Meeting Operations Management Challenges Lovely Detergents Ltd was set up in 1967, just before independence. The factory was situated in the industrial Zone, Coromandel. This location has several benefits. The equipment were imported from India and assembled under the supervision of Mr Shah, a soap technologist from the prestigious Institute of Chemical Technology, Bombay. The operators were all obtained from the surrounding region. The production of soaps is a complex process. The first step is the saponification process.

Sheep fat or tallow was imported from Australia and stored in large tanks, situated at Mer Rouge. The tallow was transported by trucks and stored in smaller tanks at the factory's site at Coromandel. The fat was boiled with sodium hydroxide in stainless steel vessels, whereby the fats were hydrolysed to the sodium salt of fatty acids (soap) and glycerine. The glycerine was a valuable by-product, which was recovered through a drainage pipe at the bottom of the kettle. It was stored in drums and exported to India to be used in the manufacture of cosmetics. The soap, thus produced, was unrefined and was referred to as soap noodles. After production of one lot the whole process was repeated using the same equipment. The raw soap needed further processing before it was converted to hard-built soap (washing soap) and toilet soap. At this time there were two production lines, each producing one type of soap. The raw soap was mixed with perfume and colour and compressed into soap cakes of different sizes. The compression of soap cakes required minimum human intervention and thus can be considered to be capital intensive. Capacity utilization was critical. The Mauritian market being small, the organisation prospected the regional market and succeeded in obtaining lucrative orders from Madagascar and the Seychelles.

Thus, the organisation could optimize capacity utilization to a certain extent. Quality control was performed at different stages. The soap noodles were analysed in the laboratory by a chemist. Samples of soap cakes were weighed and also tested. Customers were becoming more demanding. The organisation had recourse to a consultant in order to enable the development and implementation of a quality plan. The organisation obtained the product certification mark licence from the Mauritius Standards Bureau in June 1978. In 1986 a competitor started operation. This competitor imported palmitate soap noodles from Malaysia. This was of plant origin and was hence cheaper. The finished product offered was less expensive. Lovely Detergents Ltd had to review its whole manufacturing process. It started importing soap noodles in order to produce soap of plant origin. It could thus compete better. It had two systems which ran in parallel: the one using imported palmitate and the other one producing soap by the original saponification process. With the rise in the price of petroleum, Malaysia started experimenting with the use of palm oil as a source of fuel in cars. As a result less palm oil was devoted to the production of palmitate noodles.

The price of palmitate noodles rose dramatically. Lovely Detergents Ltd had to search for alternative sources of its main raw material. It succeeded in finding a reliable supplier in Vietnam. At the turn of the century cheap products started flooding the Mauritian market from South-East. The organization reviewed its marketing strategy. At this time the tourism industry was fast developing and the hotels were asking for own-label soaps. The company invested in new equipment and started producing soaps for hotels. Within a short period it became a market leader in this category of soaps. It is also tapping the hotel industry in South Africa and Seychelles. The marketing team was strengthened, with the recruitment of a marketing manager and additional sales people. Training in customer care was organized for the whole sales force. Further the whole distribution strategy was reviewed. The organisation developed fruitful partnerships with the main hyper markets of the island.

Change is a constant phenomenon in the consumer market. With the rise in standard of living of the Mauritian population, the use of washing powders and other cleaning products rose. The organization started to manufacture washing powders and liquid detergent. It also produced scouring powder, bleach and other cleaning materials. It obtained the product certification mark MS 50 for scouring powder and MS 78 for bleach. The organization also implemented ISO 9001: 2015 Quality Management System. This enables the organization to obtain several benefits offered by the standard. Lovely Detergents Ltd has been able to meet the various operations management challenges, hence ensuring its success.

Question 1:

(i) Discuss four external factors which have impacted on the organisation. For each factor, discuss the response (8 marks)

(ii) Discuss the importance of capacity utilization in such a plant. (3 marks)

(iii) What strategy could the organization have adopted to optimize capacity utilization? . (3 marks)

Identify the type of production system(jobbing/continuous/batch processing) used in the saponification process, justifying your answer. (2 marks)

(iv)Discuss the characteristics of this production system.

please refer to cast study, then give answers.

shall upvote as always!!!