Question # 1
What business is LCI in? What are the key success factors? How operations can contribute?
LCI was founded in 1994 by Mr. Sheikh Ubaidullah, a Former Chairman of Pakistan Cycle Cooperative Society Limited. LCI is located at Ferozpur Road, eighteen miles south of Lahore Pakistan. LCI marketed its bicycles under the brand name of Leader bicycles. LCI was in bad shape and financially bankrupt , all shops run by one supervisors , its production was practically zero when Managing director at Descon Mr. Razaq Dawood acquired LCI in June 1999. He hired new 6 engineers since 1999 in following departments like production planning, production scheduling, inventory control and quality control to set up all the necessary systems and procedures in order to turn LCI around. In May 2002 Five bicycles –manufacturing companies (competitors) existed in market, combined capacity of these companies producing bicycles were 580,000bicyles per annum, and all were running at or near capacity, the competition was very tough. Up to May 2002. LCI was producing 60,000 bicycles/annum, in May 2002, LCI started producing manufacturing its new product named BMX cycles, for betterment in this new product, after a year-long negotiation with Hercules of England, Decscon acquired from them the manufacturing and technology right, in Pakistan, for the very popular BMX cycle, Hercules also agreed to send engineers to Lahore for ten-week periods in order to help in set up the plant, tooling and train the staff.
KEY SUCCESS FACTORS:
* Senior Management of LCI wanted to introduce the BMX Cycle in market before competitors, and Mr. Mansoor Waraich, Senior Planning Engineer, had a lot of pressure by the top management of LCI to complete this huge production of BMX Cycles. That massive production was carefully planned and all the processes where closely monitored and upgraded. * Mr. Razaq Dawood, Managing Director, of Descon, took over the LCI in very bad shape , and he set up all necessary systems and procedures like production planning, production scheduling, inventory control and quality control in order to turn LCI around , it is also a factor of the success of LCI * Another key success factor was that Descon called Hercules of England engineers to train LCI’s staff. LCI’s staff can also go to England for the same training for a specific period.
LCI is a Production Company so operations plays very important role. Outsourcing and subcontracting of different raw materials is done for the better result of operations. All the plants structure was designed in a way so that they can minimize the wastage and can maximize the production. Manpower was also assigned according to their expertise and labor was hired on daily wage system.
Question # 2
What is your Analysis of the BMX production process? How would you characterize this process? ANALYSIS OF BMX PRODUCTION PROCESS:
BMX production process is almost in sequence, all processes depends on each other, if one process is skipped then they cannot complete other part of cycle, in other wards they cannot ignore only a single process, As LCI wanted to introduce BMX in market before competitors and management wanted to produce huge quantity of BMX cycles so LCI purchased different finished parts for BMX cycles from several suppliers, like, seats , pedals, handle bars, frame pads, and tires were directly purchased and installed , but other side , several parts, like sheet metal, metal coils, steel bars and pipes were manufactured from raw materials acquired locally and abroad. Management hired permanent and daily paid labor in all shops to complete tasks efficiently and in timely, this planning was proved very helpful to complete huge production. First process is cutting shop:
This shop having 3 machines for cutting metal pipes into different lengths to use prepare bottom bracket shell, frames and handle bar, this shop run under one...
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