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The objective of this report is to evaluate the current operation management of Rohde & Schwarz Malaysia Sdn Bhd (RSMY) and identify improvements along the five key elements of operation functions through cost, quality, dependability, flexibility and speed.
This report will also discuss the working relationship among team members from Sales, Service, Finance & Logistic and Human Resource (HR) via the four Vs analysis within RSMY operation processes to achieve customer satisfaction and expectation to maintain competitiveness based on company's goals and objectives.
The key performances of the four departments are designed specifically to measure staff contribution to meet company's business objectives to achieve greater profit. Details of the key performances are illustrated in Appendix C.
A competitor benchmarking on the current market position of RSMY among its competitors is illustrated in the Comparative Analysis Table 2.0 on page 5. Although RSMY positioned to be the most competitive in electronic equipment distribution in the local market, based on the weighted percentage on the five operation management objective achieved, RSMY seriously needs to re-design its production processes in terms of capacity, capability, resources in order to transform RSMY into a better performer, stronger organization.
Recommendations, challenges and their impact faced by RSMY were also being highlighted, to improve further the operation management processes quality internally to support external relationship based on company's goals and objectives. It is also important to be recognized as a quality management within a competitive edge of business market where RSMY is committed to deliver exceeding customer expectation and continue to strive for improvement for business sustainability.
This report ends with a salient point that reflect success of any business is measured by the continuous and appreciation support shown by customers which derived from understanding of customer needs, deliver the best quality customer service and retain the best people via training development to enhance organization performances.
2.0 COMPANY BACKGROUND
»¿Rohde & Schwarz Malaysia Sdn. Bhd. (RSMY) was incorporated in June 2004 as a local representative to Rohde & Schwarz Germany to oversee the operations of Sales and Services in ASEAN market, and also to capture bigger market share in this region.
RSMY main office is located in Glenmarie, Shah Alam. It has two additional branch offices located in Penang and Lumut accordingly.
More information about the company's information can be found at www2.rohde-schwarz.com.
2.1 Current Production System
Its production input consists of raw materials, energy and water. RSMY reviews their operations regularly and continuously update their operating procedures to ensure no adverse impact on environment issues.
Apart from that, RSMY Quality Management Systems complies with ISO 9001:2000 Quality Management Systems Requirements.
The current operating procedure of RSMY is illustrated in Appendix A.
2.2 Market segment of Rohde & Schwarz Malaysia
RSMY principal activity is to provide solutions to its customers need on electronic equipments in the following fields as shown in Table 1.0
2.3 Organization structure
As a Malaysian entity, RSMY is a multi-racially staffed organization of who are 100% Malaysian professionals, which adds to the cultural strength and nurturing a high performance culture in RSMY.
The organization chart of RSMY is illustrated in Appendix B and the key performances measurement of each department is illustrated in Appendix C implemented to achieve company's goals and objectives.
2.4 Financial Performance
Based on the result achieved in June 2010, RSMY has achieved an overall gross margin of 22%, which contributed from Service division 30% (5.9% overall company's performance) and Test & Measurement division 22% (4.5% overall company's performance).
Details of Profit Centre Report are illustrated in Appendix D.
3.0 Competitor Benchmarking
The result from the Benchmarking, what it means to RSMY:
Quality : R&S products and services are high in quality, generate good performance.
Cost : Some competitors are willing to offer lower price to customers. RSMY need to re-look at the cost/pricing method to attract new customer account to capture bigger market share.
Reliability : Customers are satisfied with RSMY's performance in terms of deliverables in accuracy of information, good co-ordination of the services arrangement that meet customer expectations.
Speed : Agilent seems to be very much efficient in responding to customer needs. RSMY needs to re-strategies its performance to ensure customer needs are being dealt with immediately.
Flexibility : It seems most competitor too have some restriction to cope with flexibility to meet customer expectation. This policy has the least influence on customer expectation, but RSMY too needs to enhance its flexibility to sustain its competitiveness.
RSMY internally needs to improve its overall performance to achieve minimal 85% of the benchmarking result in order to withstand the much fiercer market competition in meeting customer expectation on products and services against its competitors.
4.1 Summary of the four Vs measurement in each department
The current model of operations management of the four departments using the four Vs.
From the above chart, we can see each department has a different result based on each department key's performances as listed in Appendix C.
An overview of the current operation activities of each department is listed in Appendix E.
5.0 Implementation & their impact based on the five operations management objectives
RSMY mission is to meet customer satisfaction by providing the best quality of R&S product and services. On the other hand, customer can expect a high level of quality performances in terms of on-time delivery, understanding customer needs and strong talent pool of Engineers who are experienced and skillful to provide the best customer service.
RSMY has emphasized its quality objective in the following area to secure its market position:
Customer satisfaction where less complain, more repeat sales, higher profit for organization
Quotation or information provided to customer must be of highest quality, 100% accurate.
Committed to customer that R&S products and services are conformed to its specification, good quality, safe and generate great performance.
Quality and experienced Sales and Service Engineers to answer or resolve customer queries in the shortest time possible.
RSMY products and services are market driven in which the Engineers need to provide the best quality of service to customer in order to secure their sales and win market share in the business.
Therefore, RSMY needs to understand its customer needs, if they are satisfy with R&S quality products and services provided via the customer feedback form and to see if any measurement needs to be improved.
Sales Engineers need to update customers on R&S product development, new technologies with the support from marketing via newsletter, trade exhibitions or product launching events to build good rapport with customer.
Service Engineers need to provide quality solutions to customer equipment problem within the shortest time possible as time is money.
In order to support the Engineers to achieve their key performances, accurate information of business plans/activities need to be provided to the Finance Department to generate reliable business and finance reports for top management review on the business performances/results to plan/study for business opportunities, a step ahead before its competitors take action.
RSMY has to ensure HR employs quality, qualified and experienced staff to carry out respective task to maintain the quality operation system by placing experienced personnel at the right job, to ensure customer satisfaction are met in a professional manner.
If quality objective is met, dependability will be met indefinitely, speed and cost will be maintained.
RSMY aimed to deliver its services in the shortest time possible in terms of sales and services offered to its customer as time is money.
The objectives are :
Respond within 3 days on customer queries received.
Provide quick solution to customer problems- target 2 days upon queries received.
Shortest time of inspection and service of equipments should be carried out.
Order placement of customer equipments are placed to RHQ within 3 working days
Sales and Service Engineers are jointly responsible to ensure the capabilities to perform the respective tasks with support from Logistic for order placement to ensure no delay in shipment, better if this expectation exceed customer requirement as to build customer confidence in RSMY capabilities. See Table 3.0 for the impact of speed policy.
The accuracy of information is critical in measuring the dependability if customer can trust the capabilities and resources of RSMY to carry out the performance to meet customer expectations.
RHQ has invested in RSMY an advanced technology to improve the service support centre to customer. To guarantee a high standard of transparency, a special website has been provided where customer can keep up to date on the status of their instrument while it is at RSMY premises.
Dependability will definitely affect the cost of serving the customer. With experienced and competent Engineers available to work faster to respond to customer needs, on-time delivery and the accuracy information provided to customer, this satisfy customer expectation, which build better competitive position for RSMY to generate greater profits.
See Figure 4.0 on the impact on Dependability policy.
It seems quite challenging for RSMY to adopt the flexibility policy to customer in some way as R&S products are quite standardize to the market industry needs.
However, RSMY needs to adapt on flexibility to add value to its customer requirement by:
Respond differently based on the equipment of customer owned/to be purchased i.e. different circumstances, business environment needs are different.
To adjust the sales and services offered to meet and exceed customer expectations.
Engineers need to be innovative to provide customer wide variety of purchase/service option to choose for example the trend of product sales with one year maintenance packaged, which customer may be attracted and faster decision made to purchase.
With flexibility, customer response will be quicker, sales close faster, achieving sales target faster and dependability maintained.
Figure 5.0 show the impact on Flexibility policy.
It is noted that RSMY performance shown that with the internal strength built on high quality, speed, dependability and flexibility, the operation cost can be reduced.
By meeting customer expectation, at the same time achieving the four operation management objectives, customer feels happy, satisfy and confident in R&S products and services, which add value to the company's strength externally, leads to competitive advantage in the business environment.
5.6 Summary of the impact of operation management, target of achievement
See below on the relative importance of the main operation management objectives of RSMY to customers.
6.0 Recommendations, Challenges and Impact
It is important that RSMY should develop a method to measure the company's performances and always strive for improvement for efficiency, understand the market needs of its business involved as businesses have evolved tremendously due to society keep on progressing with new technologies.
Top management involvement is crucial to the success strategic plan of quality management in RSMY. They must be committed and understand the whole objectives in the effort to improve R&S products and services quality to stay competitive through enhancing customer satisfaction by meeting customer expectations. Therefore quality objective is the most important focus before the other cumulative performance objectives (dependability, speed, flexibility, cost) sets in (Slack, N. et.al., 2006).
According to the 10th Malaysia Plan, organizations need to improve their business skills, quality management frequently for efficiency if they want to survive in this ever competitive market world.
RSMY aimed to be the number one local key distributor for electronic equipment in Asean, sustaining its competitiveness to support the country's growth to become a high income nation by applying the "six sigma cycle" and "sandcone model" to preserve the organization value.
Management should remind staff the importance of working together between inter-departments to create a value success to the company's performance. Everyone has a responsibility role to contribute to the data integration of business performance for top management review/focus on areas of improvement and to understand customer value to obtain higher margin. (Cheah, J., (2010).
With these recommendations, the four Vs result will significantly improved as a whole for RSMY operation, lesser rework, better understanding of R&S products/services resulting in meeting customer expectation within shorter time, more accurate information, customer satisfy , RSMY generate higher margin where company's goals and objectives achieved,
8.0 Salient Point
In order to stay successful, competitive and sustainable in the business world, organization needs to overcome some extend of trade-offs for operation improvement by reviewing the operation performance priorities, being creative in developing a solution that suits business objectives faster than its competitors and also not forgetting meeting/understanding of customer requirements to achieve customer satisfaction.