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Describe the benefits of using the three general methods for managing risk (loss control, loss financing, and internal risk reduction) and how they can minimize the liabilities of operating a facility.

What are the differences between minimizing risk and the cost of risk? Which one of these concepts has a greater effect on minimizing liabilities? Should a facilities manager focus more on minimizing risk or the cost of risk?

Quality Facility Management Chapter 2 describes the process of TQM (Total Quality Management Principles) and Quality FM. In this chapter, there are 5 TQM experts listed with their focuses on quality management: W. Edwards Deming, Philip B. Crosby, J.M. Juran, Robert C. Camp, and Karl Albrecht. Please examine one of these five experts and describe how their subject matter can help facility management achieve the objective of guest satisfaction.

In the operation of a hospitality facility, there is a contention the business must operate in a reasonably safe manner to avoid the possibility of liability. Briefly describe the concept of "reasonably safe manner". Describe some of the various agencies and how they can help keep your facility "reasonably safe".

What are the benefits of including a long range focus on technology into facilities? Describe how a focus on Facility Management Information Systems can assist in creating accurate and responsive data that can improve facilities management. between 250 and 300 words

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Describe the benefits of using the three general methods for managing risk (loss control, loss financing, and internal risk reduction) and how they can minimize the liabilities of operating a facility.

In operating a facility it is important to identify possible risks and manage these factors before they occur. There are three general methods of risk management: loss control, loss financing, and internal risk reduction. States or insurance companies often insist that facilities provide loss control services that are "reasonably commensurate with the risks, exposures, and experience" of the facility's business. The loss control service includes surveys, recommendations, and training programs based upon an analysis of potential accident causes. In addition, qualified personnel and independent contractors must be employed at the facility. Qualifications can be outlined based on level of education or training or years of experience. Outlining these perimeters helps the facility manage risk better as well as serve as a prevention tool. By utilizing loss financing, facilities estimate a certain level of risk, which is unavoidable. This might be in the form of the deductible of an insurance policy. Insurance is the leading form of risk management. Companies pay insurance companies before sustaining losses through premiums.

Companies create special funds to cover these potential losses, sometimes. Post loss financing is the action of obtaining funds after the losses are incurred so a company may need to obtain a loan or issue stock as a way to handle loss financing. This financing serves as a way to control costs of risks that have occurred. Internal risk reductions are the acts facilities take to avoid loss by reducing risk. Facilities utilize this risk management method by ensuring that the workplace is safe, employees are properly trained, and there is a focus on common sense and safety. This is beneficial because risky behaviors are minimized. Internal risk reduction works on minimizing the effects of risks by having systems in place to neutralize the effects of an accident or disaster.

Helpful link: http://www.referenceforbusiness.com/management/Pr-Sa/Risk-Management.html#b

What are the differences between minimizing risk and the cost of risk? Which one of these concepts has a greater effect on minimizing liabilities? Should a facilities manager focus more on minimizing risk or the cost of risk?

Minimizing risk is taking action to identify and understand the risks to which your facility is exposed. Facilities may hire risk managers to evaluate and analyze potential risk, or executives may determine risk internally. Usually all risks which the facility is exposed to be listed. Next, these risks are categorized and analyzed. Alternatives are then examined as a way to manage each type of risk, utilizing the expertise the organization brings in dealing with the risk. Cost of risk is similar, however, it is based upon the type of work the facility does and where, and is typically the amount of dollars utilize based upon the listed risks. The cost of risk includes insurance, risk management department operation costs, legal and claims expenses, uninsured loss costs, and risk improvement costs. Of the two concepts, minimizing risk has the greater effect on minimizing liabilities. This is because the organization is taking an active role in identifying and minimizing risk. This is an important component when considering the cost of risk. Liability insurance takes into account not only the type of work and where the business is located but can also include variable such as the type of vendors the facility is using. For instance, if a facility were purchasing ...

Solution Summary

THis solution describes the benefits of using the three general methods of managing risk; the differences between minimizing risk and the cost of risk;and examines how Phillip B Crosby's work can help facility management achieve the objective of guest satisfaction. It also discusses the term "reasonably safe" in regards to hospitality facilities and discusses the benefits of including a long range focus on technology into facilities. It includes examples and links.

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Operations Management for Distribution Ehgineering


You are a junior analyst in the Distribution Engineering, Maintenance, and Productions Management group of the central engineering department of the Canbide Corporation, located near Torrance, CA.

The Canbide Corporation is a multi-national, publicly traded (NYSE), US - based, manufacturing company with annual sales nearing $10 Billion. Canbide is one of the pioneers of the petrochemical industry and is the acknowledged technology leader in several market sectors and benefits from large licensing royalty fees for those technologies. Canbide is the low cost producer for a number of commodity products. Canbide's current marketing approach is based on providing a wider selection of products at a single location than do any of their competitors.

Two years ago, in a surprising move, Canbide purchased a leading Korean electronics company. As a result, Canbide is now in the PC printer, toner cartridge, copier, and electronic imaging business as well. The PC printer and cartridge product lines are closely aligned and often share facilities. The copier and electronic imaging facilities are, for the most part, free standing facilities. The chemicals and electronics businesses have, until now, been run separately.

In a suburb of Tulsa, Oklahoma, Canbide operates a Central Research & Development / Central Engineering Department for the chemicals business. A similar facility for the electronics business is situated in Torrance, CA. The divisional research and engineering departments are also located at these facilities. The divisional research and engineering groups are the experts on the specific reactions or production processes and equipment associated with that division's products. The central research and engineering groups are focused on providing experts in specific subjects who cross divisional boundaries and generally work as internal consultants for the divisional research and engineering groups and often work on plant level issues.

Mr. Iwami, president of the electronics business group, is pressing his divisional VPs to solve several problems. There is internal pressure for a new distribution facility in the Pacific Northwest. There are quality problems at a facility in Nebraska. There are customer service problems at most distribution locations, but they are especially bad at the facility located near Denver, CO. There are inventory / materials handling problems at the Newark, NJ facility.

Your supervisor has alerted you to three potential projects for the coming year.

Customer Service problems at the Denver facility: This facility has been in existence since the 1930s. It has slowly grown physically since then. New production units have repeatedly been added on the periphery of the facility, leading to widely scattered production units within the facility that currently measures about 2km by 1km. The customer service issues arise from several sources. First, customers desiring to pickup multiple products must now drive from point to point within the plant to pick up each product. There are often waiting lines at each loading point. A second problem is the arrival pattern of trucks to pick up products that materially contributes to gridlock within the facility.

Production Facilities in the Pacific Northwest: For the past few years, the performances of the three production facilities in the state of Oregon have been declining. Inventory levels are up, on-time shipments are slipping. Costs are rising. Scrap rates are increasing. Delivered quality still remains strong.

Copier rehab facility near Charleston, SC: The copier rehab facility near Charleston, SC receives "trade-in" copiers from distributors across the country and restores them to "good as new" condition. The facility stocks certain parts that are always replaced and others that are often replaced, based on wear and condition. Moreover, sometimes, copiers require parts that are not stocked, leading to a delay in the repair of that copier. They have a target (imposed by the copier division VP) that copiers spend no more than seven days at the facility before being released for re-sale. Since the facility has no visibility of incoming copiers and has no precise knowledge of what parts may be required, materials and labor planning is difficult.

As the junior analyst you will be in charge of analyzing various operations management issues concerning Canbide Corporation ranging from customer service to location to operations for all three facilities. You will be making recommendations on changes, improvements and the possible use of Operations Management (OM) tools.

Assignment: 500-1000 words

Your ad hoc team at the Charleston, SC facility has already developed your set of recommendations. Your next task is to develop a presentation of your recommendations to a group consisting of the plant manager, divisional VP, your boss, and your boss' boss.

These parties are interested in your presentation for the following reasons:

The current plant manager is interested in action. This presentation should briefly discuss the problems and the history behind them, then proactively shift focus to the recommended corrective actions. The presentation should at least tentatively assign responsibility for each action to the appropriate plant level staff or operations group. It should also identify what resources the plant manager should request, if any, from divisional or corporate level staffs.

The divisional VP is interested in results. Remember that a VP is very busy, so try not to get too lengthy in this portion. It should quickly present what actions were recommended to the plant manager, but should spend comparatively more time on how the divisional staff may best provide support to the plant.

Your boss is most interested in the quality of the work that you have done. The presentation to your boss should include a more detailed description of current situation and focus more on the analytical and problem solving approaches which were used.

Your boss' boss may or may not be interested in seeing or hearing your presentation. He may be primarily interested in learning about how satisfied the plant manager and divisional VP seemed to be with your work.

To create your presentation, you should:

Define the problem
Identify the alternatives
Determine the evaluation criteria
Evaluate the alternatives
Choose an alternative.

Your recommendations (a "bullet point" format would work well for this portion of your deliverable).
A list of which additional plant staff members you would want to attend the formal presentation to the plant manager.
A risk analysis with each recommendation (Risk Analysis recognizes each possible decision combination and the set of possible payoffs and probabilities).

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