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Operation management business report

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  • 1. Rennes International School of Business ESC RENNESExecutive Master of Business Administration EMBA COHORT 1 (2003 - 2004) Operations Management Conducted by: Graham BROWN Delta Branch QS Operation By Magdy A. Sattar January, 2004 Cairo, Egypt
  • 2. TABLE OF CONTENTSEXECUTEVE SUMMARY ………………………………………………………II1. Introduction & Objectives .………………..……………………………..12. What is Menatel ....…………………………………………………………….13. Delta Branch ……………………………………………………………….1 3-1 Environment ……….………………………………………1 3-2 Objective. ……………………………………………….1 3-3 Organization ……………………………………………….24. Data Analysis ……….……………………………………...……………….3 4-1 Problem identification ….……………………………3 4-2 Elements of the problem ……………………………….4 4-3 Alarms category possible reasons ...……………………..4 4-4 Q.S/alarms category / Governorate ………………………..5 4-5 Branches benchmarking the current situation for resources analysis ………………………………………………..6 4-6 Technicians, cars distribution / Governorate / Rout ………..85. Conclusion ……….……………………………………………………….9 5-1 Potential solutions characteristics. ………………………..96. Recommendations ………………………………………………………..10 6.1 Suitable solution, Action plan and implementation ………..10 6.2 Monitoring the solution ………………………………..12 6.3 Reporting System ………………………………………..12EMBA CairoRennes International School of Business I
  • 3. EXECUTEVE SUMMARYThis report is to cover the QS operation at Menatel Delta Branch demonstrating myunderstanding of the principles and techniques of operations management. I will startby a short presentation about Menatel and Delta Branch, environment, objectives, andorganization. Analyzing the available data to identify the problem and its elements,then breaking down the problem to its alarms category and possible reasons showinghow the alarm category per Governorate affects the QS. Benchmarking the branchresources and current situation with other branches and the current technicians andcars distribution to analysis how the branch resources are managed. Driven by theanalysis results a final conclusion is obtained and the characteristics of the potentialsolutions in order to recommend the suitable solutions, action plan, implementationsteps that can be done with the available resources, and the solution monitoring andcontrolling system.EMBA CairoRennes International School of Business II
  • 4. 1- INTRODUCTION & OBJECTIVEThe purpose of this report is to allow me to demonstrate my understanding of theprinciples and techniques covered during the operations management course. I willsubmit a business report that will address Delta Branch QS analysis, potentialsolutions, action plan, and how to monitor and control this operation process. 2- WHAT IS MENATELMenatel is a joint stock company under investment low number 8/1997 registered in1998 under number 314030. Menatel is granted a ten years; renewable license, toinstall, operate, and manage a telecommunication network of at least 33,000 publicpayphone. Menatel is determined to achieve this target by the end of 2004. Egyptianshares are 51% and foreign shares are 49%. France Telecom (FCR) “providingMenatel with the know-how technology and management” holds the main foreignshares, which is 44 %. The main Egyptian company with 18% share is the NationalBank of Egypt (NBE). 3- DELTA BRANCH 3.1 Enviroment.The green triangle occupying the north of Egypt’s map we call it Nile Delta, as itoccupies the landscape in which the two branches of the Nile (Damiatte and Rasheed)flows with all their sub-branches. This landscape occupies 16411Km.*, divided into 6governorates, 31 City, 45 Town and 3000 Village and small village, shaping apercentage of 30% urban and 70%rural. Delta population is 20 Million their mainsource of income is agriculture and some small industries related to it. There is a highpercentage of illiteracy among Delta population especially females, which isconsidered a great obstacle on the way of social and economical development. 3.2 Objective.Delta branch objective is to install, operate, and manage a telecommunication networkof 4200 public payphone by the end of 2004 all over the assigned area, most of thisarea is rural inhibited by more than 20,000,000 people, 33 % of them inhibit urbanand the remaining inhibits rural.EMBA CairoRennes International School of Business 1
  • 5. 3.3 Organization. In a centralized management environment, the branch manager in the matrix heads the branch organization with functional managers in the head office. The branch manager is responsible to manage the branch team to meet the objectives planned by Menatel Managing Director in accordance with company strategy and guidelines given by the functional directors. The branch team is organized in a simple flat structure corresponding to the nature of the activities, which are technical activities (production, maintenance, and Payphone Management System “PMS”), commercial and customer service activities, financial and administrative activities, and finally public relations and logistic activities. As for the sales team they are supervised by a local sales supervisor who is reporting technically to Menatel cards distribution manager and administratively to the branch manager in matrix organization as it shows below for Delta organization chart. Branch Manager In Matrix with Menatel Secretary Functional Managers 1Engineers Commercial Customer Accountant Sales Agent Service Supervisor3 1 1 1 1Technicians Cleaning Public Sales Controllers Relation Reps19 3 2 12 Office Boy 2 EMBA Cairo Rennes International School of Business 2
  • 6. 4- DATA ANALYSIS 4.1 Problem Identification. The monthly Q.S/Branch for the year 2003 Months Cairo Alex. Canal Delta MUE SUE January 97.10 % 95.80 % 97.90 % 94.50 % 98.20 % 98.40 % February 97.38 % 96.96 % 98.33 % 95.19 % 98.37 % 98.41 % March 97.51 % 98.69 % 98.20 % 95.50 % 98.40 % 98.56 % April 97.90 % 98.70 % 98.00 % 96.20 % 98.50 % 98.70 % May 97.80 % 98.96 % 97.81 % 96.21 % 98.46 % 98.46 % June 98.13 % 99.02 % 98.15 % 96.66 % 98.47 % 98.97 % July 98.32 % 98.17 % 98.16 % 96.79 % 98.31 % 98.67 % August 98.37 % 97.82 % 98.55 % 97.26 % 98.41 % 98.86 % September 98.59 % 98.59 % 98.69 % 97.28 % 98.21 % 98.89 % October 98.52 % 99.04 % 98.72 % 96.65 % 98.23 % 98.98 % November 98.49 % 98.69 % 98.73 % 97.90 % 98.20 % 98.88 % December 95.51 % 99.43 % 98.93 % 98.73 % 98.89 % 99.33 % Average 97.80 % 98.32 % 98.34 % 96.57 % 98.37 % 98.75 % The previous table identifies the problem that Delta branch Q.S is low.Gab under study Time Progress Chart 100 99 99 98.5 98 98 Cairo Alex 97 97.5 Canal 96 97 Delta 95 96.5 MUE 94 96 SUE 93 95.5 92 95 Nov Jun Jul May Jan Aug Oct Mar Apr Dec Feb Sep QS EMBA Cairo Rennes International School of Business 3
  • 7. As it is shown in the above charts we can identify the gab between Delta Q.S and theother Branches and this gab is the one that need to be analyzed, also we can see fromthe time progress chart that the Q.S process is improving which is a good signconcerning the success probability to eliminate the under discussion gab. 4.2 Elements of the problem.  Telecom Egypt NetworkAccording to telecom Egypt executives, Delta network Q.S is 87.5 % due to the watersaturated-soil of delta which affects the isolation of telecom Egypt network cables andthe life time of the network itself. Also the technology used in most of the exchangesin delta is very old not updated one.  Geographical characteristics of Delta region.  Spare Parts and Tools availability.  PMS (S/W) performance.  Skills of the technicians and the supervisors.  Preventive maintenances. 4.3 Alarms category possible reasons.First PMS indicates Program Management System, which is the control system thatmanages Menatel payphones and monitors all the alarms of the payphones, andcategorizes them into the following four categories.MS: this is minimum service alarm and normally is due to payphone faults that istechnician responsibility.OOI: this is out of order incidence alarm and normally is due to payphone faults, thatis technician responsibility also.OOS: this is out of order supervisor alarm and normally is due to the exchange or thePMS faults, that is S/W or system responsibility.NK: this is not connected alarm and normally is due to communication link betweenthe payphone and the PMS is cut, that is line, cable, production, technician, TelecomEgypt network, or PMS responsibility.EMBA CairoRennes International School of Business 4
  • 8. 4.4 Q.S/alarms category/Governorate.This table briefs the alarms category situation and the corresponding percentage ofeach category of the total Q.S.  For the lowest month.Governorate Q.S MS OOI OOS NKKafer El sheikh 94.78 % 1.51 % 9.06 % 5.13 % 84.29 %Dakhlia 93.15 % 0.65 % 14.6 % 3.64 % 81.11 %Sharkia 94.51 % 2.07 % 17.43 % 4.22 % 76.28 %Kalyobia 97.11% 1.68 % 23.25 % 5.66 % 69.41 %Monofia 94.86 % 2.04 % 18.18 % 5.53 % 74.25 %Gharbia 93.98 % 1.69 % 19.22 % 4.4 % 74.69 %Average 94.50 % 1.56 % 16.67 % 4.15 % 77.27 %This table gives us the first indicator to the problem that 77.27 % of the alarms arecaused due to NKs, second 16.67b% due to OOIs alarms.  For the highest month.Governorate Q.S MS OOI OOS NKKafer El sheikh 98.74 % 1.43 % 24.66 % 12.51 % 61.38 %Dakhlia 98.58 % 3.12 % 24.29 % 9.85b % 62.01 %Sharkia 98.85 % 5.49 % 24.71 % 15.33 % 54.45 %Kalyobia 98.62 % 2.95 % 17.95 % 7.32 % 71.75 %Monofia 98.90 % 5.53 % 30.10 12.89 % 51.46 %Gharbia 98.61 % 3.12 % 29.69 % 14.10 % 53.06 %Average 98.73 % 3.80 % 25.60 % 12.40 % 57.90 %This table confirms the first indicator to the problem that 57.90 % of the alarms arecaused due to NKs, second 25.60 % due to OOIs alarms. 60 80 50 60 40 30 NK 40 NK 20 20 10 OOI OOS MS OOI OOS MS 0 0It is obvious from the above Pareto charts for the lowest and the highest Q.S for amonth that the NK category is the driver of the global Q.S followed by the OOIcategory, that is to say eliminating the causes of both category will positively drivethe global Q.S to the right direction and help improving the total Q.S.EMBA CairoRennes International School of Business 5
  • 9. OOS (10%) NK (67%) PMS Exchanges 10% 5% People S/W 27% PMS Preventive Maintenance 5% 30% Installation QS Tools Skills People PeopleSpareParts Controlling MS (3%) OOI (20%) As we see from the above cause-and-effect diagram that the main cause of the identified problem are:  50 % due to PEOPLE.  30 % due to PREVINTIVE MAINTINANCE.  20 % due to P.M.S PERFORMANCE. 4.5 Branches benchmarking the current situation for resources analysis. Items Menatel model Cairo Alex. Canal Delta MUE SUE Average Q.S 98 % 97.80 % 98.32 % 98.34 % 96.56 % 98.37 % 98.75 % Technicians 120 47 18 15 19 10 8 Vehicles 60 21 10 10 8 5 7 Exchange 480 93 62 63 88 54 35 Lines IO 30,000 12000 4739 4054 4150 2555 2150 Supervisors 10 4 3 2 1 2 3 Average calls 45 42 31 38 37 47 40 Tech./line 250 255.3 263.2 270.2 218.4 255.5 307.1 Tech./exch. 4 1.97 3.44 4.2 4.63 5.4 4.3 Veh./tech. 2 2.2 1.8 1.5 2.3 2 1.1 Veh./exch. 8 4.4 6.2 6.3 11 10.8 5 Sup./tech. 12 11.75 6 7.5 19 5 2.6 EMBA Cairo Rennes International School of Business 6
  • 10. Tech. / Line DeltaSup. / Tech. MENATEL Model Tech. / Ex. Veh. / Tech. Veh. / Ex. Tech. / Line DeltaSup. / Tech. SUE Tech. / Ex. Veh. / Ex. Veh. / Tech. Gab analysis for the Delta branch available resources compared to Menatel model and also to the best branch of Q.S shoos that Delta is need for:  Two Vehicles.  One more Supervisor. EMBA Cairo Rennes International School of Business 7
  • 11. 4.6 Technicians, Cars distribution/Governorate/Rout.Governorate Routs PPs IO Tech. Car T/L T/E V/T V/E S/T Q.SKafer El sheikh 3 488 3 0 162.6 4 0 0 3 96.70 %Dakhlia 4 836 3 2 278.6 6 1.5 9 3 96.00 %Sharkia 6 982 4 2 245.5 6 2 12 4 97.00 %Kalyobia 2 405 2 1 202.5 3.5 2 7 2 97.80 %Monofia 4 607 3 2 202.3 5 1.5 7.5 3 96.50 %Gharbia 4 832 4 1 208 3 4 12 4 96.30 %Average 23 4150 19 8 218.4 4.63 2.37 11 19 96.57 % 140 250 120 200 100 80 150 KSH GHR 60 100 40 50 20 0 0 T/L T / Ex V/T V / Ex T/L T / Ex V/T V / Ex 200 200 150 150 100 DAK 100 SHR 50 50 0 0 T/L T / Ex V/T V / Ex T/L T / Ex V/T V / Ex 160 120 140 100 120 100 80 80 MEN 60 KAL 60 40 40 20 20 0 0 T/L T / Ex V/T V / Ex T/L T / Ex V/T V / Ex The above charts show that Delta Branch is in need for:  One vehicle for Kafer El Sheikh Governorate.  One vehicle for either Gharbia or Sharkia Governorate.  This in addition to one more supervisor for controlling. EMBA Cairo Rennes International School of Business 8
  • 12. 5- CONCLUSIONSAs the data analysis shows, Delta Branch is 1.43 % below the targeted Q.S, whichmeans the branch, consequently Menatel, is losing the opportunity to generate dailyrevenue of about 1200 LE, a bout five hundred thousands Egyptian pounds annually.Breakdown this 1.4 % we see that 67 % of it is NK incidences, 20 % OOI incidences,10 % OOS incidences, and 3 % MS incidences.The cause of this 1.43 %, 50 % is due to people effects, 30 % is due to preventivemaintenance, and 20 % is due to PMS performance.Benchmarking the branch resources we see that Delta Branch is in shortage ofvehicles and number of supervisors, but on the other hand the number of techniciansis over what is needed to cover the assigned number of payphones. Another elementof Delta situation that analysis shows is the big number of remotes area assigned forthis region, which affects the technicians and vehicles distribution. 5.1 Potential solutions characteristics.  People solutions that provides:Accurate controlling and supervising the concerned persons through coaching,planning, time management, problems solving, and team building skills.Providing the effective tools and spare parts to technicians to insure effective solvingto payphones incidence.Provide the suitable training for all staff to in reach the necessarily skills for obtainingtotal quality performance.  Preventive maintenance solutions that provides:Design a process that facilitates the quality operation and keep tracking the results toimprove the quality operation.  PMS performance solutions that provides:Eliminating any payphone failure due to H/W connections to the PMSs, or any PMS’spower problems.EMBA CairoRennes International School of Business 9
  • 13. 6- RECOMMENDATIONS As it shows from the solutions characteristics that 80 % of the solution is an internal organization solutions related to managing people and available resources also implementing a quality process that provide preventive maintenance. Our philosophy it to improve and keep improving gradually, simply to achieve better next month and more better the month after, and so on, monitoring and evaluating the quality process aiming for continuance improving. 6.1 Suitable solution, Action plan and implementation. First; In cooperation with the HR department to provide the necessary training to all the involved persons to in reach there skills. The table below shows the recommended programs for the involved persons. Program Name Duration Target Audience Objective CostBasic Communication Understand the important of 2 Days All Levels 225 LE/day/person communications in the organization.Teamwork Getting around obstacles that prevent 1 Day All Levels 225 LE/day/person team success and build an effective team.Problem Solving Improving analysis skills for identifying 2 Days All Levels problems and recommending creative 225 LE/day/person solutions that help the organization.Customer Orientation 3 Days All Levels Understand customer satisfaction. 225 LE/day/personNegotiation Skills Understand the important of effective 2 Days Commercial persons 225 LE/day/person negotiation to the organizationSupervisory Skills Understand the role of supervisor, 4 Days Supervisors understand people, how to manage 225 LE/day/person people.Service Quality Understand quality and quality process; 2 Days Technicians understand the important of customer 225 LE/day/person satisfaction. Second; In order to have proper and effective controlling over the operation an internal rotation is a must to replace the current maintenance supervisor with one that is more skilled in terms of time management and planning. EMBA Cairo Rennes International School of Business 10
  • 14. Third; Order a purchase request for shortage tools especially the effective ones, and till we buy them try to organize sharing them among the technicians. Order a purchase request for one vehicle more, and till the approval schedule technician’s time to cover different routes in Delta every 48 hours, and assigned a car per governorate. Fourth; Assign one of the technicians for workshop to be responsible for testing new and repaired spar parts, repairing faulty spar parts, also to be trained to follow up some of the routine work of the maintenance supervisor to narrow the gape of supervisory at the branch. Fifth; Design a process for quality operation, the block diagram bellow shows the recommended process guided by TQM philosophy that involves every one in the branch including the contractors assigned for production, booth maintenance, and cleaning in continuance effort to improve quality and achieve customer satisfaction. The process is based on that each block represents a step in the operation each step is controlled and supervised by a person in charge, who knows his objective and taking the results. Before and after each block or step a check quality test is done by random sampling to insure quality at the source. Civil, Booth, Payphone Cleaning & Line PMS Line Payphone & Maintenance Booth Request Installing Received Cabling & Spare Parts Maintenance InstallingQuality Chick Quality Chick Quality Chick Quality Chick Quality Chick Quality Chick Quality Chick Test Test Test Test Test Test Test Reporting System Reporting System Reporting System Reporting System Deviation Control Reporting System Reporting System EMBA Cairo Rennes International School of Business 11
  • 15. Sixth;For the PMS part the modem line should be 100 % isolated and effectively connectedbetween the PMS and the modem to insure no miss communication through thenetwork due to bad connection. Regarding the installed S/W, all the illogical faultypayphones data are to be collected and reported directly to HQ to be analyzed andsolved if possible. 6.2 Monitoring the solution.A continues improving of the recommended process and solutions is to be achievedprovided that a good monitoring system is implemented. A reporting system isestablished to monitor the QS weekly provided by both the PMS (electronic report),and the maintenance team (manual report), also a monthly report from both sides inaddition to a monthly report for cleaning, booth maintenance, and customersatisfaction. This reporting system is to provide the necessary date to be analyzed toshow and measure the progress of the operation, to show if the operation is on theright trend or not, and to provide warning alarm for any deviation around the targetedQS. 6.3 Reporting System  Weekly Reports:Tow weekly reports are to be submitted to the Branch Manager by the PMS andMaintenance supervisors, each one of the reports contain the following: 1- PMS weekly report;This report measures the QS related to each exchange and PMS according to alarmscategory (NK, OOI, OOS, and MS), and categorize the PMSs into three categories: A- More than 98 % B- Less than 97 % C- In between.This categorization allows the branch to evaluate and measure weekly the QSoperation output and provide a guided figure as for the next week target forimproving, matching the branch philosophy to improve step by step, and bushingcategory B to C, and C to B, and like that we are on the track to achieve the Branchobjective.EMBA CairoRennes International School of Business 12
  • 16. 2- Maintenance weekly report;This report measures the QS related to each route and technicians according tonumbers of alarms, and categorize the technicians into three categories as like thethree categories of the PMS report. This categorization allows the branch to evaluateand measure weekly the technicians output and provide a guided figure as for the nextweek target for improving, motivating, supporting, and controlling the technicians.  Monthly reports:As the quality process block diagram shows that each step is monitored and evaluatedby a monthly report and all these reports are to be submitted to the Branch managerthe first Monday of each month by the following: 1- Maintenance monthly report;This report evaluate and measure Technicians performance. 2- PMS monthly report;This report evaluates and measure PMS performance. 3- Commercial and Public Relation monthly report;This report evaluates and measure lines requested, average revenue, vehiclesconditions, and occupation licenses of the locations. 4- Cleaning quality and booth maintenance monthly report;This report is to evaluate and measure cleaning and booth maintenance quality (basedon sampling methods). 5- Production monthly report;This report is to evaluate and measure availability of booths and payphones spareparts, changed cables, and booths. 6- Customer service monthly report;This report is to evaluate and measure customer satisfaction (feedback, complains,new request, and awareness clarification).All these reports and the monthly comments of the Branch manager is the monthlyBranch meeting subject in which the global branch performance is communicated andanalyzed among the meeting attendances(the concerned staff ).EMBA CairoRennes International School of Business 13

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