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PMA30116 Process Plant Operations

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PMA30116 Process Plant Operations

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Course Code: PMA30116
University: TAFE Queensland is not sponsored or endorsed by this college or university

Country: Australia

In recent years, Chrysler Corporation initiated three-shift or nearly continuous (21-hours-per-day) production at a number of its plants. Explain why Chrysler’s decision might have been prompted by movements in its wage costs or capital costs, or both.
Why would Chrysler have instituted this production change for its most popular (and profitable) vehicles, its minivans and Jeep Cherokee?
What risks might such a plan pose?

Chrysler Corporation Decision Making Power
Chrysler has advocated three year shifts, in which workers will be working for 4 days a week and shifts have been arranged in the pattern that workers plant can remain opened six to seven days a week. According to the company director, this setup is more effective and this gives more time for maintenance work. The company plans to expand in jeep sales. The decision of Chrysler Corporation is centrifugal to the success of the company. Chrysler Corporation is the first automaker, which will be operating three shifts, but the unions are dissatisfied with this result (Street, 2007). This is a test which requires the permission of local workforce and Automobile workers. The workers will be required to work for small hours and receive smaller pay. However, expert reviews are working around the clock can strain the machinery. According to Chrysler, minivans are the consistent source of revenue and profits. The Organizational structure of any company is the key principle behind financial performance. The Chrysler needs to put right people at the right places. This battle is on innovation. For instance-The role of the CEO is to create best structure for channelizing the resources towards innovation and profit making body. The question is not about the cutting costs but promoting growth. The CEO of the company should have a strategic focus for its expansion plan. The choice of the decision making in this company requires managing risk and understanding the advancements in technology. This is a cognitive process which can improvise the decision making (Pignone, 2007).
Production Change
The decision making power of Chrysler to change the production lines is associated with collection information on marketable automobiles. The start-ups costs are very expensive due to skilled labors and plants and equipment’s. As the company will get larger, the production cost will cheaper. Economies of scale with regard to the automobile services required the high skilled employees. However, the company will have to lay emphasis on research and development needs. A company needs to maintain the same level of expertise into expansion of production lines. This is a costly production that cannot move without the skilled workers. However, automobile engineers are costly and can jump over a competing company for more money (Cui, 2015).
Chrysler Corporation needs to identify the strengths in unions and technology. The complete revolutionizing of a brand is possible only when effective engines are in place. Production in masses, it is a common variable through company can capture the international markets. This automobile maker needs to identify the different models. According to the Chrysler, more number of mini vans can produced as it can give consistent profits over the period of time. The demand for these automobiles is rising as if to maintain the share. It is expected that $2000 gross profit can be achieved. The company is planning to introduce the midsize car and can consistently generate profits as the demands for mini vans are rising. The new mini vans produced will generate more profit. The emphasis must be on enhancing the capability of production units and retaining the classic characteristics of the jeep Cherokee (Chakravorty & Ghosh, 2009). 
The Risks Associated with the Plan
Most of the companies think organizational structure is everything for the success of a plant. The risk associated with this plant requires understanding the set of decisions. Which decisions to be executed? Which decisions will not be executed and which decisions can bring value to the customers and the company? The auditing process must be done with extra care. The company must not engage in analyzing the strengths, weaknesses opportunities and threats. Organizational changes will be starting with the decision audit. The critical decisions made by the company must be aligned with the organizational structure (Haghighat & Kennedy, 2012). This improves the company’s performance too. 
The company must be focused towards the fleet sales and this accounts for more than 15 percent of total sales. This will have an impact over the consumer perception.  Chrysler Corporation has been entering into mergers and has the prime motive of coming out of bankruptcy. The company needs to focus towards the product lines and save from the financial crisis.  In few emerging markets, automobiles are purchased for the resale value and after sales services. The company has serious problems in these aspects as it is not a popular brand. The company needs to learn from its past mistakes and deploy the different strategy.  The Chrysler corporation has adopted the 3 shift approach of 10 hours a day and this requires convincing the unions which may pose problems in future due to the opportunities present in competitive market (Parker & Fischhoff, 2005).       
Chakravorty, S., & Ghosh, S. (2009). Power Distribution Planning Using Multi-Criteria Decision Making Method. International Journal Of Computer And Electrical Engineering, 596-601.
Cui, Z. (2015). Decision Making in Cross-Functional Teams: The Role of Decision Power*. Decision Sciences, 47(3), 492-523.
Haghighat, H., & Kennedy, S. (2012). A Bilevel Approach to Operational Decision Making of a Distribution Company in Competitive Environments. IEEE Transactions On Power Systems, 27(4), 1797-1807.
Parker, A., & Fischhoff, B. (2005). Decision-making competence: External validation through an individual-differences approach. Journal Of Behavioral Decision Making, 18(1), 1-27.
Pignone, M. (2007). Incorporating Decision Analysis in Decision Aids. Medical Decision Making, 27(5), 547-549.
Street, R. (2007). Aiding Medical Decision Making: A Communication Perspective. Medical Decision Making, 27(5), 550-553.

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