‫المملكة العربية السعودية‬

Kingdom of Saudi Arabia ‫وزارة التعليم‬

Ministry of Education ‫الجامعة السعودية اإللكترونية‬
Saudi Electronic University

College of Administrative and Financial Sciences

Assignment 2
Introduction to Operations Management (MGT 311)
Due Date: 02/11/2024 @ 23:59

Course Name: Introduction to Operations Student’s Name:

Management
Course Code: MGT 311 Student’s ID Number:
Semester: First CRN:
Academic Year:2024-25-1st

For Instructor’s Use only

Instructor’s Name: Malak Alghamdi
Students’ Grade: Level of Marks: High/Middle/Low
Marks Obtained/Out of 10

General Instructions – PLEASE READ THEM CAREFULLY

 The Assignment must be submitted on Blackboard (WORD format only) via allocated
folder.
 Assignments submitted through email will not be accepted.
 Students are advised to make their work clear and well presented, marks may be reduced
for poor presentation. This includes filling your information on the cover page.
 Students must mention question number clearly in their answer.
 Late submission will NOT be accepted.
 Avoid plagiarism, the work should be in your own words, copying from students or
other resources without proper referencing will result in ZERO marks. No exceptions.
 All answered must be typed using Times New Roman (size 12, double-spaced) font.
No pictures containing text will be accepted and will be considered plagiarism).
 Submissions without this cover page will NOT be accepted.
Learning Outcomes:

 To designing profitable services that provide high level of quality to

satisfy business needs.
 To ensure that the services delivered are reasonable and relevant to
the customers.
 To gain an understanding of the business rules and ensure if the
results are in alignment with the organizational goals.

Go through the given case scenario

‘There must be a better way of running this place!’ said Dean Hammond,
recently recruited General Manager of Boys and Boden, as he finished a
somewhat stressful conversation with a complaining customer, a large and
loyal local building contractor.
‘We had six weeks to make their special staircase, and we are still late! I’ll
have to persuade one of the joiners to work overtime this weekend to get
everything ready for Monday. We never seem to get complaints about
quality, as our men always do an excellent job … but there is usually a big
backlog of work, and something always gets finished late, so how should we
set priorities? We could do the most profitable work first, or the work for our
biggest customers, or the jobs which are most behind on. In practice, we try
to satisfy everyone as best we can, but inevitably someone’s order will be
late. In theory, each job should be quite profitable, since we build into the
price a big allowance for waste, and for timber defects. And we know the
work content of almost any task we would have to do; this is the basis of our
estimating system. But, overall, the department is disappointingly
unprofitable, and most problems seem to end up with a higher-than-
anticipated cost, and with late deliveries!’
Boys and Boden was a small, successful, privately-owned timber and
building materials merchant based in a small town. Over the years it had
established a large Joinery Department, which made doors, windows,
staircases and other timber products, all to the exact special requirements of
the customers, mostly comprising numerous local and regional builders. In
addition, the joiners would cut and prepare special orders of timber, such as
non-standard sections and special profiles, including old designs of skirting
board, sometimes at very short notice, and often even while the customers
waited. Typically, for larger joinery items, the customer provided simple
dimensioned sketches of the required products. These were then passed to
the central Estimating and Quotations Department which, in conjunction
with the Joinery Manager, calculated costs and prepared a written quotation,
which was faxed or posted to the customer. This first stage was normally
completed within two or three days, but on occasions could take a week or
more. On receipt of an order, the original sketches and estimating details
were passed back to the Joinery Manager, who roughly scheduled them into
his manufacturing plan, allocating them to individual craftsmen as each
became available. Most of the joiners were capable of making any product,
and enjoyed the wide variety of challenging work.
The Joinery Department appeared congested and somewhat untidy, but
everyone believed that this was acceptable and normal for job shops, since
there was no single flow route for materials. Whatever the design of the item
being made, it was normal for the joiner to select the required bulk timber
from the storage building across the yard. This roughly-sawn timber was
then prepared using a planer-thicknesser machine which gave it smooth,
parallel surfaces. After that, the joiners would use a variety of processes,
depending on product. The timber could be machined into different cross-
sectional shapes, cut into component lengths using a radial arm saw, joints
were formed by hand tools, or using a morticing machine, and so on.
Finally, the products would be glued and assembled with screws and nails,
sanded smooth by hand or by machine, and treated with preservatives, stains
or varnishes if required. All the large and more expensive floor-standing
machines were grouped together by type (for example, saws) or were single
pieces of equipment shared by all 10 joiners. Every joiner also owned a
complete set of hand tools which they guarded and cared for with pride.
Dean described what one might observe on a random visit to the Joinery
Department:
‘One or two long staircases partly assembled, and crossing several work
areas; large door frames on trestles being assembled; stacks of window
components for a large contract being prepared and jointed, and so on.
Offcuts and wood shavings are scattered around the work area, but are
periodically cleared when they get in the way or form a hazard. The joiners
try to fit in with each other over the use of machinery, so are often working
on several, part-finished items at once. Varnishing or staining has to be done
when it’s quiet, for example towards the end of the working day or at
weekends, or even outside, to avoid sawdust contamination. Long offcuts are
stacked around the workshop, to be used up on any future occasion when
these lengths or sections are required. However, it is often easier to take a
new length of timber for each job, so the offcuts do tend to build up over
time. Unfortunately, everything I have described is getting worse as we get
busier … our sales are increasing so the system is getting more congested.
The joiners are almost climbing over each other to complete their work.
Unfortunately, despite having more orders, the department has remained
stubbornly unprofitable!
’Whilst analysing in detail the lack of profit, we were horrified to find that,
for the majority of orders, the actual times booked by the joiners exceeded
the estimated times by up to 50 per cent. Sometimes this was clearly
attributable to the inexperience of newly employed joiners. Although fully
trained and qualified, they might lack the experience needed to complete a
complex job in the time an Estimator would expect; but there had been no
feedback of this to the individual. We then put one of these men on doors
only; having overcome his initial reluctance, he has become an enthusiastic
“door expert” and gets closely involved in quotations too, so now he always
does his work within the time estimates! However, the main time losses
were found to be the result of general delays caused by congestion,
interference, double-handling, and rework to rectify in-process damage.
Moreover, we found that a joiner walked an average of nearly 5 km a day,
usually carrying around heavy bits of wood.
‘When I did my operations management course on my MBA, the professor
described the application of cellular manufacturing and JIT. From what I can
remember, the idea seems to be to get better flow, reducing the times and
distances in the process, and thus achieving quicker throughput times. That
is just what we needed, but these concepts were explained in the context of
high-volume, repetitive production of bicycles, whereas all the products we
make are one-offs. However, although we do make a lot of different
staircases, they all use roughly the same process steps:
1 Cutting timber to width and length
2 Sanding
3 Machining
4 Tenoning
5 Manual assembly (glue and wedges)

‘We have a lot of unused factory floor space, so it would be relatively easy
to set up a self-contained staircase cell. There is a huge demand for
specially-made stairs in this region, but also a lot of competing small joinery
businesses with low overheads, which can beat us on price and lead-time. So
we go to a lot of trouble quoting for stairs, but only win about 20 per cent of
the business. If we could get the cell idea to work, we should be more
competitive on price and delivery, hence winning more orders. At least that
is the theory. I know we will need a lot more volume to justify establishing
the cell, so it’s really a case of whether to construct a cell in anticipation of
higher demand, or to try to win more business first. To do the latter, we
would have to reduce our selling prices and lead-times, and then allocate
more joiners to complete the higher volumes of orders until we had enough
work to set up the cell. I personally favour setting up the cell first so that we
can have a “capacity leads demand” strategy.’
Questions
1. To what extent could (or should) Dean expect to apply the philosophies
and techniques of JIT to the running of the staircase cell?
(2.5 MM)
2. What are likely to be the main categories of costs and benefits in
establishing the cell? Are there any non-financial benefits which should be
taken into account?
(2.5 MM)
3.How different would the cell work (job design) be to that in the main
Joinery Department?
(2.5 MM)
4. What risks are associated with Dean’s proposal?
(2.5 MM)

Note:
 You must include at least 5 references.
 Format your references using APA style.
 Each answer must not be less than 300 words
 Answers

1. Answer-
Based on my understanding for given case scenario, Dean Hammond can significantly
benefit from applying Just-in-Time (JIT) philosophies and techniques to the staircase cell
at Boys and Boden. According to our course textbook, JIT, originally developed by
Toyota, aims to reduce waste, improve quality, and enhance efficiency by producing only
what is needed, when it is needed, and in the amount needed (Schroeder & Goldstein,
2018). Here are the key aspects of JIT that Dean could apply:
1. Waste Reduction:
 Inventory Management: Implementing JIT can help reduce the excess inventory
of timber and offcuts that clutter the workshop. By ordering materials only when
needed, the workspace can be kept cleaner and more organized, reducing the time
joiners spend searching for materials (Billesbach, 2024).
 Process Efficiency: JIT emphasizes streamlining processes to eliminate waste. In
the case of the staircase cell, this could involve reorganizing the layout to
minimize the distance joiners walk, thus reducing the 5 km daily average and
improving overall efficiency (Schroeder & Goldstein, 2018).
2. Quality Improvement:
 Continuous Improvement (Kaizen): JIT encourages continuous improvement in
all processes. Dean can implement regular feedback loops and training sessions to
help joiners improve their skills and reduce the time overruns currently
experienced (García-Alcaraz & Maldonado-Macías, 2015).
 Standardization: By standardizing the process steps for staircase production, such
as cutting, sanding, machining, tenoning, and assembly, Dean can ensure
consistent quality and reduce rework (Schroeder & Goldstein, 2018).
3. Flexibility and Responsiveness:
 Cellular Manufacturing: Setting up a self-contained staircase cell can enhance
flexibility and responsiveness to customer orders. This approach aligns with JIT
principles by creating a more efficient flow of materials and reducing lead times
(Billesbach, 2024).
 Employee Involvement: JIT promotes involving employees in decision-making
processes. Encouraging joiners to participate in process improvements and
scheduling can lead to better job satisfaction and productivity (García-Alcaraz &
Maldonado-Macías, 2015).
4. Customer Satisfaction:
 On-Time Delivery: By reducing lead times and improving process efficiency,
Boys and Boden can meet customer deadlines more reliably, enhancing customer
satisfaction and loyalty (Schroeder & Goldstein, 2018).
 Customization: Despite the one-off nature of the products, JIT can still be applied
by focusing on the common process steps and ensuring that each step is
completed just in time for the next, thus maintaining the ability to customize
while improving efficiency (Billesbach, 2024).

2. Answer-
Establishing a manufacturing cell for staircase production at Boys and Boden involves
several categories of costs and benefits. Additionally, there are non-financial benefits that
should be considered.
The main categories of costs include capital investment, operational costs, and transition
costs. Capital investment involves purchasing new machinery or reallocating existing
ones, as well as modifying the facility layout to accommodate the new cell (Schroeder &
Goldstein, 2022). Operational costs encompass training joiners to adapt to the new
workflow and maintaining the new equipment (Renna et al., 2023). Transition costs refer
to potential disruptions in production during the changeover period, which could lead to
temporary loss of revenue (Fraser et al., 2007).
On the other hand, the main categories of benefits include efficiency improvements and
cost savings. Establishing the cell can significantly reduce lead times by streamlining the
production process and minimizing the distance joiners need to walk, leading to faster
order fulfillment (Schroeder & Goldstein, 2022). Implementing JIT principles within the
cell will help reduce excess inventory, minimizing waste and freeing up storage space
(Renna et al., 2023). Improved workflow and reduced congestion can lead to higher
productivity, allowing the same number of joiners to complete more work in less time
(Fraser et al., 2007). Efficient use of materials and reduction in rework will lower the
overall cost of production (Schroeder & Goldstein, 2022).
In addition to financial benefits, there are several non-financial benefits to consider.
Standardizing processes within the cell can lead to more consistent quality of the finished
products, enhancing customer satisfaction (Schroeder & Goldstein, 2022). Involving
joiners in the decision-making process and providing them with specialized roles can lead
to higher job satisfaction and morale (Fraser et al., 2007). Continuous improvement and
training opportunities will help joiners develop new skills, making them more versatile
and valuable to the company (Renna et al., 2023). Improved efficiency and reduced lead
times will result in more reliable deliveries, strengthening customer loyalty and
potentially attracting new business (Schroeder & Goldstein, 2022).

3. Answer-
The cell work (job design) in the proposed staircase cell would differ significantly from
the job design in the main Joinery Department. In the main Joinery Department, tasks are
allocated based on the availability of joiners and the type of product being made, leading
to a broad skill set but less specialization. The cell work design, however, would involve
a more structured allocation of tasks specific to staircase production, with joiners
focusing on staircase production. This specialization can increase efficiency and reduce
errors (Schroeder & Goldstein, 2022).
The workflow and layout in the main Joinery Department are more chaotic and
congested, with joiners often working on multiple projects simultaneously and sharing
machinery. This leads to significant material handling and long distances walked by
joiners. The cell work design would streamline the workflow, reducing congestion and
interference by having a dedicated space and equipment for staircase production. This
would minimize material handling and reduce the time and effort spent on moving
materials (Schroeder & Goldstein, 2022).
The process flow in the main Joinery Department is flexible but less efficient, with
joiners adapting to the availability of machinery and workspace. The cell work design
would create a more linear and efficient process flow, with clearly defined steps and
minimal waiting times between processes. This aligns with the principles of lean
production, which emphasize reducing waste and improving flow (Schroeder &
Goldstein, 2022).
Quality control in the main Joinery Department is more ad-hoc, with joiners checking
their own work and relying on experience. The cell work design would allow for more
systematic quality control, with dedicated stages for inspection and feedback within the
cell. This systematic approach can help in maintaining high-quality standards consistently
(Schroeder & Goldstein, 2022).
By implementing a cell work design, Boys and Boden could potentially improve
efficiency, reduce costs, and increase profitability in their staircase production. This
approach aligns with the lean production principles of systematically eliminating waste
and providing exactly what the customer needs (Schroeder & Goldstein, 2022).

4. Answer-

Dean's proposal to set up a self-contained staircase cell at Boys and Boden carries several
risks that need careful consideration.
Firstly, there is the risk of demand uncertainty. Establishing the cell in anticipation of
higher demand assumes that there will be a sufficient increase in orders to justify the
investment. If the demand does not materialize, the company could face underutilization
of resources and increased costs without corresponding revenue (Schroeder & Goldstein,
2022).
Secondly, the initial investment required for setting up the new cell is significant. This
includes costs for equipment, training, and possibly hiring additional staff. If the expected
increase in demand does not occur, this investment may not be recouped, leading to
financial strain (AccelGrid, 2022).
Thirdly, there is the risk of operational disruption. Transitioning to a new manufacturing
cell could disrupt current operations. There may be a learning curve for employees, and
initial inefficiencies could arise as they adapt to the new system (Maware & Parsley,
2022).
Additionally, quality control could suffer initially as processes are refined and employees
become accustomed to the new workflow. This could lead to increased rework and
customer dissatisfaction (Schroeder & Goldstein, 2022).
Another risk is the competitive response. Competitors may respond to Boys and Boden's
new strategy by lowering their prices or improving their lead times, which could negate
the competitive advantage the cell is supposed to provide (Fagundes da Silva et al.,
2021).
Furthermore, resource allocation to the new cell might divert attention and resources
from other profitable areas of the business, potentially leading to a decline in
performance in those areas (Schroeder & Goldstein, 2022).
Lastly, employee morale could be affected. Changes in workflow and job roles can lead
to uncertainty and resistance among employees, impacting productivity and job
satisfaction (AccelGrid, 2022).
Dean will need to carefully weigh these risks against the potential benefits and develop
strategies to mitigate them. Conducting a pilot test or phased implementation could help
assess the feasibility and impact of the new cell before fully committing to the change.

References:
1. AccelGrid. (2022). The Pros and Cons of Lean Manufacturing. Retrieved from
https://accelgrid.com/pros-and-cons-of-lean-manufacturing/
2. Fagundes da Silva, T. M., Santos, L. C., & Gohr, C. F. (2021). Exploring risks in
lean production implementation: systematic literature review and classification
framework. International Journal of Lean Six Sigma, 13(2).
https://doi.org/10.1108/IJLSS-10-2020-0167
3. Maware, C., & Parsley, D. M. (2022). The Challenges of Lean Transformation and
Implementation in the Manufacturing Sector. Sustainability, 14(10), 6287.
4. Billesbach, T. J. (2024). Just-in-Time Manufacturing: Implications. SpringerLink.
5. García-Alcaraz, J. L., & Maldonado-Macías, A. A. (2015). Concepts of Just-in-
Time (JIT).
6. Schroeder, R., & Goldstein, S. M. (2018). Operations Management in the Supply
Chain: Decisions and Cases (7th ed.). McGraw-Hill Education.
7. Fraser, Kym & Harris, Howard & Luong, L.. (2007). Improving the implementation
effectiveness of cellular manufacturing: A comprehensive framework for
practitioners. International Journal of Production Research – INT J PROD RES. 45.
5835-5856. 10.1080/00207540601159516.
8. Renna, P., Materi, S., & Ambrico, M. (2023). Review of Responsiveness and
Sustainable Concepts in Cellular Manufacturing Systems. Applied Sciences, 13(2),
1125. https://doi.org/10.3390/app13021125