Assessing the Operation Management Problem

Background information: Pepsi

Pepsi is a beverage manufacturing company which is located in the United Kingdom; it has an established brand of the beverage Pepsi which is known for its taste as well as the highest level of quality. It is also the latest brand which entered the market recently and has continued to increase the percentage of its market share at large (Krajeswki 3).

Identification of the Specific Problem and its Root Cause:

According to the high level of the companies’ success and major achievements, Pepsi is believed to be one of the most trusted brands in the world and ranked second after the Coca-Cola Company in terms of soft drinks production and performance. The company has been able to achieve this level of success out of the fact that it has over time deployed strategic forms of planning as well as applying the most current marketing techniques. However, this level of success almost came down when news agencies all over the globe indicated that there was a decrease in the level of the quality for the Pepsi Cadbury product. It was reported that Pepsi’s product was contaminated with high levels of pesticides and the operation department was put on the limelight for its failure to contain the matter. These setbacks lead to not only loss of revenue but also loss of loyal customers (Krajeswki 6).

The setback was so adamant that some countries denied Pepsi products from entering their consumer beverage market. The root of the problem is believed to have developed through the processes which existed within the company at large. The various processes taking place within the company include: firstly, the manufacturing department where the ingredients used in making the soft drinks are mixed and the formula for Cadbury Pepsi determined. The ingredients used in making this soft drink include the vanilla beans, flavors, nuts (Kola nuts), and sweetened sugar. After the products are manufactured, there is a department which is mandated with the transfer of the Pepsi Cadbury product into the packaging warehouses. Utmost level of care is undertaken to prevent any chemicals from mixing with the formula which has been manufactured in the manufacturing department. The subsequent stage after the transfer process leads to the packaging department where the Cadbury is packaged into cans and afterwards into cartoons and is later transferred to the storage department. While packaging the product, it is handled with utmost level of care so that the caps are fitted tightly never to allow any form of leakages.

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At the storage processing stage, the packaged Cadbury is stored in warehouses awaiting transportation. It is also believed that this stage could have been the root cause of the problem since it is stipulated that rats and other insects walked over the cans and hence, it might have brought the Cadbury product into a vulnerable contact with the impurities. Despite the fact that it was somehow difficult to establish the exact location or rather stage at which these impurities polluted the beverage, damage was already done and the only way which was left to curb the situation was allowing for the minimization of losses which were brought about as a result of the unfortunate occurrence.

Analysis of the Problem, Identification of the Possible Alternatives &Analysis for Each Alternative:

It is believed that when problems facing the Pepsi Cadbury Company are listed down in a way which will provide easy comprehension, then the process of analyzing the exact problem becomes easier to look at (Cleland 17-23).

The problem at hand is the contamination of the Cadbury Product (produced by the Pepsi Company) by impurities, specifically pesticides. In the analyzing process, the problem at hand is expected to be broken down into the different components whereby impurities might have taken form. It should be noted that the analyzing process is somehow similar to the identification of the root cause only that in the identification of the root cause general processes are covered while analyzing of the problem specific processes are determined and evaluated. This analysis will take the traditional approach of the Total Quality Management as well as incorporate elements of the Fishbone Diagram approach in order to analyze the situation at hand. The essence of combining these two approaches is for the mere fact that the Pepsi case had to be analyzed in a way which allowed for inclusion of the specific probable causes as well as the provision for alternatives on the same issue.

In the first stage (the manufacturing stage), the problem might have arisen when the ingredients were being mixed together to come up with the formula of Pepsi. This stage is believed to be the most vulnerable stage of the production process. It is required that a maximum amount of supervision is placed in position since whenever the requirement is neglected, then a probable mixture of the pesticides and the formula can take place without the knowledge of the supervisors heading the department. The possible alternative for this stage is to ensure that the quality of the formula leaving for packaging department is high. The only way possible that could have been used in deploying this strategy was mandating the highest level of personnel to oversee the processes and letting go of careless staff. In the second stage of production which involves the transfer of the Pepsi formula into the packaging department, pesticides are believed to have found its way into the formula since the act of transporting the formula exposes it to those impurities thereby present within the company. An alternative way which could have been deployed to curb this misfortunate was to reduce the distance covered in transporting the formula by either scrapping off the stage or incorporating it with the manufacturing process altogether (Krajeswki 18).

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In the packaging department, the formula is packed into cans and later into cartoons ready for storage. It is logical to say that, at this stage, the formula might have come into contact with the impurities first hand. This is possible when the level of staff in the department is reduced greatly with a move to minimize the level of expenses incurred during production. The few and overworked staff are implicated to have lapsed on there work so that tiredness lead to the carelessness in the packaging of the formula. The alternative which best suited to curb the situation at hand was to improve on the number of staff altogether. A company with the acceptable number of staff especially in the production processes increases its level of production as shifts allow employees to relieve themselves of boredom and monotony. It is also believed that the carelessness at the storage department might have caused the company the trouble as media reports indicated that it was while at the storage facility whereby the contamination took place since rats and other insects were perceived walking over the packaged products.

It is also stipulated that the storage department kept pesticides which it used in preventing rodents and other insecticides from getting their way into the cartons; however, there is a probabilistic theory which indicates that the pesticides were mishandled thereby contaminating the stored Cadbury product. The alternative which would have been deployed to curb this particular situation was to either increase the spacing used for storage purposes or to ensure that thorough quality checks are conducted each day in order to prevent any form of contamination whatsoever. This is because rodents only breed and develop in spaces which have no access to fresh air. Getting to have a team deployed to conduct routine checkups might have been costly, but it was an alternative worth to consider as it could have saved the company lots of revenue.

There was also the issue of water which was used to dilute the formula. It is argued that the water from the ground might have been contaminated way before usage. Despite the fact that Pepsi Company boosted its capability of using distilled water in the place of purified water, it was highly evident that this requirement was neglected. The alternative to this probable cause of impurities could have been employed preventing the technologically-viable machines that were to be used to distil water as it was claimed by the Company officials. It is also a believable fact that Pepsi storage facility was of sub-standard quality. This implies that the stored product might have reacted with the cold temperatures as well as the unacceptable level of humidity which is basically a favorable temperature for which microbes breed. The final probable cause which might have lead to the operational problem at hand is the negligence or rather ignorance Pepsi had in not training its staff in matters concerning quality management. If at all the senior-most management was stern about providing the consumer market with quality products, then it could have facilitated work settings whereby staff was to be trained on the importance of ensuring quality in all the processes concerning the production process at large.

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Recommended Solutions with Basic Reasons:

Firstly, it is true to indicate that the major part of the operation problem was as a result of negligence on the part of employees. The fact that they did not comprehend on the importance of maintaining favorable environmental settings in the storage and manufacturing of the product exposed the company to great levels of vulnerability. The recommendation for this problem is that the management must ensure that their respective staff is well trained before they are assigned their respective tasks in the production process. Secondly, the company should have ensured that the machines which they use are of standard quality and hygienic at all times. The company should also understand that the products produced are consumable and, therefore, the hygiene in the company should be set at a high level altogether. In order to curb the highest levels of poor quality products, the senior most management are obligated to formulate quality check departments whereby the products manufactured are passed through thorough quality check before release into the consumer market. The management should be held accountable whenever products of poor quality are left to reach the consumers. Fourthly, it is a wise recommendation to have the management analyze the different scenarios affecting an organization and make sure that these organizations are never affected by unnecessary loopholes. The management should be held responsible for identifying the loopholes and, in turn, eliminate them at the soonest time possible.

Improved solutions to the above recommendations that include the following: firstly, the storage facilities are affected with standard machines to regulate temperature, and then the machines should be maintained at the highest level possible with routine checks conducted to ensure that any fault is detected whenever it arises. Whenever temperatures are maintained at favorable level, the management is mandated to ensure that the situation is kept at bay and stringent measures are put to deter employees from unnecessary carelessness. Immediate sacking of inattentive employees will act towards bringing the situation at par with the requirements. In doing all this, the company is assured of quality products and increased revenue (Chase 32). However, my position on this case study can be challenged by the fact that the problems could have been instigated by Riemann way of discussing arguments and conclusion of the majority opinion so that the outcomes of the problems arose out of the fact that the instructions for performing checks ups in the manufacturing company were deficient and therefore the mistake arose without any prior knowledge of the employees. Another scenario which might have led to the resultant problem is as explained by Dolinko retributive argument of fairness whereby

The problem is related to specific types of facets so that there are problems which are internally-instigated and those which are externally-instigated. In this case it is wise to indicate that almost all of the problems are internally-instigated since the manufacturing employees are retributive to the instructions given, the results being carelessness which allows intrusion of impurities into the finished product.

In conclusion, it will be wise to indicate that although operation management problems sometimes cost companies lots of revenue, they provides a channel through which the awakening of the management is reached so that the correct methodologies are implemented in order to increase the level of productivity of the company as a whole.