Operation and quality management

To help you to start a toy manufacturing company , we strongly believe that Operation management and quality management is a very important factor, and could not be neglected in your management system. In order to prove this point, we will set out the overall impact as the beginning.
With the rise of the service sector, the concept of the further expansion of production, and gradually to accommodate the non-manufacturing service sector, including not only the manufacture of tangible products, but also include intangible services. The implementation of effective operations management is increasingly. Faced with such pressure, quality management become indispensable.
So firstly we should understand that the goal of the Quality Management program(QMP) is to establish leadership structure throughout the path of quality workflow that enables merry toy manufacturing company to provide high quality services. We are designed to promote quality and child’s entertainment and safety and also operations efficiency through process strategy,quality management, inventory management and supply chain management
Quality management
Business profile:
Merry is a toy manufacturing company. It deals with the production and sales of various toys. As we all know, children related consumption is a good gold digging point, thus it’s certain that many businesses go for it. Toy industry is one of the competitive battlefields.
There are mainly three components of quality management: quality control, quality assurance and quality improvement. Most of us would take the simple view that quality management is just concerned with product quality. In fact, that’s not complete. Quality management also deals with the control of manufacturing process. For the company whose dominant business is the manufacturing and selling of products, like Merry, quality management is especially important. High-quality product is the most basic thing your company should focus on to achieve an outstanding performance.
When it comes to quality management, the most classic case could be Six Sigma Methodology. Sigma is the standard deviation used in statistics. Six Sigma is a management approach near perfection, demanding that there must be less than 3.4 defective products or processes per million units. A number of world-class international corporations, like Motorola, Citigroup, Ford, Kodak and General Electric, once employed Six Sigma to keep their leading position in industry. The widely used management methodology characterizes in the following aspects:

  1. It highlights the customer demand and always treats it as the main breakthrough point.
  2. It emphasizes the measurement of performance and processes. Based on these, the company comes up with more challenging goals.
  3. It provides specific performance improving methods for specific purposes and fields.
  4. It owns a group of trained professionals in its implementation to guarantee the effect.
  5. It defines the standard and measurement of success as well as the rewarding methods to employees participating in the accomplishment.
  6. It breaks the barriers between different departments.

All of us know Jack Welch and General Electronic. In the mid and later years of 1990’s, Jack Welch became a loyal seeker of Six Sigma Management. This led to GE’s great success and the whole world’s eyes.
Actually, quality management has many classic theories besides Six Sigma, like PDCA Cycle (Plan-Do-Check-Action) and Total Quality Management. They have been raised and being used universally in today’s society. Those successful stories can give you some experience on the quality management. In the daily operation of your toy company, you can borrow and use it.
Process strategy
Business profile:
Merry is a toy manufacturing company. It deals with the production and sales of various toys. As we all know, children related consumption is a good gold digging point, thus it’s certain that many businesses go for it. Toy industry is one of the competitive battlefields.
To obtain an advantage over the rivals, process strategy and supply chain management are vital.
Process strategy is to figure out the way of doing right things to improve the productivity or efficiency. After recognition of a better process, the existing process can be optimized to achieve a much more satisfying performance. Let’s take an automobile manufacturing factory as an example. With rapid development, its scale and labour had increased a lot yet no change in management system. So a bottleneck occurred. Under the guidance of experts, the company began to realize the problems and optimize its process, including standardization of process instead of process mess among different departments, process function reinforcement instead of useless form, process supervision instead of ignorance of the implementation. The adoption of these process strategies did give much vigour to the company: the production had been soaring; what’s more, the employees had been more disciplined and organized. This example tells how the process strategy can help us make a breakthrough and yield twice the result with half the effort. Besides those measures, process strategy also includes process restructuring, process cutting and process control etc. In reality, most manufacturers neglect the importance of process optimization. They put all their emphasis on the equipment or technology. I hope your toy factory will draw a lesson from it. After all for a manufacturing factory, production is the top priority needed to be dealt with and is a critical competitive point. You will benefit a lot to take process strategy into consideration in the production of toys.
Supply chain management
According to Tom McGuffog, Supply Chain Management (SCM) is "Maximizing added value and reducing total cost across the entire trading process through focusing on speed and certainty of response to the market." Supply chain is so complicated a system that it needs efficient coordination and management. Huge invisible profits are hidden between every two chains. The purpose of SCM is to squeeze out those profits continuously. To understand this more vividly, I’d like to employ the most classic case Wal-Mart. As the global number one retail business, Wal-Mart’s SCM consists of four parts:
Customer demand management: All businesses know the motto “customer is God”. Only stick to our commitments to customers can we make the most profits. High quality products and high standard services are the basic things we should do.
Supplier and partner management: Wal-Mart has established strategic relationship with P&G. It provides P&G with plenty of room to demonstrate itself freely; it uses P&G’s fame to popularize itself. They are digging potential mutual benefits instead of grabbing the existing cake.
Inner-company and between-company logistics management: Wal-Mart established its own logistic system to guarantee most efficient and instant delivery. Marching with technology, the system has realized automation. 
Information communication based on internet or intranet: Wal-Mart is the first retail business to launch a communication satellite. With the help of the satellite, Wal-Mart makes delivery keep the same pace with sales.
Maybe you can learn from the success of Wal-Mart and stress the importance of SCM. The key point of SCM lies in close relationships and cooperation between upstream and downstream companies. For your toy factory, for example, you can consider carefully the best location of factory for the convenience of delivery to your downstream customers. Also, you can design a customer feedback system to understand the customer’s real demand and comment at the first time.
We can see both process strategy and supply chain management are scientific approaches to achieve the effect of Pareto Optimality.
Inventory Management
Inventory management, the planning and controlling of inventories in order to meet the organization, is an important concern for managers in all types of businesses. Inventories are important to all types of organizations, their employees, and their supply chains. Inventories profoundly affect everyday operations because they must be counted, paid for, used in operations, used to satisfy customers, and managed. Nonetheless, companies realize that the availability of products is a key selling point in many markets and downright critical in many more.
Certainly, too much inventory on hand reduces profitability, and too little inventory on hand creates shortages in the supply chain and ultimately damages customer confidence. In this respect, Merry does very well. Despite the many changes that company goes through, the basic principles of inventory management remain the same. Some of the new approaches and techniques are wrapped in new terminology, but the underlying principles for accomplishing good inventory management has not changed. Its inventory management designed to meet the dictates of the marketplace and support the company's strategic plan.
The company of Merry uses J-I-T (just in time) and J-I-C (just in case) systems. The company provides the products what does customer want and when does customer want. Merry provides the products in time and in case. So, it decides that Merry should have a good inventory management. The inventory management system provides information to efficiently manage the flow of materials, effectively utilize people and equipment, coordinate internal activities, and communicate with customers. Inventory management does not make decisions or manage operations; they provide the information to managers who make more accurate and timely decisions to manage their operations. 
So, many customers always like Merry! This good inventory management makes the company get more benefits and more money. Because of this Merry can be so development! It shows that how important the inventory management is!
Overall, good inventory management to meet the market domination and support the company's strategic plan. Good supply chain management  to required the right product (Right Product) can be at the right time (Right time), in accordance with the correct amount of (Right Quantity), the right quality (Right Quality) and the correct state (Right Status) to the right place (Right Place), therefore, to increase the enterprise competitiveness. Good process strategy can be optimized to achieve a much more satisfying performance and improve the productivity or efficiency. Good quality management ensure product quality and increase core capability of enterprise. To bulit a good operation and quality management is a good foundation for business success.

  1. T McGuffog, N Wadsley, (1999) “The general principles of value chain management”.
  2. R Wilding, (1998), “The supply chain complexity triangle: uncertainty generation in the supply chain”.

             P Trkman, MI Stemberger, (2005), “Information transfer in supply chain management”.