Operations Management Report
Bondstein Technologies Ltd.
Letter of Transmittal
Mofassel Hossain
Lecturer
Department of Management
School of Business and Economics (SBE)
North South University,Dhaka
Subject: Letter of Transmittal
Dear Mr. Mofassel Hossain,
We have prepared a report on the company, Bondstein Technologies Ltd., which was
assigned to us as a course requirement. In view of that, we worked as a team with utmost
enthusiasm and applied our knowledge and understanding of the different factors, tools and
elements related to Operations Management terms, theories and analysis. We hope to reply
the approaches that we have been taught in class.
If you require any further clarification or additional information regarding this report, please
do contact us without any hesitation.
Sincerely,
Md. Fakhrul Islam
Team Leader
Group-5
Section- 18
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Acknowledgement
We are grateful to Almighty Allah who has given us this opportunity to create such an
interesting term paper and helped us to finish it for MGT314. We would like to add a few
hearty words to the people who helped us in numerous ways to complete our term paper.
Our hearty thanks goes to Mr. Mofassel Hossain, School Of Business, North South
University, for giving us the opportunity to prepare this term paper and gain new and
practical knowledge in the process. The guidelines she showed and the way she tirelessly
instructed us on the topics our work is related, assisted us a lot.
We would also like to thank Mr. Nafizul Islam, Operations Manager, Bondstein Technologies
Ltd and his operations team for providing the information and assisting us for data collection.
We have enjoyed our term paper and hope it will be appreciated.
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Executive Summary
Bondstein Technologies Ltd. was founded on 2014 with a vision tobuild the platform of
‘Made in Bangladesh’ by creating new opportunities and scope of business by giving
technological access to mass level. Then the company has developed a rich portfolio of
diversified innovative projects-Locate.Guide, Halkhata, Gariwala, and is currently focused on
their next big thing: Track My Vehicle )TMV(. It is a GPS based hardware and software
integrated tracking service that provides much more than just the location. Bondstein
ismarketing its product through an 'invite only' process due to its current limitation of
resources to handle the full influx of the market demand. With dedicated before and after
sales team services. The sales team scouts for potential customers that fits the organizations
goals and offers them the full service only for the installation charge.During our
investigation, we analyzed that while the focus on wait in line management was not
completely ignored, but some major loop holes were left that might prove costly in the future.
There are other operational problems such as limited capacity, waiting, location, processtime,
movement and defects.After analyzing the operation activities of Bondstein, we came up with
a handful recommendations for their operations, implementing which would result in a
smooth flow of process, efficient use of available resources and potential growth
opportunities.
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Contents
Bondstein Technologies Ltd. ................................................................................................................ 10
Operations Strategy ............................................................................................................................... 12
Supply Chain Management .............................................................................................................. 12
Process Mapping............................................................................................................................... 14
Business Process Map .................................................................................................................. 14
Demand Forecasting ............................................................................................................................. 15
Recommendations ............................................................................................................................ 15
Capacity Planning ................................................................................................................................. 16
Facilities Layout.................................................................................................................................... 17
Process Selection .................................................................................................................................. 18
Quality Management ............................................................................................................................. 20
Product Design and Conformance .................................................................................................... 20
Ease of Use ....................................................................................................................................... 20
After Sales Services .......................................................................................................................... 20
Awards Achieved ............................................................................................................................. 21
Quality Control ................................................................................................................................. 21
Raw Materials .............................................................................................................................. 21
Post Sales Service......................................................................................................................... 21
Monitoring and Inspection ........................................................................................................... 22
Inventory Management ......................................................................................................................... 23
Conclusion ............................................................................................................................................ 24
Recommendations ................................................................................................................................. 25
Appendix ............................................................................................................................................... 26
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Bondstein Technologies Ltd.
Bondstein Technologies Ltd.
Bondstein Technologies Limited is a hardware and software solutions provider, established
on 2014, by a group of enterprising young men and business leaders from various
backgrounds. Most of the directors of the board functions as silent partner, only 2 of them are
actively involved in the operations and functions of the firm.The CEO Mr. Iftekharul Islam
and MD Mir Shahrukh Islam are the main top officials for the organization along with being
full members of the board of directors.
The organization, along with their technological solution providing, has a limited range of
products of technological nature. One of them is Track My Vehicle (TMV). It is a device,
functions with network connections in concert with GPS device within to provide location
based service and tracking capabilities.
The organization is headquartered at Baridhara DOHS and has a storage/laboratory at Kaola,
Uttara. The devices are made and supplied from both of these locations. The organization has
the capability to install and operate the devices from any location with the aid of their
technical and operational executives.
The firm has several strategic alliances with technological and telecommunication giants to
streamline and facilitate their services. The firm solely relies in Robi Axiata Limited for the
networks connections through SIM cards for their device connectivity.
The product, TMV, is basically a vehicle tracking service, provided by the TMV devices
attached to the clients’ vehicles. It allows the authorized personnel to keep track of their
vehicle/vehicle pools and its various metrics. The device generates data regarding the
distances, locations, fuel reading, capacity, functions and security. It can be accessed through
android and IOS apps. Its functionality can be availed through the panels accessed through
desktops and laptop computers, which updates the information within short period of time.
The device is attached within a vehicle and connected through wires with the internal systems
of the vehicle. These installations complexity varies differently for different types of vehicles.
The Client Service team is the backbone of the after-sales phase of the service. It is made up
of executives and coordinators under the lead of departmental head, the MD. The day to day
operations is overseen by the Operations Manager, Mr. Nafizul Islam. He has the authority to
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make decisions in absence of the departmental head. The CS team communicates with the
clients to receive and act accordingly to the feedback received. The Operations Manager also
leads and directs the team of executives and technicians responsible for installing the devices.
The IT team is headed by Mr. ASM Amin Mehedi, Sr. IT Manager whose sole responsibility
is to keep track of the web based software and servers and conduct regular customizations
and modifications requested.
The organization’s belief stated in their website relays the value which they hold through 4
simple sentences. They Connect, to interact with the stakeholders to create something
valuable. They Design, to build something with the capability to function in the majority of
the situations, regardless to the factors affecting it. They develop, with passion to create
something revolutionary. And lastly, they keep it up, relaying their commitment to support
their clients through every step of the service life cycle.
Their main competitors are M2M Communications, NITS Service (Pvt) Ltd, Finder GPS
Tracking System and GP Tracker.
The organization was first established as a Start Up, bringing together expertise and
experience of the various technological and economical fields. They have been able to be
selected as one of the participants of ECHELON Top 100, a competition recognizing
innovation in Asia. They also have managed to rank highly in other competitions locally and
internationally.
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Operations Strategy
Bondstein’s operational management is not that much different from others. Since its journey
Bondstein added new innovation to life. They are working on one of their successful“Track
My Vehicle™” (TMV) device which is awarded Echelon -2015 people’s choice award for its
innovation.
Operation management of Bondstein Company is detailed here by.
The overall operational decisions reside on departmental head or the Managing Director in
this case, under whom the Operations Manager takes on day-to-day running of the operations.
Under the manager Operations, Manufacturing and Client Service team functions. The
executives are the leading person for the team of technicians who are responsible for
installing the devices into vehicles.
In operation management of Bondstein Company there is a Regional or Divisional head who
looks after or directly lead every individual project. Every project is directly supervised by
him. Client at first will have to fix a meeting with regional head who then assigns the task to
operational head. Operational head lead the lower hierarchy and report to the regional head
about the assigned task. In lower level of operational hierarchy there is an operational
executive who does the main work in different work stations. There is also a client service
section which deals with the client 24/7. They are mainly after service team who report to
upper executive if any problem arises. In the operation management, there is another
important sector who are technicians. There work is to install the device on spot.
Supply Chain Management
Engineers are there to generate ideas and technologies to increase productivity and reduce
cost. Board of directors of Bondstein is aimingto improve flexibility to meet rapidly changing
customer needs, assuring a safe workplace for all employees . For this reason, they have their
own technician team to assemble all the components to create the whole device.
They collect different components or needed parts from local market and they import the
main equipment IME chips from China. The whole product is assembled by own lab
technician team. While collecting different components, they have to deal with different
supply chain. To produce the best product, they have to deal with the best local market
suppliers. To meet the demand, timely delivery from supplier is important. The collection of
the devices is then internally checked to assure optimum quality.
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In this supply chain, the organization imports IMEI chips from vendor in China, which is
shipped to Bangladesh through airplane cargo mailing service. The shipment takes up to 1
month after forwarding the order. One of the directors are responsible for receiving the items
as Bondstein’s representative. The other component vendors send the items straight towards
Bondstein after receiving necessary orders and paper works.These orders are generally
received within the order placing work day. After assembly and software loading processes,
the device are installed in client vehicles by the Technical team. This installation period takes
up to 20-40 minutes depending on the vehicle model and make. After receiving device and
service order from clients, the TMV can provide the devices within 1-3 days. Corporate fleet
device delivery order size and deadline is set as per agreement reached by the involved
parties.
Like any other product after collecting all the components work in progress phase starts .
Outputs are inspected to insure quality to satisfy the customer demand . Planning, Organizing,
Coordinating, Controlling etc.altogether brings the product that customer needs by Bondstein
family.
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Process Mapping
Business Process Map
Detailed process map for TMV (Corporate Client – Vehicle Fleet):
1. Communicating with the Client: The Marketing teams pitch the prospective client
to subscribe the TMV service.
2. Client Onboard: A trial run for 2-3 cars over 15-30 days’ period is proposed to the
client. If the client is satisfied with the services offered, they can apply for
subscription of the service.
3. Piloting: The client verifies the services offered through the usage of the devices in
their vehicles. The organization demonstrates what can be gained through the VTS.
The organization requires Data Package and Device service charge for this phase.
4. Clients Approval & Payment: After getting the approval of the client, the
organization requests the work order and an advance payment. If the number of
vehicles to be installed is less than 30-40, the full amount is requested. If not, then
50% of the total amount is requested.
5. Installation for the whole fleet: The organization can arrange for installation of up to
8-10 cars a day at a single location.
6. Panel Handling Training for the Client: After installation, the organization arranges
training session for the client regarding the Admin Panel. The training is focused on
teaching the client about how to use the options and information from the panel.
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Demand Forecasting
The demand forecasted by the senior officials of operations at Bondstein is derived from the
trends noticed from the number of VTS registered users gained from previous years.
Generally, the demand for the number of devices to be produced is set according to the
agreements and discussions with the prospective clients. From these meetings the number of
devices to be produced and the delivery deadline is decided. As per these aforementioned
requirements, the operations manager sets up the production planning. As per the Operations
Manager, they have the capability to produce 40 devices per day which can be doubled up if
the employees function overtime. Recently, they have managed to complete manufacture and
installation of VTS for 245 vehicles within 15 days deadline.
The demand forecast is done by the Naïve method, because the actual demand is irregular and
order based.
The detailed calculations are included in the Appendix section.
Recommendations
 Exponential smoothing method should be used for weighted averaging method instead
of moving average.
 Using moving average gives relatively more errors than other averaging methods.
 For forecasting accuracy, MAPE method should be used.
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Capacity Planning
The main questions in capacity planning are the concerns regarding the KINDS of capacity,
the AMOUNT of capacity and WHEN it is needed. As per our investigation conducted on
TMV’s operations, we have identified the relevant metrics regarding the capacity.
As to the Design Capacity, the existing facilities that are available has been designed to
produce 40 devices per day. After more discussion, the Effective Capacity is 30 device per
day and the Actual Capacity is 20 devices per day. If the demand increases, the output can be
pushed to more than 30 devices per day including overtime from the workers. The Efficiency
and Utilization calculations are shown in the Appendix section.
After the review of these metrics, we would like to recommend the following approaches for
effective capacity management of TMV.
 The Effective capacity is 66%, where the actual is 50%. So, employee training and
productive team assignment should be conducted to proper utilization of capacity.
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Facilities Layout
The Bondstein Technologies has their facilities at 2 different places for the operations of
TMV. One is their main official headquarters at Baridhara DOHS, where the administration
and a smaller laboratory is located. Another place is a warehouse and multi-purpose lab for
research and bulk production of devices located at Kaola, Uttara. The facilities layouts are as
follows.
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Process Selection
After a comprehensive research of Bornstein's operation and studying their operational
layout, we were able to determine that the Vehicle Tracking Device’s manufacturing process
utilizes a labor intensive process for production. They have highly skilled workers in their
production line to manufacture individual devices with maximum precision and accuracy
with general equipment or tools.
Bondstein Ltd. use batch processing system and their manufacturing process is intermittent.
They manufacture the devices in their research lab which is of 400sq ft. and their
manufacturing team organize the tools to accomplish a total of 11 tasks. . Moreover, the
manufacturing team ensures that the company’s Total Quality Management (TQM) goals are
met. The manufacturing process has the following steps:
a. IC Soldering (25 minutes)
b. Capacitor Fixing (10 minutes)
c. IC Board wire connection fixing (5 minutes)
d. Cable attaching (2 minutes)
e. Inserting the software in the circuit (10 minutes)
f. Check & Test (2 minutes)
g. Serial storing in Database (1 minutes)
h. Framing the circuit into the box (4 minutes)
i. Attaching Antenna and its connections (2 minutes)
j. External Wire connection (5 minutes)
k. Finish package & overall check (2 minutes)
These tasks are arranged in a U shaped layout. There are 3 workstations and task no. 1 has the
bottleneck.
The bottlenecks that have been identified are of 2 types. They are Capacity Bottleneck and
Operational Bottleneck.
Capacity bottleneck is embedded in the facility. Our recommendations for it are-
Remodeling facility layout
-
Expand and upgrade the research lab
-
Buying updated machines and invest more in capital
Operational strategy is the cause of operational bottleneck. Our recommendations arePage 18 of 26
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-
Identify if the bottleneck is long term or short term
-
Short term bottlenecks are temporary and could be solved if the procedures are strictly
controlled by management
-
Long term bottlenecks could be solved byo Remove the activities from the bottleneck process that could be done by other
people or machines
o Add capacity to that particular step
o Assign the most productive team and technology
o Train the employees to become efficient
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Quality Management
The Bondstein VTS device is square shaped box connected nearby the engine of the vehicle.
It serves with speed alert system which provides SMS notification when a vehicle crosses a
preset limit and also provides SMS notification when a vehicle is performing unauthorized
activity during off hours. It provides notification when a vehicle moves out of a preset area
zone. It provides a reminder notification to the owner about document renewal before one
month of the validity ending. It provides the clients with a seat sensor which is used by Amar
Bike, Runner cab, Trust cab to track if their vehicles have passengers on or not.
The Quality determinants of TMV fulfill all the general criteria of a good quality product.
The main points of quality determinants are as follows:
Product Design and Conformance
The structure of Bondstein’s vehicle tracking system can be divided into several parts. To
achieve simplicity in description its parts has been differentiated into two specific categories.

Hardware Layer: It includes different hardware that is connected and used in the
structure of vehicle tracking system, such as EMI chipset, Arduino board, Tracking
device, Satellite, Server Pc, GSM network tower, User mobile phone and PC.

Software Layer: Software layer includes different software that are used in the
vehicle tracking system, such as Arduino IDE, DBMS, Google Map API (Application
Programming Interface), XAMP/ WAMP.
Although the exterior of the product is not much of a concern for the clients, the internal
design and engineering is undoubtedly one of the smartest design among its kind. It helps real
time tracking of the travelled route of a vehicle. It generates a distance report within a
specific period of time and the distance it has travelled, turning engine ignition on/off
remotely. It monitors fuel status of a specific vehicle with up to 100% accuracy.
Ease of Use
The user manual for TMV is a simple and easy to use guide for the clients. All they require is
to get registered into their network and clients Smartphone.
After Sales Services
Steps to assure quality is considered even after the finished service is already sold by
providing clients with admin panel handling training, empowering clients to fully utilize all
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the aspects and function of the service. This is a factor of the quality control measure since if
a client is not properly educated on the technical aspects, the overall quality of the service
would deteriorate.
Awards Achieved
Echelon 2015 - People's Choice Award
Track My Vehicle, won People's Choice Award at the Bangladesh Qualifier in Echelon Asia
Summit 2015 which was held at Singapore from June 23. The company represented
Bangladesh in the summit. They were qualified in this prestigious event for their innovative
technology.
Quality Control
The IT service market still being relatively new in Bangladesh’s perspective has yet to gain
the consumers’ confidence. After a thorough investigation of Bondstein’sseparated activity it
has become evident that they have acknowledged the stigma and have taken steps to control
their quality within their capability. Through prolonged discussions and site visit, we could
determine the following quality control initiatives.
Raw Materials
Bondstein has tackled the quality issue from the very root of operations. Instead of
purchasing its hardware unit, they acquire the individual components of the device and
assemble it themselves in their plant. This allows them to source specialized suppliers for
each component who can offer the best quality at an optimum economic value. For the parts
that do not meet the standards locally, they have the option of importing open. There are
around 5 vendors for the supply of components, box, circuit board and SIM.
Post Sales Service
Another sector where they are actively monitoring quality is their post sales service
technicians, apt technical knowledge along with human-skills training. This helps them
deliver superior after sales service. Their relatively small scale of operation allows them to
offer more customized service products to their clients. They have ensured specialized
corporate handlers, who are trained in human-skills, helping clients develop customized
service packages adhering specifically to their needs technology to an extent. It improves
their customer satisfaction.
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Monitoring and Inspection
The quality of their offered service is also monitored by offering clients a free trial period of
usually one week where they are allowed to test the products for themselves and experience
all the benefits with minimal charge. This is a quality control factor as the client gets to
experience the product hands on, and now with a better knowledge of the product, they can
better dictate the terms of service they require from Bondstein, as charging for unnecessary or
irrelevant services would decrease the overall quality of the product.
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Inventory Management
Bondstein’s management uses Periodical Inventory counting system. The inventory count
takes place every once in a month. If the number of orders from the clients exceeds the
anticipation, then the inventory storage is inspected once in 15 days and in extreme cases it is
done on a weekly basis.
The demand forecast is done based on Naïve method so the lead time is quite difficult to
calculate. From the data gathered from the company, we have concluded that their order size
is small and average inventory is low resulting in low carrying cost. The lead time is usually
3 to 5 days.
The Economic Order Quantity for TMV is calculated from the collected information from
Bondstein’s factory.
Quantity Discounts:
Bondstein gives the corporate clients quantity discounts. Their rates are as follows:

BDT 5,500 per device

BDT 475-500 per month
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Conclusion
As a three year old IT firm, Bondstein Technologies Ltd has performed well and gained a
good reputation in the market. Track My Vehicle being one of its innovations has come a
long way. The findings from this report clearly suggest that the users, i.e. the organizations,
of Track My Vehicle are very satisfied with the device.
Customers are enjoying quite a large number of benefits. There has been a drop in fuel
consumption resulting from prevention of oil theft owing to mileage report. Real time driver
locations has caused on time deliveries leading to improved fleet efficiency. Assessment of
unsafe driving habits through TMV panel and speed alerts, such as unnecessary trips and
speeding respectively, have greatly reduced the increased prevalence of accidents, higher
insurance costs and greater organizational liability. Through detection, business managers
could achieve improved safety records for their organizations.
Currently, there is scope for improvement of Track My Vehicle. As per the users of TMV,
the mitigation of the problems can make TMV their ideal product in future. As far the
company is concerned, management of Track My Vehicle can conduct a customer
satisfaction survey every year and keep on improving the user experience of Track My
Vehicle.
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Recommendations
After analyzing the operation activities of Bondstein, we came up with the following
recommendations for the management, implementing which would result in a smoother flow
of processes, much for efficient use of available resources and enable them to take advantage
of potential growth opportunities:

They should generalize their offered services so that they can process and rope in a
larger number of clients at a lower operational cost. As higher the customization,
lower the quantity output.

Decentralize their maintenance and after sales service crew. This would improve the
current state of waiting-line. They should establish two response centers at Dhaka
North and Dhaka South regions headed by the two-current engineer/response heads.
The time would cut down almost by half.

They should hire more technicians or keep a group of freelance technicians always at
their disposal to decrease the down time and increase the probability of attaining
service. It will help to facilitate sudden high demand in future.
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Appendix
Demand Forecasting
The actual numbers of order are:
Year
Demand
2014
800
2015
900
2016
1200
2017
[| Error
Period
Actual
Forecast
(A-F) Error
| Error |
Error2
÷Actual |] *
100%
2014
800
-
-
-
-
-
2015
900
850
50
50
2500
5.55%
2016
1200
1050
150
150
22500
12.5
2017
1500
1350
150
150
22500
10
Total
-
-
350
350
47500
28.05
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Moving Average Forecast Accuracy:
MAD =
350
4
= 43.75
47500
MSE =
MAD =
4−1
28.05
4
= 15833.34
= 7.01%
Capacity Planning
Fixed Costs:
Items
Cost (in BDT)
Office Rent Cost
600,000
Office Setup Cost
400,000
Insurance Cost
500,000
Equipment/Machines Cost
400,000
Indirect Plant Cost
Administrative Expense
Salary & Wages
6,168,000
Other
500,000
TOTAL
8,118,000
Items
Cost (in BDT)
Raw Materials
28,6,22,000
Maintenance
300,000
Device Internet Cost
49,120,000
Power & Utility
240,000
TOTAL
78,282,000
Variable Cost:
Total Cost = Fixed Cost + Variable Cost = 8, 64, 00,000 Taka only.
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Price of per Device = 12000 Taka (including 6000 tk yearly service charge)
Although Bondstein’s facility has the capacity to produce 40 units of TMV a day, the actual
production is on average 20 units per day. So in one year they produce around 7,200 devices.
Break-Even Quantity:
Profit= Revenue-Cost




0= Price*Quantity-(Fixed cost + Variable Cost)
0= 12000*Q – 86400000
Q= 86400000/12000
Q=7200
Efficiency =
Utilization =
𝐴𝑐𝑡𝑢𝑎𝑙 𝑂𝑢𝑡𝑝𝑢𝑡
𝐸𝑓𝑓𝑒𝑐𝑡𝑖𝑣𝑒 𝑂𝑢𝑡𝑝𝑢𝑡
𝐴𝑐𝑡𝑢𝑎𝑙 𝑂𝑢𝑡𝑝𝑢𝑡
𝐷𝑒𝑠𝑖𝑔𝑛 𝐶𝑎𝑝𝑎𝑐𝑖𝑡𝑦
=
=
20
30
20
40
= 0.66 or 66%
= 0.5 or 50%
Process Selection
The cycle time is 25 minutes per column. The tasks are assigned in three workstations.
Immediate
Task
Task Time
a
25
-
b
10
a
c
5
a, b
d
2
b, c
e
10
d
f
2
e
g
1
d
h
4
-
i
2
h
j
5
i
k
2
j
Predecessor
Task Assignment Table
Station
Eligible
Assigned
Tasks
Tasks
Task Time
Cumulative
Time
Idle Time
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1
2
a
a
25
25
0
b, c, d
b
10
10
15
c, d
c
5
15
10
d
d
2
17
8
k
k
2
19
6
e
10
10
15
f
2
12
13
g, h, i, j, k
g
1
13
12
h, i, j, k
h
4
17
8
i, j, k
i
2
19
6
j, k
j
5
24
1
e, f, g, h, i,
j, k
f, g, h, i, j,
k
3
Bondstein Technologies Ltd.
Idle Time
Idle Time in percentage = (7 𝑚𝑖𝑛 /3∗25 𝑚𝑖𝑛)* 100
= 0.09333 * 100 = 9.33%
Efficiency
Efficiency = (100% - 9.33%) = 90.667% ≈ 90.67%
Inventory Management
Economic Order Quantity
Annual demand, D=7200 per year (approx.)
Annual Holding cost, H=3000tk (approx.)
Annual Ordering cost, S= 4500tk (approx.)
EOQ= √2DS/H
=√2*7200*4500/3000
Ave
= 147 (rounded)
Total Annual Cost, TC= Annual carrying cost + Annual ordering cost
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= (Q/2)*H+ (D/Q)*S
= (147/2)*3000+(7200/147)*4500
= 220,500 + 220,500
= 441,000 tk
While calculating EOQ, we have considered the following facts,

The holding cost is designated by the management of Bondstein and not the
accounting department

The EOQ is approximate quantity and not the actual one

EOQ is used because of its flexibility to modify the order quantity
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