BUMGT 5901 OPERATION MANAGEMENT Group Assignment Jims Cleaning Pty Ltd

Executive SummaryJims is a well-established Australian business with over 20 years capability in domestic cleaning services, and a standing for delivering the maximum standards. The variety of services comprises specialist options or standard services such as Regular Cleaning, One-Off Spring Cleaning and Carpet Cleaning. The services are tailored to each customers individual needs.Carpet Cleaning is Jimss afresh launched division which is facing some operational issues at the moment. However, the report highlights ways to overcome those problems and strengthen the process flow to streamline its group operations.

Table of contents

1. Objective and scope of the report..............2. Introduction and Company Background033. Operational Issue/Problem064. Development of alternative solutions075. Analyse/evaluate alternative solutions096. Implementation127. Recommendations148. Conclusion149. References15

Objective of the Report: The objective of this report is to highlight the operational problem within the company that is causing losses. The other objective was to find potential root causes to the problem and eliminate them. Ultimately providing some alternative solutions and selecting one best possible solution.

Scope:After studying the company background and business processes it was obvious that there was a major flaw in the company's inventory system. The challenge was how to overcome this operational problem.This report suggests two possible alternative solutions and selects one best possible alternative that meet the needs of the company. Every alternative has been analysed carefully in detail with its pros and cons.

1. Company Background:Jims Cleaning Franchise was first signed in September 1994. Jims Cleaning is one of the most competitive and the biggest cleaning franchisee in Australia. In recent years it has experienced exponential growth under the leadership of Haydar Hussein. Haydar hussein is the CEO who is behind this successful cleaning business. Haydar has diversified his cleaning business into 6 different divisions, Jims Cleaning, Jims Carpet Cleaning, Jims Window Cleaning, Jims Pressure Cleaning, Jims Car Cleaning and Jims Blinds now with more than 520 franchises, Haydar is a impressive business person no other Franchisor has managed to develop their business as he has. With around 65,000 new clients booked every year. Demand for our services is such that more than 12,000 leads went unserved in 2013 for lack of enough local franchisees. The market for cleaning is such that we could easily be ten times its current size. Jims cleaning, about us. (2001). Retrieved May 15, 2014, from http://www.jimscleaning.net.au/about-us/the-jims-group

Jims Cleaning Franchisees take pride in their standards of customer service. Registered complaints have fallen dramatically in recent times, to an average of only 8 percent per Franchisee per year. Business MissionJims has a mission statement that embarks on achieving the maximum customer satisfaction while optimizing the profit for the company. Jims cleaning, about us. (2001). Retrieved May 15, 2014, from http://www.jimscleaning.net.au/about-us/the-jims-group> ImportanceAccording to Slack et al. (2010), low cost is a universally attractive objective. The lower the cost of producing their goods and services, the lower can be the price to their customers. All operations have an interest in keeping their costs as low as is compatible with the levels of quality, speed, dependability and flexibility that their customers require. The measure that is most frequently used to indicate how successful an operation is at doing this is productivity. (Slack et al, 2010)Jim's Cleaning Service Process Flowchart:

In the above flowchart the company process has been explained how the system works and what steps are included in carrying out the carpet division activities of the business. Starting from taking the orders from the customer followed by preparing the work order for each job and then assigning the cleaners. The next few steps are the carpet cleaning process involved in carpet cleaning.

Why Why Analysis:

The above diagram sh

2.Operational Problem ( Manual Inventory Management System)Operational problem at the moment lies with Fabric Cares loss of profitability due to faulty manual inventory system. The company has no system of updating its clients records and database. This makes difficult for the sales and marketing department to keep record of its new clients and also hampers the accessibility to the inventory. This resulted in rescheduling and cancellation of new jobs thereby increasing dissatisfaction of customers and loss of revenue.

PeopleInventory

Revenue LossINVENTORY SYSTEM (MANUAL)

MeasurementEquipment

CAUSE AND EFFECT DIAGRAM (JIMS CLEANING)

As can be seen from the aforementioned diagram, it can be seen there are 4 causes but the major cause contributing towards the loss of revenue is the manual inventory system.

Manual Inventory System:Nowadays everything is managed electronically and remotely and same goes with keeping the data of your customers. Jim's cleaning lack automated inventory management system in its business which makes things more worse in busy days. The reason to identify manual inventory system as an important cause is because it controls all the other processes related to the business. It controls the amount of inventory needed for a certain time period, it also enables the company to effectively measure the daily jobs booked in and also keep the equipments up to date because carpet cleaning equipments cannot work without supplies.3. Development Of Alternative Solutions:By reviewing the problems faced by the fabric division of Jims cleaning ltd following are the best possible solution to be adopted by the company. Automated Inventory Management System Automated Customer Scheduling Jims fabric division has been experiencing an increased number of sales over the last few years because of an increased demand of carpet cleaning and they have been unable to meet customer expectation because of manual inventory system held by the company. The automated system can help the company to keep a record of inventory and all the function can be performed electronically rather than manual. The system is itself made of hardware and software tools which are used to track the inventory. All the inventory products are scanned by using a bar code machine and the data is stored to the central computer enabling the inventory manager to keep an eye on the quantity of inventory held. In this way the manager has a birds eye view of the inventory system and can keep the inventory up to date with variation in demand.According to ABC Analysis Jims Fabric Division can install an automated inventory system which can distinguish the most important inventory products from the least important inventories. The following diagram shows ABC analysis for Jims Fabric division.

According to the diagram the company assigns 80% importance to the expensive parts of cleaning equipment to be kept in the inventory which are to be changed for every job, followed by second most important items including chemicals, shining wax for the carpets and lastly have 5% importance for other administrative materials to be held in the inventory. Talking about the other problem faced by the company it is very important to develop Automated Customer Scheduling system which will enable the company employees to serve the customers better and increase the customer retention rate. A company needs to maintain a proper customer schedule which helps them to serve the customer on first come first served basis with a priority given to high margin customer depending upon the amount of inventory held. With this system the company will have a clear picture of the inventory held along with the number of orders pending making it easier for the company employees to decide that which order should be processed first depending upon the customer portfolio. Customers will be more satisfied and the company will be minimizing the risk of losing high profile customers. Hence both the system will go hand in hand and will bring higher profit margin for the company in shape of increased sales more job orders Another alternative solution for the company to adopt could be upgrading the existing manual system of inventory. This could be done in certain ways and then all the options can be evaluated to choose the best one possible. Upgrading the existing manual inventory system could push the company to bear extra costs.In order to upgrade and make the existing process more efficient company will have to hire extra employees which would be around $50,000 per annum/ person. As the system would still be manual and people would be required to do the job hence that would take extra time as compared to automated system leading to additional cost for the company in terms of time savings. Hiring more employees would lead to hire extra managers to manage the work and employees resulting in additional cost burden for the company.

4. Analyze/Evaluate Alternative SolutionsIn this case, the main problem is loss of profitability and the directly cause of this issue is poor inventory management. Inventory management is the core work of enterprise operation management which is closely with other departments. Inventory control level represents an enterprise overall management level. Efficient inventory control and management is an important step for company to increase profitability. How to develop and improve inventory management level for enterprises to ensure production and supply has practical significance to enhance the competitiveness of enterprises. Enterprises continue to improve inventory management to ensure production and supply logistics cost savings, while reducing inventory capital occupied, so as to create favourable economic benefits. (Steinker and Hoberg. 2013)Further in this report all the possible alternatives and solutions are elaborated through the use of force field analysis and individual pros and cons analysis of each alternative.

First Step-Force Field Analysis

Advantages Of Automated Inventory System:1. We can use computer system record and analyse the inventory changes.2. Automated inventory management system can forecast how many cleaning equipments and materials which we need to order. 3. Saves a lot of time.4. Reduces the cost of extra staff.

Disadvantages Of Automated Inventory System:1. Employee training costs2. Requires high level management Advantages Of Automated Customer Scheduling:1. Fast and efficient way to handle customer records.2. Automated customer scheduling will record the current customers serves then predict future demands.3. Time efficiencies better than the former operation system.4. Customer information collection helps us understand customers further needs, so that we can get their satisfactions more.Disadvantages of Automated Customer Scheduling:1. Employee training costs to be incurred.2. High Equipment and maintenance cost.3. Requires high level management such as managers to oversee the work.

5. ImplementationCompanies can use different ways to improve the inventory management, including using the computer system to control and operate the company activities. It directs and controls the inventory so that it contributes to the business' profitability (McGraw-Hill, 1994). Making sure that inventory is available when customers call for it, but also have to avoid too much stock on hand so that inventory loss might occur (Juhi Gonzales, 2001).1. Automated inventory management improves the way how the data is kept and makes it much quicker and easy to access. The inventory can be tracked easily and it is easier to measure the stock take.2. Automated inventory management reduces the chances of human errors that might occur in the stock take. Hence making the inventory system free from flaws and errors and giving a true picture of the current inventory.3. It also helps in keeping all the relevant records of customer together and it is easier to draw conclusion and make decisions on the basis of different needs of the customer. Thus you can separate your high end customers from the database and focus more on their needs.

6. Recommendations:The company is although doing very good business and has established a good reputation but it needs to focus on technological changes that needs attention. The company has to equip itself with the latest automated inventory system so as to cope with the rising job cancellation problems. It also has to focus on managing its inventory such as what supplies the company needed for each equipment.

All the business process throughout the company is smooth and has no problems in it. It is therefore essential for the company to maintain its reputation in this growing competitive market otherwise someone else can take an advantage of it and can damage the company's share in the market.

7. Conclusion: Operation management is important to the company when they do business activities in market. Even the process had the major cause that we found several reasons can be impact on the company operation that damage the company effective and service attitude with the customers. However, we support two ways for solution the questions and basic on the situation to do action advanced company look forward in future. Whilst, had relevant recommendation suggest for company to change the operation effective, make company using the best way to operation management.

8. ReferencesSlack, N. Chambers, S. and Johnston, R. (2010). Operations Management.6th edition.Pearson Education Limited.Edinburgh Gate, Harlow, Essex CM20 2JE, England.Steinker, S. and Hoberg, K. (2013). The impact of inventory dynamics on long-term stock returns. Journal of Operations Management. Vol 31, No.5. P229-235. Hanna M.D. and Newman R.W., (2001). Integrated Operations Management Adding Value for Customers. New Jersey: Prentice Hall Inc.Heizer J. and Render B., (2008). Principles of Operations Management. (9th ed.) New Jersey: Prentice Hall Inc

Group planOperations managementName of group: Arsalan, Muddassir, Ahtesham, Naveed, RizwanResponsibility: equalTask of each member:IntroductionIdentifying & analyzing problemsPPT organize

Generate potential SolutionsEx. Summary

Select and Plan SolutionsReport organize

Implementation of solutionsRecommendationsConclusion

17 / 19Force field analysis

Automated Inventory Management SystemDriving force

Inventory record and analysis

Forecast inventory demand

Saves time

Clear inventory plan

Restraining force

Equipment expenses

Increase job position

Employee training

Diagram 1

Force field analysis

Automated customer schedulingDriving force

Link customer demand to inventory

Forecast consumer demand

Saves time

Increase customer satisfaction

Restraining force

Equipment expenses

Increase job position

Employee training

Diagram 2

Force field analysis

Upgrading manual inventory systemDriving force

Improve current inventory level

More efficient work

Saves time

Restraining force

Employee expenses

Require high level management

Employee training

Diagram 3