Question:
Discuss about the Operational Management for Dummies.
In this report we are require to choose a business for further analysis. So we choose the business of restaurant. A restaurant is a place where people go for best dining experiences and entertainment in return they have to pay a certain amount for such entertainment and experience (Jeo Bastinich 2017). With the advancement of technology this industry has came out as one of the fastest growing industry in the world’s economy. United States is on number one with having the market size of restaurant industry of around 782$ billion dollars, on the second spot it is China with having 482$ billion dollars following to China there are a number of other countries like Japan, India, Brazil, United Kingdom with having more than 150$ billion dollar market size of restaurant industry (Bourdian 2015). By the year 2019 the revenue of this industry is expected to surpass 141$ billion dollars mark globally (Meyer 2010). A restaurant is place that provides high quality food and drink services to its customers. In this era of throat cutting competition every restaurant is working on the ways and techniques of improving the quality of the food and the ways in which they can perform different functions efficiently and effectively. Every restaurant around the world has to face different issues at different time; these issues can be menu issues, location issue, competition issue, price issues etc (Benjamin 2012). Every restaurant has operations manager that tries their best to minimize the waste and increase the efficiency of the organization so that it ultimately increases the profitability of the organization (Slack 2011). These operations managers have to face many challenges, some of these challenges are as under:
Changing Technologies: This is the first most challengeable issue that has to face by the operations manager. Changing technologies are increasing the competition at such a fast pace that if the organization is not adapting such changes then they will certainly end up losing all their profits(Mceffe 2016). Changing technology is not only increasing competition but it is also increasing the confusion in the minds of the employees. As new technology is coming up with newer and newer hardware’s and software’s, this soft/hardware are not easy to understand hence it creates a lots of confusion in the minds of the employees. Another issue of changing technology is the increase in the expenditure of the restaurant, installing newer technology means new expense for the organization. Now opening up a restaurant is not limited to foods and drinks only but only those restaurants are going to be successful that are having a strong financial back up plus those restaurants who are willing to change their structure and way of doing business as per the demand of the industry as this industry works in a dynamic environment that means which is constantly changing (Gr 2016).
Continued Globalization: Globalization is process that enables a domestic organization to stretch its legs internationally; globalization has made it possible for every country no matter if it is 1rst world or the 2nd world to perform business operation internationally(Baghwat 2011). This process has emerged as a biggest threat for the Restaurant industry as there are no restrictions on the entrants in this industry. Globalization has increased the competition in terms of newer and newer cuisines, machinery & equipments, efficient and effectiveness of doing business. In this industry only those players are going to rule and to stay, who are capable of surviving all these challenges (D’suza 2017).
Changing Customer Expectations: Another issue or a challenge that is faced by the operations manager are is to cope up with the customers’ expectations. In this fast changing world where nothing is constant, the operation managers need to identity wastage area to eliminate them so that with that saved cost they can invent or introduce something as per the expectations of the consumers(Rodrik 2015). Customer expectations never remains constant, there are only 20 out of 100 customers that remains loyal to their brand and to their specific taste. All other keep on changing as per the fashion or the trend, so it is a major challenge that is faced by the operations manager of the restaurant to keep meeting the expectations of the customers to keep them happy and to maintain the profitability of the restaurant. Restaurant industry is the only industry that needs to keep on inventing new dishes, because the humans of 21rst century are way more habitual of changing their preferences and tastes. So in this industry only that player will make a room for itself that is capable of inventing newer and newer dishes.
Changing Job Designs: Job designs means the structure of the work to meet the physical and behavioral needs of the employees, job designs are constantly changing with the increase in competition, earlier employees were trained to perform only the tasks that were relevant to their fields but now each and every employee whether they are in restaurant industry or in any other industry is multi trained for performing multi-tasking(G 2014). This constantly changing job designs has made the operations manager more concerned about efficiency and affectivity of the employees and the work done.
Quality management: The operation manager in a restaurant business will have to continuously work upon the quality of the food and services provided. Quality management can be defined as an action of supervising all the activities so that the quality of the products and services do not get compromised at any level. This is one of the main and the biggest challenge that the operation manager has to face. As if at any point the quality standards falls in future then this fall might result in a huge loss of the profitability of the business organization(Karen Martin 2009). Restaurants operations manager need to work upon this as if only for once, the customers get low quality food or services they will never come back to that particular restaurant. Hence quality management is an important aspect of this industry. In this industry mostly the main the reason of the failure of many restaurants are the low quality, so in order to have a loyal customer base and to ensure a long run survival the restaurant management must appoint a quality manager or an operation manager that will keep an eagle eye on the quality of the products and services of the business organization (Mauch 2016).
Global manufacturing: In restaurant business global manufacturing is concerned with the manufacturing of the machines and equipments that are used in the kitchens. In this business of restaurants, in almost every corner around the world is manufacturing top class machines and equipments. This has led to a severe increase in the competition amongst the players of this industry (Thomas 2012). The operations manager need to keep in his concern about the global manufacturing process so that they can timely make an action to cope up with the competitors.
Above are the challenges that might face by the operations manager. These issues are so complex that operation managers need to make proper action plan to cope up. These challenges are capable of affecting the business in an adverse way that will result in the loss of profitability; loss of loyal customers, employees will shift to more profitable and growing organizations. Hence these issues must be resolved at their earliest, if the organization wants to ensure its long run survival.
Now if we talk about operations management, then it is that department of the organization which is concerned with performing each and every task of the organization in the most efficient manner so that the organizations resources do not get waste or used unnecessarily. The official definition of operations management is as follow: Operations management refers to the administration of the business practices to create the highest level of efficiency possible within an organization. We will now discuss three area of operation management that is most likely to affect the success of the restaurant business.
Supply chain design: Supply chain design involves the selection of the supply chain; in simpler words it is to structure the supply chain, selecting partners, and location, and warehouse, modes of transport and information systems(Christopher 2000). In the restaurant business the operations management or the manager needs to design the supply chain in such a manner that the organization do not suffer at any point because of the loose supply chain. A supply chain can easily affect the restaurant business as if the delivery of the raw material is not provided on time then the restaurant will suffer as they will not have the fresh supplies of the raw material which will affect their quality, modes of transportation is another factor that can affect the success of the restaurant, the operation manager must choose such a mode of transport that is not costly and which is capable of transporting maximum raw material on even a short notice. Supply chain is the most important thing to be considered in a restaurant business. As in food industry a restaurant or a café or a bar is only dependent on their supply chain. If the connection between the restaurant or the supply chain gets break at any point then it will incurs huge cost for the restaurant owners. So an operation manager must keep an eye on the supply chain and make sure that everything in this chain is under control and working well in advance so that if by chance any uncertainty occurs then it can be controlled by the possible means (Greny 2012).
Managing inventory: Inventory management is another factor that might affect the success of a restaurant. Inventory management means keeping an eye on the process of flow of inventory from the manufacturer to the warehouse and from the warehouse to the points of sale. This is a very important aspect of operations management. Inventory management must be performed by an expert operation manager who will not only make sure about the efficiency but he will ensure that the goods are being transported safely from the manufacturer to the ware house and from ware house to the point of sale(Chopra 2014). It is very important for the management to keep safe and secure the inventory as any damage to the inventory will result in increase of the expenditure which is totally opposite to the objective of the operations management. Another thing in managing inventory is that the operation manager works upon increasing the efficiency and affectivity of the employees and the organization and if the organization is having large inventories then that will result in huge wastage and in food industry it would not be recommendable to have large inventories of stocks as it will not be a good practice to serve food that has been stored from a long time (Barbasor 2012). Hence inventory management is also an important factor that might affect the success of the restaurant business (Kaminsky 2013).
Quality management: The task of maintaining the quality of the products and services falls under quality management. The main purpose of quality management is to work upon maintaining or improving the quality of the products or services that are provided by the organization(Hoyle 2014). Maintaining the quality sometimes becomes such a big task for an organization that any little loophole ends up affecting the profitability of the organization. In restaurant business the quality management holds lots more importance because every human being around the world goes to the restaurant not only to eat food but to eat quality food (Gitlow 2015). Hence if in the restaurant business the quality of product or services falls then it will cost the restaurant a huge loss in terms of customers, competition and ultimately in the profitability.
Conclusion
Above is a report prepared on a restaurant business and the issues that are faced by the operations manager and about the factors of operation management that affects the success of the business. Here is concise and a clear conclusion provided. Operation manager indeed plays an important role in managing the operations of an organization that increases the efficiency and reduces the wastage of the resources. There are several factors that the operation managers need to take into their concern for the successful completion of the tasks. A restaurant business can grow easily as it is one of those growing industries whom revenue is expects to be doubled in next couple of years (The Uniform Systems for Restaurants 2013). But this is only possible if operations manager performs his duty with full dedication and make sure that no employee puts his efforts into the wasteful activities.
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