Production And Operations Management

Every manufacturing  firms looks to find ways in which it can increase efficiency and maximize profits. This paper looks into Hahn Brewery located in Auburn,New South Wales. There are  strategic decisions and operations that the management of the brewer  can efficiently take in its operations to attain maximum profits without compromising on quality of the beer. Some of the management decisions operations of this brewery are;Design of goods and services,Quality management,Strategy process,Location strategies,Distribution strategy installations. Other important decisions made are:Human Resources,Supply chain management,Inventory administration,Programming and Maintenance all this result into an efficient process for the brewery (Besanko, Dranove, & Shanley, 2000).

On a typical day the operations start at 7:00 am, when 20000-25000 pounds of grain are delivered into the brewery. After the delivery is made, the equipment is cleaned then the grain is put in the equipment to be crushed. The operations manaher and the chief brewer work together most of the time to ensure smooth running of the operations. The work they do include addind specific amounts of hops and grain, they ensure that the unfermented beer is  boiled, they also supervise the workers who transfer the beer to various containers and tanks and lastly, adding the most important ingredient which is yeast for the fermentation process. Brew days can vary in length, however, a single batch takes 8 hours while a double batch takes 12 hours.

On average, from the day in which brewing takes place, it takes 9-13 days for the beer to be bottled. At the shelf, the beer takes only 2 days after packaging. Hahn brewery does about 6-7 batches in a week, so inorder to keep production moving, multi tasking is essential. Repairs are very common, so at any given day you can find this repairs can be in process.

From the theoretical point of view the distribution plan is useful because brewery managers need to have a clear and thorough understanding of concepts and techniques handled within the context of distribution engineering plan and their contribute to the success of  the plant. On the other hand, if the distribution is observed in plant practically we can say that it is vitally important because through it a command and management of work areas and equipment, in order to minimize time right is achieved, space and costs, guiding managers in their task of directing the activities and ways forward and pointing out the dangers to avoid in production (Erickson, Messner, & Ring, 2007). A good distribution plan is important because it prevents productive and financial failures, contributing to continuous improvement in both processes in industrial enterprises and in the service.

Management should ensure that  there is a quality control department which is important during operations and  is critical in ensuring that quality products are produced in every stage of production. It ensures that the beer meets the standards set by the regulatory authority as well as meet consumers’ expectations. There is cost of quality in every manufacturing plant.There are 4 main categories of costs associated with quality, and are:Prevention costs, costs associated with reducing potentially defective products, eg training.Evaluation costs, costs related to the evaluation of products, process, eg laboratories.Internal fault resulting cost to produce defective parts before delivery to customers, for example scrap and waste.external costs, costs occurring after delivery of defective products, such goods returned (Managing resources, 2012).The first three are estimated costs reasonably but the external cost is very difficult to quantify.International Quality Standards,ISO 9000 ,It is a set of quality standards internationally recognized, developed by the International Organization for Standardization.To obtain the ISO 9000 certification, organizations go through a process of 9-18 months involves documenting quality procedures, evaluation and a series of audits of products or services. Which is very important for the brewery.

A brewery uses continuous production. Processes in which the transformation of raw materials into products is carried out continuously over time. You can also include in this type of repetitive mass production processes to achieve economies of scale which is the goal of these processes (Greasley, 2008).

There are several factors that are considered when selecting the location of a brewery.This is to ensure that there is sustainability within the location.  A brewery should be located in an area that offers tax credits, this could be an area designated by the government  for industrial production purposes only. Also, due to distribution purposes, the plant should be located in an area that has high standards of infrastructure, this reduces transportation costs . Infrastructure not only helps to reduce transport cost but also helps the plant get the necessary requirement to manufacture beer. This materials include water, a waste  disposal system, availability of labor, electricity among others.

The location decision depends on the type of business. However, for a brewery we should ensure that the localization strategy is to maximize the benefit of the location for the company. Factors affecting location decisions (Forrester, 2006). These are the critical success factors needed to achieve a competitive advantages well as the sustainability of the brewery. For example: Critical success factors of a country, would be:Location of markets,Availability of supplies and communications. This enables the plant to be sustainable in all ways. Also,distribution FacilitiesDistribution strategy installations is the most efficient and effective way of knowing how you can distribute a facility so that a product quickly is provided, reducing labor and waste, this also includes machinery, furniture office, etc. For example: The distribution of offices seek to maximize the flow of information, distribution stores focus on product exposure.

There is also an environmental sustainability, as manufacturing firms are expected to ensure that there is minimal pollution of the environment. Therefore, the brewery should ensure that it complies with ISO 14000 which  is a standard of Environmental Management, established by the International Organization for Standardization. The ISO 14000 containes five important components : environment control , auditing , efficiency assessment , labeling , life cycle assessment . The change in standard might have a number of positive aspects :A constructive public image ,a sound organized approach , conformity with regulatory expectations as well as possibilities for competitive advantage and lessened requirements of multiple audits among others .

 The firm needs to evaluate the level of production that the system may achieve capacity is going to be described by the expense to be made in the related goods as well astechnical installations , influencing the design of the related cost function , particularly in relation to to fixed costs as well as indirect costs The level of inventories (Greasley, 2008). The company, once established production capacity, determine the overall level of inventories that need as well as the control system and asked to renew the media and security stocks needed for the production process, as demand their characteristics.

Location and distribution plant. Previous decisions lead to the need to locate and to design the processing plant (or plants). Approach is known as the technical expression of lay-out or way to distribute and acclimate physical spaces for maximum productivity and a good working environment in the operations of the company (Wacker & Sheu, 2006). The implementation of the production process involves an analysis of the activities in which it develops, which, in turn, shall be composed of some tasks or jobs. The efficient performance of these requires a definition and valuation of positions, resulting design of the remuneration system and, in many cases, development of a manual of functions and labor regulations. In this way, the human factor should be integrated into the system in terms costs and to optimize performance and meet your expectations and goals.

For this part is convenient to introduce the concepts of capacity, activity level strategy and capacity development and its impact on the processes of planning, programming and control of production activities. This means the potential capacity of a worker, a machine, a workplace, a process, a plant or an organization for the production per unit time. Production capacity, analysis, planning, programming and control are critical activities that develop in parallel with the programming and material planning, capacity being the quantity of product  designed to meet customer needs or society that can be obtained by a production unit in a given period of time. It is the volume of production that can be achieved in a given time, or the maximum speed that a system can perform in a work.

It is difficult to express the capacity and production rate when diversity of products that require different levels of resources occur; for such a situation the rate of production depends on the product mix and the size of the lots, and capacity can be measured in units of resource available (Wacker & Sheu, 2006).The term capacity is related to the technical and economic potential that has a system or productive organization or its structural units to participate in the development of products and / or services of a technical, rational and economically efficient manner, within a given time .

For this brewing company, capacity expansion can be done by working in shifts to increase the man hours, buying production equipment that can handle more production in a given time. The company can also improve its operations by providing training to personnel in all levels of management. This improves quality of decision making as well as providing more skills to the junior level workers to perform better.

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