The Application Of Selected Company Business Essay
Eltis Sdn Bhd(ELTIS) was established in year 2000 .They own three warehouse, one is located in china, Guangzhou, the other two located in Puchong, Kuala Lumpur, Malaysia.
Their business partner is Diamond pavilion, Courier Company, which help them transit the goods from China to Malaysia, and handle the custom matters. They have collaborated since ELTIS established.
The mission of the company is to invest in their people to deliver beyond satisfaction to our customer, stakeholders and themselves. The vision of the company is to be the BEST by ensuring that the customer is at the centre of everything we do.
ELTIS specialized in handling break bulk and dry commodities, with the cooperation and confidence relationship with their business partner. By growing in dry and break bulk commodities industries, they believe that provide a good and on the spot services is the criteria to success.
Moreover, ELTIS’s principal activity is providing express delivery services in time between locations. The main line of the business is from china ships to Malaysia. Generally, they handle more goods in KL area, in rest of the place in Malaysia, they normally outsource to other company.
2.0 Company operation process and facility layout
2.1 Company operation process
Process 1 (Diagram refer to appendix 1 note 1)
Local customer will contact ELTIS when they need the service provided by ELTIS. Customer will contact ELTIS through phone or face to face ask for the quotation, customer will let ELTIS know how many goods there going to send, and characteristic of the goods.
Normally the price is calculated based on the goods volume, 1 M3 is between RM280 to RM350. If the weight of goods bigger than goods volume (for example, car engine only consumer small volume but heavy), then will calculate based tons, 1 tons is RM350. The price will change based on market prices. If the goods is time sensitive (for example, fruit or vegetable) the goods will be process in different way, refrigerators will be use to keep the goods, the customer need to pay for the refrigerator, the price is RM1200, and go through other common process but the time period consume one week only. The firm claims that generally the goods is dry and break bulk commodities, seldom they received time sensitive goods order.
After the firm received the request, the firm will quote a good price and reply to the customer within one day. If customer satisfied with the prices, ELTIS will give customer warehouse addressee in order to let customer inform their supplier, send their goods to ELTIS’s warehouse in china, Guangzhou. Supplier in term of people who provide goods to our customer who required service form ELTIS.
After the goods reach ELTIS’s china warehouse, they will pack the goods and loading to container, normally consume one week. Between, one container will has many goods, which is from different customer, so ELTIS will issue a code for the goods, easy for differentiate and calculate, such as SNT-FTK-269 (appendix 3-PIC1), SNT-FTK is refer to which customer , 26 is the number of the goods. After loading, the container will ship from china to Malaysia, it also consume one week.
Process 2(diagram refer to appendix 1 note 2)
Two weeks later, goods from china will abroad to Klang Port. The usual process is should pass through the customs check before distributed to Malaysia. The customs check may take two to three days. If there is no any matter, Eltis will get their gate pass and drive their container by themselves to warehouse. Sometimes, they will face some problem at the customs check process; therefore they may need helps from the courier company, which is one of their partners, to help them negotiated with the customs. After success, they will get the gate pass to send the goods to Eltis. Due to the sending time delay, sometime Eltis will receive both containers in the same time. Therefore, when facing such problem, Eltis may request their worker work overtime in order to allocate the stock in one day and can check goods which in other container in the next day.
Process 3 (diagram refer to appendix 1 note 3)
When the container arrive ELTIS Company, the worker will lay down the goods from it. Normally, allocate three workers clear the container and one workers drive forklift.
They progresses in container(appendix3-PIC2), the worker differentiate customer’s goods based on code and mark down number of the goods ensures the goods no missing, and check whether the goods in good condition, afterward move the goods on a fork. Another worker will use forklift move the goods out of the container (Appedixe3-PIC3). If found that goods is missing or damage, they will inform the courier company for claiming.
Subsequently, proceed to allocate step, the worker allocate the goods based on the location, for example this goods is going to Cheras then store in Cheras area. (Layout is classified in few areas they send, for example Sungai Besi, Sri Pertaling)Sometimes, if the goods are big size or heavy then will lay on the place nearby the exhibit door. After allocate, then the goods will be store in warehouse accordingly. Later than call Courier Company to collect back their container. Normally this process will finish within one day.
Process 4(Diagram refer to appendix 1 note 4)
On the next day, ELTIS Sdn. Bhd. will schedule the timetable of delivery goods. based on the requirement from the customers such as the date and time to send out and where to send out. Different location they will use different way to distributed the goods to customers. If the customers come from other state, such as Penang, Johor, Kedah and etc they will call for local freight company to send the goods to customers. The delivery fee will count in term of weight or size of the goods. If the goods are heavy but small in size, they will calculate in term of weight rather than size. Eltis will negotiate the transportation fees, time available with the local freight company.
If the goods are send to customers who in the KL area, Eltis will schedule a timetable and send the goods to the customers. They will schedule based on the destination of goods and arrange the goods to certain Lorries. There are certain area which Eltis will send the goods by themselves (1) area of Cheras and Kajang; (2) Shah Alam, Sunway, Damansara and Klang; (3) Sungai Besi, Sri Petaling and Old Klang; (4) Puchong and Sri kembalang. Eltis owns three Lorries, one is 10 tons and other is 3 ton（Appendix3-PIC4). 10 tons lorry will use to send the goods which is heavier such as battery or air-conditioner gas. Otherwise, they also use 10 tons lorry to sent the goods which go for many situation in the same area. For example: the goods from Shah Alam, Sunway, Damansara and Klang they will use 10 tons lorry to distribute. In addition, 3 tons lorry usually uses to send the goods which near them such as send to Puchong area. The goods arrange in lorry will arrange from the last destination (which put inside the lorry) to the first destination (which put outside), and it will make convenience when deliver. They will distribute at least one area in one day, if the time is still early, they will distributed to other area also. However, if after 4pm, they will not send the goods and the goods will keep in warehouse and wait the next day to send out. Sometimes, Eltis may face traffic jam when send the goods to customers and cause delay arrival time to customers. Therefore, they will apologize to customers and promise that will send out on next day.
If in the next day Eltis have another container arrive, Eltis will clear the goods in their warehouse. For example: Eltis know that the goods in the container is belong to Cheras, Shah Alam, Sunway customers, then they will clear the goods of this certain area in order to allocate the goods which come on next day.
Customer must make a payment to Eltis within 7 days after receive their goods. If there is late payment, sometime they will add interest for the following days. If there is a new customer, when they receive goods, they should pay it on spot. If the customer rejects to make a payment, for the next delivery, Eltis may hold their stock until they pay for the previous payment. However, this situation is less occurs for Eltis, because they have built a good relationship with customers.
2.1.2Analyze strength and weakness of the operation process
The equipment uses to lay down goods are general purpose equipment. Since the goods in the container all are in bulk and boxes, therefore they usually use forklift to lay down the goods from the container because it is heavy. Forklift usually is a general equipment use in warehouse to carry the heavy goods. The workers in Eltis just need less broadly skill, they just need how to control the forklift and the stock can arrange probably in warehouse. Therefore, there is few work orders and job instructions because work are standardize and will lower down the labor cost.
Besides that, from our interview with the owner of Eltis, we know that Eltis has a good scheduling in their delivery road map. In one day, they will at least to 3 certain area and the goods which from other state, they will call local foreign company to help them distributed. Therefore, the inventory in their warehouse is almost clear everyday. It will lowest down their holding cost for the inventory.
In addition, Eltis has partner with Courier Company which help them arrange the arrival time of container. Therefore, it brings an advantage to Eltis that they can make sure they have enough capacity to store the goods and will reduce the fixed cost. This is because if they did not arrange probably, all container come in the same time and the warehouse lack of capacity, Eltis may need to decide to have another warehouse and it will increase fixed cost because of the rental fee.
The process of allocate goods rely on forklift to move the goods, therefore the variable cost is high. Moreover, if forklift damage, will break down whole process as normally the goods are heavy and large, without forklift, the worker will not able to move the goods. In addition there have two forklifts in this company but they do not fully utilize them. They mostly only use the forklift which can carry three tons to run their operations. Although they do not use another forklift which only can carry two tons but they still need to pay for the maintenance fees. If they well utilize these two forklifts, it might increase their efficiency.
Although ELTIS has collaborate with Diamond pavilion long time ago, but they rely on one company if the courier company delay or encounter economic problem, they will bring the disaster to ELTIS also, as they are responsible for delivery their goods in time, not the courier company. If possible, ELTIS can find few more courier company as business partner.
Since its go through many processes and in order to provide just in time services, a well scheduling is essential. Therefore, the person who arrange or scheduling it required well manages skill. So training need to be provided, it will increase the cost. Moreover, people who in charge do not manage it properly will incite holding cost. The condition of two container come in same time or no place for the coming goods may occur.
All the process does not in a systematic way, they no certain system to detected the goods. They can only briefly answer where the goods now. They can’t predominate the information, hence it will bring difficulty in scheduling. Customer, who want to know where the goods proceed while we can only forecast where it is, it will lower down customer satisfaction as well.
2.2layout facility (diagram refer to appendix 2)
ELTIS Company also had fully utilized their people. There are 3 cleaners, 3 drivers and 4 employees. Every employee knows their job position and content. At the first starting point, south is main entrance which the lorry can drive in to unload. When there have goods to unload they will open the spotlight to let the workers easier to move the goods. Office is located at the most corner of the west. Since location of office is located at a place that to see at a glance therefore customers won't waste time looking for the office. Accounting department is at middle between the two offices. This will bring the better communication of the department. Besides the office is the staff room which allow employees to take a break. Normally their supervisor will stay at the company. He has the responsibility to ensure that their employees are carrying their jobs.
Right hand side of the starting point is side entrance. They usually are using this entrance as their out of place because main entrance is just for the lorry to drop down the goods. Left hand side of the side entrance has alarm which use in emergency case. Furthermore, large cargo is place at the right of the side entrance. Ten tons of goods are also placing at here. Stock for Damansara, Kepong, Sungai Burug, P.J, Batu Caves are beside of the large cargo. From the starting point to the place for container unload; there are two toilets at the end. For the place for container they have fully utilized their space. The space is considered as wide enough for container to unloading and receives the stock, so that this will do the work effectively. Beside the toilet is stock for Ipoh.
In front of the second starting point is the place for the company to put the stocks. Beside the stocks is the place for company to put the Cheras’s stock. Left hand side of the second starting point is the place for company rent to others and south part is exit for shipping their stocks. They will use forklift to move the goods from the certain particular place to the lorry that park at this exit for shipping. Right hand side of the starting point is transport to Penang and Kedah. For the left hand side of stock for Penang and Kedah, there is another stocks transport to Shah Alam, Klang, Subang and Puchong. The stock for airport is opposite to the stock for Penang and Kedah. Stock that transport to Johor is located at right side of airport. However, the other empty space is placing the stock which is not frequently to transport. The arrangement of this layout enable for lorry to drop down the container and the forklift to move the goods without blocking the path.
Company had provided a better and safer working condition. If the employees accidents and injuries, company will compensate all the losses and medicine expenses. Moreover, every corner has CCTV and there are 9 fire extinguishing located at the corner. Besides, there are 9 fans, 6 exhaust fans, and 24 lights to make sure workers work in the safety environment. In addition, there are 2 spot lights to make sure workers be able to see clearly and would not face the sight obstruction.
The fully utilized of space can bring the strength to the ELTIS Company. Fully utilise can eliminates the need for extra movements or unnecessary task completion, this situation can helps employees to feel more accomplished and therefore resulting in positivity overall job satisfaction. Company not only have properly arrangement of good and provide an adequate storage space, but also lease the redundant space to earn more profit. This circumstances will bring the work effectively and able to increase the profit of the company.
The location of the office can let customers easily to find and means that this will increase the interaction with the customers. Besides, company always keep to the delivery schedule and deliver the stock on time. This can increase the customer’s loyalty which resulting the reputation of the company increase. Furthermore, ELTIS Company had clearly allocated the place of the stocks which can make the employees work effectively.
ELTIS Company had fully utilised the people. Since all employees know how to operate the forklift and sort out the stock. Therefore, ELTIS Company does not have to worry about the employee absent will ties up the whole operation. Besides, CCTV is keep watch over the stock. This circumstance is able to provide a safer environment as well as making the business more efficient and less likely to be robbed. ELTIS Company also can facilitate a better access of control for employees and stock. On the other hand, ELTIS Company has many lights which use to illuminate the stock and therefore workers would not face the sight obstruction. The spotlight is used to lighten the container so that employees be able to see clearly and effective to complete their work.
In addition, every corner has fire extinguisher which use to preventing fires. This consider as company had provided a better and safer working condition which can make employees feel more secure in the company. Moreover, office, accounting department and the staff room locate nearly would bring the better communication of the department. Employees have a well communication and this will improve employee morale which is the vital to the success of company.
The fire alarm is located at the forefront which will bring the weakness to the company. It can be said that employees are consider as slowly and difficult to press that alarm to alert everyone when there is anything happen. Employees cannot escape as fast as possible. This will bring the injury to the employees and the losses to the company.
Eltis Company needs to use forklift to carry the stocks inside to the lorry that park outside, this consider as time consuming because they have to go back and forth for a lot of rounds only can finish moving to stocks to the lorry. The employees repeat the same action everyday will feel boring and this will decrease their motivation. Thus their effectiveness will decrease as well. Furthermore, the cost is high as they need to spend RM25 of petrol in one day for each forklift. As a result, company cannot reach the objective of cost effectiveness.
In addition, ElTIS Company does not fully utilise the forklift. There have two forklifts but they mostly only use the forklift that can carry three tons to run their operations. Although they do not use another forklift but they still need to pay for the maintenance fees. This will increase the cost of the company.
For the environment and aesthetics in this company, it is not attractive. When the customers come in, it might leave a bad impression for them. First impression is very important to everyone. If the customers have a bad impression then they will have no confidence to this company and will affect the company business. In addition, the bad aesthetics will demotivate employees. This will directly affect the company performance while decrease the productivity.
3.0 Literature review
Quality management is vital to any kind of the business. It also relates to the survival of the manufacturing companies as well (Garvin, 1988, Curkovic et al., 2000). At last two decades, the importance of QM has significantly increased and many organizations have started to exercise QM practices. It is also indicated there is getting more companies use QM practices as initial strategy for creating a competitive advantage (Reed et al., 2000) and enhancing organizational performance (Samson and Terziovski, 1999). It is because QM practices tend to assist companies in gaining goodwill.
Without doubts, the rise of global competition has developed the concept of quality management (QM). Companies with international trade and global competition have paid considerable attention to QM philosophies, procedures, tools and techniques. Dean and Bowen (1994) have defined quality management as a management philosophy which made up of a set of mutually reinforcing principles, and each of them is supported by a set of practices and techniques. These are certain elements that are essential to QM which include quality leadership, customer focus, benchmarking, and teamwork among employees, employee training, continuous improvement, employee involvement, strategic planning management, quality results, and quality assurance. None of them can be excluded in establishing an excellent QM since they are interrelated. For the satisfaction level component comprises of employee satisfaction, customer satisfaction and supplier satisfaction. Yoo et al. (2006) has indicated that higher employee empowerment lead to higher organizational performance. A case study conducted by McAdam and Bannister (2001) suggested that the implementation of TQM in a company contributed to a positive working environment thus decrease the absenteeism of the employees.
Jun et al. (2006), had found that employee satisfaction have a positive impact on organizational performance. QM practices have been shown to enhance organizational performance through customer satisfaction. By having a better understanding of customer needs and the use of this knowledge to produce a better product, a customer satisfaction has influenced organizational performance directly (Johnson and Gustafsson, 2000). However, Johnson and Nilsson (2000) argued that concerning customer satisfaction, no direct customer measures were available. They suggest it is important to combine measures from different sources. The relationship between buyer and supplier is an important factor in organizational performance. The need to improve supplier's quality and delivery performance at the same time, reducing the costs of supplied materials and parts has motivated buyers to engage in supplier development activities which is has a direct impact on organizational performance (Krause et al., 1998). Empirical studies demonstrates that evaluating supplier performance and providing feedback, result in improved buyer supplier performance (Humpreys etal., 2004) and enhanced product or service quality of the buying firm (Krause et al., 2000).
QM practices help to improve in reducing scrap, rework and stable the production process. These in turn minimize the production cost and increase productivity (Ahmad and Schroeder, 2002). Through continuous improvement, not only errors and defects can be prevented but also product cycle's times can be reduced, thereby improving productivity and organizational performance (Huang and Lin, 2002).
The study area chosen - logistic industry
The logistics industry consists of the integration of information, transportation, inventory, warehousing, material-handling, packaging, and security. Basically, logistics industry is one of the approaches for the development of industrialization in Malaysia which is related to the international trade. The progress of the nation’s industrialization and its competitiveness in international trade depend heavily on the performance of logistics industry. The development of logistics management has facilitated production and distribution processes and created accessibility to the global market. Logistics is widely defined as a backbone to the economic development. It means that a good or systematic logistics system applied in certain organizations will bring positive impacts to the organization and definitely could increase their competitiveness among competitors.
The application of selected company – Eltis Sdn. Bhd
A detailed survey has been carried out based on the numerous journals we have read, it was observed that quality management is considered a critical factor that influence the success in the logistics industry. To meet the immense growing market competitors, implementing quality management typically confers competitive advantages and enables them to meet superior performance.
During the studies on various journals, it was observed that one of the major areas of activities emphasized in Total Quality Management (TQM) is customer focus with the explanation of "we must identify changes in customers’ needs quickly and allocate resources for satisfying them". (Shiba.S ,1992). Based on observation, it was found that customer focus plays a crucial role in quality management. Therefore, our selected company, ELTIS has adopted customer satisfaction as the main focus by placing customer’s quality requirements as priority and set up an ultimate objective to attain customer satisfaction in which described as customer focused. Additionally, to meet immense competitors market, ELTIS provides quality products and services within the expectations of customers in achieving customer’s satisfaction that brings the company to be more challenging, competitive and successful. Customer focus is vital as customer satisfaction is depends on the overall logistics performance. Apart from that, in order to success in logistics, QM practice like customer focus must be implemented. For instance, ELTIS company actually implemented QM practices by taking actions such as maintaining a close contact with customers to build loyalty, request feedback from customers on ELTIS company’s logistics’ quality and delivery performance. Furthermore, ELTIS endeavors to be highly responsive to our customers’ needs and they also perform survey on customers’ requirements consistently.
Teamwork among employees
Team based approach is often practiced in many organization rather than depending on individuals to sustain a successful business. Generally, a team is characterized with a group of mutually dependent employees, which have similar goals to achieve higher level of coordination and homogeneity (Francis and Young, 1992). In addition, "teamwork has been identified as essential factor for the success of quality management programs". (Reed et al., 2000). Thus, ELTIS currently applied this QM practice which is teamwork approach among the employees. In fact, ELTIS knew that teamwork plays a crucial part in logistics. Consequently, they highly requested participation from every single employee which eventually boost up the implementation of quality because working together as a team is more efficient and reliable rather than working alone. Besides, ELTIS often make their employees feel that they are aware that they are individually important for the success in company. Other than that, ELTIS provides unambiguous role perception, all information and set deadlines to employees, so that employees have a clear guideline to complete their tasks and the action made by ELTIS actually make employees feel that they’re responsible for the outcome, this eventually will motivate the employees to work as a team accomplishing the tasks.
Employee training has been considered critical factor in quality management programs (Saraph et al., 1989; Ahire et al., 1996). Training and development programs for employees enhance their motivation and commitment towards the organization (Bardoel and Sohal, 1999). Based on the information we gathered after visiting ELTIS company, we have discovered that ELTIS actually conducted a training program focuses on quality management for managers and supervisors staff in their company with the intention to carry out the training program they have learnt. Essentially, it is necessary that all the managers and supervisors have to take part in the training program. Most of ELTIS’s workers were sent to undergo training program to obtain n a better understanding of the concepts and objectives of the QM implementation, so that they can share and explain very detailed information to their subordinate staff. Apart from that, it was found that when the entire staffs in ELTIS company have a better understanding on performing their tasks, a significant improvement shown on the quality management and profitability respectively.
According to Professor Shiba (1992) he indicated that continuous improvement is one of the major areas of activities emphasized by TQM. The explanation said by him was "We must improve everything in the organization continuously, studying the facts and validating what we do by experiment, in order to achieve every-higher levels of quality and shorter times to market".( Shiba.S 1992). As an example, ELTIS actually exerted QM practice which is continuous improvement. ELTIS has long experience in storing and handling goods traded in Puchong. In the meantime, ELTIS has strong financial and security as financial documents. They employ sophisticated stock control systems for accurate real-time reporting, ELTIS even install CCTV security systems in warehouse to protect clients’ valuable stocks and also 24-hours guarding service and apply safe locking systems to make sure that no one can steal their customer’s goods which will fulfil customer’s satisfaction. Moreover, a strong financial position, allow them to effectively execute expansion plan, capitalize on business opportunities. Besides that, the facilities layout designed are excellent as there are fewer chances to damage the goods either due to too warm or too cold conditions. The actions taken above are so called continuous improvement in TQM.
Commonly, top management provides the environment and infrastructure to facilitate the implementation of quality management program. Meanwhile, employees are the one who actually demonstrate the implementation in organization. Other than that, employees that have strong commitment, loyalty and motivated will effectively give an impact in quality management’s of a company (Hussain, Akhtar & Butt, n.d.). In Eltis Sdn. Bhd., the superior try to involve all of its employees in each stage of the processes for the purpose of letting his subordinates to know they also are one of their part family as well. Eltis Sdn. Bhd. also can satisfy the need of the employees who desire to gain recognition from its company.
Employment empowerment is meant by employees are given certain power in performing their tasks. By exercising this practice, the overall confident level of employees will increase and the employees are likely more satisfied with their job. They feel that they are needed by company. It also reduces the possibility of having job ambiguity and unclear role perception since they are aware of what they want to do and would not confuse to their job (S. Thamizhmanii and S. Hasan, 2010). This practice has exercised well in Eltis Sdn. Bhd. The employees in Eltis Sdn. Bhd are given certain authority to complete their tasks. They are not need to report everything to their superior, thus enhance the confident level and they believed that the decision made by them can bring positive impact to the company. The employees’ trust has gained by implementing this practice as well since they possess some authority to accomplish their work without the excessive control by their superior. Moreover, it tends to shorten the length of time needed to perform their job since they are satisfied with their work and perform their work well. It improves the overall job performance eventually.
Just-in-time (JIT) is known as dynamic compilation, which refers to translation that occurs after a program begins execution. In other word, it means the attempt to fulfill customers’ demand once they needed. It is one of the excellent approaches in cutting down the fix costs since there is no warehouse rented to store inventory. In Eltis Sdn. Bhd., JIT approach has implemented well since the company only dealt with the suppliers after customers made orders. It reduces fixed costs incurred in the company successfully at the same time also provides assurance to customers to ensuring their demands can be fulfilled in time frame. For Eltis Sdn. Bhd., a well scheduling is also established in processing those orders. Therefore, the person who arrange or scheduling it required well manages skill. However, it may incite holding cost if people who in charge do not manage it properly.
Quality management practices are important to improve the quality of process, which are integrated to form an entire organizational system. Montgomery (2000) stated a negative relationship between process quality and process variations. Process orientation approach considers process designing, process controlling, and process monitoring which are primary activities to ensure process quality. In ELTIS, it has implemented process orientation approach nicely when all related tasks have been well-assigned. This approach enables employees who possess certain skills to perform respectively jobs more efficient. It also assists in improving the efficiency of the overall assembly line. Besides, the employees in ELTIS has fully-utilized by assigning tasks which according to the competency of its employees.
4.0 Discussion & Conclusion
ELTIS principal activity is to provide the express delivery services for dry and break bulk commodities in time between locations. Logistic is important to most of the company because it create the value expressed in terms of time and place for customers and suppliers. Products and services have more value when they are in the possession of customers when (time) and where (place) they wish to consume them. Because of globalization, logistic have become increasingly important value-adding process to many firms. Especially for ELTIS, when their main line of the business is from china ships to Malaysia, logistic processes are so important to deliver the products in times between the both locations. According to Sterling & Lambert (1989), Harrington & Lambert (1989), Lalonde & Zinszer (1976), Marr (1994), Baritz & Zissman (1983), Jackson et al. (1986). Research over the years has shown that logistics variables are dominant in the minds of customers when they evaluate the service offerings for a product. Mostly customer service variables are logistics related and delivery time typically ranks the highest among all service variables. Since customers respond to a company’s service offerings with their patronage, revenues are a frequently determined by logistics variables. ELTIS Company is using product focus process strategies which its facilities are product oriented and having high volume but low variety of product. Since it is a logistic company, so it is having typically high fixed cost to operate the business but low variable cost, and it also need less skilled labor.
With problems of not utilize the usage of forklifts, rely on human manage or scheduling the orders, and without tool to detect and mark down the code and locations for every stock. Based on the strength and weakness of the operation process discussed, the major problem of ELTIS Company is they are not fully systematic yet and didn’t follow up the computer-controlled methods trend. To solve the problems, we suggested Eltis Company to follow up the trend and install few production technologies such as Automatic Identification System (AISs), Autonomated Storage and Retrieval System (ASRSs), Autonomated Guided Vehicle (AGVs), Process Control Software, and also Computer-Integrated Manufacturing (CIM). For example, if ELTIS Company using Automatic Identification System (AISs), the system will mark bar codes or RFID on every stock in their warehouse, thus it will improve data acquisition, reduce the data entry errors, increase scope of process automation, and finally it will totally improve the company productivity. Their forklift will finally utilize its usage because they working with accurate data and arrangement, and they also can reduce the errors made by human because everything changes to computer-controlled system.
The facility distribution form of a production line depends on the type of the enterprise and the production organizational mode ((Amaral,2008);(Khilwani et al., 2008)). Facility layout play important role in logistic company for designed the properly space and arrange the physical equipment to store the stock and to help the company work in productive way. A good layout scheme would contribute to the overall efficiency of operations. Traditionally, there are two approaches for the facility layout problem (Sahin et al., 2009). ELTIS is belonging to warehouse layout type which its objectives is to optimize trade-offs between handling costs and costs associated with warehouse space. It also aims to maximize the total space to utilize its full volume while maintaining low material handling costs.
Based on the strengths and weakness of facility layout we discussed just now. The major problem of ELTIS Company was they don’t have the appropriate safety system. They don’t even could alert for disaster happens because the safety system had not yet been fully well prepared. To solve the problems, they have to install a proper alarm alert system to avoid any disaster or steal by criminals. And also, they need to hire sufficient security guard or workers to guard their stocks and also CCTV during working hours and after working hours. For improve productivity instead of using forklift to keep moving the stocks or the troublesome of arrangement to storage the stock, ELTIS Company can try the cross-docking system which the stocks are moved directly from receiving to shipping and are not placed in storage in the warehouse. For other way to improve the productivity or to expand their business, ELTIS Company can install Automated Storage and Retrieval System (ASRSs) which it consists of a variety of computer-controlled methods for automatically placing and retrieving loads from specific storage locations. ASRSs can significantly improve warehouse productivity by an estimated 500% but of course it will need the huge amount of cost to install indeed.
Logistics industry can be described as a backbone to the country’s economic development because it creates the accessibility to international trade and global market. Because of globalization, many firms seek to survive in this competitive global market. A systematic and computer-controlled logistic organization will bring positive impacts to their business and definitely could increase their competitive advantages among the other competitors. We as students should learn how to foresee and catch up the trend and make improvement to our organization’s operation before our competitors to create the competitive advantages. Other than improve organization’s productivity, we should focus on customers’ satisfactions toward our company ELTIS’s logistic deliver service. We should how to identify the change in customers’ needs quickly and allocate the resources for satisfying them (Shiba.S, 1992). Thus, we get the good feedback from customers and then build the relationship with them. As long as our company satisfies their needs and maintain the relationship, they will continue loyal to us. Other than that, we should learn to improve our company’s inner factor which is employee that can improve organization’s productivity. We could improve their teamwork, skill empowerment and training, and also task involvement through many methods. Other than these area of studies, we also can research and study on organization’s business or facility expand, examine the method should company use to operate their business which are maximize the revenue or to minimize the costs. For our suggestion, ELTIS should improve their equipment and enhance their technologies in time in case to compete with other competitors, to survive in global markets and also to expand their business and markets.