for maintenance and
warranty. RM has its own customer and warranity division, handling issues in the field for
dealers and consumers alike.
Goods and service design. According to Henzer (2004), design of goods and design defines
much of the transformation process. The factors of cost, quality and human resources must be
made during the stage. Operation management of product and services is also different
because due to different characteristic and tangible / intangible feature.
II. Quality. Customer has a very high quality standard nowadays and operation management
decision in quality must be clear and strict for its members to understand and comply. It must
set a quality, standard and operating procedure to meet customers high expectation.
III. Process and capacity design. Manufacturing of physical products may have higher
importance on process and capacity design than services operation. Operation management
(product) should decide what process it, what type of technology and to what extent, human
resources, quality and maintenance that determines its basic cost structure. Services operation
decision on this area is much simpler and it can determine by customers who directly involved
in the process. For example, customer will ask tailor to design specific fashion clothes.
Capacity design issue is critical for services because it will try to reduce waiting time and
avoid lost of sales due to insufficient capacity. For manufacturing capacity design is based on
firms financial capability, forecast for future and market demand.
IV. Location can be an area for operation management to decide and with globalization of
business, operation managers too must think global. For physical goods, location selection can
be determined by pools of qualified human resources, technology, raw material, access to
market and government policy. For services as it is direct to customers, the location is
determined by market accessibility or near to customer as possible.
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Regal Marine questions

TURTLES

V. Layout design. Material flow, process selection technology used, capacity needs, workers
needs, inventory requirement, and capital will influence the decision for layout design. For
services such as hotels, beside capacity needs layout also will enhance its attributes and
features to the customers.
VI. Human Resources and Job Design Employees is the integral part in the total system
design. Operation management must set a policy to set labor standards to ease transition of
skills, improvement of knowledge, skills and abilities (KSA), build a balance work and life
quality in an effective cost target. For services one extra area operation management should
touch, which is customers relationship that they are dealing directly.
VII. Supply Chain Management Decisions that have to take place of what to produce, what
material to buy, from where, how is the cost and how is the delivery from supplier to the final
end customers in on-time delivery and minimum cost possible. It is more critical in
production of goods than services.
VIII. Inventory Decisions on how and where the inventory level to keep long term
customers satisfaction, suppliers, material availability for not to disrupt the production, human
resources needed for this purpose and important the holding cost from financial perspective.
Goods production are more concern because manufacturer may kept raw material, in progress
work order and final goods while services is not critical as it is directly produce and consume
simultaneously.
IX. Scheduling Efficient way of allocation, control and management of materials, capital
goods and human resources to efficiently produce the final goods from the input available.
Schedules are more formal in goods production with short, medium and long term planning to
accommodate customers demand. For services the demand is more direct and volatile and
often concern on human resources and KSA availability to meet current customers needs.
X. Maintenance Decision must be made regarding the desired level of reliability, stability
and systems must be established by management to maintain that reliability and stability.

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