Maximizing Efficiency in BMW Operations

Introduction

Operation management is referred to the administration of business practices for creating highest level of business efficiency possible within the organisation. The administration is concerned with conversion of the material and labour into products and services in the most efficient way so that the profit of the organisation can be maximised. In this report, the operation management of BMW is to be discussed to understand the way it is supporting, developing and delivering convinced products of the organisation. Additionally, if you require further insights into this topic, seeking marketing dissertation help can provide valuable resources and guidance. Additionally, if you require further insights into this topic, seeking marketing dissertation help can provide valuable resources and guidance.

Problem in operation management faced by BMW in the market

The operation management of BMW is seen to be executed effectively as possible from the part of the organisation but they are found to be facing certain problems in the market. In 2018, the global sales of electric passenger cars totalled to 2,018,247 which is up by 72% from 2017 showing an increase in market share of 2.1% globally (qz.com, 2019). This rise of electric cars in the global automobile market has created issues for BMW’s operation management performance to successfully incur effective profit for the organisation. This is because most of the cars produced by BMW are fuel-efficient cars and they still do not have effective technology available to produced high-quality electric cars for their target premium consumers. The increased automation of cars is creating problem for BMW as they are going to face increased competition in the market. This is because the automated care technology industry is new where there is threat of entry of new companies to perform in a better way compared to BMW as they have limited operational knowledge regarding the automated car industry thus showing negative operational management efficiency of the company. It is evident as BMW are just launching their initial products and thus would be unable to know the way strategies and product specification are to be managed to be in a competitive position (www.theguardian.com, 2019).

The other problem being faced by operation management of BMW is related to their failure to manage the proper manufacturing process in the organisation. This is evident as various malfunctioned parts of BMW are being reported such as electric windows in the BMW cars are reported to be broken down after few initial uses by consumers and gasket that creates connection with the oil filter of BMW is frequently reported to be leaking causing oil spill. Moreover, the malfunctioning of the fuse box in the BMW cars is also reported to be one of their manufacturing defects due to which they are made to recall 300,000 vehicles from the UK in 2018 (www.bbc.com, 2018). Thus, the malfunctioning of the BMW cars is creating a negative image regarding the quality of the automobiles in the mind of the consumers that is posing problem for them to effectively attract more new consumers and incur better profit. It is evident as the issues have led BMW to incur 7.9% less profit in 2018 compared to the previous year (in.reuters.com, 2019). Further, it is seen that the operation management of BMW is facing issues with HR activities. This is evident as the head of the company has reported that they are facing talent shortage issues due to which the operation management of the company is facing crisis to implement required talented employees in the production of their high-quality automobile products (www.nytimes.com, 2017). It has resulted BMW to face failure to create high-level performance that is the key motive of the company.

Way the problems are responded by BMW

In order to resolve the challenges or problems, BMW is implementing various improved strategies to get better outputs. The aspects can be explained through Transformational model which is the framework that is used by the leaders to understand the way they are creating a successful redesign of their operation (To et al. 2015). As mentioned by Prajogo (2016), organisations are able to survive in the industry only if they maintain a harmonious relationship with the external environment as per the transformational model. The aspect is well-understood by BMW due to which they are seen to create better and extensive market research for identifying the nature and types of improvisations in technology needed for them to produce high-quality and better efficient self-driving cars as per the current demands of the consumers in the industry (www.press.bmwgroup.com, 2018). This is because by knowing the type of improvement they are to make within the manufacturing technology of self-driving car in the organisation BMW would be able to make products that fulfil the demands of the external market, in turn, maintain a harmonious relationship with the industry. It would help BMW to be in a competitive advantageous position in the industry as they would be able to provide better quality self-driving cars to the consumers which are up to their satisfaction level making the consumers prefer them over other new automobile companies out of satisfaction. The transformational model indicates that change in business strategy as per the market condition is to be made to attain success (Diebig et al. 2017). In relation to this, BMW has been seen to create change in their business strategy by supporting their focus more on manufacturing increased number of electric cars compared to fuel-efficient cars (www.press.bmwgroup.com, 2018). It is done so that the rising problem of their business performance due to increased demand for electric cars in the market can be resolved. This is evident as the focus would lead them to manufacture more electric cars compared to fuel-efficient car making them incur increased profit by selling increased number of electric cars as per demand in the market. The transformational model informs that core processes of the manufacturing of the product are to be redesigned according to market reports of the manufactured products by the organisation (Okanga and Drotskie, 2016). It is seen that BMW is creating change in the electric circuit design of their cars so that the electric malfunctions reported can be resolved. Further, BMW is trying to improve the design of gasket and its adjacent parts so that it can be made leak-proof for longer time. This is done to avoid the challenges faced by BMW in relation to the manufacturing operation of their cars which is creating risk for them in the market to earn bad image and lower sales.

Ways in which the managers understand the issues and responses

The operation managers of BMW perceive the responses regarding their products by monitoring the performance of their products in the market compared to other competitors. This is evident as after monitoring the market for BMW 3-Series GT brand the operation management identified that it is showing low sales and thus accordingly they decided to discontinue it globally (www.drivespark.com, 2019). As asserted by Alles et al. (2018), monitoring the progress of the manufactured products in the market leads the managers to understand the way it is accepted among the target consumers. This is because monitoring provides opportunity to operation manager for identifying extent of demands, sales and purchase of the product among the target customers and whether or not the operational performance of their launched products is meeting the determined sales goals of the organisation. Thus, market monitoring is done by the BMW managers to perceive the responses regarding their products. Moreover, market monitoring helps the company to identify the factors that are improving the sales of the products of the competitors compared to them (Koetter and Kochanowski, 2015). Thus, marketing monitoring is used by the managers at BMW to determine the issues that is leading to their lower operational performance compared to its competitors. The BMW managers understand the issues regarding their products by analysing the feedback of their products from the customers. As asserted by Merlo et al. (2018), feedback from the customers provides their reactions after the use of the products. Thus, analysing the feedback leads BMW managers identify the cause of the issues regarding the lower operational performance of their products. The BMW managers perceive the issues and responses related to their operation by making direct communication with the marketing department of the company. This is because the marketing department is related to the promotion of the business and driving the sales of the product (Krush et al. 2015). Thus, by remaining in direct communication with the marketing department the operational manager in BMW would be able to know the extent of the sales performance in the industry and the reason behind any raised issues as the marketing department directly interacts with the target consumers and industry where the organisation is performing.

Way findings of BMW can be interpreted and evaluated

In the view of the literature, it can be interpreted that BMW is facing lower operational performance in the market as the company is facing various challenges that are posing hindrance for their effective business execution. This is evident as it is mentioned regarding BMW that the company is facing fear of increased competition due to rising electric car industry in which they are still not been able to effectively perform like they are currently performing in the fuel-efficient care manufacturing industry. The reason behind the lower operational performance can, in turn, be interpreted due to the lack of proper talented individuals in the company. This is evident as the literature reported that BMW reported they lack effective talent in the organisation as per their need. Further, the evaluation of the literature regarding BMW informs that they are incurring lower profit which is evident from their annual financial report and thus it can be interpreted that through BMW is experiencing issues to properly attract increased new consumers due to which their profit has diminished from the previous years.

Suggestion for improvement

Process Design and Analysis is referred to the systematic approach implemented by the organisation for improving the understanding of business processes to assist the way tangible benefits can be incurred and effective allocation of the human resource can be executed (Hayes, 2017). The improvement to be made in the BMW is to be suggested through Process Design and Analysis. The phases of the approach include Planning, Analysis, Design and Implementation. In the planning phase, the way improvements are to be made is determined (Shah et al. 2018). Thus, in this phase, BMW is suggested that they are to plan on focussing factors that are presently causing issues for their operational performance in the industry. In the Analysis phase, concepts to establish the planned facts are to be identified (Shah et al. 2018). Thus, in this phase, BMW is suggested to identify the concepts regarding ways they can increase the amount of manufacture of electric cars, implement new technology in faster production of self-driving automobiles and recruit improved talents in the organisation.

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In the design phase, the way the concepts are to be implemented is to be determined by the company (Hayes, 2017). Therefore, BMW in this phase is suggested to design ways in which the mentioned concepts can be institutionalised. BMW is suggested that they are to design training program for the existing employees to improve their talent so that the lack of talent issues in the company can be resolved. Moreover, BMW is suggested in this phase to redesign the manufacturing unit so that it can be adjusted to help them build electric cars in a faster way to capture the market since those types of cars are in high demand among the premium consumers compared to fuel-efficient car. BMW is also suggested in the design phase to determine the way better self-driving cars of high quality can be manufactured by them. In implementation phase of Process Design and Analysis, the way the determined designs are to be put into practice are identified by developing design tests, change communication and execute documentation (Hayes, 2017). The BMW in this phase is suggested to develop its implementation plan for the determined design. In this process, they are choose the place and members who are going to train the employees of the company to increase their talent, determine the aspects to be fulfilled and resources required to implement the redesigned plan of the increasing manufacturing of electric cars and identify the technological advancement to be made in their present self-driving cars to meet the quality standards mentioned by their target consumers in the market.

References

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