Expert answer:Operations Management Almarai Company
Solved by verified expert:Almarai is the largest dairy company in the Middle East. Imagine that the company wishes to expand to a new location. What process type would be best for Almarai and why: job shop, batch, repetitive, continuous, or project?Embed course material concepts, principles, and theories, which require supporting citations along with at least one scholarly, peer-reviewed reference in supporting your answer unless the discussion calls for more. Attached are some of the answers of other students1 page
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Answer 1
Business growth and expansion are always good unless it happens too quickly. Indeed,
rapid, uncontrolled business expansion can have negative repercussions in the short and the longrun. However, small businesses and large corporations can reap the benefits of expanding
operations into a new location like increasing the business profits (Warren, 2017). The expansion
process is a significant step that takes time and requires careful planning in order to succeed.
Accordingly, this article will identify what is the process type that would be best for Almarai
Company and why in case if the company wishes to expand to a new location.
Indeed, the process selection decision will be based on the way of production of the
goods and services. According to Stevenson (2014), there are five basic process types that
include job shop, batch, repetitive, continuous, and project. The job shop refers to the operation
on the relativity small scale and having skilled workers is important in the job shop. The batch
process is used a moderate value of the goods or services are desired. Also, the skill of the
worker is low due to the less variety in the job such as movie theaters or bakery. The repetitive
process is used when higher volumes of more standardized goods and services are needed and
the skill of workers is low in this process (Stevenson, 2017). The continuous process is used
when a very high volume of non-discrete and highly standardized output is desired. Lastly, the
project process is used for non-routine work with a unique set of goals to be achieved within a
specific time such as publishing a book.
Almarai Company is the largest company in the dairy products industry in the in the
Middle East. Almarai Company has a great reputation in terms of producing quality foods such
as dairy products, poultry products, and infant formula that is made affordable by anyone
encompassing all status of life (Almarai, 2017a). Almarai products are non-discrete products
such as dairy liquids and food, which requires a continuous process. The continuous process is
more suitable for Almarai because of the way of production in terms of a very high volume of
non-discrete, as well as highly standardized output (Stevenson, 2014). More so, the continuous
process produces a homogenous flow of non-discrete products that fit company production.
Almarai production is characterized by flow-continuous, no need for equipment flexibility, no
variety in output, and low variable cost. In addition to, high volume, and low worker skill that
can be range from low to high, which reflects the continuous process as the best process for
Almarai.
Finally, business growth and expansion is a significant step in the business world.
However, this step requires a clear understanding of the company products as well as careful
planning in order to succeed. Moreover, there are five basic process types that include job shop,
batch, repetitive, continuous, and project. Indeed, the continuous process is more suitable for
Almarai according to the way of production. It is very important to select the process according
to the company production because failure to do so will lead to inefficiencies, higher cost as well
as creating a competitive disadvantage.
References
Almarai. (2017a). A proud heritage, a positive future and a relentless commitment to quality.
Retrieved from https://www.almarai.com/en/about/history
Stevenson, W. (2014). Operations management (12th ed.). New York, NY: McGraw-Hill Irwin.
Warren, W. (2017). Coordination of entrepreneurial growth methods and business retention and
expansion outreach. Community Development, 48(2), 187-20.
doi:10.1080/15575330.2017.1288148
Answer 2
Process Selection
Process selection refers to deciding on the way production of goods or services will be
organized (Stevenson, 2015). It has major implications for capacity planning, layout of facilities,
equipment, and design of work systems. Process selection occurs as a matter of course when new
products or services are being planned. However, it also occurs periodically due to technological
changes in products or equipment, as well as competitive pressures. Forecasts, product and
service design, and technological considerations all influence capacity planning and process
selection. Moreover, capacity and process selection are interrelated, and are often done in
concert. They, in turn, affect facility and equipment choices, layout, and work design (Stevenson,
2015).
Almarai Company
Almarai Company (Almarai) is a vertically integrated dairy company. Its product portfolio
includes dairy liquids, foods, juices, yoghurts, cheeses, fresh chicken parts, breads, burgers buns,
sandwich rolls, puffs, croissants, wafer, cake bars and infant formulas (Almarai company :
Consumer packaged goods – company profile, SWOT & financial analysis, 2016). The company
sells these products under various brands including Almarai, Alyoum, L’usine, 7Days and
Nuralac. Almarai also involved in dairy farming, arable farming and poultry farming in Saudi
Arabia, Jordan, Argentina, Ukraine, and the US. It operates manufacturing plants in Kingdom of
Saudi Arabia, Jordan and Egypt. The company’s transport and logistics office is located in Saudi
Arabia, GCC, Jordan and Egypt. Almarai is headquartered in Riyadh, Saudi Arabia (Almarai
company : Consumer packaged goods – company profile, SWOT & financial analysis, 2016).
Continuous Process Type
Almaria company produces highly standardized goods, so, continuous process type is
used. When a very high volume of nondiscrete, highly standardized output is desired, a
continuous system is used (Stevenson, 2015). These systems have almost no variety in output
and, hence, no need for equipment flexibility. Workers’ skill requirements can range from low to
high, depending on the complexity of the system and the expertise workers need. Generally, if
equipment is highly specialized, worker skills can be lower. Examples of nondiscrete products
made in continuous systems include petroleum products, steel, sugar, flour, and salt. Continuous
services include air monitoring, supplying electricity to homes and businesses, and the Internet
(Stevenson, 2015). Like any computational model, these continuous/discrete models are
subjected to uncertainties (Cunha & Sampaio, 2015). These uncertainties are due to the
variability of the model parameters (physical constants, geometry, etc), and mainly due to the
possible inaccuracies committed in the model conception (Cunha & Sampaio, 2015).
In conclusion, it is clear that the project selection process is time-consuming, but it is
absolutely essential for project management success. It is always best to have a good plan from
the beginning, with a list of criteria to be considered (Oueslati, 2016). This guides the Senior
Project Manager through the entire selection process and also ensures that the right choices are
made. Organizations will achieve their goals by conducting the right projects. But it is only
through an effcient selection process that they can choose and support those able to best
contribute to the objectives of their strategy . So, the effcient selection of projects is decisive for
organizations success (Oueslati, 2016).
References:
Almarai company : Consumer packaged goods – company profile, SWOT & financial
analysis. (2016). Basingstoke: Progressive Digital Media. Retrieved from https://searchproquest-com.sdl.idm.oclc.org/docview/1850338662?accountid=142908
Cunha, A., & Sampaio, R. (2015). On the nonlinear stochastic dynamics of a continuous system
with discrete attached elements. Applied Mathematical Modelling, 39(2), 809819. doi:10.1016/j.apm.2014.07.012
Oueslati, A. (2016). The added value of the project selection process. Journal of
Defense Resources Management, 7(1), 75.
Stevenson, W. J. (2015). Operations Management (12th ed.). McGraw-Hill Education. 978-0-07802410-8
Answer 3
Almarai is the leading food and beverage production and distribution company in the
Middle East and the largest vertically integrated dairy company in the world. Since the
establishment of our company in 1977, Almarai brand has become a synonym for quality among
consumers throughout the region. We live and work every day with the slogan “Quality deserves
trust”. Quality culture is embedded throughout the company. This culture begins with the
strategic decision of the board of directors and senior management and extends to the company’s
operations in agriculture, manufacturing and distribution, and is an integral part of developing
the professional skills of our employees. We also expect a lot from our suppliers and distributors,
and we apply strict quality control standards in all our purchasing transactions.
Our Activities
Headquartered in Riyadh, Saudi Arabia, the company offers five major products in the
Middle East and North Africa region: dairy products, juices, bakery products, poultry and infant
formula. We work in Egypt and Jordan through our joint venture «International Company for
Dairy and Juice» (IDJ) for the manufacture of dairy products and juices. In addition to the
company’s main bakery sector, Almarai manages its operations through our joint venture,
Modern Foodstuff Company (MFI) to manufacture the Seven Day brand products.Today, the
paid up capital of Almarai is 8 billion Saudi Riyals, divided into 800 million shares at a nominal
value of SR 10 per share. The number of free and available shares at the end of 2016 reached 290
million shares representing 36.3% of the total issued shares. At 31 December 2016, the market
value of Almarai was SAR 54.8 billion. (Almarai,2016)
An overview of the company’s strategy
Almarai is the largest food and beverage manufacturer in the Middle East and seeks to
provide high quality food and beverage and high nutritional value that enriches the lives of
everyday consumers. Through its constant focus on meeting the highest standards of quality,
Almarai has become the preferred choice for consumers to deliver products that meet their needs.
Almarai maintains its leadership in the market in its various product categories due to its interest
in consumers’ views on the one hand and its commitment to providing quality products and
services on the other. (Best, 2014)
Almarai vision 2021 m
Almarai ‘s five – year plan from 2017 to 2021 reflects recent regional and global
economic developments, as well as the impact of Saudi Arabia’ s Vision 2030 programs.
According to Best (2014) the features of the master plan focus on adjusting operational costs and
maximizing the utilization of available resources. As a result, capital investment for the period
from 2017 to 2021 is expected to reach SR 14.5 billion. The focus will be on replacing part of
existing assets, raising productive capacities and capacities in farms, manufacturing, distribution
and transport facilities, expanding geographical spread and enhancing innovation capabilities
And product development. The investment program will be financed from cash flows from
operating activities. The company will also utilize available financial resources through banks,
Saudi Industrial Development Fund, Agricultural Development Fund and Sukuk programs. By
the end of 2021, this plan will provide 4,500 job opportunities for Saudi nationals, 20% of which
are for female citizens, in recognition of the company’s unique economic and social role in the
food and beverage sector in the Kingdom. (Best, 2014)
Consumer is the core of our attention
Almarai focuses its efforts on continuous improvement and diversification of its products
in the various categories it offers. This is achieved through the adoption of rigorous and rigorous
R & D and quality assurance process, ensuring that our dairy products, juices, baked goods,
poultry and infant milk are manufactured and developed. To meet their specific needs. Accurate
analysis and measurement of customer expectations is a key element of our product development
strategy. (Almarai, 2016)
supply chain management
Vertical integration requires meeting or exceeding the stringent quality standards adopted
by Almarai at every stage of the work. From this point of view, high quality components are
imported from around the world and transported to advanced manufacturing facilities in Saudi
Arabia, Egypt, and the Kingdom of Jordan. The company imports 1.5 million tonnes of feed
annually, mostly from its own farms around the world. These farms are run on the basis of
international best practices, ensuring the highest quality of feed for cattle and poultry in our
farms. (Best, 2014)
Growth and expansion
Almarai is committed to achieving continuous growth in its various product categories
and expanding to cover the entire region. In 2016, the company continued to achieve growth in
sales across all major product categories and in the International Dairy and Juice Company in
Egypt and the Kingdom of Jordan. The expansion of the geographical spread since the
company’s incorporation into the Saudi Stock Exchange (Tadawul) in 2005 has contributed to
reducing the Company’s dependence on the Saudi market sales, while the diversification of
products has contributed to reducing reliance on dairy products. The gains from innovation and
efficiency will result in a stronger cash flow and improved working capital management to
support capital expenditures for future growth. (Almarai, 2016)
Referance
Almarai Company. (2016). Fort Mill: Mergent. Retrieved from https://search-proquestcom.sdl.idm.oclc.org/docview/1824879750?accountid=142908
Best, D. (2014). Management briefing: FMCG in the middle east: FMCG in the middle east:
Profile – almarai. (). Bromsgrove: Aroq Limited. Retrieved from https://search-proquestcom.sdl.idm.oclc.org/docview/1546570442?accountid=142908
Almarai company : Consumer packaged goods – company profile, SWOT & financial
analysis. (2016). (). Basingstoke: Progressive Digital Media. Retrieved from https://searchproquest-com.sdl.idm.oclc.org/docview/1820065316?accountid=142908
Answer 4
Each business has a process that suits its type of production. Thus, distinguishing
between process types is important to select the suitable one. There are five types of processes
that are job shop, batch, repetitive, continuous, and project. Thus, this article will study
Almarai’s case and match it with the suitable process. However, it will start by defining each
process type.
As said previously, there are five types of processes that are job shop, batch, repetitive,
continuous, and project. Stevenson (2014) defined each process clearly. Job shop process is
suitable for small-scale and high-variety of goods or services that need for skilled workers. Batch
is suitable for the moderate volume and variety of services or goods that need for less-skilled
workers than those in a job shop process. Repetitive is required when higher volumes of more
standardized goods and services are produced. The workers’ skills are usually low (Stevenson,
2014). Continuous process is suitable for a high volume of non-discrete products. The skills of
workers can be various high and low. Project process fits with nonroutine works and its workers’
skills also range from low to high (Stevenson, 2014). Thus, each process has different criteria.
Sometimes the volume of the production changes is affected by the life cycles, thus the business
manager may need to change from one process to another. This shift may affect also the cost.
The increases in the volume lead to shift the process from batch mode to repetitive operation and
thus reduce the cost further (Dahlgren, Göçmen, Lackner, & van Ryzin, 2013; Stevenson, 2014).
Therefore, it is significant for industries to find out the most suitable process to generate more
profit.
Almarai company is one of the companies that produce the non-discrete products because
it produces milk and other dairy goods (Almarai, 2017). Non-discrete products are the
homogenous goods that are produced by process industries. The quality and composition of these
products cannot be evaluated by eyesight (Stindt & Sahamie, 2014). For example, milk is a
homogenous product and cannot be evaluated by eyesight. Almarai usually produce dairy
products in large volume as its products are seen in every store. Thus, the suitable process type is
the continuous process. However, because Almarai wishes to expand to a new location, the
volume of the production must be considered. As Stevenson (2014) state, the life cycles affect
the volume of products that begin with low volume and increase gradually. Thus, in the new
branch, the production may start with low volume as it is in the first period of the life cycle.
Therefore, the suitable process will be the Job shop process because it is suitable for a small
scale. Using the continuous process with the low volume will cause higher than necessary cost or
lost opportunities (Stevenson, 2014). Therefore, the volume of production in the new branch is
the determinant of the suitable process. However, if the discussion about the main branch
process, then Almarai must use the continuous process as it may supply the new branch with the
products.
Finally, this article discussed the process types then studied Almarai’s case and matched
it with the suitable process. There are five process types that are job shop, batch, repetitive,
continuous, and project. Each process has specific criteria. The volume and type of Almarai’s
products were suitable for the continues process. However, the wish to expand created two cases.
If the production meant to start in the new branch, the products’ volume would be small and thus
the suitable process would be job shop. On the other hand, if the production meant to be in the
main branch to support the new one, then the suitable process would be the continues process.
References
Dahlgren, E., Göçmen, C., Lackner, K., & van Ryzin, G. (2013). Small modular
infrastructure. The Engineering Economist, 58(4), 231-264.
doi:10.1080/0013791X.2013.825038
Stevenson, W. (2014). Operations management (12th ed.). New York, NY: McGraw-Hill Irwin.
Stindt, D., & Sahamie, R. (2014). Review of research on closed loop supply chain management
in the process industry. Flexible Services and Manufacturing Journal, 26(1), 268-293.
doi:10.1007/s10696-012-9137-4
Almarai. (2017). Almarai Products. Retrieved from https://www.almarai.com/en/brands/almarai
…
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