You will write a concise business report (2500 words) aims to report the latest trends of operations management (OM) and technology development.
Operation management refers to the process of compilation of all activities that are concerned with the designing and controlling the production process (Stevenson, Hojati & Cao, 2007). It also includes the redesigning of business operations in the production of goods and services (Heizer & Render, 2008). In the competitive business environment use of new technology is essential to create an existence in the market. The current report is based on the operations management and business analytics of the firms. In this regard, the emphasis is given on “The smart enabling technologies and digitation to yield competitiveness by the firms”. In this context, the latest trends of technology such as CPFR (Collaborating, Planning, Forecasting and Replenishment), ABC analysis, JIT (Just in Time) etc. used and their roles have been analyzed. Further, challenges faced by the firms with use of the technology also included. A number of relative studies, academic books and journals have been used for the references.
Operation management is a multidisciplinary functional area that includes the finance and marketing along with technologies (Jacobs, Chase & Aquilano, 2004). It is also one of the important aspects of the production and service department in the organization to face the competition and maximize the profitability (Chen, Chiang & Storey, 2012). Moreover, operational strategies are used to face the dynamic capabilities in the enterprise to achieve the business objectives and create an existence in the competitive environment of the firms. Thus, it reveals that operation management requires for the effective development of the organization and to attain the competitive advantages in the business environment.
Competition is spread all over the world in the several fields such as production, supply chain, marketing, operation activities etc. Competition increases the level of standard and quality of products and services because in today’s world every enterprise desires to stay updated and maintain qualitative relationships with entrepreneurs (Dunning, 2013). Further, to increase the productivity, operation management adopts various smart technologies and trends such as Just in time (JIT), Lean operation, Total Quality Management (TQM), Computer Aided Design. Further, Manufacturing (CAD/CAM), Green manufacturing, Cloud computing and Total Production Maintenance (TPM) etc. also used for developments. in the production process and for final delivery to consumers (Kinkel, 2012; Cua, McKone & Schroeder, 2001).
In the current business era, firms are using the JIT technology in the operation management to meet the expectations of the customers instantly (Stevenson, Hojati & Cao, 2007). It is also useful to minimize the waste and increase the quality of the products and services. In this regard, previously the firms were preferring the lean operations to generate the economies of scale but now they are shifted to JIT because it reduces the cost of inventory of firms (Fullerton & McWatters, 2001). However, the organizations are focusing on the green manufacturing that no damage to the environment with the production of goods and services (Liu, Kasturiratne & Moizer, 2012). With the help of it, an environment will not be exploited and develop the sustainable products for the consumers. On the other hand, JIT emphasis on the solving of the forced problem instead of customer understanding (Nahmias & Cheng, 2009). It is beneficial to attain the more depth information regarding production and to maximize the revenue. For example, Toyota motor corporation is emphasizing on the JIT technology for the continuous improvement in the models, to achieve competitive advantages that turn to higher results of output (Heizer & Render, 2010). Therefore, it indicates that JIT technology is more acceptable than other trends because it decreases the time, waste, cost and increases the revenue. In the competitive business environment firms have a desire to reduce the production cost and provide the quality products to fulfill the demands of the consumers.
Several studies Ahire & Ravichandran, (2001); Ismail Salaheldin, (2009) mentioned that TQM is one of the smart and new technology in the operation management to improve the quality of goods and achieve the customer satisfaction. Nonetheless, in the current business era, the manufacturing firms are focusing on the new computer-based technologies like Cyber-Physical System (CPS) instead of traditional technologies that are based on the internet functionality (Lee, Bagheri & Kao, 2015). CPS is beneficial to reduce the errors in the processing and then attempt the final production. Moreover, it also facilitates the safety and usability for the further manufacturing of products. In this, there are fewer requirements of the physical appearance in comparison to other trends and it provides the maximum results with coordination between physical and computerized elements (Baheti & Gill, 2011).
CPS is specifically adapted to manage the big data issues in the current firms in the operation management because with the help of it large data can be in the different sections and accordingly the data can be analyzed. (Yin & Kaynak, 2015). Further, CPS is helpful to monitor and control the big data of firms in the modern edge of technologies.
The latest trends in the operation management play an important role to face the competition in the business in the form to improve the productivity of goods and services (Nahmias & Cheng, 2009). In the competitive scenario, firms are adopting innovative technologies to save the time and cost of the products and services. It will be helpful to fulfill the expectations of customers and attract them towards the advanced products.
In the case of big data of organizations, it is difficult to manage the inventory of the products and for that an effective inventory management system is used to maintain and analyze the data in the department of operation (Sravani & Rao, 2017). For instance, Tesco is a big retailer in the UK that deals in the multinational groceries. To manage and control the inventory, Tesco adopts an effective inventory management system that is big data analytics (Meagan, 2018; Zhao, 2014). With the help of big data analytics, a company improves its supply chain and achieve the success in saving the cost. Moreover, Tesco can focus on the expectations of the consumers with advanced supply chain management. The innovative supply chain is used to minimize the cost, reduce the inventory holding and enhance the availability and product quality.
On the other hand, latest technologies play a crucial role to bring the unique competitive advantages in the firms and profitability of the business affected through success/failure of new technology (Hert, Fredlake & Barron, 2008). For example, Tesco company brings a change in the supply chain management by adopting the Radio Frequency Identification (RFID) technology. RFID technique is used to scan the radio barcodes and product information can be tracked with help of RFID in the whole supply chain (Wilding & Delgardo, 2004). Moreover, RFID facilitates the better customer service, improved working efficiency and saves the time for the customers as well as sellers (Roberts, 2006). However, RFID technology is not completely mature because it creates data errors in the case of tags are more close to the liquids and metals (Jones, Clarke-Hill, Hillier & Comfort, 2005). Then, the RFID will not access the correct information of the product regarding price and all. More, radio barcodes are costly rather than barcodes. In this manner, it identifies that use of new technology in the business brings the drastic change in the whole process of production and supply chain. It may have impacts in the form of positivity or negativity on the success of firms.
Development of digitized world in the modern era shows the higher standard of the business and there is no scope to arise a mistake because it directly reflects the growth and image of the firms (Loebbecke & Picot, 2015). For instance, Wal-Mart has adopted CPFR supply chain framework to minimize the cost of inventory and coordinate with supply chain partners (Freeman, Nakamura, Prud’homme & Pyman, 2011). However, RFID technology is more beneficial for the Wal-Mart to control and minimize the inventory along with the creation of real-time database (Baars, Kemper, Lasi & Siegel, 2008). Moreover, there is a possibility to reduce the inventory including insurance cost with the help of the RFID (Emiliani, Stec, Grasso & Stodder, 2007). Therefore, CPFR and RFID both are beneficial for the firms to control the inventory and reduce the cost of production so that more profitability might be earned.
To face the competition in the business environment and maintain the inventory level, technologies are important and needed stock volume can be carried out from that inventory. (Esper & Waller 2014). Inventory is helpful to maintain the difference between demand and supply because it retains a balance between both demand and supply. Further, logistic technologies minimize the cost of transportation and warehouse because before logistics the products go for the proper packaging that may reduce the cost of packaging at a warehouse.
Figure 1: Effective supply chain management
(Source: Jawad, 2017)
The main objective of latest trends is to create a brand image of the firm in the market and help to reduce the customer service time that has an impact on the customer satisfaction level (Transchel, 2017). Customer satisfaction is more important for the success of the business because if buyers get the delivery of products and services on time then they will be attracted towards the organization.
To maintain the level of inventory, most of the companies such as Wal-Mart, Tesco etc. prefer the ABC analysis (Shin & Eksioglu, 2014). ABC analysis divides the whole stocks into three categories like A, B and C grade of inventory and it is useful to saves the time at the time of delivery of goods. Moreover, ABC analysis facilitates the management of daily basis inventory that will show the missing stock instantly, stealing and misplacing of inventory etc. So that firms can easily maintain the balance between opening and closing stocks (Agrawal & Smith, 2016).
Figure 2: ABC Analysis
(Source: Bemelmans, 2014)
Industry 4.0 consists of several improvements in the technology for the development of business and to face the competitive environment (Lasi, Fettke, Kemper, Feld & Hoffmann, 2014). The development phases from 1st to 4th is coming under the 4.0 industry. In this advancement, the technologies include such as internet things, cognitive computing etc. and it is known as the fourth generation of revolution in the technology (Lee, Kao & Yang, 2014). The technology is increasing on the regular basis in all fields like production, operation, supply chain etc. although it has several drawbacks and to face the challenges in the industry.
The advanced technology is developing in the operation management activities and the firms also preferring the several kinds of technologies such as Cyber-Physical system, cognitive and cloud computing, ABC analysis, RFID etc. However, with the use of these technologies, companies are facing the issues related to IT security. The big organizations have large data of operation and production processes and for that all data requires to maintain perfectly. In this context, to manage the big data CPS technology is being used by the firm and for the compilation of the information (Jazdi, 2014). It increases the problems regarding the security of data in the IT field because the management cannot directly rely on the compiled data. It might be possible that data are not on the current basis and may include the past data and prepare the report for the current condition.
On the other hand, in the process of compilation and arrangement of data, there may be chances to lose the data that are required for the further processing. Therefore, in this case, insecurity of data is a major problem for the firms and it might incur the losses for the business. Insecurity of data may have an impact on the reliability of suppliers because it will provide the incorrect and insufficient information and the whole processing might be wrong.
Now a day, to face the business challenges firms are focusing on the application of advanced technologies to maintain existence in front of the rivalries (Brynjolfsson & Hitt, 2000). If the companies do not an emphasis on the new techniques and continue the production and operation with traditional strategies, then firms will not be able to get success in the business. In this regard, requirements of skilled employees increase with use of technologies because knowledgeable and experts can be able to operate the technologies in the business (Freel, 2005).
It is not necessary that all workers in the firm are skilled and experienced, there are unskilled people also works efficiently. But a problem may arise in front of the unskilled employees that they cannot work with the updated technologies and firms become unable to face the challenges in the competitive market. For example, Tesco is using the RFID technology to control the inventory and for the effective supply chain (Shin & Eksioglu, 2014). But if the employees are not that much skilled that they can run the RFID programs. Thus, management of big stocks may not be possible without the use of latest technologies. Further, the firms cannot be limited to the available unskilled people and an emphasis on training programs to train the employees for the use of respective technologies. In this way, the gape among skilled and unskilled employees can be removed.
The current business environment is full of several advanced technologies and organizations also focusing on the advancements. Reliability and dependency on a single technology is not beneficial for the firms to achieve the growth in the business (Mueller, 2012). If the company rely on single base technology, then the firm cannot access the additional information for the production and operations. For instance, Wal-Mart has adopted CPFR technology for the inventory management but as per the advanced business environment company cannot believe on a single technology. So, Wal-Mart started to use the RFID, ABC analysis and a combination of other modern technologies for the effective management of inventory and control on supply chain management (Shin & Eksioglu, 2014).
In any situation, if the technology doesn’t work on that the company depends then there might occur a great loss to the business because in this the important information may be missed. The production manager is not able to assess the next stage of processing in lack of adequate data. So the company does not depend only on one technique and adopts the multiple technologies. If one technique does not work, then it can be replaced with another suitable technique and the working process will not suffer. Moreover, it helps to generate the possible Outcomes For The Business.
Conclusion
On the basis of the report, it has been concluded that the current business environment is full of with several advanced technologies such as RFID, CPFR, ABC analysis, JIT, CPS and TQM etc. With the use of these technologies, it becomes feasible for the firms to face the competition and increase the productivity of a business. Further, it also concluded that use of the technology increases but the challenges also increases for the firms. If the company use a single technology for the operational activities, then it is not acceptable in front of rivalries because competitors adopt more than one technique for the convenience.
Moreover, it also consisted that technologies are more important for the development of business because without preference of technology the firms may lose the existence in the competitive environment and the relations with suppliers might lapse. At the end, it is found that CPS technology plays an important to manage the big data through internet and compilation of different data takes place. Big firms have the large data to save and secure for the future use so with the help of advanced technologies it might be possible for the firms to manage and control the inventory along with better supply chain.
References
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