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Introduction to Business Operations And Services

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  • Course Code: UGB165
  • Course Title: Introduction to Business Operations And Services 2019
  • University: Leeds Beckett University
  • Country: UK

When Things Go Wrong

Eyes off the ball at Mercedes-Benz?

Luxury German Car maker Mercedes Benz has been having a bad time of it recently. For many years, the company’s cars were well -known for its quality and reliability but in the last few years, Mercedes’ famous three-pointed star has become a little tarnished in the eyes of many buyers. These days Mercedes lags behind former arch rivals BMW in terms of sales and profits and some argue, image.

Its problems seem to stern from the tie-up between Mercedes parent company, Daimler-Benz and American’s Chrysler in 1998. The Merger created the world’s fifth biggest car manufacturer, employing
385,000 workers worldwide.

At that stage Chrysler was the struggling third placed volume manufacturer in the US behind general motors and Ford. By 2005, however, efforts to turn around Chrysler’s fortune seem to paying dividends as the company reported a 5% annual increase in unit sales and 10% increase in revenue in its results for 2004.

Meanwhile, Mercedes Benz’s operating profits fell in 2004 on the back of poor sales of the luxury brand and restructuring costs at its Smart car divisions; the ultra-small ’Citycar’ division had failed to perform as expected since, its launch in 1998.

Mercedes itself has been struggling with quality control problems on many of its vehicles and increasing numbers of its previously loyal customers have been moving to competitors such as Audi or BMW. In 2005, the company even had the embarrassment of having to issue the biggest product recall in its history. Problems with batteries, alternators and brakes on a number of models made since 2001
necessitated 1.3 million cars having to be returned to dealers to be fixed. The move is likely to costs many millions of Euros, hampering efforts to improve its product image, and hitting profits.

Many analysts believe that many initiatives being undertaken at DaimlerChrysler have detracted from the management of its previously highly profitable Mercedes business. Some accuse the company’s
managers of ‘taking their eye off the ball’ as far as Mercedes operations are concerned. Some question whether the highly technologically sophisticated gadgetry on its latest top on the range S-Class cars can be trusted to perform. They fear that any electronic gremlins could further damage the entire marque’s image and further alienates its customers.

In an effort to improve performance and financial results, Mercedes is cutting more than 8500 jobs at its Sindelfingen plant in Germany. DaimlerChrysler’s newly appointed Chief executive; Dieter Zetsche said the firm is determined to retain Mercedes’s position as the world’s most successful luxury brand. He said efforts to improve productivity, which is well behind rivals such as BMW and Toyota’s Lexus, would not be allowed to compromise efforts to tackle Mercedes’s recent quality problems.

As the newly appointed Operations Manager for the Mercedes Benz, you have been asked by the SeniorManagement Team to prepare a 3000-word report to:

Explain how you would introduce a companywide operations improvement strategy. This improvement strategy must include the tools and techniques that you have learned in this module UGB 165.

Advise on the operational strategies that Audi and BMW can implement to gain market share from Mercedes-Benz.

Learning outcomes

Knowledge outcomes:

K1. Explain and interpret the practices and processes involved in Business Operations and Services.

K2. Describe and summarise a number of possible techniques which can inform decision making for

Business Operations and Services.

Skills outcomes:

S1. Apply of a range of numerical decision-making models and techniques.

S2. Apply and explain the factors involved in the managing of Business Operations and Services.

Solution:

Introduction

Operations are process of transforming raw material into finished products or services so that customers demands can be achieved. Operations management is concept by which administration of organisation ensures that operations reaches to maximum efficiency.......

Main Body

1. Explanation of operational improvement strategy at global level

Operations are daily activities that any business perform so that there are smooth functioning of tasks. It is process by which companies transform their raw materials as inputs like manpower, resources, machines are converted into finished products.....

Cause and Effect Diagram: This tool examine potential causes of event happened in operations or organisation. This put reasons into categories.......

Total Quality Management (Tqm): It is a management tool which aims at customer satisfaction with continuous improving efficiency of products, processes, services, operations and organisational culture........

Lean Production: This is management tool that focuses on eliminating waste while ensuring quality. This approach can be applied to every factor of business like production, design, distribution, marketing, etc. This tool aims at cutting down activities.....

Deming Theory: This was developed by statistician Dr. W. Edwards Deming who has philosophy that improving quality will help companies to decrease expenses and improve.......

2. Operational strategies that are implemented to capture market share

Market share is one of biggest indicator to evaluate performance and success of business and important source of earning sales revenues. This indicates percentage........

Innovation: It is important that in order to stay ahead of competitors need to be innovative in its operations. This can be done......

CO2 emissions: European government has come up with new law in which carbon emission standards are revised according to environmental conditions. This is applied.......

Eco: Friendly design: According to future opportunities and changes in environmental conditions there is need that auto – mobile industries and companies come up with new......

Managing Inventory: In order to be cost effective and make changes in pricing policies there is need that eliminating waste activities in operation is important. One of the.....

Continuous Process Improvement: These days organisational objectives aims at achieving more productivity and be cost effective in industry. Thus there is need that there is process of continuous improvements which aims at reviewing........

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