Business Operations Management
Table of Contents
Overview of chosen establishment and define the scope of the analysis. 3
Gantt Chart for the production of the report 3
Operation management challenges of the organisation. 4
4V analysis of GlaxoSmithKline (GSK) 5
Performance Objectives of GSK.. 7
Overview of chosen establishment and define the scope of the analysis.
The company selected for this paper is GlaxoSmithKline (GSK), which is a leading pharmaceutical company of UK. The company is primarily engaged in manufacturing human health products, in which the most significant division is the pharmaceutical division. The company is headquartered in the UK and also operates in the new headquarters of USA (Kasaei 2018). The two primary business divisions of the company are pharmaceutical and consumer healthcare, among which 85% of sales are generated from the pharmaceutical division. Some of the significant medicines manufactured by the company are Seretide for asthma patients, anti-depressant named as Paxil and Avandia for type 2 diabetic patients.
The analysis will be based on the operation management functions of GSK Company. Operations management refers to the process of planning, organising as well as controlling the operations of a business for the betterment of its productivity. Through a detailed analysis of the operation management of GSK, the company will be able to find out judicious ways of cutting down its cost structure and utilise optimal resources for its business (Yamin and Alharthi 2019). Another core functional area of operations management in supply chain management, which bridges the gap between supply and demand and helps in the transportation of products from the manufacturer to the end customers.
Gantt Chart for the production of the report
In the preparation of the report, many tasks have been conducted in a sequential manner, which has been presented in the Gantt chart table. The first step involved research on the overview of the company, which has included sub-steps like preparation of a sample draft and finalisation of the draft. The second step has been the preparation of a Gantt chart, which required detailed planning and collection of feedback (Kolios and Luengo 2016, February). The third step is to detect the challenges faced by the company in its operational process through extensive research, which is followed by steps like 4V analysis, performance objectives of operations management and lean management. The 4V model consisted of sub-steps, like Draft preparation and obtaining feedback. The performance objectives also included steps like sample preparation and receiving feedback.
Similarly, lean management consisted of steps like draft preparation and obtaining feedback. The next task was to evaluate the fundamental processes that have been identified in the production model of the company and the advantages and disadvantages of these processes in meeting the performance objectives of the company. All these tasks have also involved research, preparation of draft and feedback collection. The final mission is to draw recommendations for improving the quality of product delivery to the customers, which has also required sub-tasks like draft and feedback generation.
Operation management challenges of the organisation
GSK has introduced an average and simple business model in the pharmaceutical industry. Instead of the stereotypic technique of “high-price and low volume”. The research and development operations of most pharmaceutical companies have been very complicated and innovative (Kontogiannis et al. 2017). However, GSK has prepared a balanced and straightforward strategy opting for long-term growth, which has faced many criticisms in the complex business environment. These factors might pose significant challenges to the system of operations of the company.
4V analysis of GlaxoSmithKline (GSK)
The 4V model consists of four critical dimensions of operations management such as Volume, Variety, Variation and Visibility.
The 4V model of operations management tries to find out a variety of ways by which input is converted into output by going through the operational processes.
- Volume
The company operates across 10 countries, having more than 13 manufacturing sites all over the globe. After the launch of the pharmaceutical division, the company has delivered more than 9 million doses at the global level. It is currently working to meet up the fast demand pace of the customers. To boost up its production volume, the company is undertaking multiple initiatives across its vast manufacturing networks of US and Europe (Abdullahi 2019). Every stage of the manufacturing process has been taken into consideration, starting from antigen production to packaging. The company has simplified its supply chain network and discarded all the duplicate products. The ongoing investment of the company in its manufacturing network has led to a 10% growth in its production volume.
- Variety
The variety dimension displays an analysis of all the options that the available to the customers in each of the segments of the business.. In the pharmaceutical department, the company offers drugs like Flovent, Horizant, Nimbex, Prolia and many other kinds of varieties. In the vaccines department, the company provides vaccines of influenza such as Fluarix and FluLaval and Hepatitis A and B, which are named as Ambirix and Engerix-B, respectively (Mina 2019). The consumer healthcare products offered by the company are Aquafresh for oral healthcare, Breathe Right for respiratory issues, Committed Quitters as nicotine replacer and Beechams Cold & Flu for cold and flu treatments. All the varieties of products offered by GSK are unique as they are prepared by experts specialised in a particular area with a detailed understanding of customer needs and scientific innovation.
- Variation in demand
The company is experiencing growth and variation in demands for its preventive and therapeutic healthcare products due to the change in the demographics of the customers. The increased lifespan of older adults has doubled the demand for pharmaceutical products (Khan et al. 2018). As compared to all its competitors, the demand for GlaxoSmithKline is still at the peak point.
- Visibility
The visibility of the products of the company is high, and almost all the retail stores contain the products. However, the operational process is not completely visible to the customers owing to its little complicacy. GSK follows a simple business process mapping which identifies the job roles of different departments at respective stages of the production process.
Performance Objectives of GSK
GSK has various objectives that support the functioning of its operational model. The company has the goal of becoming the most innovative, the highest performing and the most trustworthy organisations committed for the healthcare of customers. The values and expectations of the companies are their core priorities. The company strives to bring about excellent products in the market for providing customers with a better and healthy lifestyle (Hitt et al. 2016). The core values of the company are focus on the patients, transparency in the communication between the various stages of its operations, respect among all the employees, integrity in its services. The pharmaceutical business has an extensive portfolio of established medicines having commercial leadership respiratory and HIV departments. The research and development department uses genetics and advanced technology for developing new approaches to the immune system through the application of science.
Lean Management
The company applied three kinds of lean management techniques for achieving constant enhancement in operations and long-term growth through incremental changes. In the global manufacturing and supply department, the company employs Lean Six Sigma technique for delivering small and measurable improvements in the business (Tortorella et al. 2017). In the department of consumer healthcare, the company executes project management techniques for driving noticeable changes in the course of the projects. The company has also come up with organisational development teams that showcase high levels of engagement among the employees for adopting appropriate change programmes. The other steps taken by the company to establish a change framework within the business are the diagnosis of the current business environment for improvising further changes and strategies for sustaining the ongoing changes and maintaining the momentum of change. The company has also developed an implementation plan for building confidence as well as enthusiasm through tests and trial methods.
Critical evaluation of the essential processes used in the production or delivery of the product or service discussing the pros and cons of the methods in meeting the performance objectives.
The process of manufacturing is considered as the vital capability of GSK. The company owns more than 14 vaccines and 40 pharmaceutical sites in more than 25 countries all around the world. The company is continuously involved in reviewing its global manufacturing process. Through constant review and evaluation, the company reallocates the production needs among all its facilities in different geographical locations. Primarily, this task is conducted across geographic areas, which are under the focus of the company (Hill 2017). The company also considers closure of some other facilities which are currently not under focus and are not performing well in their manufacturing processes. The company has simplified its portfolio of products as it believes in the strategy of tapping new markets with bulk products at low prices. The simplification strategy having a more reliable and balanced platform would facilitate alignment of operating model with the vision of the company.
The company faced issues while it tried to streamline its supply chain network with its low-profit margin strategy. In 2013, GSK launched a supply chain programme with an end-to-end connection to simplify its supply chain process. The company aimed to re-design its organisation structure in such a way that it caters to the simple governance model as proposed by the organisation. Through the simplification of the entire process, the company aims to improve the integration of the activities across the value chain. These activities start from the sourcing of the raw materials to the delivery of the products to the end consumers (Kundu et al. 2018). In 2014, the company introduced a standardised production system known as GSK Production System across all the manufacturing facilities such that all the facilities can work under an integrated process. This standardised production system helped in identifying the root cause of uncertain situations that might increase defects in the production process and removing all the waste materials from the production process. Through this system, the manufacturing interruptions could be decreased by 40%, leading to a growth of 26% in the production facilities (Uddin 2018). GSK has also tried to ease down its manufacturing processes through the discontinuation of some of the medicinal packs. The percentage of packs discarded by the company has been approximately 19%. Along with these activities, the company has also curbed down its number of outsourcing manufacturing partners such that it can only rely on its processes without relying on its partners.
The operational model and the global commercial model of the company have many significant advantages in catering to its performance objectives. The simplification of the operational model in both the manufacturing as well as supply chain areas has helped the company in nurturing its vision of simplicity (Al-Damen 2017). Through the simplification of the operational model, the company has been able to manufacture quality products for the customers, which has been the second goal of the company. Thirdly, the company has been able to incorporate innovation in its research and development area by entering a fantastic swap deal with Novartis. Through this deal, the company has been able to divest its assets into complex therapeutic areas.
One of the significant weaknesses of the operational model of the company is the imitation of the model by the competitors. Through imitation of the model, the company would not be able to stand-out in the market in the fields of creativity and innovation and therefore, would be lagging in meeting one of its performance objectives (Pantouvakis and Psomas 2016). Another weakness can be a minor one being less variant in its industry.
Identification and prioritisation of quality improvements for the delivery of product and service using continuous improvement frameworks
The quality of production, as well as delivery processes, can be improved through many kinds of models and frameworks. The most significant model used bringing about the constant enhancement of the process is the plan-do-check-act (PDCA) cycle. According to the PDCA cycle, the organisation can perform four essential activities in a stepwise manner for organising its production and delivery process (Bunglowala and Asthana 2016). The first step is to plan, which means identifying an opportunity that can bring about a change in the process. The next step is to act, which refers to the implementation of incremental change within the organisation. The third step is to analyse data to find out the effect of the change process (Christensen et al. 2019). The last step is to act, which means examination and evaluation of the change process, figuring out its success or failure. This process also involves the implementation of the change process on a full scale for assessing the results. In case of failures, the entire cycle can be repeated.
The next important model of change management can be a lean six sigma model, which has already been implemented in GSK on a small-scale. Six sigma model helps the organisations in improving their potentials of business processes (Hedderson et al. 2019). Six sigma can be appropriately linked with lean management to develop lean six sigma model. Through this model, the six sigma would help in bringing about variations in the process and enhancements in the control actions of the process. At the same time, lean will be useful in driving out errors in the process such that the quantity of waste materials can be checked. Through the process of lean six sigma, the company can enhance the level of satisfaction of the customers and enjoy excellent bottom-line results. This process also helps the company in adopting a standardised workflow by reducing a large amount of wastes and decreasing the cycle time of the process.
Another necessary process that could be suitably adapted by the company to improve its performance is the lean management process. The lean manufacturing process is defined as a system of activities which enhances the effectiveness of a process through the elimination of waste products (Tsafarakis et al. 2018). All the manufacturing and service operations under lean management work under the same underlying principle that is, elimination of the non-value adding activities from the process. The seven essential elements constituting the lean management system are the defects, overproduction, waiting, non-utilised talent, inventory, motion, transportation, and extra-processing. The lean management requires many prerequisites such as choosing of a value stream from improvement, identification of customer value, preparation of improvement plan and standardisation of the new processes.
Another vital model which can be suitably applied for quality improvement is total quality management. This model describes a management approach for building up a long-term success with the customers. In the process of overall quality management, the organisation can participate in the improving processes related to the products, services and culture within the organisation (Ross and Naylor 2017). The four core elements of total quality management are focus on customers, engagement of the entire workforce, process-centric tool and integrated system of operations. The overall quality management also takes into account many other factors such as being strategic as well as systematic, featuring continuous improvement, encouraging a fact-based decision-making system and bringing about transparency in the communication process. All these elements if used together can facilitate constant growth within the organisational processes (Tahir 2018). All the items can also bring about more significant change and transformation within the operational processes such that the company can earn better returns and create a competitive advantage in the market.
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