Mr Te Whatu Cae Study - Call Us Plumbing Supply Company Limited - Production Planning - Operations Management Assessment Answer

Assessment Task:

Mr Te Whatu Cae Study - Operations Management Assessment Answer

Learning Outcomes 

Learning Outcome 1: Students will apply a range of capacity and inventory management tools to improve entity performance 
Learning Outcome 2: Students will appraise the appropriateness and applicability of supply chain management to improve entity performance 
Learning Outcome 3: Students will demonstrate effective communication skills to engage with stakeholders. 

Case Study—Call Us Plumbing Supply Company Limited:

The Call-Us Plumbing Supply Company Limited produces and stocks millions of plumbing items which are sold to regional plumbers, contractors, and retailers in New Zealand. The company manufactures or supplies one million pieces per year. In the last month alone, they produced 150k individual items alone. Current estimates suggest that this will rapidly rise to approximately 300k articles per month. 

Mr Te Whatu, the General Manager, has concerns related to current rapid business growth. The rapid growth has resulted in significant issues, for example: 

• Overstretched manufacturing and production resources.'

• The delayed production of component materials, for example, the washers for pipe fittings delay the assembly of the final product.

• There were instances of interdepartmental and staffing conflict related to unmet internal demand for production equipment.

• Workers under constant stress resulting in burnout and staff churn.

• The inability of the organisation to keep track of its provision in the rapid growth stage.

• The inability of production and assembly managers to plan effectively given the demands of rapid growth with systems and processes at the breaking point.

• Many missed business opportunities especially related to global markets.

• More product returns, related to the reduction in overall quality of garments. 

Mr Te Whatu, the General Manager, has voiced his concerns to the board related to rising costs related to suppliers and decreased margins with the product from retailers. He suspects this is possibly related to the new Auckland region fuel tax. He has also been made aware of a competitor who has greater business scalability but offers lower grade products. 

As regards production, Mr Te Whatu has noticed: 

• A sharp rise in labour costs BUT not profitability.

• Increased inventory costs with excessive work-in-process inventories.

• Frequent overly used and non-optimised production equipment.

• Delays to some major projects at the expense of bespoke one-off projects. 

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