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Operational Objectives and the Transformation Process in the Energy/Electricity Industry

Stromproduktion in der Energiewirtschaft: operationale Ziele und Transformationsprozess

Title: Operational Objectives and the Transformation Process in the Energy/Electricity Industry

Research Paper (undergraduate) , 2009 , 16 Pages , Grade: 1,0

Autor:in: Florian C. Kleemann (Author)

Business economics - Supply, Production, Logistics
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Summary Excerpt Details

Auf Basis eines grundlegenden Modells des transformationalen Produktionsprozesses (Input-Transformation-Output) wird der Herstellungsprozess von Strom anhand eines realen, anonymisierten Unternehmens aus der Energierwirtschaft beschrieben und analysiert. Auf das besondere Produkt (Dienstleistung) „Strom“ hin werden operationale Ziele der Produktionswirtschaft abgeleitet und kritisch analysiert. Da in diesem Gebiet kaum betriebswirtschaftliche Arbeiten bestehen, leitet die Arbeit einen wesentlichen Beitrag zu dieser Perspektive für die Energiewirtschaft.

Schlüsselwörter: Operations Management, Energieerzeugung, Energiewirtschaft, Stromproduktion, Produktionsprozess

Excerpt


Table of Contents

1. Introduction

2. The transformation process at EXAMPLE

2.1 Definition of the EXAMPLE operations

2.2 Characterisation of the key operations process

2.3 Electricity – product or service?

3. Operational objectives for EXAMPLE

4. Conclusion

Objectives and Core Topics

This report examines the transformation processes and operational objectives of a German electricity generator, identified as "EXAMPLE". The primary goal is to analyze how the company converts inputs like fuel into electricity within a continuous production framework and to derive the critical operational objectives required to maintain an efficient and reliable energy supply.

  • Analysis of input, process, and output factors in electricity generation.
  • Evaluation of the classification of electricity as either a product or a service.
  • Discussion of operational strategies for managing high capital intensity and continuous production.
  • Identification of key operational performance objectives: dependability, flexibility, and cost efficiency.
  • Examination of the trade-offs between load management, cost optimization, and supply reliability.

Excerpt from the Book

2.1 Definition of the EXAMPLE operations

Transformation processes are a key part of a company’s operations. When a set of inputs is transformed to provide outputs, this is called “transformation process” (Slack et al. 2004). In the following, this basic model will be applied to energy generator EXAMPLE.

Input resources are separated between transformed (processed) resources (therein material/ information/ customer) and transforming resources (therein facilities/ staff) (Greasley 1999).

At EXAMPLE, the transformed resources are mainly materials such as fuel (e.g. coal) to be fired during the transformation process. Additive materials used in the process are air and water (Dyckhoff 1994). Although information (e.g. demand data) does play a role in planning operations, it is not changed during the transformation process. Also, customers are not converted as part of the production process, thus are not key part of the operations at EXAMPLE.

The transforming resources, mostly facilities, play a major role in power generation are. The power plant’s key components (e.g. steam boiler, turbine or generator) are the core of transforming the energy that is bound in the fuel into electrical energy (Oeding / Oswald 2004). Thus, building, running and maintaining power plants is the key function of EXAMPLE. Due to the complexity of the equipment, a highly skilled workforce is required to run the power plants as efficiently as possible. However, the staff is mostly not directly carrying out, but far more supervising the transformation process (Waters 1999).

Summary of Chapters

1. Introduction: This chapter introduces the theoretical framework of transformation processes and outlines the scope of the report focusing on the coal-fired electricity generation of the case study organization.

2. The transformation process at EXAMPLE: This section defines the specific inputs and outputs of the company’s power generation and characterizes the process as a continuous production system.

3. Operational objectives for EXAMPLE: This chapter evaluates and prioritizes the company's operational objectives, highlighting the conflict between dependability, cost minimization, and the need for volume flexibility.

4. Conclusion: The final chapter summarizes the findings, asserting that the classification of electricity as a product or service is secondary to the primary goal of providing a dependable supply to customers.

Keywords

Operations Management, Electricity Generation, Energy Industry, Transformation Process, Continuous Production, Operational Objectives, Dependability, Cost Minimization, Volume Flexibility, Resource Management, Power Plant, Infrastructure, Industrial Efficiency, Supply Security.

Frequently Asked Questions

What is the primary focus of this report?

The report focuses on identifying and describing the transformation processes and operational objectives of a real-world electricity generation company.

What are the central thematic areas?

The key themes include the analysis of transformation models (Input-Transformation-Output), the nature of continuous production processes, and the strategic prioritization of operational objectives in the energy sector.

What is the main research question or goal?

The goal is to determine how a large-scale electricity provider manages its operational processes and which objectives (such as dependability or cost) are most critical to its business success.

Which scientific methods were applied?

The study utilizes secondary research to build a theoretical framework, which is then applied to analyze the specific operational context of the anonymized case company.

What aspects are covered in the main body?

The main body covers the definition of operations, the characterization of the power generation process, the debate on whether electricity is a product or a service, and the evaluation of five operational performance objectives.

Which keywords best characterize this work?

The most relevant keywords include Operations Management, Electricity Generation, Continuous Production, Dependability, and Cost Minimization.

Why is dependability considered the most critical objective for the company?

Dependability is ranked as the top objective because electricity is expected to be available instantaneously; any interruption could lead to major network-wide blackouts, which carries significant consequences.

How does the company balance cost efficiency with the need for flexibility?

The company employs a strategy of utilizing large, efficient power plants for "base load" while managing demand peaks through smaller, more flexible plants or by trading capacity on commodity markets.

Does the classification of electricity as a product or service matter for operations?

The report concludes that while electricity has service characteristics (intangibility, storage difficulties), the distinction does not fundamentally change the operational strategies, which remain focused on serving the customer reliably and profitably.

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Details

Title
Operational Objectives and the Transformation Process in the Energy/Electricity Industry
Subtitle
Stromproduktion in der Energiewirtschaft: operationale Ziele und Transformationsprozess
College
Robert Gordon University Aberdeen  (Aberdeen Business School)
Course
Operations Management
Grade
1,0
Author
Florian C. Kleemann (Author)
Publication Year
2009
Pages
16
Catalog Number
V190102
ISBN (eBook)
9783656145691
ISBN (Book)
9783656146032
Language
English
Tags
Operations Management Energieerzeugung Energiewirtschaft Stromproduktion Produktionsprozess
Product Safety
GRIN Publishing GmbH
Quote paper
Florian C. Kleemann (Author), 2009, Operational Objectives and the Transformation Process in the Energy/Electricity Industry, Munich, GRIN Verlag, https://www.grin.com/document/190102
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