ASSESSMENT 2: GROUP REPORT

ASSESSMENT 2: GROUP REPORT

Introduction

Strategic management is the planning, monitoring, evaluation and assessment of all the prerequisites that an organisation needs to achieve the goals n and the aims. Managing strategies help the organisation to continuously assess the firm's present stock of their current situation and plan the strategies, use them and evaluates the effectiveness of the strategies implemented. Operation of business is mainly concerned with the production and manufacturing actives - turning inputs to outputs in an effective manner. This study shed light on the operation of Thermax Ltd, the contribution made by their partnership, the threats, and opportunities posed by the organisation. This report also deals with the facilitators, challenges for adopting new technologies and the extent to which the technology will be beneficial for Thermax

Company background

Thermax Limited was founded in 1966, an engineering company involved in energy and environment. The company was founded because of the family concern and went public in 1995. Thermax with collaboration with Wanson, a Belgium company who manufactures coil-type boilers. The company caters in the area of heating, waste heat recovery, cooling waste, captive power, water treatment and recycling of waste. It is headquartering in Pune and its revenue is US$770 million, 2016 (thermaxglobal.com, 2021). The subsidiaries under Thermax are First energy private limited and so on. Thermax has quite a global presence that helps industries of different countries to achieve better productivity while marinating a cleaner environment.

Current operations of Thermax ltd

Every organisation operates in terms of 4Vs but vary from each other. The Vs of operation management is volume, variety, variation and visibility (Awwad et al., 2018).

• Volume is that aspect of the organisation which concerned with how much of the products are to be manufactured. A high volume of products means it is easy for an organisation like Thermax to satisfy high demands. Low level of production means the operation process tends to much less repetitive. A high volume of production means more repetitive process. The Brexit situation and the covid-19 have affected the growth of the Thermax across the globe.

• Variation implies the different products produced by Thermax to meet the changing demands of the market. Though in many situations it becomes difficult for the company to predict the variations.

• Variety refers to different good and products that Thermax manufactures that they sell to the customers. Thermax offers a wide range of products and services - boiler, heater, absorption cooling, solar, water solution, power O&M and so on (thermaxglobal.com, 2021).

• Visibility is the process by which a company improves it's business process y taking the customer feedback into account. Thermax has high visibility as it is a services industries.

Application of theories

Six Sigma theories that are concerned with the quality of products and the production process behind it (Antony et al., 2017). Six Sigma was adopted by Thermax to improve its financial growths. It was initiated towards increasing the profit of the company and reducing the manufacturing cost. Thermax uses the Six Sigma theories with the incorporation of ratios, and charts to achieve the desired goals

Lean Manufacturing models works around the idea of eliminating the waste in manufacturing and supplying process to reduce the cost to develop a shorter process (Costa et al., 2017). Thermax makes sure that customer should pay for those elements that don’t add value to their products.

Thermax uses the hybrid of Lean Six Sigma to achieve its vision (thermaxglobal.com, 2021). They use this approach to prioritise the customers, managing the flow of the process, removing the non-essential elements and undertaking the acts of improvements. Thermax harness best technologies to provide a perfec6t service and fulfil the customer’s need. Their business process is based on sustainability and makes profits but not at the cost of the environment.

Identification of the contributions and relationships

The technology partners of Thermax are Babcock & Wilcox Enterprises, Black Durr and Lambion Energy Solutions, Germany. Babcock & Wilcox Enterprises entered into a partnership with Thermax to engineer, produce and sell selected industrial boilers and aloe the utility of the supercritical boilers up to 800 MW in thermal power units. Black Durr's partnership with Thermax was made with the intention to offer the electrical precipitators, regenerative air gas heater and the pulse jet bag filters. Whereas Thermax got offers of grate technology from Lambion Energy Solutions

The most appropriate type of partnership that should be maintained by Thermax is the limited liability company (LLC) as it is a hybrid structure that will allow the owners of Thermax, partner or shareholders to enjoy the benefits of the partnership while limiting their liabilities. It will allow getting liability protection that a corporation has (Keers et al., 2018)

Summary of opportunities threats

Thermax can align smart strategies with other strategies and coordinate the mechanism with operative and strategic level. Thermax can involve its stakeholders, partners in the process of development of strategies and funding programmes. The company can adopt the triple-helix cooperation through the ecosystem (Dalenogare et al.,2018). The industry 4.0 with Thermax intended towards the bottom-up approach, industry to be driven by demands and innovation in system and cluster. It also helps in the monitoring system of the cluster and management of Thermax. It will benefit Thermax to foster long term relationship. It will give Thermax access to European funds. Thermax may also gain the weight of the cluster in policymaking and fuelling of knowledge. Thermax may face the threat of a lack of knowledge about digital transformation in the management of top-level. The organisation will likely to face the lack of competencies issues and the digitalisation of resources (Vaidya et al.,2017). Thermax might be affected by the world economic turndown and the Brexit situation. Industry 4.0 might also lead to a reduction in structural funds.

Responses made my Thermax in favour of the emerging megatrend

Megatrend can be considered as one of those external forces that remain directly associated with the transition of the market the organization is operating on. It can be considered one of the major transforming factors that bring an entire change in the business operation of the organisation (Seyler, 2020). Considering that Thermax operates majorly in the domain of energy and environment sector, it is important to note that the company has to maintain innovation in regards to its operation so that it increases appal to its consumer base. For such reasons, identification of the megatrends and taking proper steps accordingly becomes one of the most vital parts for an organization to maintain sustenance. Some of the major responses provided by the organization to the market trends are:

• More focus on the increased use of renewable energy

Thermax is one of the most dominating organizations in its sectors have made some remarkable progress in implementing innovative operational structure. Being and energy-based engineering firm, it has put more focus on the renewable source of energy as its one of the main sources of power supply that can be controlled steadily with the progress of time (Yang et al., 2018). The noticeable aspect about this concept is that it has an increased number of investors from different sectors as the utilization of the renewable energy vas the main source of power is at aha high rise since the last 5 years.

• Decarbonization

It is important to note that in the energy and the environment sector, the adoption of decarbonization has caught a significant amount of attention in the eyes of environmentalists and power generation organization. It helps in environmental sustainability and also offers for improved utilization of energy (Parhizkar et al., 2021). Thermax has shifted to the operation that significantly supports the concept of decarbonisation which has not only increased the firm appeals to its customers but has also improved its standing from the administrative point of view. The ability of the decarbonisation to implement the “near-zero-emission” concept is one of the major reasons why the operations of Thermax has shifted its mode of operation.

• Digitalization and decentralization of electricity grid

The several factors like the lowered cost of the renewable energy and the implementation of the new technologies that play a vital part in the utilization of the centralized grid used for the power supply serve as one of the most important factors that relate to the improvement of the firm (Wei et al., 2017). This has led to the increased demand of decentralization of the supply grid that improves the cost efficiency as the standard utilization can be controlled in an improved manner in this concept. Thermax has made some consistent demand in improving the decentralization of the concept of the supply grid that has adhered to the improved utilization of the powers used for the power generation.

• Implementation of ERP

The concept of enterprise resource planning has served to be one of the most effective methods that allow any organization to improve its conversion ratio in its operating market. Thermax has implemented the ERP which has led to improved utilization of the resources acquired in this sector (Gielen et al., 2019). By considering that the entire context of gaining profit remains associated with the utilization of the resources, implantation of ERP serves as one of the biggest responses provided by the firm.

Identification of facilitators and challenges to adopting new technologies

The implantation of the new technologies in the energy sectors requires proper development of an architecture which can properly streamline the funds used for the implementation. In such cases, it becomes important for the firm to identify the different types of challenges and the facilitators that will remain involved with the implementation of the new technology within the firm. Some of the important challenges encountered are:

Identification of the demands

This can be considered as one of the most important challenges it involves the entire working class of the organization that remains directly associated with the firm's productivity (Saha and Chakraborty, 2017). The implementation of ERP that has been done in Thermax ltd to improve resource utilization, it can be observed that the optimization of the task was the first objective behind the deployment of the framework.

Ensuring compatibility

It is important to understand that the entire implementation of the new technologies remains associated with the existing frameworks and the flexibility of the architecture to adapt to the new technology that is imbued within the organization. In this case, the facilitators for the identification of the compatibility issues majorly resides on the operation manager that remains responsible for the different operation co-occurring in the firm (Bandyopadhyay, 2019). Thermax being one of the most innovative organizations in its operating market ensures to maintain a very high standard of operation management teams that helps in averting any kind of crisis that arises due to the deployment of new technology.

Acquiring investors

For the deployment of any kind of new technology in the energy sector, it requires a large number of resources and financial assets as it involves the deployment of a new architecture that will to only affect the entire productivity of the organization but will also affect the operation undertaken in the organization (Lu et al., 2017). In such cases, it can be said that the entire organization remains directly dependant to a different kind of investor who invests in the organization for the deployment of technology and work as sone of the important source fort funnelling the resources for the directed case. The acquiring of the investors becomes of one of the most important challenges of any company operating in the energy sector. This is because the success of the newly implemented technology heavily depends on the assessment done by the organization towards its framework which the investors do to remain aware of.

Analysis

All the above points provide a descriptive analysis in regards to the different types of challenges encountered by an organization due to the implementation of new technology. It is important under tenant the entire mechanism remains largely associated with the functional. It can be understood from the above that identification of the facilitators during the implementation of a new technology serves as one of the most important factors that relate directly to the development and the sustenance of the firm.

Application of ERP technology within the business operations of Thermax ltd

The company under the engineering and manufacturing segment, Thermax Ltd deals with the development of boilers and absorption coolers. For this purpose, the company utilises the integrated equipment that enables them to reduce their cost of productions and thereafter provide them with an opportunity to lower the energy consumption of resources. However, Agnolucci and Arvanitopoulos (2019) stated that due to immense competition in this segment of the market, the company as undertook the initiative of enhancing their operational segments through the application of modern technologies. As per the records of the company, there has been observed a proposal to apply cost reduction measures through global sourcing by upgrading their current IT systems. As opined by Drobkova (2020), this is because the IT systems provide them to an opportunity to estimate the overall production cost and thereafter price their products in the market accordingly. The lack of effectiveness of the current cost management technology that has been adopted by the company has led them to incur issues while producing boiler and absorption coolers. In this context, the management of the Company has idealised the application of knowledge management as an effective paradigm of estimating cost constraints through IT applications.

Change in existing operations

The application of technical changes within the operational segments of Thermax ltd is expected to alter the current parameters that they consider as key performance indicators of the business. As per the views by Chofreh et al., (2018), this is because the application of ERP systems as a centralised operational management practice would instantiate the utilisation of a common database to store and access data that the company possess. In other words, the ERP system entangles very operations that are executed by the company in terms of efficiency and effectiveness. This indicates that the system would help the busies administrators to make decisions based on the results produced by the system upon receiving certain inputs. For instance, the production of a boiler would require several types of equipment that would be supplied by external stakeholders to initiate the production and development process. With the help of ERP systems, the cost of production could be calculated with high precision providing the company with an opportunity to balance their investments to the estimated profits attained in marketing them (Haddara, 2018).

Based on the current operational structure of Thermax Ltd, there has been identified a few major segments that might drastically require reorganisation in order to successfully implement the ERP system.

• Marketing: The traditional approach to market analysis would be eliminated upon having the ERP system under possession by Thermax Ltd due to its high precision in estimating the current market trends. In other words, Aljawarneh and Al-Omari (2018) suggested that the operational manager would not be required to perform primary and secondary data collected from the market rather apply search engine mechanisms to engage customers using online portals. In this way, the company would be able to acknowledge the customers and their preferences over certain products.

• Supply chain management: The ERP system is also capable of administrating the supply chain management that enables the company to gain a perceptive measure of the overall costs incurred for raw materials gathering. According to Saberi et al., (2019), performing this requires the administrator of the ERP system to feed inputs that are related to the requirement specifications of the boiler to be designed. With the help of this data, the ERP system would be able to process its designated task and thereby provide an estimation of the overall equipment to be required for the production process. In this way, the cost of acquiring raw materials could be managed with optimisation and investments of production could be required avoiding loss of surplus goods.

• Database management: the current database that is being used by Thermax ltd to sore and manage information would be altered through an online mechanism. In other words, Vasilev et al., (2019) underpinned that the hard disks and other storage devices that are used for the management of information would be transformed using a cloud-based mechanism. With the help of this change in operations, the threat to loss of data would be avoided. In this way, the company would successfully be preventing any unauthorized and anomalous changes to occur within their information.

Impact over the performance metrics of Thermax ltd

Generally, the application of technological advancements within an organisational operation allows the business developers to enhance their performance metrics at high instances, Similarly, in the case of Thermax ltd, the enhancement of performance metrics is expected to occur due to the effectiveness ERP systems and its applicable platforms. In other words, Oghazi et al., (2018) exclaimed that the capability of the ERP systems to manage business operation one of the major reasons entrepreneurs adapt to this enhancement. Henceforth, the following performance metrics have been identified that is expected to be enhanced through the operating elements of ERP systems in their operational and management activities.

• Resource management: Executing operations that are related to engineering and development require accuracy in managing resources at very high precisions. This is because, the resources utilised for the manufacturing processes are prone to incur high-cost investments that might lead a company to face financial issues (Chofreh et al., 2020). Thermax Ltd has been observed to possess a very weak resource management practice due to their ineffective operation management segment. Henceforth, the application of ERP systems has been suggested as the performance of the organisation in context to resource management could be enhanced. As concluded by Pekša and Grabis (2018), this is done by the system through the initiation of the list fo activities that the company would process within their product segments. Having identified the list of resources, amount of consumption for each resource would be calculated and thereafter the operation manager could execute the production accordingly.

• Business scalability: The changes that often occur in the market of operation for Thermax ltd are resistant to business scalability. For this purpose, Amini Valashani and Abukari (2020) stated that it becomes difficult for the organisation to undertake decisions regarding maintaining a suitable position in the market. With the help of ERP systems, it is expected that the business development managers would be able to undertake decisions by analysing their current strengths and weaknesses and thereby make relevant changes within their operational segments.

• Cost management: One of the major activities that are performed by the finance manager of Thermax ltd is the analysis of the costs of investments and the products earned at the end of the annual year. As the manufacturing of boilers and absorption coolers are long term processes, it becomes difficult for the financial execute to estimate accurate costs of productions. For this purpose, Taghipour et al., (2020) underpinned that the individual critically analysis the activities that are associated with the manufacturing processes and thereafter associate each activity with a particular cost. In this context, the application of ERP system becomes handful as it provides support to initiate every activity with their desired costs according to the current market charges. This enables the finance manager to undertake decisions without having consumed much time of estimation.

Impact over three stakeholders

Stakeholder type	Stakeholder name	Roles	Impact	Field of interest
Internal	Operational manager	The operational manager is responsible to undertake the installation process of the ERP systems by engaging their departments within a single unit	With the implementation of the ERP system, the operation manager would effectively be able to keep a track of the processes that are undergone during the development and production of boilers and absorption coolers	Management of operations
External	Suppliers	The suppliers are engaged by the operational manager to provide support to the development and production processes by initiating raw materials	The initiation of the ERP system within the business segments of Thermax Ltd would allow the operation manager to engage supplies using their supply chain management system leading to the attainment of accurate estimation of raw material costs	Supply of raw materials
External	Customers	The assessment of the customer needs and demands that are to be specified can be estimated through the use of ERP systems by engaging their needs from the market and current trends	The arbitration of the customer needs could be gathered through online portals as the ERP system is integrated with the network of communication within internal as well as external segments (Aljawarneh and Al-Omari, 2018). Having this technology updated, the customers are expected to gain products at high quality and lower costs.	High-quality products and reduced costs

Table 1: Stakeholder identification and Impacts

(Source: Influenced by Halim et al., 2019)

Impact of associated risks

Risk type	Description	Impact	Mitigation	Responsibility
Financial risk	The operation manager is expected to face issues regarding the allocation of resources while implementing the ERP system without having proper knowledge of its costs and investments	High	The finance manager is responsible to establish a sustainable budget plan that would list down every cist of installation with proper precision of associated costs avoiding excessive cash flows	Finance manager
Implementation risk	Without having proper requirements specification undertaken, it is expected that the ERP implementation might face inappropriate configuration leading to the disruption of the process	Moderate	The operation manager needs to elucidate the activities that are to performed suing the ERP systems such that its application provides benefit to Thermax Ltd	Operational manager
Flexibility risk	Without implanting flexible parameters to the ERP system, the updating of its functionality with respect to changes in operations might be difficult leading to the increase in change resistance parameters	Low	The developers are required to make the system flexible enough to undertake changes that occur within the functional segments of the company (Zebari et al., 2019). This would allow Thermax ltd to make relevant changes within their operational segments without disrupting their infrastructure	Developer

Table 2: Identification of risks

(Source: Influenced by Taghipour et al., 2020)

Purpose and Recommendations

The study above provides an elaborate outline in regards to the different types of factors involved with the implementation of the new technologies and the consistent transition of architecture in the energy sector. A proper establishment of the relation in regards to the different kinds of functionality relates directly to the development and the productivity of the firm that relates to the operation of the organization.

Some of the recommendations that can be implemented in regards to the organization are:

• Improved utilization of the renewable form of energy to improve the conversion ratio concerning directly with the profits incurred by the organization. This will play a vital role in the sustenance of the organizational its operating market (Thirunavukkarasu et al., 2020).

• Implementation of the latest ERP version will allow the organization to utilize its resources in a strategic manner allowing the company to optimize its operations as well as increase its profits based on per units.

• The compatibility check after the implementation of the ERP system will help the organization to aver ay form of crisis or risk-related factors that can hamper the entire operation of the firm. It is important to understand that the productivity of the firm will be associated very slightly in both positive and negative ways.

Conclusion

The entire context remains largely focused on providing the different aspects of the operation management that is utilized by the organization to improve their functioning in the business grounds. The assignment sheds light on the different aspects of the organization that remains directly associated with the operations and the tasks associated with the firm. the ERP system that has been implemented in the Thermax system has been mentioned within the organization. It is important to note that the entire firms remain associated with the development of the different types of factors that remain associated with the functionality of the firm. the benefits of the ERP system and the different new technologies implemented in the organization has been described elaborately. This has allowed us to understand the different factors that affect the progression of the firm in its business grounds. Based on the above-mentioned technological implementation, it is expected that the operational manner of Thermax ltd would be required to gain specified requirements for the ERP implementation. The context also provide a proper outline on the necessity of investors and the funnelling of the funds in the energy sectors and how each of the implantations connects all the aspects of the organization in regards to operational architecture.

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