Operations Management - Hyundai Motor Company - Assessment Answer

Operations Management Assignment

Assignment Task

Assessment 2 is an individual research report that is focused on ensuring that students are able to do quality research (peer reviewed articles (most important), textbook, reports, etc) which is relevant to a company they choose from a pool of available options.

The assessment is to carry out an analysis of operation in one of the following companies:

• Hyundai

Students are expected to answer the following questions:

• Clarify the competitive priorities that the company is trying to achieve.

• Explain why operations management is important to the company and how it supports the company in achieving its priorities?

• Describe the features of the company’s operation which reflects common operations management practices.

• Highlight some of the issues experienced by this company and how operations/supply chain management can help in resolving these issues.
• Create a process map which highlights the company’s store and head office operation.

To successfully complete the assessment, students will need to explain in depth and within the permitted word limit of 2000 words the stated questions. This word limit does not include the summaries of the journal articles, the title page, the table of content and the references list. Students research must be done by undertaking quality research (peer reviewed articles (most important), textbook, reports, etc) in order to achieve high marks for the Research Section of the marking criteria which is worth 45%. As part of the assessment, students will need to draw a computerised process map of the company’s operations. As part of the work, students could do additional work by writing a minimum of 3 summaries for the best 3 peer reviewed articles read.

Hyundai Company is one of the largest South Korean conglomerates that was founded in 1947 by Chung Ju-yung. The first operational company of this conglomerate was established in the year 1947 with its key function being constructed. The company then received massive support from different industries that were interested thus expanding its operations into various industries and attaining the state of the largest conglomerate in South Korea (Lee, 2011, p. 1217). Basically, the key objective of the company is to try as much as possible to satisfy its customers by offering the best possible products and services. Currently, the company is trying as much as possible to establish the best possible cooperation systems among its production basis across the world (Zehir, et al., 2012, p. 298). Additionally, the present goal of the company happens to be customer-oriented as it continues to execute its global management operations. Thus, this report will focus on highlighting the organization's competitive priorities, operations, management of the company, the common operations management of the company, issues and solutions of the company, and the company process map.

Hyundai Competitive Priorities

In this highly competitive market, it gets important for organizations to develop effective strategies that will help them to be in front of its competitors. In trying to achieve this, Hyundai has developed a set of unique priorities that will help it to be in form of its competitors in the industry (Shim, and Steers, 2012, p. 587). As such, some of the competing priorities that the company has developed include the following.

2.1 Producing cheap and efficient cars

Presently, Hyundai is focused on producing the best cars that are affordable and cost effective regarding diesel engine aspects. The company has produced a set of cars including Hyundai’s i3o SX that are highly efficient in terms of diesel consumption compared to its rivals (Lee, and Cheong, 2011, p. 965).

2.2 Environmental sustainability

To be in front of its competitors, the company focuses its operations on producing new products that are environmentally friendly. The company is currently working on a program that enhances its general environmental compatibility of their products (Lee, 2011, p. 1218). Additionally, the company is in the front line ensures that it maintains its corporate social responsibility by offering products that are environmentally friendly as they deal with the issue of greenhouse gasses production of its products (Shim, and Steers, 2012, p. 590).

2.3 Providing the needs of the society

As a global leader in the motor vehicle industry, the company is working hard to fulfil its obligations by offering what the society needs. Additionally, the company is working on its pricing by offering cheap products that are of high quality (Lee, 2012, p. 90). Through this, the company will be in a position to offer very efficient yet affordable cars to its customers.

2.4 Importance of operations management

Operations management is a process that is undertaken by business administrators for purposes of creating the best efficiency levels within the organization. The process of operations management is usually concerned with the whole process of converting materials and labour into goods and services to the best efficient levels available (Hong, and Kim, 2012, p. 450). The process is carried out by the management to make sure that it maximizes the profits that it gets from the operations that it engages in different parts of the world. As such, it is critical that all organizations should incorporate this process into their operations as it has a number of benefits that are attached to the organization (Bae, 2012, p. 580).

Operations management is always important to an organization as it makes sure that the organization achieves efficiency in its operations an exercise that leads to the organization realizing more profits from its operations (Kim, 2013, p. 230). Additionally, the process of operations management leads to an organization utilizing its resources effectively for purposes of delivering efficient goods and services for its customers. The operations management process also helps organizations to develop the best designs for appropriate products as well as being in a position to manage their development and handling all the concerns that are evident in the organization's supply chain (Budhwar, 2012, p. 2520).

Again, in the manufacturing industry, operations management plays an effective role in determining the best location of the organization, the size of the manufacturing facilities, and the supply chain structure that will help the organization to operate effectively and profitably (Pundir, Mishra, and Ganapathy, 2013, 63). Most importantly, the process may be very instrumental in the process of selecting the best types of equipment for carrying out different operations in an organization. As such, it is in order to conclude that operations management of an organization is core to all the operations carried as it controls all the systems in the organization (Lee, 2011, p. 1219).

How Operations Management Supports The Company In Achieving Its Priorities

There are different ways through which operations management can help an organization to achieve its priorities. Most importantly, the activities of operations management can be maximized by an organization for purposes of moving forward and making important decisions that will help the organization to effectively achieve its operational objectives. Some of the ways that operations management helps organizations include the following.

3.1 Supporting the long-term operations of the business

One of the important functions of operations management in helping an organization to achieve its priorities includes that of supporting the long-term operational goals of an organization (Kim, 2013, p. 215). The process helps an organization to achieve this by playing an important role in supporting its marketing and financial goals thus making it easy for the organization to achieve its priorities within the stipulated period. Additionally, the operations management activities of an organization help it to support the overall strategy of the organization that helps it to achieve its priorities (Stadtler, 2015, p. 19).

3.2 Predicting future organizational sales

Most importantly, the process of operations management of an organization helps it to be in a position to predict its future sales effectively and efficiently. As such, through operations management of an organization, it gets easy for an organization to know the kind of sales that they are expecting a process that will lead to the development of appropriate strategies to achieve the organizational sales (Kim, 2013, p. 231). Additionally, the operations management of the organization also helps the organization to design an appropriate capital investment of the organization that will make it easy for the organization to operate effectively and efficiently.

3.2 Helps an organization to make important operational decisions

Organizational operations management also plays an important role in helping an organization to make important decisions that will help it to achieve its priorities effectively and efficiently (Joshi, et al., 2013, p. 160). Some of the important decisions that operations management helps an organization to make that will help it achieve its priorities include location decisions, type of technologies to employ in achieving the objectives of the company and a determination of the way that the workforce of the organization should be organized (Pundir, Mishra, and Ganapathy, 2013, 50). Additionally, it will be important for an organization to use operations management in determining the period that it will take for the organization to achieve its long-term goals.

3.4 Making tactical decisions

Tactical decisions are very important in the operations of an organization. The decisions are important because they are needed by different organizations in meeting their key operational strategies, it gets important for it to design an effective schedule that should be followed for purposes of efficiency in organizational operations. In this, operations management plays an important role in making effective schedules for the employees follow in meeting the priorities of the organization (Joshi, et al., 2013, p. 155). The other tactical decisions that are guided by operations management in an organization includes that of establishing effective quality assurance procedures for the organizational employees, thus covering for the health of the employees that happens to be very crucial for many organizations (Budhwar, 2012, p. 2528).

The process of contracting with vendors is also affected by organizational operations management as well as helping the organizations to manage their inventory. As such, helping organizations to make these decisions is always very important as they work effectively to guide the organization in accomplishing their key goals (Verschoor, 2014, p. 20). Finally, operations management plays an important role in helping organizations to achieve some of the most adorable unique competitive advantages that will keep them ahead of their competitors that happen to be amongst the top priorities of an organization.

Hyundai Operations Management Practices

To make the operations of the company effective, there are a number of operations management practices that the company has employed in its operations. Some of the operations include that of developing effective mechanisms of coordinating its production planning as well as scheduling its supply chain activities (Brandenburg, et al., 2014, p. 300). Additionally, the company’s production and sales control department employ a schedule cross-functional meetings that are made for purposes of coordinating its supply chain activities that lead to effective operations in the company.

Additionally, the company’s production- and –sales control department have tried to synchronize its production activities as a way of ensuring efficiency in its production across the world. Additionally, the company has offered an interface among its purchasing, production, and sales in its short-term planning as a way of making its operations effective (Verschoor, 2014, p. 22). Again, the company’s domestic sales department happens to carry out an inventory of its finished automobiles as a way of monitoring what it has sold in the market and in the process creating a strong bond between its clients.

Issues experienced in Hyundai and solutions

There are a number of issues that have been experienced in the company over the last number of years.

5.1 Korean economic crisis in the late 1990’s and early 2000’s

One of the issues that have been affecting the company is that of labour issues that were experienced in the company in the late 1990’s and the early 2000s. In this, the company was affected by the economic slump that was experienced in the country in the late 1990’s and the early 2000. As a result of the problem, the employees of the company went on strike and affected the operations of the company greatly (Verschoor, 2014, p. 25). Additionally, in the early 2000, the employees of the company demanded for a 30 percent share of all profits that the company had made, but the management could not afford it. As a result, the management had to talk to the employees and convince them that their demands could not be met (Brandenburg, et al., 2014, p. 307).

5.2 Increased competition

The other problem that the company experienced was that of increased competition from general motors as it purchased the Daewoo that greatly affected the organization. As a result of this, the company had to gear itself up for purposes of competing with general motors. As such, the company had to up the quality of vehicles that it offered to the market as a result of coping up with the increased international competition in the market (Verschoor, 2014, p. 21).

How supply chain development helps in solving company issues

There are various ways in which supply chain development can solve the issues that are faced by different organizations. Some of the ways include the following.

6.1 Expanding company markets

Through effective supply chain management, it gets easy for an organization to expand its markets and offer its products to the international markets. As such, through this, the company will be in a position to offer its products in international markets (Stadtler, 2015, p. 24).

6.2 Connecting with suppliers

For purposes of effecting organizational operations, it gets easier for organizations to solve any supplier issues that might arise between the organization and the suppliers. Supply chain management will make sure that there are no issues between the suppliers and the management (Kim, Kumar, and Kumar, 2012, p. 298).

Hyundai’s process map

Conclusion

The process of management happens to be very important in the operations of an organization. Managing the operations of an organization makes it easy for the organization to perform effectively and efficiently as well as making sure that all organizational operations are cared for. As such, this report has looked at the process of operations management as Hyundai Company applies it. The report has looked at the competitive priorities of the company; the operations management activities applied, the issues experienced in the organization and the solutions that have been offered.