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Frito Lay Case

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Product design: Each of Frito lay’s 40 product or more must be conceived and designed, tasted such as market studies also evaluated for profitability.

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Quality: The standards for each ingredient including its purity and quality must be determined.

Process: The process that is necessary to produce the product that must be maintained for each component by each segment of equipment must be specified and obtain.

Location: The fixed and variable costs as well the transportation costs in and the delivery distance given the freshness must be determined.

Layout: The Frito- Lay facility would be a process facility with great care given to reducing movement of material within the facility.

Human resources: Machine operators may not have inherently enriched jobs so special consideration must be given to developing empowerment and enriched jobs.

Supply chain: Frito- Lay like all other producers of food products must focus on developing and auditing raw material from the farm to delivery. Inventory: Freshness and spoilage require constant effort to drive down inventories.

Scheduling: The demand for high utilization of a capital intensive facility means effective scheduling will be important. Maintenance: High utilization requires good maintenance from machine operator to the maintenance department and depot service.

How would you determine the multi-factor productivity of the production process at Frito-Lay?

Determining output and labor hours would be a good start for single factor productivity. For multifactor productivity, we would need to develop and understand capital investment and energy as well as labor and then translate into a standard such as dollars. How are the ten decisions of OM different when applied by the Operations manager of a production process such as Frito-Lay versus a service organization such as McDonald’s? McDonald’s implement all ten decisions also only with a more service sector orientation

Product design: The main goal of McDonald’s is to provide affordable products also they minimized in size to make the product more affordable, McDonald’s like any tangible product it must be designed such as packaging, tested.

Quality: The aim is to maximize product quality within constraints such as costs, price limit and hiring the right people also McDonald’s uses a production line method to maintain product quality consistency. Process: McDonald’s capacity design is centered on efficiency for cost-minimization that supports the company’s strategies and they focus on maintaining process efficiency to meet market demand also they use production line method to help them maximizes efficiency and capacity utilization. Location: Establish locations for maximum market reach, McDonald’s marketing mix includes restaurants, kiosks, and the company’s website McDonald’s can reaches customers through in traditional and online ways. Layout: McDonald’s uses practicality for this decision area of operations management. The strategy involves maximizing space utilization in restaurants and kiosks, rather than focusing on comfort and spaciousness

Human resource: McDonald’s human resource strategies include training for skills needed in the production line in restaurant kitchens also make sure of individual and organizational learning which is support McDonald’s organizational culture.

Supply-chain management: McDonald’s has a strategy of supply chain diversification and its various locations around the world also include getting more suppliers from different regions to reduce McDonald’s supply chain risks Inventory: McDonald’s goal is to minimize inventory costs while supporting restaurant operations the McDonald’s company doesn’t directly sell products and ingredients to its restaurants also distributors coordinate with McDonald’s restaurant managers to manage their inventory.

Scheduling: McDonald’s uses corporate conventions for scheduling, based on local market conditions and laws, as well as supply chain needs. Which mean the company’s strategy involves regular schedules to address in local market demand. McDonald’s is flexible and adapts to local market conditions

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Maintenance: McDonald’s lets restaurant managers or franchisees select maintenance service providers. However, for kitchen production equipment, McDonald’s Corporation also has certified/approved maintenance providers. The company addresses this strategic decision area of operations management through local and corporate control.

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