QSO 300 Milestone Three@ PDF

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Running Head: FINAL PROJECT MILESTONE THREE

QSO-300 Final Project Milestone Three

November 29, 2020

Final Project Milestone Three- Module Five

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Introduction The company BYD (Build Your Dreams) of China started with making high quality batteries in 1995 at a lower price. Batteries were already available, but they were poor quality and high price. Wang Chuan-Fu was the creator of BYD and would study the Japanese batteries since they were high quality and try and find ways to create the high quality with lower cost. Wang’s excitement with batteries lead to electric and hybrid global car market in which they wanted to become the largest car company. We will discuss process management functions of BYD and how they may incorporate them into their OM functions along with the use of these process management functions and how BYD can incorporate these into their OM functions.

Theories and Techniques A. Summarize the following theories: just in time (JIT), Toyota Production System (TPS), and Lean. How are these concepts related? Describe the advantages and disadvantages for using each of these concepts at the company presented in the case study. You may find page’s 635-652 of our Om textbook helpful here. Just-in-Time (JIT) is a continuous improvement theory that the words somewhat describe the theory of inventory in which you get just what you need from your suppliers when you have the orders. You align your supply orders from suppliers with production schedules and this keeps your inventory low on hand and costs are lower. It eliminates the need to stockpile too much inventory on hand and it does not become out of date and reduces storage costs. This way the manufacturing assembly area continues to have all the necessary parts at the right time (justin-time). Lastly this also exposes bad quality supplies as you are not keeping inventory on hand.

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Toyota Production System (TPS) refers to a system Toyota manufacturing uses to focus on continuous improvement, respect for people and standard work practice (Heizer, Render & Munson, 2020). These three components of TPS are also considered essential parts of Lean operations. Lean focuses on the elimination of waste through continuous improvements and focus on exactly what the customer needs (Heizer, Render & Munson, 2020). All three of these theories help make an organization more efficient and run better. JIT helps eliminate extra cost of storage and inventory, TPS focuses on always improving and getting better and Lean streamlines the processes. These three are related in the way they try and make companies run more efficiently and streamline along sharing of information through the manufacturing process. BYD using JIT would help eliminate waste, extra inventory and reduce supply and storage of inventory cost which is an advantage. In the current Covid-19 pandemic this could be an issue when you keep a low inventory and your supplier had to shut down do to state regulations or too many employees out with Covid-19. Many supply chains were interrupted during the pandemic and if one of BYD suppliers were unable to provide a raw material needed for production then manufacturing would have to shut down. TPS & Lean are very similar and focus on employees and improving processes. Lean charges workers with increasing efficiency and eliminating waste in their jobs and relentless attention to detail which is an advantage. Lean does not want unnecessary raw supplies and so they could run into the same issue a JIT during this pandemic. TPS instills in their employees a value system that stresses processes can be improved and improvement is a part of every employee’s job which is an advantage of TPS along with streamlining the manufacturing process. A disadvantage of TPS would be sometimes

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over analyzing the process can cause issues with employees and it you empower your employees you need to truly listen to them in every suggestion or they will begin to feel not valued.

Sustainability A. Describe how the emerging concept of the triple bottom line can be used to enhance operations management at the company. Be sure to address each component of the triple bottom line. Please see pages 195-197 of our OM textbook.

Triple bottom line is a newer concept rising in more and more corporations. The three components of the triple bottom line are People, Planet and Profit. People means caring about their employees and their customers that purchase their products.

By caring about their

employees that means providing them safe workplaces, offering educational opportunities and paying them good wages. Planet means reducing the environmental impact that their production does on the planet and profit means of course making a profit while doing the other two p’s. When it comes to BYD’s care for its employees. BYD provides employees, including engineers and scientists housing on company grounds and covers other living expenses (Rarick et al., 2011). However, we cannot dismiss the fact that by doing this in China where the labor cost is low, they are still saving a substantial amount because the labor cost is a fraction of the costs in the United States and Europe. BYD reduces their impact on the planet, they produced a battery that contains nontoxic fluids and if the battery is discarded instead if recycled it will do less harm to the environment. They are producing electric cars, buses, work trucks and forklifts that have a smaller carbon footprint than gasoline cars which is better for the planet. Lastly is profit, and without profit the other 2 P’s are not possible.

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B. Explain how the company integrates ISO 14000 standards in its manufacturing plants. Support your explanation with citations from your textbook (page 204) and outside sources. ISO I400 is a series of environmental management standards that have five core elements, environmental management, auditing, performance evaluation, labeling and life cycle assessment (Heizer, Render & Munson, 2020). These standards and elements are meant to reduce the environmental impact that companies have on the planet. BYD does believe ISO is important that they are certified and that is why they use ISO suppliers and want all suppliers to have ISO 1400I certified management systems in place. They have tired to select their suppliers that have the highest environment, labor practice and human rights standards (BYD, 2019). BYD believes it is so important to reduce their environmental impact on the planet that they produced a battery that contains nontoxic fluids and if the battery is discarded instead if recycled it will do less harm to the environment. “BYD believes that it has made a major breakthrough in battery technology which will produce a longer lasting charge and allow the battery to be recharged numerous times” (Rarick et al., 2011, p. 24). C. Describe ways by which the company can integrate corporate responsibility principles into their operations. Which of these do you believe to be the most effective? Why? Support your opinions with citations from your textbook or outside sources. Please reference pages 194-204 of our OM textbook. Corporate responsibility is corporate social responsibility meaning companies need to consider how the product or service they provide affect both people and the environment. This means they need to consider their image and think of the environment their employees work in and disposal of any production waste or product. I think BYD needs to think about their employees more and the wages they are paying them, especially in China. They talk about the low cost of labor in China, however, are they paying them a fair wage for the work these workers in China are producing to be more responsible.

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When talking about corporate social responsibility the concept of shared value comes up and it “suggests finding policies and practices that enhance the organization’s competitiveness while simultaneously advancing the economic and social conditions in the communities in which it operates” (Heizer, Render & Munson, 2020). BYD does this with their electric vehicles because of their low carbon footprint that they sell in the global market and help the environment. I believe the most effective corporate responsibility action BYD can take is to focus on its employees and its suppliers. If they focus more on their employees and pay them fair wages, I think they will get more and more production out of happy workers. When it comes to suppliers, BYD wants suppliers that are have ISO 1400I certified management systems, but they also will want to make sure they screen them and have enough suppliers to keep them supplied especially in hard times in order to keep production going.

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References

Heizer, J., & Render, B., Munson C. (2020). Operations management. Sustainability and supply chain management. (13th ed). Upper Saddle River, NJ: Pearson.

Rarick, C.A., Firlej, K., & Angriawan, A. (November 1, 2011). BYD of China: Electrifying the World’s Automotive Market. Journal of the International Academy for Case Studies, Volume 17, Number , 10789950.

BYD,(2020) BYD CSR Report, https://en.byd.com/wp-content/uploads/2020/10/document.pdf https://owl.purdue.edu/owl/research_and_citation/apa_style/apa_formatting_a nd_style_guide/general_format.html....