Management concepts Essay Example | Topics and Well Written Essays - 2000 words

Management concepts - Essay Example According to CEO James Thompson, operations management within Concept Design Services â€Å"totally transformed our outlook, our resources, and our prospects† over a ten-year period, resulting in a phenomenal unanticipated financial success (Chambers, 2003, p. 46). Management assessed Concept Design Services original growthelement, industrial plastic components, and noted the decrease in sales and the unreliability of the market in both purchasing the product and requesting larger orders. As Concept Design Services diversified into household goods and plastics, the demand for inexpensive household products expanded. At this time Concept Design Services was faced with the issue of an increasingly competitive pricing market from smaller manufacturers that could produce a duplicated item within a tightly controlled overhead. Even while these items appeared to be duplication, they were not the quality of the Concept Design Services items. Concept Design Services evaluated their pr oduct line, deleted the less profitable industrial enterprise, and developed a niche market with a new designer and a new concept. Designer household plastics became the â€Å"it† item for new homebuyers and those with a desire for fashionable home decoration. While developing the new product line, Concept Design Services created a new distribution network that brought the product closer to the consumer and the point of purchase. Placing their designs and color coordinated products at eye level in retail markets and chain stores, Concept Design Services launched their products with enhanced publicity by providing visible merchandise on television cooking shows, color magazine advertisements, newspaper articles and advertisements, and point-of-sale color brochures and self-service displays (Chambers, 2003, p. 48). As a first step in transformation, Concept Design Services changed their inputs, by changing the direction and gaining control of the process that transforms resourc es. Next in the transformation process, Concept Design Services changed the physical design of their product, changed the customer base for their product, and changed the information available to customers to market a chic, new product. At this time Concept Design Services changed the distribution process, or output, so that the customer had better service and a quicker turnaround time for product availability. While enacting the new focus for Concept Design Services, operations management utilized the four dimensions, of operations management in the following ways: Volume-The company concentrated on providing a high volume product (plastic housewares) and abandoned the low volume product (industrial plastics). The new high volume product required an entire new division of designers, colors, marketing, and increased the cost per unit of the new plastic housewares. This change was capital intensive as it required paying royalty payments to Italian designers in return for the endorsem ents and designs, an operating cost that was not previously anticipated (Chambers, 2003, p. 53). Variety-The Company moved from a low variety (only specific models of industrial plastics) to a high variety (plastic housewares with multiple colors and designs). The higher variety brought a more complex set of circumstances requiring more mouldings, more tooling changes, more color changes and more waste of the product