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Question:
Critical analysis and evaluation of operations, you are required to select and research an organisation with the view to reporting on its operational.The report should be divided in three main parts The first part deals with backround of the operations The second part deals with the transformation process, the five preformence objectives and the four Vs of operation management.Brifly description of the its general and business context
* Purpose
*Size
*Competetose
*Target customers
*Recent company performance
 
Transformation Proceses and evaluation of the Operation Discribe the main operation of the organisation in terms of inputs, trasformation prceses and output.* Analyse the orgainastion in terms of the four Vs of operations management:
Volume
Varity
Variation Visibility

Evaluate what each of the operation performance objectives means to the organisation and factors are most valued by its ccastomers Pattr Three Process Design Describe the layout and the flow of
*materals (Incuding supply chain)
*Information
* Customer
 
Discuses what do you think are the maine ojectives of the process design , and whether or not these objectives are bing achived Identify any problems within the operations and what solution to be implemnted.
Answer:

Larsen and Toubro, commonly known as L & T, is a major engineering and construction company which provides services for powerful hyder power projects and nuclear plants, with its headquarters situated in Mumbai, Maharashtra.  It was founded by two Danish engineers who were living as refugees in India. It has highly satisfied its customers with its innovative solutions. The company, founded in 1938, has been serving us from the past 8 decades. The prime motive of the company is that it aims at making products which are highly sustainable. The company extends its offices and manufacturing units in 8 countries including India.

Larsen & Toubro Limited- Operations

The Engineering Construction and Contracts Division [ECC] is the construction division of Larsen and Toubro, with projects widespread all over India, and countries like UAE, Bangladesh, Malaysia, South Africa etc. The company has the largest geographical location of operations with almost 6000 suppliers spread in 350 locations. ECC is India’s largest construction organization. It has added several successful projects to its credit.

 It employs around 35 million people. The ECC division presents turnkey solutions including engineering and using modern methods of construction. The use of modern strategies has made the company incomparable in the market. They have an in-house research center which aims at developing new methods of construction and advantage, and solves problems then and there. The Company’s operations are characterized by an overriding emphasis on safety, on time delivery, cost competitiveness, high quality standards etc. these things have enabled the company in delivering critical and complex projects (Han and Du, 2011).

Size 

 Larsen & Toubro is a US$ 14.3 billion company featuring in various spheres like engineering, construction, technology and financial services. The product consumption constitutes the bulk of the segment to around 56 %. It has over 130 subsidiaries and 15 associate companies. Spare part revenues range around 20-29% (Marciniak, 2014).

Competitors 

L&T is a multinational company with a large number of product and services. There are large

Numbers of competitors for L&T doing the same business in the same sector and competing

Among each other to increase their profitability. Reliance Infrastructure is considered to be L&T’s top competitor. The company deals in architectural field. The other competitors of L & T in the ECC division are as follows:

  1. Punj Lloyd
  2. HCC limited
  3. Lanco Infra
  4. NCC
  5. Afcons

Larsen & Toubro is a huge company; no one competes in the field it operates.

Target customers

 L & T has a strong customer focused approach from the last 75 years. They believe in delivering high quality products at their said time. The company has satisfied customers across 30 countries in the world. The company has 30 top customers which contribute 65% of the revenue. Also, for L & T, the countries like Europe and US are its main market. They have also developed IOT [Internet of things] to support its customers. The main target customers are Aditya Birla, Reliance, Godrej, Magnum Forge, Hitachi, Chevron etc.

Company Performance

Larsen & Toubro believes in building the country’s infrastructure by collaborating with investors, multinational organizations, governments etc. the company has performed well in all economic parameters and has showed a growth of 43% in the group profit. The company also got orders worth 1,429,950 million giving a growth of 5% to the company. The group revenue increased by 8 % (Vochozka and Šule?, 2017).

The Transformation Process- the inputs and outputs with respect to L&T

The transformation process of any company is regarded as the core of the operations management from where various inputs like materials, labor, money etc. is converted into outputs like services, goods, ideas etc. Larsen and Toubro is one of the reputed companies in the private sector. Its reputation is based on how it treats its customers, the high technology hat it uses and an impressive record of achievements being delivered in the last decades, by delivering high quality products.

The company has started a transformation process which is aims at being a conglomerate in the shortest possible time. The two main areas are its Engineering core and Information technology and communications.

The engineering core comprises of engineering projects, construction, heavy engineering and electrical and electronics ltd. Whereas IT involves technology and innovations. Employees at L& T, work with a good conduct and high performance so that the company earns a good reputation with its customers and clients.  Larsen and Toubro’s construction and engineering sphere is considered to be a business vertical, as it has good expertise, background knowledge and sufficient equipment to undertake several projects, all types of building and various other structures.

The company as undertaken projects to build major airports and other associated facilities, tall buildings, hospitals and residential buildings.

The transformation process. 

The Inputs

The phase comprises of transformed and transforming resources. The transformed resources for L &T include inputs like materials, labor, money, time and energy out of which materials are the key factor. The raw materials purchased like cement, steel, wires, machinery etc. by the suppliers are transformed in the process. Secondly, are the transforming resources which are the staff and technology used to achieve the desired targets. The employees design the plan and then the ideas are implemented and results come in the form of outputs called goods/products.

Outputs 

The outputs come in the form of tall buildings, multiplexes, bridges, heavy structures etc. and facilitating high quality services to the customers.

The transformation process

The transformation process is the in between process where all activities are done to convert inputs to outputs, before it reaches to the customers. The main operation of Larsen and Toubro is to manufacture heavy machinery, bridges, tall structures, hyder projects etc. it specializes in being a conglomerate with global operations. This process involves the supply chain of raw materials to the site, construction of the desired project and its sustainability in the market (Heinze, Amme and Moser, 2017).

Here, environment plays a major role in the making of the project for this company. Also, the products undergo a thorough investigation and rechecking. As per the need of the customers, the products are also altered and after further processing, they are transported to different areas across the globe.

Performance objectives of Larsen and Toubro

Larsen and Toubro aims to deliver a high quality product with the use of high end strategies and work oriented employees. The key objectives of the company are:-

  1. To study the business and operational strategy of the company.
  2. To know the competitors, products and services offered by them as compared to other companies.
  3. To look into the corporate social responsibility and its effort on environmental sustainability.
  4. To know the recruitment strategy of L & T -ECC division.
  5. To know the financial status of the company in the last 5 years.

L & T offers a perfect transformation and operation support services for its clients and customers. They aim at carrying business smoothly proving excellence to its clients.

The four V’s of Operation Management.

Every company has a similar operational process but they differ in some aspects in terms of the following:-

  1. Volume

The ECC division of L &T’s work volume is comparatively high owing to India’s top construction companies. It makes big and heavy projects which require the raw materials at a very higher amount. Also, the production cost for making the projects is very high. This account to low product cost as larger quantities of products are made at one point of time. The company also makes large number of specialized projects.

  1. Variety

The company deals with a variety of multi constructions, bridges and tall structures. The company regularly comes with creative designs of projects which require large manpower more money. As a result, the unit cost of the product goes high. As per today’s demand, customers ask for highly innovative designs. And the company masters in customizing their projects as per their customer’s desire. The customer is also satisfied giving good profits to the company. As the have a higher variety dimension, they will definitely develop strategies to have a good control in the market (Johansson and Säfsten, 2015).

  1. Variation

The company has a high variation demand. If we consider a case where L& T, and any of its fellow competitor are handling the same project, Larsen and Toubro on the contrary has a high variation and flexibility in its areas of working. They have a widespread network, they can construct bridges, metros, hyder projects etc., whereas competitors have a restricted area of working. They can only make high rise buildings. The company will make your desired designs in the available space at customized prices. They offer standard pricing. They might take longer time to finish a project, but the quality and customization provided will be incomparable in the market. Such companies are always flexible and always in demand (Häusermann, 2011).

  1. Visibility

Larsen and Toubro have high visibility. This dimension refers to a customer’s ability to see, track their experience in the operation process. Projects handled by the company usually are easily accessible and approachable compared to its competitors. The investors, distributors etc., who have invested in the project can easily visit the construction sites and check the status of completion. The service skills of the company greatly affect their customers’ experience (Liu, 2013).

Nevertheless to say, the customers and clients associated with L& T are highly satisfied due to timely delivery of the constructed project. This includes higher efficiency, faster time and higher overall productivity (Shoshana, 2012).

When the visibility is high, clients have short tolerance and they can visit as many times as they want. As a result, the product unit cost goes high, giving profits to the company. People are ready to pay more if the quality is par excellence (Benligiray, Ozsoy and Bukec, 2012).

The four V model of Operation Management.[writepass.com]

The Design Process

L & T Engineering is the main operations of the ECC division. It focuses on the diverse, vast geographical business of ECC’s business and examines the challenges that are faced by the company. The design process of any company basically deals with the basic needs to produce a product like equipment, labor, money and the process through which it is implemented. It basically highlights the various steps taken to achieve a set target. The workflow, equipment needs and implementation requirements are the key factors in this design process (Acklin, 2010).

The design process of L & T is basically denoted by the Product Development and Process Technology [PDPT]. The PDPT center for L & T heavy engineering is the main point for technology development, primarily for process plant, nuclear plant and other equipment projects. The campus is based in Powai and consists of multi skilled engineers from different corners of the globe. Based on the type of project, various teams are formed and they are assigned specific tasks which are completed using high end technologies (Gati and Tromboni, 2012).

The progress of the company has been acknowledged globally. The center stays at the forefront and provides technology for taking new assignments which results in the global development of the company (Hansen and Kristensen, 2011).

Key objectives of Process design

The objective of L & T is to provide service and product, creating a value and satisfying customer. The products are designed according to the needs and feedbacks taken from the customer (Schmidle, 2011).

  1. The main objective of process design is to achieve what is required of the company and that the performance of the process is accurate.
  2. All the processes planned will undergo a series of transformation so that the product efficiency and accuracy is being checked at each step.
  3. During the transformation process, the company might have to wait for certain inputs. The time taken might be long but the output delivered will be good enough.
  4. Being environment protective, the company aims to take into account both process and process designers.
  5. As the product is processed at every operational level, the company gives a detailed check on each step to provide good quality to its customers.
  6. Effective process strategy, customer participation, and technology investment should be taken care of.

The company aims to achieve these objectives. It says that the product design and the processes involved must satisfy the customer. For that, the product should be pleasing, reliable, god quality, easy to manufacture and deliver.

Key challenges

Larsen and Toubro is India’s most reputed companies with global operations. The stock performance of the company shows a downfall. The BSE capital index shows a weightage of 24 % since January. The challenges faced by the company are:-

  1. Order inflow and economic outlook
  2. Project execution
  3. Working capital constraints
  4. Cutting out subsidiaries

Order pricing is expected to be weak for future earnings estimates (Sharma, 2017).

The Supply chain Management

The company has a large list of supply chain of vendors, contractors, distributors etc. to make sure that every area is well manage, and there are different supply chain teams for different businesses (HITT, 2011).

L & T uses the supply chain management to deliver the most effective products. The strategies include the identification of the supplier, screening, analytical evaluation and selection and commercial negotiations. They imply end to end strategic sourcing.

The company has experts with good industry experiences and a database of qualified suppliers. The Company also has good business relationship with the suppliers. The strategies have been adopted by ECC in order to streamline its business and increase the efficiency of supply chain. The company also has an enterprise information portal and a web based supply chain management solution. They also use B2B relationships to increase the flow of supply chain

The supply chain process. [process.st]

In order to handle the complex challenge of implement the supply chain management in the company, ECC decided to go for a solution built on SQL server 2000 which works on online order and offline deliver strategy. This helped to streamline the vendor network as well (Li, 2014).

Flow of materials in the company [ researchgate.net]

Layout of the process

The layout of the process for any company is the flow of information throughout the system. It aims at arranging the equipment according to its need on a desired floor plan. It increases/improves the efficiency of the functioning of the system. There are three steps which help in framing the process layout.

  • Collect information
  • Develop a block plan or layout
  • Make a detailed layout.

Process layout is of four types: hybrid, fixed, process and product.

layout of the process[pininterest.com]

Critical analysis

The performance management system has a lot of advantage for the company as it will be beneficial to the employees and organization as a whole. The employees work for themselves as well as teams to add to the global development of the company. This type of goal alignment will allow any manager to see the link between the employees and the organization. Also, this system will encourage work flow, process control and return on investment for which the company is targeting.  The ECC division is focused on exports which give them a major business potential. They are also planning to open offices overseas.

References

Acklin, C. (2010). Design-Driven Innovation Process Model. Design Management Journal, 5(1), pp.50-60.

Benligiray, S., Ozsoy, G. and Bukec, C. (2012). An Exploratory Research Regarding the Visibility of the Mission Statements on the Airline Company Websites. Journal of Management Research, 5(1).

Sharma, D. (2017). Macroeconomic Challenges Faced by Indian Economy. SSRN Electronic Journal.

Gati, A. and Tromboni, P. (2012). Manufacturing role in simple product development at a multiproject environment. Product Management & Development, 10(1), pp.61-70.

Han, L. and Du, R. (2011). Study on Operation Management of Producing Service Company for Manufacturing Enterprise. Advanced Materials Research, 201-203, pp.1050-1053.

Hansen, Z. and Kristensen, S. (2011). Global product development: the impact on the product development process and how companies deal with it. International Journal of Product Development, 15(4), p.205.

Häusermann, D. (2011). For a Few Dollars Less: Explaining State to State Variation in Limited Liability Company Popularity. SSRN Electronic Journal.

Heinze, T., Amme, W. and Moser, S. (2017). Static analysis and process model transformation for an advanced business process to Petri net mapping. Software: Practice and Experience, 48(1), pp.161-195.

HITT, M. (2011). RELEVANCE OF STRATEGIC MANAGEMENT THEORY AND RESEARCH FOR SUPPLY CHAIN MANAGEMENT. Journal of Supply Chain Management, 47(1), pp.9-13.

Johansson, G. and Säfsten, K. (2015). Managing uncertainty, complexity and dispersion in product development projects. International Journal of Product Development, 20(1), p.25.

Li, L. (2014). Reverse Logistics Operation Model Research under the Circumstance of Green Supply Chain Management. Applied Mechanics and Materials, 687-691, pp.4771-4773.

Liu, F. (2013). Revisiting the Translator’s Visibility: Does Visibility Bring Rewards?. Meta: Journal des traducteurs, 58(1), p.25.

Marciniak, R. (2014). Organizational Size and Operation Scope in Company of Using Shared Service Model. SSRN Electronic Journal.

Schmidle, T. (2011). Performance Management. Public Performance & Management Review, 35(2), pp.370-389.

Shoshana, A. (2012). Classification, Subjectivities, and Personal Visibility. Sociological Forum, 27(1), pp.187-206.

Vochozka, M. and Šule?, P. (2017). Determining the company value using free cash flow to the equity. VESTNIK OF ASTRAKHAN STATE TECHNICAL UNIVERSITY. SERIES: ECONOMICS, (1), pp.93-99.

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