Aurora Cannabis Company Case Study– Operation Management
The history of Aurora Cannabis Inc. The company is big and wide. The company was founded by four individuals who were Steve Dobler, Terry Booth, Chris Mayerson, and Dale Lesak. The quad contributed about five million US dollars and decided to set up the company. Officially, the company gets its license for growing marijuana in the year 2014. Through licensing, Aurora Cannabis was the first company that was growing and producing Cannabis. In the last quarter, Aurora Cannabis had a deal with the Coca-Cola Company in an agreement of developing medicinal beverages made of cannabis.
Aurora Cannabis Company is based in Canada, and it engages itself with in production and distribution of medicine made of Marijuana. The chain of distribution for this company is horizontally diversified and vertically integrated. The Aurora chain involves designing and engineering of marijuana breeding, genetics research, derivatives, total sale, and retail distribution. The Company’s motivation constructed offices which incorporate advancements over and all procedures are characterized via customization and automation. The Company has a financed limit of more than half a million kilograms for each year and in addition, deals with activities more than more than eighteen nations around the world.
Aurora Cannabis Inc. is an incredibly influential incorporated cannabis organization with industry-driving renown for ceaselessly hoisting and setting the worldwide cannabis industry standard. Through our completely possessed auxiliaries, vital ventures, and worldwide organizations. Aurora gives an extensive variety of premium quality cannabis and hemp items and administrations create creative innovations, advances cannabis customer well-being and health, and conveys an extraordinary client encounter over the entirety of its brands.
Aurora’s tasks range different landmasses and spotlight on both the therapeutic and recreational cannabis generation and deals, quiet training, and facility advising administrations home hydroponic development, extraction innovations, and conveyance frameworks, also, hemp-based sustenance wellbeing items. The company works far and wide seeking after new and developing cannabis markets where conceivable through our possessed system of import, fare and discount merchants, our e-business and versatile applications, physical retail locations, and in addition basic need store retailers, and drug stores (Aurora, 2018).
Weaknesses in Aurora Cannabis Inc.
Aurora Cannabis Company as it is known for its production and distribution of cannabis medicine, it is organized in the machine and product utilization in both continuous and repetitive process. Therefore, there are several weaknesses found in the Aurora production process. One of them is lack of flexibility. The machines producing the products are not flexible in that they can change in product variety and design. For this reason, Aurora Cannabis Inc. is required to purchase a new machine with the ability to work in a series. The produced varieties are of low quality.
Generally, Aurora Cannabis has produced many varieties of cannabis medicine including Aurora cloud CBD (Cannabis Oil), Luna (Banana split), Haiduk (Sour Tangie), Snowdome, ambition, and white crown among others (Aurora, 2018). The weaknesses arise during the production process where each variety is produced by its production process instead of producing them together. This method is costly, time-consuming and wastes a lot of resources such as energy and raw materials (UKESSAYS, 2016).
Besides that, Aurora lacks skilled personnel to handle the machine. The process of production would take a lot of time to be completed in case of machine developing a mechanical problem. So if the staffs are not technically skilled enough and machines are not working, there will none of the staffs to handle and fix the problem which could affect the entire production process (UKESSAYS, 2016).
In addition, the weaknesses are the parts of the company which not performing well and need to be addressed. There were other weaknesses which affected the Aurora including poor financial planning, gaps in the production phase, and challenges in losing small market share in the market. Others include unable to outdo the competitors, low investment in technologies and high attrition rate in work force. In addition, Aurora Cannabis is overcentralized and is unable to respond to the local need quickly. Furthermore, the company system interface does not align between local functions, error in data entry and poor patient need integration.
Strategies to Strengthen Aurora Operation
There is much more Aurora Cannabis need to do to strengthen its operation. Firstly, the company should focus on its growing cost. The company should start from scratch the tips for economic scale. Secondly, the company should focus on production target. To achieve the company’s goals, the goals and objectives of the company should be aimed high. The third strategy should be an expansion of company capacity on budget and track. Aurora cannabis should gain quite a lot of investors. The capacity expansion is focused on the company’s production power of more than half a million kilos (Williams, 2018).
The other strategies are growing visible presence (Williams, 2018). The company should aim at overlooking the international markets. By including the international market, the company is expected to get high production for all planters that yield more than three million kilos. The international market targeted, therefore, should be the one where marijuana is legalized.
Furthermore, the company should be highly focused on product differentiation. The Company’s motivation manufactured offices which incorporate advances overall procedures are characterized via computerization and customization. The Company has a subsidized limit of more than 500,000 kilograms for each year and additionally deals and activities more than 18 nations worldwide. The way Aurora can separate itself is twofold. In the first place, it’ll have to give some time, exertion, and funding to working up its brands. Furthermore, also, it’ll have to widen its product offering admirably past dried bloom, which has shown itself inclined to commoditization after some time in select U.S. states where grown-up utilize weed is lawful. Aurora’s push into cannabis oils and other elective items, for example, implanted refreshments, will be essential to lifting its edges and making each dollar in income honestly check (Williams, 2018).
Components of Supply Chain Management
This is a standout amongst the essential stages. Before the start of the whole supply chain, it is fundamental to conclude the techniques and established them. Checking the interest for the item or administration, checking the suitability, costing, benefit, and labor and so forth, are imperative. Without a legitimate arrangement or methodology set up, it will be well-near unimaginable for the business to accomplish compelling and long-haul benefits. Along these lines, enough time must be dedicated to this stage. Simply after the conclusion of the plans and thought everything being equal and cons, would one be able to continue further. Each business needs an arrangement or diagram or a guide dependent on which the methodologies are made. Planning recognizes the interest and supply slants in the market and this, thus, makes an effective supply chain administration framework.
This is the strategic part of supply chain management required to manage all the resources that go towards satisfying customer need for goods or services. The big piece of planning is developing a faction of metrics to control the supply chain so that it is useful, cost less and delivers high quality and value to customers.
SOURCE: Suppliers assume an extremely pivotal job in supply chain management frameworks. Items and administrations sold to the end client are made with the assistance of various arrangements of crude materials. It is, in this manner, essential that reasonable quality crude materials are acquired at savvy rates. On the off chance that a supplier can’t supply on time, and inside the stipulated spending plan, the business will undoubtedly endure misfortunes and gain negative notoriety.
It is pivotal that an organization gets great quality resources so it can make great quality items and keep up its notoriety in the market. This requires a solid job for suppliers in the supply chain management framework regarding the choice of the suppliers that will deliver the goods and services needed to create products.
MAKE. The manufacturing step where the activities necessary for production, testing, packing, and preparation for delivery is scheduled. Measure quality levels, production output, worker productivity. Production is a standout amongst the most vital parts of this framework. It is just conceivable when the various segments of the supply chain are pair with one another. For the procedure of creation to begin, it is fundamental that legitimate arranging and supply of merchandise, and in addition the stock, are very much kept up. The generation of merchandise is trailed by testing, bundling, and the last planning for the conveyance of the completed item.
DELIVER/TRANSPORTATION: Logistics, coordinate the receipt of orders from customers, develop a network of the warehouse, picking carriers to get products to customers and set up an invoicing system to receive payments. Transportation is indispensable as far as conveying crude materials to the assembling unit and conveying the last item to the market. At each stage, auspicious transportation of merchandise is required to maintain a smooth business process. Any business which focuses on this segment, and takes great consideration of it, will profit by the creation and transportation of its merchandise on time.
It is fundamental that an organization moves in the direction of a sheltered and secure transportation process. Be it in-house or an outsider seller, the transportation management framework must guarantee zero harm and negligible misfortune in travel. A very much overseen coordination framework alongside impeccable invoicing are the two mainstays of secure transportation.
RETURN: The difficult part of the supply chain, create a network for receiving defective and excess products back from customers with the delivered product. Among the different segments that make a solid supply chain is an office for the arrival of defective/breaking down merchandise, alongside an exceptionally responsive shopper complaint review unit.
Nobody is trustworthy. Indeed, even a machine may break down once in a million times if not more. As a piece of a solid business process, one may expect the arrival of merchandise under different conditions. Indeed, even the best quality control procedures may have certain transient omissions. On account of such slips by, unavoidably pursued by buyer disputes, a business must, instinctually, review the item/s and issue an expression of remorse. This makes a decent client holding, as well as keeps up altruism over the long haul.
Advantages of Employing Just-In-Time
Aurora Cannabis Inc. is a company which is fit to use just-in-time philosophy for it is an efficient method to apply. The primary aim of this method is to minimize the goods the company held at any one time. The following are the advantages that arise as a result of being used in the Aurora Cannabis Company.
First, the space needed is less because there are no warehouse or storage facilities needed. This advantage also reduces the cost of storage as they arise due to renting space. Reduction of wastes is another advantage of applying just in time. Due to the efficiency of the stock, there is a reduced number of damaged goods. In addition, the just-in-time method ensures smaller investment for companies those that do not have enough money for buying huge stock hence preferable for Aurora Cannabis Company. Finally, the just-in-time system controls the overproduction of goods in the company. This means that the company uses to reduce production and raw material costs.
Impact of Just-In-Time Philosophy
Just-in-time philosophy, also known as JIT, is used regularly used in different phases during production and manufacturing processes. Here are the various impacts of Just-In-Time in Aurora Cannabis:
Advantages of small lot size (Yeh, 2018). The manufacturing and production of small portions provide more cost reduction and ensures high-quality production. In small manufacturing portions, products are turned easily, and the mixing of products is done flexibly. This flexibility ensures the improvement of transport responsiveness. Methods of decreasing set up include clear setup operation, procedural set up operation and set up process analysis.
Group technology, GT, is manufacturing and engineering philosophy that recognizes the similarities in the process and launches efficiency in product manufacturing and design.
Restructuring the Company Floor
The Just-In-Time philosophy helps in restructuring the company by developing a new approach and philosophy effect on company layout – reduces movements, customer communications, simplicity, flexible and safety, and be orderly. In addition, there is material flow, selection of equipment, material checking, and planning requirement material.
|Trend Analysis||· Defines the upward and downward pattern
· Includes exponential, regression and triple smoothing
|Seasonal Adjustment||· Demand vary from time to time.
· Made to baseline prediction and forecast
|Decomposition||· Data separated into cyclical, seasonal and trend
· Random data does not have a pattern
· Forecast is made by projecting the pattern
|Graphical Method||· Graph plotting
· Patterns and trend are easier to plot
|Market Research||· Conducted through the survey|
|Expert Opinion||· Opinions are widely sought
· Opinion given on current trend
|Focus group||· Consist of a panel of customer|
|Historical Analogy||· New sale compared to previous sales.|
|Panel consensus||· Opinion provided by a group of people.|
The quantitative method of research has the following strengths
This method provides a room for the formulation of statistics. In addition, this method affords a macro view with the required information. Thirdly, any large sample enables a generalized conclusion. Furthermore, this research method enables the estimate of various data. Lastly, the application of manual ideas is put into reality through automation which saves time.
Weaknesses of Quantitative method
The method reveals the extent of data but fails to answer the r for a reason.
Qualitative Research Method
Strengths of Qualitative method
All solutions provided by this method are in details hence satisfying the company need. The technique focuses on small groups therefore manageable. The data from small groups represent the large population and thus saves time.
The following are the weaknesses of Qualitative research method
This method collects data for small groups; hence not the right assumption is made for these groups. Moreover, there are difficulties in demonstrating, assessing, and maintaining the inelasticity of data. Other weaknesses of this research method are that there is time consumption for dig data.