Issues faced by CQuest Marine Laboratory
Discuss about the Operation Management for CQuest Marine Laboratory.
In the case study, it can be seen that there are some issues regarding the operational management that is faced by the owner of CQuest Marine Laboratory. This laboratory is a floating platform that is anchored at the side of a coral reef. The laboratory is used to carry out research and scientific studies regarding the coral ecosystem and habitats of the fishes. Douglas privately owns this platform any Amy Patterson. Apart from carrying out scientific activities, the platform is also used as a place for tourism. It is used as a marine park where tourist visits to experience the aquatic nature and the marine system. According to the permit that they acquired they can have not more than 120 tourists per trip (Armstrong & Taylor,2014).
They have a option of keeping 120 tourist on platform at a time. They feel that the boat that they use is very slow in nature and they can afford to have another trip, which will further increase their profits. It was thought that they could accommodate two trips the boat will bring one set of passengers and then return and then again return with one set of passengers and will go back with the previous set of customers. However, this will said to prove very chaotic. With so many people at a time may cause some chaos, which will prove to be a problem that is hard to manage (Buttigieg et al., 2016).
They have already invested 8 million and they are further planning to invest another 3 million. They are highly reliable on the agents, as they themselves do not provide bookings or any kind of marketing. Therefore, the problem is that the time of cash in-flow is long. The agents’ takes typical 90 days time after the tourists have paid the price of the tickets and experienced the trip. This process is very long and is causing problem for the function of the business. As finance is the most important aspect to carry out the activities so it need cash. Therefore, the cash flow need to be fast enough and there should always be cash inflow to maintain the business activities (Chia & Round, 2015).
In order to carry out this tourism business they have a contract with a company, which provides them transport services. The tourists are brought from Trinity Inlet in cairns to marine platform. After winning the award for international tourism, they want to further extend their tourism operations. They want to make an arrangement so that 10 tourist can stay overnight on the platform and further more they want to increase the number of trips each day so that can accommodate and provide service to more tourist. This will increase their business by a great amount. However, as they want to expand, they are facing some problems regarding the operations that are needed to be carried out (Elsawah et al 2015).
Principles of Operation Management
The problems mainly that are being faced by them are:
If they want to provide a overnight stay for 10 people on the platform, in that case they also need to give them facility. The facility and services will require further couple of service personnel and a chef who will provide services to the tourists. It is also to be taken care off that it does not cause any problem for the scientist or cause any hindrance for their studies, which are being conducted by them.
The second problem is that there is a fluctuation in demand that may arise due to the news of cyclone and other causes.
They are having problem in optimum utilization of resources. In considering time as a resource, they are not being able to utilize time properly, so there is a waste.
They also have a problem with cash flow where a big share of their income are being charged by the agents as commission and also they are getting the money after a long period of time (Gal, Stewart & Hanne, 2013).
They face a chaotic situation as too many tourists is coming on the platform at a time, which is damaging the quality of the trip. So they want the problem to be solved by dividing them into small groups with proper operation plan so that the experience of the tourist could be made better.
Reality. Operations management should focus on the problem, instead of the techniques, because no tool in itself would present a universal solution (Glaub et al .,2014).
Organization. Processes in manufacturing are interconnected. All elements have to be predictable and consistent, in order to achieve a similar outcome in profits.
Fundamentals. The Pareto rule is also applicable to operations: 80% of success comes from a strict adherence to precisely maintaining records and disciplines, and only 20% comes from applying new techniques to the processes (Geisler & Wickramasinghe, 2015).
Accountability. Managers are expected to set the rules and the metrics, and define responsibilities of their subordinates, as well as regularly check if the goals are met. Only this way would the workers put in the necessary efforts.
Variance. Variance of processes has to be encouraged, because if managed well, they can be sources of creativity.
Causality. Problems are symptoms: effects of underlying causes. Unless the causes are attacked, the same problems will appear again.
Managed passion. The passion of employees can be a major driver of company growth, and the managers can instill it if not coming naturally.
Application of Principles to CQuest Marine Laboratory
Humility. Instead of a costly trial and error process, managers should acknowledge their limitations, “get help, and move on.”
Success. What is considered success will change over time, but always consider the interest of the customer. In order to keep them, all the other principles have to be revised occasionally.
Change. There will always be new theories and solutions, so you should not stick to one or the other, but embrace the change, and manage for stability in the long term.
Operation management helps to smooth functioning of the business. It helps to minimize the input and maximize the output with the least possible use of resources. It helps to convert the resources into goods and services. In this case study Douglas and Amy Patterson are providing services so they should take the help of operation management principles for smooth functioning of their business (Gosling et al., 2015).
The principle of operation management and how they can be useful to the business that is being run by Douglas and Amy Patterson are as follows:
Principle of organization – They should have a well-planned operation format so as to maximize their profit. Perhaps in this case they can divide the tourist in smaller short groups and reduce the time while increasing their experience and value for money.
Principle of fundamental – They should try to act according to the process and maintain strict regulations on use of resources so that wastages can be checked.
Principles of accountability – Every employee should be made accountable for their task and they should be provided with goals and checked which will decrease wastages and increase efficiency.
Principle of variance – Variance will help to reduce the cost of the process. The variance should be measured and it should be kept under control.
Principle of causality – Causality from the process should be ignored. As this may lead to further increase in consumption of resources (Haimes,2015).
Rather than doing costly trial and error, help should be taken in order save resources.
If we form a process of the business mentioned in the case study we can make some changes. The process starts from when they avail the boat, arrives at the platform, stays there, and experience the aquatic environment and then return. Therefore, if the process time can be reduced and the groups of people can be reduced to a groups which may be 120 people at a time while increasing the number of process in a day. This will help in managing the problem of chaos and tourist will have a more pleasant experience (HakemZadeh et al , 2015).
Two tools that can be used in order to improve the process are Six Sigma and Lean. These two tools will help to reduce the cost of the process by eliminating all the unnecessary cost in relation to the process. It also helps to maintain the quality of the process by reducing the chances of errors (Jaber, 2016).
Rather than maintaining a long and big process it is advisable that it should be divided in to small process which is to be repeated more. In this way it will reduce the time of the process and further increase the output from the process.
Six sigma is a strategy that is being developed to reduce the number of errors to the least possible amount, which is almost negligible, or nearly zero. With the help of certain tools such as process mapping, calculation of potential defects, statistics, trending charts and ratios six sigma ensures that there is zero error in the process. So that the quality of the process is maintained, thus it will help in the project (Kline, 2015). Six Sigma is a strategy designed to improve the quality of process outputs. The Six Sigma program accomplishes this by identifying and removing the causes of defects (errors) and by minimizing the variability present in manufacturing and business processes. This strategy relies on particular quality-management methods, such as statistical analytics, and creates a special infrastructure of employees within an organization (Norton & Schofield, 2017).
The case study speaks of a business, which is oriented to providing service. There is a process involved in the function. The process involves various activities, which can be controlled. The process is divided in to activities, which clubbed together forms a process
Lean is something similar to the six sigma but it is something little different, rather than focusing on the elimination of errors it focus on elimination of the unwanted use of resources. With the help of lean we can reduce the cost of the resources which is very useful to reduce the cost. This tool is very effective to smooth running of the business and in industry which is very cost competitive in such a industry it helps to reduce cost thereby making the organization and its product more competitive. Lean is similar to Six Sigma, but is slightly less focused on defect rate and more focused on eliminating the amount of waste and excessive steps in an operation. Lean is a production theory that considers the expenditure of resources for any goal other than the creation of value for the customer wasteful, and thus a target for elimination (Scott & Davis, 2015). Beginning from the perspective of the consumer of a product or service, “value” is defined as any action or process that a customer would be willing to pay for. Lean employs tools to evaluate production workflow and determine where there is waste. Examples of this waste would be excess motion, inventory, and overproduction`( Spruell, 2016).
In this case study, they should divide the process into smaller process and further repeat the process to increase the profits. As the total number of person can stay on the platform at a time is 120 so reducing that number can be a loss of opportunity. It should not be considered until and unless there is any hindrance caused. The ships should be changed with faster options to reduce time. As time is a very important resource and saving time may increase profits. So considering this fact if the boats are changed with faster boats, in that case the process can be repeated more than once which will increase the profits and further will give full use of the opportunity. The process of cash flow is very lengthy and it should be reduced to smaller circle or smaller process so that the case flows in faster. This will help in further functioning of the business (Zurich, 2017).
References
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Chia, A., & Round, H. (2015). A Developmental Learning Framework for Business Report Writing: Guidance for Management Educators”. Journal of Adolescent and Adult Literacy, 45(7), 556-566.
Elsawah, S., Guillaume, J. H., Filatova, T., Rook, J., & Jakeman, A. J. (2015). A methodology for eliciting, representing, and analysing stakeholder knowledge for decision making on complex socio-ecological systems: From cognitive maps to agent-based models. Journal of environmental management, 151, 500-516.
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