Operation Management Report On Haier

After finding miss management in one of his Refrigerator product by Haier Pakistan, the organization management ask for generate a report on Haier Refrigerator Department .The miss Management are found in the field of training , planning , team work and development , awareness, motivation, coordination and lack of cooperation are point out. With the help of this report, we will describe how to handle the operational problem through theories as well concepts of successful step up.

The basic aims and objective of this report is to follow right techniques at right place and applies it at appropriate time, planning according to the needs of organization, apply strategic management method which plays fundamental function in the success of an organization, in order to get competitive advantages as compare to their competitor’s we need to keep our product (Refrigerator) low cost and High in quality.

What is Operation Management

There are many possible definition of operation management, but the two selected definition for this report are

“Operations management is defined as the design, operation and improvement of the systems that create and deliver the firm’s primary products and services. Like marketing and finance, Operation management is a functional field of business” (chase et al. 2001, pp .6)

“Operation management is concerned with creating , operation and controlling a transformation system that takes inputs of a variety of resources and produces output of goods and services needed by customers” (Nayloar, 2002).

Operations management is an importance in today’s competitive market. It is related with generate approchonities for the services and products. All organizations whether it is small or large, for profit or for non- profit, public or private, manufacturing or service they produce some mixture of services and products. Most of organization have come together to recognize the importance of operations. Because they have realized that efficient operations management gives the likely to increase both efficiency and customer service at the same time. All related managers, whether they are called Operations, Marketing, Human Resources, Finance, or they manage processes and serve customers. This all makes part of their operations activities. (Slack, Chambers & Johnston, 2010).

Back ground of Haier Refrigerator as an Introduction

Haier was built in 1984 in Pakistan original brand of china, which is multinational home appliances company head quartered in Qingdao, Shandong, in People Republic of China and took start in 1920’s was only producing household refrigerators. Over the past 20 years Haier international spread almost in four continent which are Asia, Europe, Oceania and North America. This company originates from china but introduce his first product in Pakistan in the form of refrigerator for Pakistani local market since 2002 by successful establishment of refrigerator plant in Lahore Pakistan and Haier produce more product as well like Air conditioner, commercial AC, Microwave, television and washing machine oven. Source.http://www.haier.com.pk/newsite/haierGroup.html

After successful establishment of refrigerator plant in Pakistan, Refrigerator department face different problem in term of manufacturing cost, which makes the manufacturing cost 1.5 times higher than its estimated cost. These kinds of crisis can be solved with the help of closer examination of operation characteristic to bring enhancement in the system of production. The key thing of enhancement of an organization is to developed operation. { http://www.haier.com }

Analysis on Current Strategic issues;

By making powerful strategy for Haier Refrigerator department can help re-gain in its market value, in a production quality, low tariff and well built marketing strategy with constant development through proper research according to taste and demand of community. It is the basic duty of management; to design well planned, competitive advantage with successful leadership, commitment, motivational and introduce culture of total quality management (Cole, 1994).

Model which has been introduced by Cole (1994) shows the strategy and planning for Haier Refrigerator which depends on management of human resources, size, mission and statement of organization. Therefore Haier refrigerator should focus on the following strategy to choose the right strategy.

Importance of strategic Planning

Should have information about the weaknesses and strength of organization

Effective resources of management

To get opportunities, need to capitalization and re- organization as to defend against downs fall.

Should be soft and open in regards to business policies; (Thomson, 2005)

Customized Haier Refrigerator research analysis, market manufacturing

Analysis In the light current strategy of

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Statement mission.

Differntiation strategy Total statisfaction of GOAL ACHIECHED

Hair refrigerator customer

Demanded Product, according to the need of customer demand’s & Organization Mission statement oforganisation

Model applied on Haier Refrigerator Department to follow right path (Cole, 1994).

Haier Refrigerator SWOT (strength , weakness , opportunities and threats) analysis clearly mention threats and weakness in production, where Haier Refrigerator management unsuccessful in using opportunities (external and internal) due to lack of headship. We required long term techniques and short term with brand management in order to gain competitive advantage in the market place. (Lee, 1999)

Difficulties for Haier Refrigerator

Absence of Cooperation in between Service department

Lengthy procession time for stake holder, customer and supplier.

Absence of loyalty for their consumer, employee and supplier

Insufficient connection (relationship) with his customers.

lack of collaboration & coordination.

Absence of development and Education

Business enchantment need skilled staff which is not available.

Bring up to update training methodology

Deficiency of trained staff

Absence of Social Corporate culture

Absence of skilled employees

Irresponsibility and absence of punctual behavior

Absence of loyalty towards their job by the employee

Ineffectiveness of recruitment

Failure of Management

Leadership irresponsible

Unqualified management

Wrong disciplinary standards

Unproductive decision making

Absence of team work approach

Absence of motivation

Techniques And Short Term Tools


Corporate strategies

Corporate strategic positioning with its business.( Nigel, 2007)

Business Strategy

Business strategic positioning in term to its markets players and consumer, in the compartment of corporate strategy (Nigel, 2007)

Functional Strategy

‘A series of actions planned to have a far reaching consequence on the company’s perform to achieve its objectives’. (Kempner, 1980)

Continuous improvement

Tool and technique isn’t taking in to account by continuous enchantment because it possible through real by real enchantment process of services and product. In terms of operation management this Process is called service process and manufacturing process (Nigel, 2007).

Tools and techniques for effective improvements:

Total Quality management

Just in time production control

Business re- engineer process

Material Requirement Planning

International Organization standard 9000(ISO 9000 system)

Benchmarking Process

5 Performance objectives strategy

Human Resource Strategy

Total Quality Management

Total Quality Management is the key Technique to get improvement in all sector of Management. Total Quality Management based on three pillars which are continuous improvement in quality, satisfaction of customer and participation of employee. To create Total quality management (TQM) culture, Management can create vital role in it. (Krajewski & Ritzman, (1999)).

‘An effective system for integrating the quality development, quality maintenance and quality improvement efforts of the various groups in an organisation so as to enable production and service at the most economical level which allow for full customer satisfaction’ (Slack, 2004. pp.720).

Total Quality Management is a step for expertise of management which has turns into more accepted in the Western world since in the early years of 1980’s. In short according to Slack (2004) that the TQM can describe as arrangement of the attitude, corporation organization and culture which aims to offer products and service its consumers which give total satisfaction as a result.

TQM Application;

The following are the TQM application for Haier Refrigerator, which has been mention in class hand book by (Roger, 2010)

Consumer driven quality

Total Quality Management defines customer first policy regarding to quality. The satisfaction of Customer should be Haier refrigerator first main concern. The demands of Consumer must be deal through quickly reply according to their necessities (Nigel, Stuart & Robert, 2007). Total Quality should the main concentration of all departments, like an operating in a number of tasks as a shopper and in some as a dealer. Merchants are measured as associates in order to attain satisfaction of consumer ( Krajewski & Ritzman, 1999).

Total Quality management leadership;

Function of leadership or management plays vital role in generating quality values and goals which are dependable on objectives of corporation (Johnston, 2003).And according to (Brand, 1993) and (Hyde, 1992) it is the key responsibility of management to describe process, capacity of techniques and system, which provide assist in completing goals.

Fast response;

Fast and intelligent examination, constant research, changing demand with consumer behavior and priorities competitor tools are required to stay in market for Haier refrigerator. Haier refrigerator can take benefit through fast and value response and through analysis of consumer demand as well ( Nigel, 2007).

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Continuous development

Continuous development for Haier Refrigerator will help it in competitive market. With the help of continuous development in all segments of business such as proper research in all segments, fulfill the customer demand according to their wishes with quick service, high quality production and quickly production action with most recent innovations will help to guide Haier Refrigerator. (Nigel, 2007)

TQM culture

Well trained and committed work force need for a successful TQM environment where they can know the significance of production quality of Haier refrigerator (Johnston et al, 2003). Well trained and loyal staff should be awarded then as result other staff of Haier refrigerator will also try his best to go for achievements .On the other hand Employee must be optimistic by their bosses to hard work, to play important role in the interest of an organization, take more responsibility, creative thinking and communicate efficiently. Management should be appreciated employee knowledge and skills. (Nigel, 2007)

Data and study base Activities

For operation management correct data is essential because the basic reason is that all reviews, planning, stock room and delivery all depending on the given data. So Haier refrigerator management needs that those people who are in their toop position need to analyze. (Johnston, 2003) and ( Roger, 2010) online {www.johnstark.com/ prn01.html}

Just in Time production Control

(Nigel, 2007. p. 466) ‘A method of planning and control and an operations philosophy that aims to meet demand instantaneously with perfect quality and no waste’

Just in time production control is a common method which force on productivity development and reduce of waste. It is essential in case of Haier refrigerator production, due to its cost effectiveness and will be delivered in time. As a production manager ‘just in time production control’ would be a good technique for Haier Refrigerators production due to it zeros level inventory and perfect situation for production management. (Roger, 2010)

Planning for Material Requirement

Material requirement planning will assist Hair Refrigerator for its Planning & control resources for Production (water, 1992) & (Russel & Taylor, 2006)

Management of Haier Refrigerator can assist MRP through following;

Material Requirement Planning can order material according to requirement.

The period of the delivery would be much quicker or dependable on the situation.

Haier refrigerator will be to fulfill the demand on time.

Saving capital and necessary will be ready in case of emergence


“A set of worldwide standards that established the requirement for companies quality management systems, last revised in 2000, there are several sets of standards.” ( Nigel, 2007.pp.661)

ISO 9000 system is an international recognize system, which has been introduced and used for minimum maintaining level of standard in terms of quality for all organizations around world. With the help of this system we can easily manage our quality in production field. So it will give us an ideal to introduce international standard Product, which is an indirectly advantage for our production department to maintain quality according to international standards.

We need to be requiring following basic steps for Haier Refrigerator production management (Johnston et al, 2003):

Selling , Purchasing and business with suppliers

Development control system

Management system for Store room, Packing and delivery

Requirement of training for TQM application

Control Designing

Quality audits interior

Train staff for documentation practices

Procedures for checking and testing.

Management of Haier Refrigerator will responsible for corporation system, organization, quality and process.

Organization Performances;

Roger, 2010 and Torrington & Weigtman, 1994 urges that for successful operation management, management must need to have five organization performance strategies to gain advantage on the other market operation players, which are following;

Haier refrigerator production quality will help in the field of marketing in term of advantage on other players. So Haier refrigerator management should focus on that everything is going happening in right way in sector of quality.

If Haier refrigerator production management delivers a product on time then it will give speed advantage on others.

Delivering ordered product on time will increase reliability, trust on Haier refrigerator.

Management should focus on cost competitor.

The last thing on which we need to be focus are innovation in production will create flexibility in choice of production by customer.

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‘The activity of comparing methods and or performance with other processes in order to learn from them and/or assess performance’ (Nigel, 2007. P. 587)

And (Oakland, 2003) stated that Benchmarking is a nonstop procedure, which assist in guide the superior functioning for adapting the best practices, processes and identifying.

Benchmarking of Haier refrigerator are linked with different sector of organization such as functional, internal and competitive techniques, where worker will follow the aims and objective of the Hair refrigerator production, through which we can achieve competitive advantage. Where Hair refrigerator management need to required self assessment process such as; ( slack Nigel et al , 2007 )

Search of external development

Search of internal development

For innovation comparison of production in the market with top competitors

Human Resource Strategy;

Human Resource is the core capability of any company or organization. If the staff or employees are more train and skilled then the performance outcome will be better than any other organization. So Haier Refrigerator production can take more advantage with this strategy to get their competitive edge in the market in the long term (slack, 2004). According to (Oakland, 2003) that management should focus on the following;

Empowerment of Employees;

Empowerment of Employees should be needed in Haier Refrigerator where employees can bring change within it job by themselves. Management should need to create flexibility in responsible environment for their employees, where staff takes independence decision. The main responsibility of management to bring all staff in one unit (Slack, 2004)

Top tactics for Haier Refrigerator Human resource Manager are these;

To construct an employee network

Employee need to be responsible and creative

On any positive contribution management should need to encourage them

Right person on right time or place


According to Oakland (2003) management (management of Haier refrigerator product) should promote motivational culture, where management or manager should need to do job specification , job distribution, targets approach and after all encourage on achievement. Reward need to be give from the side of management to get maximum improvement by the using of employee skills. Like

Direct bonuses

Job satisfaction

Pay related to performance

Rank promotion

Development, Training and Education

The training and education of the staff is mainly related to work field, natural of organization, Haier Refrigerator products targets, promotional, health & safety and courses for first aid are necessary for Haier Refrigerator management (slack, 2004) .

Improvement Recommendation for Haier Refrigerator:

Focus need by the management of Hair Refrigerator with the constant development strategy on the demand of customers, changing culture according to the time and on dealers demand.

According to the vision and mission, the management of Haier refrigerator need to be adopts their planes and policies towards their nonstop improvements.

Role model must be plan for continuous improvement in Haier refrigerator management through their strategic assessment management, key component and Total Quality Management culture as everlasting environment of Haier Refrigerator productions.

Right decision at the right time need to be taken for Haier Refrigerator according to the requirement of demand and supply.

Corporate social culture, friendly customer services, fair management, loyal staff & training, high level of quality, competitive price and activities need to be based on correct data should be the main focus for the management of Haier Refrigerator.

Barriers to recommendations;

UN skill and un trained staff

Shortage of employees

Low morale

Irresponsible Management

Lake of corporate social culture

Brand name going down wards

Low level of quality

Un competitive price

Lake of customer services skills.

As a manager how we can control all Barriers;

As an Operational manager of Haier Refrigerator we need to highly train our staff to compete in every related field in the business. We need to launch training programmes courses for every staff member of Haier Refrigerator production team.

We need to recruited more fresh staff for marketing and Production. And we required examining whole machinery from start to end in the production area for the constant improvement and development either it is working rightly or not, if it is not working correctly then we to need to fix it. We need to make some new rules and regularities for corporate social culture and focus on the implementation process.

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