Production and sustainability of project operations are significant in achieving the desired result of an organization. Demand and supply market forces affect how resources are allocated to a project. Thus, this project applies the knowledge of sustainability and production in project management to evaluate the best scenario a perfect business entity can adapt efficiently. Project management applies the real-life application of skill, knowledge, and execution of skills required in non-business fields.
Introduction
Organization development and growth depend on various aspects such as cost-effectiveness and enhancement of strategies to respond to supply and demand market forces. Effective strategies of a project help organizations to enjoy a favorable market environment and a competitive environment. An organization with a suitable market environment will likely overcome competitive forces in the short and long run. For this reason, the competitive advantage helps overcome and minimize resource waste.
The global economy has strengthened business operations’ viability by forcing companies to maintain a competitive market advantage. Many companies lose time and money through sensitive aspects such as product development and services. The growth of goods and services overcomes this challenge surrendered to project management for profitability and quality performance. Project management is significant in developing unique services and results through different phases. Primary factors of a project in operations management include demand forecast, aggregate planning scenarios, cost calculations, and comparison of the best scenario.
Demand Forecast
The overall demand in 2018, 2019, 2020, 2021, and 2022 was 1611.766667, with a seasonal index of 0.7795173. Project managers are responsible for their financial decisions (Heizer, 2017). These decisions efficiently ensure the running of an organization’s daily activities and operations. They enhance the sustainability of businesses and promote profitability. Further, project managers use them to predict and forecast the organization’s future performance. Thus, the future operational cost of this project is forecasted to be 1476 as of June 2023.
Aggregate Planning Scenarios
The total sum of constant minimum level production, subcontracting, and overtime determines the expected demand. This scenario rules out subcontracting and overtime for workers. Thus workers will have twenty-four days of work per month. The expected demand is 1445, 1451, 1457, 1464, 1470, and 1476 in the first to the sixth month, respectively. This demand is calculated based on six inventories: regular labor cost, overtime, subcontracting, hiring, inventory, and layoff. The total cost on demand is expected to be $314,564.
There is a higher forecasted cost of production in this scenario. Remote availability is essential to ensure that the project yields to the demand. Thus, there is a need for overtime work. Overtime payments, therefore, will increase the inventories of the project, which further increases the total cost to $318986. The average production level is therefore easily met but, over time, is initiated to meet market supply and demand forces.
There is increased efficiency with many workers, hence less cost. Thus, there is no cost incurred for overtime and subcontracting costs. The total cost in this scenario is $302268 due to matching resources and skills in production. According to Heizer (2017), project management comprises planning, staffing, controlling, leading, and organizing. This scenario provides guidelines and adherence to the budget and remote availability of tasks and clients.
Cost Calculations
Forecasting in an organization is the science and art of predicting events in the future. Predictability of future events consists of technological, economic, and demand forecast models (Heizer, 2017). In the first scenario, there is a high cost at the project’s inception (314564.00). The second scenario cost is 318916, comprising six inventories excluding subcontracting. The third scenario is cost efficient with a cost of 302268 with reduced hiring and increased employment of workers.
Discussion
The cost incurred in the first, second, and third scenario is $318986, $318986, and $302268, respectively. More cost is incurred in the first and second scenarios. Therefore, the third scenario is superior to the second and the first. There is less cost and higher demand in the third scenario. There is also high efficiency due to the increased number of workers. A sufficient number of workers reduces the number of inventories such as overtime and subcontracting. There is no need for overtime and subcontracting additional workforce. Reduced inventories will, therefore, reduce the cost of production and operation.
Conclusion
Project sustainability is significant in ensuring that the cost of operation is minimized. Understanding sustainability and the production of a project are useful in real-life applications for me and others in a business environment and broader fields. Sustainability in project management helps individuals apply skills, knowledge, and techniques to execute non-business activities. It helps to achieve desired objectives under time, cost, quality scope, and resource constraints.
References
Heizer, J., Render, B., & Munson, C. (2017). Operations Management: Sustainability and Supply Chain Management (12 ed.). Boston: Pearson.