Operation Management

Operational Challenges and Solutions

Supplier Issues and Mitigation Strategies

Initial Challenge: Supplier Shortages

• The primary operational challenge discussed is dealing with supplier shortages.

• When a supplier faces a shortage of goods, it creates tension and impacts production.

Solution: Diversifying Suppliers

• To address supplier shortages, the immediate action taken is to find alternative suppliers.

• This strategy of diversifying suppliers is crucial in mitigating risks associated with relying on a single source.

Supply Chain Management and Risk Mitigation

• The company emphasizes a relationship with WIRK as a trusted supplier.

• A key strategy is having a backup plan to prevent out-of-stock (OBR) situations.

Proactive Measures: Multiple Suppliers

• The company maintains relationships with multiple suppliers (more than 10 currently) to avoid over-reliance on any single supplier.

• This approach aims to proactively minimize disruptions caused by individual supplier issues.