Essay on "Operational Analysis and Effectiveness"

Essay 10 pages (2784 words) Sources: 12 Style: Harvard

[EXCERPT] . . . .

Operational Analysis and Effectiveness

Introduction

The well-functioning of any organization in general, and of retail

operators that directly work with the customer, in particular, depends on

the efficiency and effectiveness of operations. Nowadays, customers are

more and more demanding with the quality of service they receive and pay

for.

Given the strong competition on the retail market, where customers can

easily switch from one retail operator to another in case they do not

receive the required product or service quality, it is very important for

retail operators to create and maintain an efficient service system

The operational structure, referring to production and concept, is

defined by the number and content of operational units, in this case the

actual supermarket locations, their size and actual location, by the

internal organization, and by cooperation relationships that are

established within these units, in order to ensure that the company's

object of activity is directly accomplished (McNamara, 2008).

Situation Presentation

The following analysis focuses on analyzing the operational structure

and its effectiveness for a high profile supermarket retail branch. The

competitive advantage created and maintained through the supermarket's

activity on the market is represented by providing excellent customer

service and products.

The company's managers have understood that in order to create a

sustainable position on the market, it is imperative that the supermarket

raises to high quality standards regarding the products delivered to the

customers and the services that create the distinctive identity of the

supermarket.

However, it seems that the supermarket is starting to lose ground in

favor of its competitors because the quality of service provided by the

supermarket to its customers is in decline. If the situation continues to

follow this descending direction, it will most likely lose more and more

customers, which will be translated in decreased market share and market

value, which will further affect supermarket's activity.

It is imperative that the supermarket improves its situation. In order

to achieve this objective, a supermarket retail branch operations analysis

must be conducted.

Operational Analysis Necessity within the Supermarket Branches

As mentioned above, the decreasing level of the quality of service has

determined the supermarket's managers to seriously develop an operational

analysis process. In my opinion, such an analysis should be conducted even

during periods of time when there is no apparent problem that requires an

analysis. The reason behind this statement relies on the fact that

operational analyses are not only designed to investigate and to solve

existing problems, but to forecast and prevent the emerge of such problems.

Operational analysis, no matter what type of company and issues it

addresses, should be considered as a formal, periodic analysis conducted by

"service teams on operational assets, or parts of assets, during in-service

management" (FAA, 2007).

The necessity of periodically conducting operational analyses consists

in the fact that such analyses are designed in order to discover whether

the operational asset in case has an effective and efficient contribution

to the performance of the supermarket, to the coast and other financial

objectives, and to the safety and needs requested by customers, which are

situated in the center of the company's strategy.

Furthermore, the operational analysis is intended to determine the

cost and the efficiency, in other words the performance of the operational

asset under analysis. The findings of the analysis must be studied in

comparison with the standards and objectives established by the company.

The analysis will allow for estimation of future costs, benefits, or

possible shortfall that might be determined by changes in the macro and

microenvironment, or by internal factors.

Operational Analysis Process Implementation

In order to conduct an efficient operational analysis it is very

important to clearly establish the duration of time within the analysis

will be performed. Given the fact that the operational analysis will be a

general one, including all operations that compose the service activity

delivered to customers, it is recommended that the analysis is performed

during a period of time generally characterized by steady sales, unaffected

by seasonal factors.

In other words, it is recommended to avoid the winter holidays, the

summer season with special offers and promotions, or any other holidays,

celebrations and events of national importance. Such periods are

characterized by increased demand from customers, especially for certain

categories of products and services, the supermarket's service activity

will be subjected to increased pressure, which could affect the quality of

service because of the above mentioned factors.

Therefore, the results of an operational analysis conducted during

such periods would not lead to conclusive, objective results that should

allow for further analysis, decision-making, and future strategies. As a

consequence, it is recommended to perform the operational analysis on the

supermarket's branch service during the beginning of spring or autumn

season. It is estimated that such an analysis could be conducted for one

month's period, in order to analyze both the weekend and weekly activity.

Factors Affecting Customer Service

In order to implement successful customer service strategies it is

vital to take into consideration the factors that affect customer service,

factors that influence the efficiency, the effectiveness, and the

productivity of the operations addressing customer service.

These factors can also be studied in the operational analysis. The

results must be measured against quality standards previously imposed by

the supermarket's managers in order to provide the best quality service for

existing and potential customers.

Generally, the most important factors that affect a company's customer

service quality include people, process, and technology (Jones, 2000). As a

consequence, the operational analysis should focus on following these

directions.

Other general factors that affect a company's strategic direction

regarding operations management are represented by improving product

quality or by reducing product cost (Davig et al, 1991). More specific

factors of influence that derive from the factors previously mentioned

include: improving product quality, reducing product cost, improving

product design, improving service, improving inventory and control,

reducing lead times, improving scheduling, improving materials handling.

The supermarket in case has focused its strategy on improving product

and service quality, rather than on reducing costs. However, the declining

level of service quality has revealed that either the quality improvement

strategy has exceeded the period for which it was applicable, or the

strategy was not flexible enough in order to adapt to changes produced by

the external environment.

Operational Analysis Strategy

The lack of success produced by the supermarket's strategy regarding

customer service, which is translated in declining quality of service, was

probably produced by either internal or external causes, or both. In order

to determine the exact causes that led to the current situation of the

supermarket and to develop strategies to counteract their effects, it is

recommended to conduct both an internal and an external analysis.

External Analysis

The external analysis consists in studying the external factors that

might have led to the current situation or the stakeholders affected by the

situation in case. Given the fact that consumers must be the center of the

supermarket's activity and that the declining quality of service is

directly affecting them, it is only reasonable to focus part of this

investigation on the supermarket's customers.

Customers cannot provide information on the reasons and causes that

determined service quality to decrease. They can however provide

significant information on future objectives the supermarket's managers

should take into consideration.

Therefore, it is very useful to analyze all complaints received during

recent months from customers. In addition to this, it is necessary to

spread questionnaires among the supermarket's customers in order to

determine the problems they are facing in relation with their experience in

the supermarket.

The questionnaire must refer to personnel's service in order to

determine whether employees' attitude towards customers has depreciated and

to take suitable measures. It should also address issues related to

products, their placement, price and other. Questionnaires must come in

both written and oral form. Also, they should allow the interviewee to

express other issues that the questionnaire failed to address.

Based on the responses, the supermarket's managers can identify any

existing or potential aspects that threaten the quality of customers'

experience within the supermarket's branches. They can further develop

strategies and sub-strategies that must take into consideration the aspects

identified by customers as problems.

Internal Analysis

The internal operational analysis is intended to determine any aspects

that affect the factors that further influence the supermarket's customer

service and, therefore, the quality of the service delivered to customers.

As mentioned above, the internal analysis must review operations

regarding the most important factors of influence for customer service:

people, process, and technology.

In order to be efficient and to deliver high quality service to

customers, the supermarket's organizational structure must a supple,

flexible one. It must not be composed by many departments. It should have

bigger and more important departments, rather than smaller departments that

require a more complex informational and communicational system.

The more department and compartments a company's organizational

structure has, the more time is required for information to travel on both

the vertical and horizontal direction. This situation further leads to

problems regarding… READ MORE

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