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Operations and Logistics

Whether your firm is a new venture start-up, a developing business or a mature organisation, managing your operations and logistics is necessary for turning inputs into useful outputs that in- turn create desirable value.

Managers can either choose to arrange their activities based on traditional functional design or by using more contemporary approaches such as the value-creation basis. More often than not, a combination of these two approaches is used. Moreover, whether your firm is service or product oriented makes no difference as both variants require a thorough understanding of the factors of production and environmental cause and effect.

What are operations?

Operational innovation is said to be at the heart of any organisation. However, in order to bring the enormity of parts together also requires strategic capability so that a competitive advantage is not only created, but can endure continuous development over time. To achieve this, the firm’s operations must be purposeful.

The notion that operations are ‘production’ is probably based on the traditional management approach. However, ‘production’ is merely one part of the operations and logistics equation. Contemporary management seeks to integrate input factors with transformational systems that convert into facilitating goods and services through strategically making allowances and adjustments for customers, government regulations, competitors, suppliers, technologies and economic environmental considerations.

Contemporary operations management monitors and controls the entire organisations systems and sub-systems alongside business environmental considerations. Operations are a series of one-off and ongoing or continuous projects aggregated for superior performance.

What are logistics?

Sound logistical innovation will efficiently and effectively manage the flow of goods, services and information from one point to another. Operational activities as already mentioned include tangible and intangible resources that are stored as inventories momentarily, distributed via networks and sometimes warehoused through complex layers known as ‘tiers’. The movement of these resources becomes the supply chain or ‘key point’ at which value is transferred. Good management will focus on this entire value-chain process and leverage strategic advantage.

Paradox Strategic Management has first-hand experience in operations and logistics and we can assist you with; 

  • Operating systems and activities (Understand systems perspectives, transformation systems and outputs, monitoring and control, service and non-service attributes, impact of the business environment, commoditisation v’s customisation, value-adding activities, organisational structure) 
  • Strategy and global competitiveness (Understand global trends, generate new market ideas, R&D mortality, disruptive technologies, transformation process characteristics, strategy formulation, core competencies and capabilities, outsourcing considerations, strategic development mapping, project portfolio management, quality, functionality, customisation, dependability, speed, costs and productivity)
  • Input processing and transformation (Choosing flow methods, facilities layout, task identification and sequencing, cost-volume distance analysis, job-shopping, cellular production, project form, volume and variety considerations, product and process life-cycles, service provisions, technology considerations, business process design)
  • Six sigma and quality management (Evolutionary forms of process and quality improvement, defining problem opportunities, measuring performance appropriateness, analysing root cause and effect relationships, improving gaps in current performance and controlling sustainable gap solutions, quality function deployment, normal deviations, measurement systems analysis, process capability thinking, experiments, charting, service quality, accreditation frameworks)
  • Locations and capacity (Forecasting demand, time-line allowances, determining capacity measures, facilities planning, economic scale and scope, multiple outputs, strategic considerations, pure service factoring, resource utilisation analysis, cycle times, sequencing value-added activities, procurement considerations, organisational learning curves, buffer management, delay psychology)
  • Managing schedules (Demand forecasting, aggregated planning, disaggregated unitary measures, production planning, master scheduling, service scheduling, resource scheduling, yield/revenue optimisation)
  • Managing supply chains (Understand efficiency opportunities, asset utilisation analysis, value transition and transformation points, the ‘bullwhip’ effect, just-in-time planning, transportation considerations, distribution requirements, procurement value analysis, partnering for efficiency, supplier management, technology enhancers)
  • Managing inventory (Understand different forms and functions of inventory, identify inventory related costs, purchasing systems, review systems, value classification, economic order and product quantifying, variable and constant demand and lead timing)
  • Planning enterprise resources (Understand dependent demand items, product tree development, demand and supply requisition, bills of materials and labour, distribution, assembly and sub-assembly planning and design, service resource requirements planning, information technology)
  • Lean management (Understand synchronous prioritisation of facilities layout, transformational teams, inventories, suppliers, planning and control mechanisms, quality and maintenance)
  • Constraint management (Understand the ‘theory of constraints’, ‘kanban’ and ‘JIT’ systems, identify bottle-necks, develop ‘buffers’ and ‘drums’, aggregating system output, develop ‘pull-through’ of demand-driven value)
  • Project management (Project identification, project portfolio planning and aggregation, project lifecycles, team formulation, activity scheduling, working with unknown time horizons, critical assumptions,  establishing key milestones, multi-tasking and critical chains, buffering, charting, risk and contingency planning, financial planning and present value forecasting)

Value chain:
A system of interdependent sub-parts designed to create value for customers. In order to create value, the sub-parts are superimposed into functional points and then linked for optimal capability and performance. By treating each function as an internal customer, the value-chain becomes stronger.

Core competencies:
The combinations of skills, knowledge and energy a firm uses to distinguish itself from its competition and to harmonise with its environment. The successful development of these attributes leads to identifiable core capabilities and when combined with a great strategy will provide a unique value proposition.

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