Operation and service management
Executive summary
Operation and service management focuses on managing the process of product and service development. Efficiency and effectiveness are of great importance in the operation management process. Operation management entails planning, supervising and organising in the production context or service provisions. The system in business activities is organised efficiently to optimise productivity. The process is chiefly concerned with converting material into goods and services with the highest level of efficiency possible. This study focus on Sainsbury’s operation management, practices involves and the technology used. This report also includes the supporting functions linked to operation management
Introduction
Operation management is the functional responsibility of the organisation to produce a service and directly providing them to the consumer. Service operation management is vital to control the manufacturing cost and to improve customer satisfaction. The management involves having knowledge of the service need of the target audience, supervising the process that delivers the services, ensuring the goals are met and constant improvement of the service provided. This study sheds light on the identification and analysis of operation management of Sainsbury's. This report also entails the way technology is integrated into the process of management and supporting functions linked to that.
Company overview
J Sainsbury’s PLC, situated in London, United Kingdom is the second-largest supermarket chain. It has a market share of 16.0% of the supermarket sector. In 1869 it was founded by John James Sainsbury's with a small shop in Drury Lane. In 1922 the company became one of the largest retailers of groceries. It has 1428 shops and the revenue is 2.900.7 million GBP as of 2019 (sainsburys.co.uk, 2021).
Identify one operation management practice within a chosen organisation
Operation and service management is the supervision of business practices to provide the highest level of efficiency within the organisation. It is the procedure of conversion of material and labour to good and services with maximum efficiency to yield a maximum profit (Rasouli et al., 2019). The specific operation management that has been entitled is quality operation management. A service operation is the transformation of the consumer to the satisfied consumer through the appropriate use of labour, material, information and consumer. An operation practice is a method of operating a business.
All organisations have one thing in common that is the operation. All takes the inputs and converts them into outputs. Similarly, Sainsbury's have efficient operation management and the way of doing a thing is different. The 4V's followed Sainsbury's is including volume – Sainsbury’s is known to give more quantity of food at ales price. Variety – Sainsbury’s being a retailer in groceries offers a different range of products in varying states (sainsburys.co.uk, 2021).Variation- Sainsbury's offer the products to the customer both in an offline store, online and have home delivery services too. Visibility – The products of Sainsbury's is properly labelled and positioned so that it's easy for the customer to locate it.
Principles of operation practice
The principles of operation and service practices followed by Sainsbury’s are :Reality – Sainsbury’s operation managers must focus on the problems rather than techniques as no tools can be the solution to every problem Organisation , the process in the manufacturing of Sainsbury's is interconnected. In order to have the same profit, all elements in the process must be predictable and consistent. Fundamentals, the operation manage of Sainsbury’s must ensure that all the fundamentals must comply together in order to achieve the desired results (sainsburys.co.uk,2021).
Theoretical framework
Business process management (BPM) – Sainsbury’s operation manager should have a good hold on ob BPM. It is about constantly analysing improving the automation process. BPM of Sainsbury's includes designing, modelling, analysis, monitoring, and improving the process of manufacturing.
Figure 1: Business process management
(Source: Influenced by Caro et al., 2020)
Six Sigma focuses on the manufacturing process of Sainsbury's. The six sigma theories include defining the issues, measurement of performances, analyzing the cause of the issues, trying a potential solution, control and implementation of the new process. It helps Sainsbury’s to provide the necessary tools to improve and enhance their business process.
Figure 2: Six Sigma
(Source: Influenced by Tanabe et al., 2019)
Sainsbury's in order to be the largest retailer in the UK so it is constantly trying to enhance its business operations. So Sainsbury's always attempt to take the feedback of the customers and they compare the products with the competitor's one and then eliminates the issues. The organisation focuses on the issues in the production process and tries to improve it constantly for desired results (Hamzah et al., 2017). Sainsbury is while transforming the inputs into outputs considers the customer demands. Sainsbury’s is aiming towards reducing the complexity of the operation in order to turn more focus on the products thus improving the financial situation and delivering the stronger returns. They are changing their process by transforming the cost and unlocking new opportunities for them (Ramanathan et al., 2017). Salisbury’s quality management, quality control and quality assurance are very different from one another yet all of them has a common objective. They make their suppliers understand the principle of their organisation and enables them to produce the products while consideration the needs of the customers. They have a quality attribute system where every products is supposed to maintain a basic quality standard.
2. Critically analyse how this operation management practice impacts the organisation in regards to efficiency
Operations Management Practices
Capacity or stock control – They practice to identify and measure the capacity of production is called strategic capacity planning (Caro et al., 2020). Sainsbury’s uses the capacity planning to utilise the capital, and resources efficiently. There are three types of capacity planning – long, medium, short term planning. Sainsbury plans the capacity on the basis of demand. For instance, Sainsbury saw the demand for toilet paper was massive during the Covid 19 phase. Therefore, they planned the capacity for production according to it. Sainsbury’s has two levels of capacity planning. In the first level, the capacity-related decisions are generally long term and strategic in nature. As the decisions are strategic, so the company have to follow them for a longer period. Sainsbury’s capability to do business will be affected by large capital investment for capacity planning. The second level of capacity planning is tactical in nature which focuses on short term problems related to the planning of inventories, workforces and machines.
Quality management standards and system – The act of overseeing all operation process and the task are attaining the desired level of excellence to produce a quality product. Quality management is about determining the quality policy, creating and implementing the quality control, improvement and planning (Miki et al., 2020). Total quality management (TQM) at Sainsbury's requires all its stakeholders in the organisation to work together in order to provide quality products or services. Sainsbury's TQM depends on a few principles. First is the customer focus, Sainsbury's customer will determine the quality level. It is all upon the customer to see if the products they get are of high quality no matter what training, planning and tool Sainsbury's has used. Second is the total employee involvement, as the employees together can work towards the common goals. When the employee feels empowered and Sainsbury's has provided a proper working environment then the production of quality product is sure to happen. A vital part of TQM at Sainsbury's is the focus on the process of operation management (Tanabe et al., 2019). A process includes innumerable steps to take the inputs and convert them into outputs, so each and every step is monitored by Sainsbury’s operation manager to ensure quality outcomes. TQM includes larger aspects known as continuous improvement where Sainsbury’s uses techniques to be more competitive in the market and more effective in meeting the expectation of customers and stakeholders. Management of quality helps the organisation to make the customer satisfied, earn more profit and productivity increases. Additionally the quail management affects the overall cost of manufacturing and helps firms to hold a strong position in the market.
Supply Chain Management is the process of flow of goods and involves all the process that turns the raw materials into the final products ( Eskelinen, 2017). It is the way of streamlining of supply of business activities to get maximum customer value and stay on an advantageous side. SCM at Sainsbury's helps to keep the cost down and minimises the shortage of products. A supply chain manager of Sainsbury's overviews the entire process from creation to the final sale. Recently Sainsbury’s has chosen Blue Yonder for their end to end supply chain management. They will deploy Blue Yonder as they are artificial intelligence power platform. The current capabilities will include – AI technology, forecasting demand, replenishment, space management, digital control tower, labour management and yard management. An effect SCM can impact the organisation by providing a good customer service. The product of right product and coorect quantity when delivered in a timely manner, appease both the distributor and the producer.
According to Izogo et al., (2018) improving the operation management process is not one initiative. It includes all the combined efforts of capacity, quality, SCM, and technology to optimise the process. The process of manufacturing is the core operation at Sainsbury's. On the other hand Hamzah et al (2017), without having a deeper knowledge about the business process will have an impact on the efficiency. To make business operation efficient it is important to focus on the issues Sainsbury’s is facing. According to Miki et al., (2020), it is essential to see if the organisation is getting cost-benefits from the resources. Measuring the risk helps to identify the potential risk and allows an organisation to compare them thus focusing on the efforts. On the contrary, the survival of business no longer dependent on the abilities of the firm rather on the capability to cooperate with the supply chains. Thus a good SCM, effective TQM and capability management all together creates appositive impact on the organisation resulting into profitability and productivity.
3. Evaluate how technology could be embedded in this process or evaluate how this has already been achieved
Technology has changed the way of doing things. Due to the rapid technological advancement, the way entrepreneur does business has changed (Tanabe et al., 2019). Sainsbury's is no exception to use technology for its success. The role of technology in business operations is:
Information technology: Having a tech-savvy workforce is the basis of every organisation. Sainsbury's always updated their technologies and their workforce from time to time. IT is indispensable be it small or big organisation. Sainsbury has brought the Scan & Go solution in a few stores for better customer service experiences. This helps the customer to scan the products as they stroll in the store and then checkout and pay (Puspita et al., 2020). Advanced information technology has influenced the production process, distribution of goods and services, and sale of the products greatly.
Improved communications – It’s true that technology simples the communications (Melacini et al, 2018). A retailer like Sainsbury’s uses technology to advertise and create a buzz in the market. Sainsbury’s stay up to date with new mail marketing 6techniques of sending data via the digital platforms. They use advanced technology to improve their business process to deliver maximum profit and satisfy the customers.
Instant connection with the customers - The use of internet application by Sainsbury’s has made it easier for them to connect with customers (sainsburys.co.uk, 2021). They use social media platforms, search engines, websites, CMS, e-commerce stores to promote and provide services to the customers. Sainsbury’s uses QR scan code and send customer personalised offer to engage them. Technology has allowed Sainsbury’s to retain their customers and not letting them switch to other brands.
Cloud computing - Technology has made business-like Sainsbury's to create a virtual world. They are adapting technology to integrate business by cloud computing to create, operate and access the store and the manufacturing process (Khabbazian et al., 2020). Sainsbury's can do auto-scaling, pay based on usages, automatic maintenance with the use of technology without the need of any physical stores. Sainsbury’s is embedding the cloud compution in the management process. The management team of the firm needs to provide adequate training to the employees for them to stay updated with technology.
Sainsbury has witnessed a significant increase in sales because of the advance use of technology (sainsburys.co.uk,2021). For instance, during the pandemic situation, Sainsbury's adapted the new shopping trends. Just because of the presences of e-commerce online sales have increased by 50%. They have noticed a change in the shopping behaviour of the customer. They are more focused on buying essential items that have made Sainsbury's produces more of those products. The Smartshop technology by Sainsbury's has made one of the third of the sales go through it. This technology makes shopping experience quicker and safer.
4. What supporting functions are linked to this operation management practice and evaluate how can they assist with ensuring organisational success?
An organisation having effective operation management is much more accountable and accurate in delivering the products and services. The operation management has various functions within the process that are an aid to increase the production. Thus, the key functions are as follow:
Finance – The most fundamental component of operation management is financed (Khabbazian et al, 2020). It is essentials for every organisation to ensure that all the finances are utilised to its full potentials. Sainsbury's uses its finance to optimise the creation of products and services. They view the process in a way that allows them to produce products or services that will satisfy consumer demands.
Strategy – The planning tactics used by an organisation for the creation of goods or services through optimization of resources is referred to as strategy. The strategies adopted by Sainsbury’s are – supply chains configuration, capacity for holding money, optimum utilisation of resources and sales (sainsburys.co.uk, 2021).
Product design – The selling of products becomes much simpler when technology is available to the firm (Koberg et al., 2019). An organisation like Sainsbury's ensures that the products are designed properly that will cater to the current market trends and the demands of the consumers. The customer that Sainsbury's target is more concerned with quality than quantity that why it becomes necessary for them to create a product which is of top-notch quality.
Forecasting - In Sainsbury's the operation management gets benefited from forecasting. The forecasting includes the estimation of consumer demands that are linked with the production process through the production of an accurate amount of goods within a particular time frame. Sainsbury's get to know what to produce, how much to produce and when it produces in relation to the customer's demands.
Quality management – Sainsbury's operation manager allocates the task of quality management to the team and then administrates them. The manager is responsible to identify the flaws and rectify them.
Operation management is a vital strategy that Sainsbury's needs to have in place. It helps the business from different aspects. These aspects are capacity, quality management, product analysis, and improvement. Finance in operation management is important aspects of Sainsbury's. With the huge cash flow within the organisation, it helps to determine Sainsbury's what to spend, when to spend, and where to spend. When the finance is in its place the next thing that determines Sainsbury's success is the correct strategy. The operation manager must devise a plan to create a vision of the organisation. An effective strategy needs to be provided for the organisation to achieve the desired goals (Caro et al., 2019). Sainsbury’s knows that a good product design will attract more customers along with giving them hedge above the other rivals.
The product design includes there issues – the concept, the process and the packaging. Forecasting is a key function to operation management enable Sainsbury's to commit to its resources with the assurance of profit over a long term period. It helps the company to allocate its budget to anticipate the expenses for the future.. The main advantages of this system are greater efficiency, better knowledge of the customers, improvement of the risk management, and better participation of the employee and regulation of successful working practices (Vilcu et al., 2018). Thus an efficient use of these factors ensures the company to achieve success and satisfy the market demand.
Conclusion
The competitive environment of today compels the organisation to have an effective operation and service management. The field of management that focuses on taking inputs and converting into final goods is known ha operation management. . The process of operational management is concerned with scheduling, having proper resources and quality and quality of final goods. It can be concluded operation management surely impact the productivity and profit of an organisation. Sainsbury's has well-designed management of operation that acts as pillar and strength in fulfilling the customer's need with a specific time period. For a business like Sainsbury's the field of operation is very crucial to maintain the working standards, planning, coordination, and continuous development. Quality management for Sainsbury's enables them to maintain customer satisfaction, loyalty and reduce to risk of replacement of faulty goods. Sainsbury's quality management system ensures to achieve the desired success Sainsbury’s is raising their ambition that will speed up the rate of change across their business. They are now moving towards to simply the operations that will accelerate their cost savings programmes so that they can invest for on the quality and innovation of the products.
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