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Essay on Aircraft Procurement And Production Management
Procurement is the acquisition of goods or services at the best possible total cost of ownership, in the right quantity, at the right time, in the right place for the direct benefit or use of the governments, corporations, or individuals generally via, but not limited to a contract.
An important distinction is between analyses made without risk and those with risk. Where risk is involved, either in the costs or the benefits, the concept of expected value should be employed.
The airline industry is a prime example of a market where cutthroat competitive activity is the status quo. Airlines that survive in this environment do so through the understanding and continued improvement of the way in which tactical management tasks are addressed.
"Success is dependent upon doing all of these tasks well including demand forecasting, logistical programming, marketing and production. The key point to remember is that; any airline corporation is a tactical entity, its key area of concentration is equilibrium maintenance. A continual endeavor must be made to match supply closely to demand, especially anticipated demand. If it is not likely that production can be amended to more closely match demand, then promotion should be used to affect demand" (William, 1997).
Since demand forecasting is one of the key drivers of production, i.e. how many products a firm should supply, this will be the first management task to receive consideration.
All firms engaged in activities as a tactical entity will, in some form or another, attempt to get a handle on expected demand for their products within a certain future time period such as a week, month, quarter or year. The main thing to bear in mind is that this is a tactical environment and, aside from any earth shattering new developments or shocks to the existing environment,....
