Operations Management: Strategy and Implementation

This assignment delves into the core principles of operations management, focusing on strategic decision-making and implementation. Students will analyze concepts such as customer relationship management (CRM), sustainable operations, and supply chain management. Additionally, the assignment examines lean transformation within service environments and the role of business process management in achieving operational excellence.

MANAGEMENT AND
OPERATION
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TABLE OF CONTENTS
Task 1.........................................................................................................................................3
LO 1: Differentiating between role of leader and function of manager.....................................3
LO 2: Applying the role of leader and functions of a manager in a given scenario...................4
Task 2.........................................................................................................................................7
LO 3: Demonstrating the role of leaders and functions of managers in the operational
management of the company......................................................................................................7
LO 4: Explaining the relation between leadership and function of management in a business
..................................................................................................................................................11
Reference List...........................................................................................................................15
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Task 1
LO 1: Differentiating between role of leader and function of manager
As per Adam Jr and Swamidass, (2015) leadership is a term that only suggests the level of
motivation and skills used by the individual to take the company forward and achieve the
desired goals and objectives. Leadership is a dynamic duty that is not the capability of any
person to implement readily. Managers come close to being a leader but their roles and
functions suggest the dissimilarity between the two.
Leaders Managers
According to Angell and Klassen (2014), a
leader is what a leader does. They innovate
various operational strategies and
procedures that pave the way for the
business to achieve its objective.
Arndt (2014) suggested that managers have
the duty and responsibility of managing their
team and boosting teamwork. Unlike leaders
they do not engage in new strategy
development but focus on the performance
of the team and their approach towards
company goals.
Another characteristic that separates leaders
from managers is the development of trust
and confidence that they can instil among
workers in the organisation. By verbally
motivating the workers and through policy
making they can boost workers to strive
towards achieving the objectives,
The manager’s role is to effectively conduct
the various administrative functions and
monitor all the daily operational activities to
understand daily progress made by the
various departments.
The vital role that a leader needs to fulfil is
the strategic vision of wanting to achieve
specific long-term goals of the company.
Keeping this in mind, various goals,
strategy and policy making is carried on.
Unlike leaders, the responsibility is limited
only for the achievement of short-term
objectives of the company. They monitor
daily progress and their decision making is
limited to this extent.
According to Coughlan and Coghlan
(2014), leaders are supposed to take vital
and risky decisions for the benefit of the
company.
The role and function of a manager is to
carefully assess employee performance and
generate necessary performance reviews that
can help in showing the employee progress
and performance evaluation can be initiated.
Proactive nature is a characteristic that
every leader possesses and this translates
automatically in their policy making
strategies.
The decision making function of managers is
restricted to managing operational activities
and improving existing policies. This allows
them to change daily routines and way of
work.
The leaders must continually drive towards
the creation of new business ideas and
strategies so that the company functions are
not hindered by the constant change in
business environment.
As per Croxton et al. (2014), managers are
responsible for the operational activities that
are critical for the running of the
organisation.
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Table 1: Differences between leaders and managers
The above table suggests how dissimilar the functions and roles of a manager and leader are.
This difference is critical as it allows to understand the role which both a leader and a
manager play in making the organisation run smoothly and on track to achieve the objectives.
The distinctive approaches of both helps in understanding that they are critical in their
respective functions and are irreplaceable from their functionality. A key point is the fact that
leaders cannot be made. The qualities required for leadership can be learnt to some extent,
but some features remain inherent in the leaders and that makes them stand out from the
managers. The importance of both cannot be underestimated since both are good at what they
do. The prime importance of both their roles and functions is the fact that they help the
company in staying organised through well planned strategies.
As per Goodhue et al. (2014), the true test of both managers and leaders lies in the various
traits and qualities that each possesses and implements for collectively working towards
making the company successful. Managers sometimes may have to bear the burden of ill
planned objectives by leaders and it may also happen that well chalked out plans are not
monitored and administered properly by mangers. Both this situation leads to the bad
performance of the company. Hence, in a way it can be stated that leaders need managers to
carry out their duties and managers need the guidance of leaders to implement strategies. This
is a sign of a closely knit group who undoubtedly work as a unit to achieve the set objectives
both in the short-term and in the long-run.
LO 2: Applying the role of leader and functions of a manager in a given scenario
According to Kleindorfer et al. (2015), a leader is strategically opulent and manages to chalk
out intricate strategies that not only help in boosting the policies, but in a way it assists the
achievement of company targets. The leader is exclusively responsible for the manner in
which they communicate and take decisions. If the business perspective of Tesco is taken into
perspective, the role of leaders and manager functions can be brought out clearly. The
leadership style that the company follows has direct consequences on the operations at
managerial levels. Tesco very wisely utilises the management by objectives theory and
situational leadership style to produce strategies and plans that assist the business in
achieving its desired goals.
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Lambert and Cooper (2015) argued that using a particular theory model assists in leadership
as it provides theoretical and empirical knowledge about the rate of success that can be
achieved by its implementation. In the case of Tesco, the various issues surmounting the
company has been dealt with the utmost ingenuity. The concern for the company lay deep
down in the fact that even after the company began sales service well in 2016, their actual
sales figures still saw a decrease even after providing exciting offers to lure the public. There
was a massive fall in sales by 1.5% and group sales fell by 0.5% (website). The performance
of Tesco gradually improved by the introduction of seasonal offers. These offers bore good
results as according to retail owners, customers responded well to the products as they were
offered at 5% cheaper rates than the previous year. This clearly suggests the situational
leadership that they incorporated to achieve the desired results from their consumers.
The company had faced a massive loss worth £6.38 billion in 2015, so the steady business
albeit not highly profitable in the preceding year is a point that leadership skills definitely
helped in stabilising business opportunities for the company. Management of the company
also played a major hand in the utilisation of offers to make attractive discounts possible and
it had an impact on the overall sales initially. The distinction can be clearly understood as
leadership in the company allowed changes in plans and policies and the management
allowed implementation of the policies and procedures.
The major focus of management by objectives lies in the fact that it focuses highly on
leadership and communication in the business and managing control of the decision making.
It readily helps in managing the duties and roles of managers and doesn’t need the
management of the workforce. Mentzer et al. (2013) stated that the process of managing by
objectives helps in making the managers more responsible towards their capabilities and
encourage them to utilise effective steps to take company forward. In the case of Tesco, they
used a combined effort on both leadership skills and management skills of personnel to tackle
the falling business scenario and make the company stable again with discounting strategies
and offers to its valued customers.
Tesco has already established business across the globe, and it is crucial that their business
management system used methods that could tackle various issues that can damage the
company image. Nguyen et al. (2015) argued that managing a large organisation with huge
global market requires effective leadership styles and processes as cultures, values and
operational activities may vary from place to place. The behavioural theory could not help the
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issue of Tesco as it is solely focused on improving marketing aspects of the company. The
behaviour of customers could not be mapped. The management by objectives process
allowed Tesco to entertain a simplified management process. Having business widely spread
across the country, it requires management at every location. This is where the transformative
leadership implemented by them bears its results. The power and responsibility given to the
local managers and other departmental heads allows them to exercise control over necessary
strategies and plans keeping in mind external and internal factors of the location they are in.
The general managers of each geographic location maintain democratic approach in order to
lead their staff since careful attention is required in considering the macro factors of a
business environment. Giving top priority to the general managers allows the company to
handle its global operations with ease. The constant managerial and staff performance
reviews allows the company to assess whether the desired targets have been met or will
require further efforts to be successfully done. According to Oliva and Kallenberg (2013),
managerial functions dictate the level of results from employees and makes it evident
whether the approaches taken by them have been capable enough to garner desired results.
The emphasis that Tesco gives on making managers of various departments in several global
areas responsible for operational activities makes the roles and functions of managers even
more relevant.
The implications of decision making always falls upon the manner in which leadership and
management are carried on in the business. In the case of Tesco, the consistent focus on
recording and evaluating employee information is critical for the manner in which decision
making is conducted in the company. It only goes to suggest that leadership functions and
manager functions are very much important in order to devise decision making steps that can
help the business in the creation of strategies that are best suited for achieving business goals.
Situational leadership theory:- The situational theory of leadership advise that no
individuals' leadership style is best rather, it all the depends on the condition at other hand
and which kind of leadership and planning are best- appropriate to the project. As per this
theory, the most effective leaders are those capable to adopts their style to the condition and
look at cues such as the type of projects, the behaviour of the group.
System leadership theory:- System leadership theory refers to management discipline that
define the understanding of a system by analysis the connection and physical phenomenon
between the element that comprise the integrability of the organizations. This leadership
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theory helps to the Tesco in terms of improving the performance and maintaining effective
monitoring and controlling within the organizations as well as regulates business in a proper
manner.
Contingency leadership theory:- This theory examine that to work group or companies
context, its impact on the extent to which leader ability and behaviour become effective fro
the Tesco. Contingency theory is based on favour-ability and that leaders Hence, more likely
to be effective when placed in conditions conforming to their choice of style. This theory is
highly based on the criticized on methodological and Theoretical evidence. It remains a
significance role given into the understanding of effective leadership.
Task 2
LO 3: Demonstrating the role of leaders and functions of managers in the operational
management of the company
Considering the fact that leaders are the initiators of every strategic change that is needed to
be done, it is evident that company benefits lie specifically in the functionality of the leaders.
Operations management is a vital aspect that decides the manner in which the business will
perform for achieving the set targets. Piercy and Rich (2014) argued that the
accomplishments of operations management is the vital task that managers of all
organisations, be it small, medium or large must conduct to ensure business functionality.
The qualities and traits of managers who are responsible for operations handling must be in
lieu with the organisational values and cultures. This will help them to be clear about the
matters that need attention so that strategic measures can be adopted.
According to Smith and Fingar (2013), leaders pose a tremendous responsibility in making
operations management possible with their impeccable knowledge and idea about the market.
The case of operational leaders suggest to the point that their important knowledge about the
supply chain management and distribution networks can be vital information that can be
passed to operational managers for effective business undertakings. Since improving
productivity is the major factor in the business, operational leaders supply vital information
and perspective that is beneficial for business interests. Operational managers can readily
benefit if information regarding the various warehouses, logistics and production department
are provided specifically. Quick decisions can be made and the best supply chain option can
be initiated for enhancing business. Considering the fact that Tesco is a huge Food and
Beverage Company, the need for operations management rises significantly.
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The biggest requirement for companies that indulge in food and beverages is of achieving
total quality management (TQM). The functionality in Tesco’s business ventures lies
specifically in satisfying the needs of customers. The need for the business to maintain
quality in its products and ensure that the distribution system is capable to handle demands is
the top priority that they focus in. Operational activities in the company can decide the
success of the company in achieving the quality parameters and tis will only be possible by
intercommunication. Stevenson and Sum (2013) argued that communication and feedback are
important traits of both managers and leaders as it helps them to communicate and gather
necessary feedback that is essential for business operations. Managers who are responsible
for the operations management in an organisation focus mostly on the production and
development aspects of the business. They are responsible for supervising, recording and
assessing the progress of the functions on a regular basis. Stuart et al. (2015) suggested that
business needs to focus on maintaining a tight production schedule so that effective
distribution can commence.
On the contrary, leaders who handle operation management must conduct their operational
activities in such a manner that that their actions do not collide with the interests of the
company. Ward et al. (2013) suggested that leaders have the prime responsibility to deal with
factors related to the supply chain network. They are responsible for tracking logistics and
maintaining inventory stock as well. These factors bring their responsibility to hand over the
gathered information to the operations manager so that they get an idea of the overall demand
of the products. Inventory management is vital for the maintenance of stock since it allows
the company to understand and control supply in the market. Tesco faces massive
competition from Pepsi and its sub brands, this makes it vital that Tesco understands market
demand so that they can easily supply the products to locations that show a brighter prospect
for profits.
According to Zeng et al. (2013), TQM is a serious factor that helps in controlling the
customer loyalty factor and allows managers to effectively motivate the employees for
creating the best value for money product so that brand retention can be achieved.
Considering the widespread loyalty that Tesco enjoys, it is important that quality is never
compromised and the operations managers must be dynamic enough to handle the daily
operations across the globe in tandem. It is also vital that sharing of business dealings must
be transmitted to all the regions that Tesco conducts business in as it can give the feedback of
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global performance of the business. This information is vital for the company to identify
strengths and weaknesses in their business activities.
The essence of operations management can be embodied by various methods namely, Six
Sigma, Lean production and queuing theory. Arndt (2014) opined that lean strategy
essentially helps in cost cutting on other factors and helps the company raise its scale of
operations. If reports are to be considered, it is evident that by adopting an eco-friendly
model and sourcing around 30% of its raw materials from sugarcane-based commodities the
company has helped in cost cutting. It also provides them a good value on their corporate
social responsibility (CSR). By focusing on the main element of their product which is water,
the company has focused on areas that can reduce the level of water inefficiency
(Cmuscm.blogspot.in, 2017).
Key approaches to the management of operation department:
 Six sigma: The approach in which number of damaged products and services reduced
as well as eliminated from the manufacturing procedure is known as six sigma. With
the help of this, quality of the goods and services also increased up to the better level.
In addition to this, proportion or ratio of damaged items is 0.06% behind every 1000
units. Hence, it can be said that it is one of the highly effective approach of managing
whole operation as well as boost up quality of products.
 Lean production: In the context of Tesco, it can be stated that the use of lean
production has definitely improved the performance of the business in recent years.
The demand-driven nature of the supply chain of the company has focused highly on
increasing scale of operations in a bid to cut costs that would be required in inventory
management.
 Just-in-time: Another method is just-in-time in which goods and services are to be
manufactured, placed and delivered on time. When raw materials are purchased
within proper time and converted in finished goods also then stock will be managed.
Along with this, it helps to deliver goods up to the customers in proper timing which
is also the best approach for operation function in Tesco.
 Kaizen approach: It refers to the continuous production of goods and services within
manufacturing procedure. According to this, if company produces products in the
business process on consistent basis then able to utilise all the required resources in
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proper and adequate direction. Because of this, overall function of product
manufacturing will become smooth and managed effectually.
Explaining significance as well as value of operation management:
 Quality of products and services:- Tesco must focused on product and service quality
and produce more effective product with the best price for its customer and adopts
different design of their items as compare to other market competitor such as
Sainsbury, Morrison's, Asda. Therefore, from this strategy the company gain
competitive advantage from the existing and attract more new customer for
themselves (Zeng, Wen and Yen, (2013).
 Working conditions:- Good working conditions of Tesco, motivates their employee in
terms of improving performance and efficiency in the production of product. Always
better work place interact employees feelings, beliefs and attract to words for working
or produce effective production of products with higher intention and innovation.
 Supporting function:- Tesco Plc has to ensure that its stores always monitor and
control in a effective manner so that they attract large number new customer. Their
finance and accounts department supports to the operations management for funding
and provide fund at the time of requirement for purchasing any kind of raw item for
production. Therefore, from this the organizations achieve their goals and business
objective with increasing the sale and generating more revenue (Olive and
Kallenberg, (2013).
 Transformation procedure:- The procedures of making up the operations functions
must be designed and evaluates in a path that effective in delivering of demand
products.
A SWOT analysis of Tesco is viable in understanding the pros and cons of the
company along with an idea of the various possibilities that the business environment
provides.
Strengths:
 The vast global presence that Tesco
enjoys gives them instant brand
recognition and helps them to launch
new products without the effort to
use promotional mix.
 Being one of the most renowned and
Weakness
 Tough competition with rivals such
as ASDA, Sainsbury and Morrisons
gives it the much needed competition
in terms of business though its
products and aggressive marketing.
 The lack of product diversifications
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profitable businesses, it has a good
track record of business transactions
even under massive competition.
 Customer loyalty has been a huge
part of the success of Tesco. This
can be attributed to their amazing
marketing strategies and discount
factors.
 According to Coughlan and Coghlan
(2014), the huge demand for its
products ensure that the company
has a large distribution network. The
nature of the distribution network
assists the company to function well
in distributing and maintaining its
supply chain.
curbs the level of impact that the
company could do with other
products in its roster.
Opportunity:
 Business expansions in developing
nations and climatic condition that
are favourable for such products
allow the business to increase their
chances of profitability.
 The need to improve supply chain
management and making it more
streamlined will allow better
distribution network.
 Focusing on high discount factors
and making seasonal offers on a
regular basis can help the company
immensely.
Threats:
 The economic hassles that the
European Union is facing, combined
that with the BREXIT issue makes
business difficult in such a scenario.
 Constant evolution of marketing and
promotional strategies of rivals
ASDA and Sainsbury makes it
important that the company doesn’t
lose focus.
Table 2: SWOT analysis of Tesco
LO 4: Explaining the relation between leadership and function of management in a
business
As per Oliva and Kallenberg, (2013), the leadership and management are interrelated
terms that suggest the need for each other. The lack of leadership cannot initiate proper
management and without management leadership has no value at all. Tesco being a large
brand with high level of brand recognition and loyalty is considered to enact its part of CSR
towards the community. However, the fact that leadership and management must be kept in
mind not to hurt any sentiments within the organisation and outside the organisation. The
business must conduct itself responsibly by keeping company values and ethics intact. The
CSR of Tesco has been prominent in providing certain part of it revenue stream towards
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charitable options. Management must decide what should be the level of charitable donations
that is feasible for the company.
Business sustainability is the major objective that every organisations look forward to
achieving one day. Tesco being an already established company should focus on newer
market so that global sustainability in business can be achieved. Better business is linked with
better relations with stakeholders and shareholders. This is based on how the leaders have
established business policies and the man management of the various departmental managers
in the organisation. The building of relations with suppliers and logistics is possible by better
management in understanding needs of company and improving level of communication with
suppliers and distribution network. This can assist in quicker supply in order to meet
demands and fulfilling business targets will be possible. As per the comparisons between
leadership and management, the need for situational and contingency leadership can arise in
any business house. The contingency leadership arose during Tesco’s fall in sales that saw
the company lose massive finances in a single year. It however was rectified by redesigning
policies that was handled well by the management staff.
To the operation management wide range of the factors and aspects affected up to the
greater extent. Because of this particular situation overall smooth system of the Tesco
company influence in negative direction. Therefore, managers cannot take business decisions
in an appropriate way. There are internal and external both kinds of aspects included by
which smooth functioning of operation department affects. These factors are explained as
below:
Internal environment factors:
 Ability of management: It is one of the highly important factor which create impact
on the operations. As per this, if overall management is highly able, qualified and
skilled then easily manage any kind of obstacles incurred. As problems managed then
overall manufacturing procedure become more effective and proper. On the other
hand, due to lack ability in management lead to hinder overall operations (Nguyen,
Sherif and Newby (2015).
 Financial aspects: In the company different kinds of incomes, expenditures, costs etc.
incurred which affect operations of Tesco in both negative and positive way. If level
of total cost of production is higher in the workplace then company cannoty purchase
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better quality of raw materials. Therefore, whole manufacturing process affect
negatively and vice-versa.
 Another internal factor is regarding to the efficiency of workforce which is one of an
important asset for the Tesco organisation. When employees are the most and highly
efficient then able to utilise available resource in an optimum manner which is
positive impact on the operation function (Lambert and Cooper (2015).
 Supplier is a significant stakeholder of the company who provide raw materials to the
operation department. Quality if products and services within Tesco Plc depends on
raw material's standards which supplied by the supplier. Along with this, good
relationship with supplier also influenced on the operations of cited firm in positive
direction.
 Internal aspect which create impact on the operations is related to the marketing and
advertisement. The reason is that, attractive strategies when adopted by the company
then people influence for purchasing its products and services. Therefore, sales and
and profitability both affected in highly positive direction.
External environment factors:
 Political: The retailing company Tesco operating their business worldwide,
international political factors largely affect the performance of the company. In this
includes Tax rates, governmental rules and regulations. The stability of the nations it
running their business. Due to ongoing fiscal instability in the world, many
government force to retailers to provides jobs for their local populations. As Tesco
plays its role in providing jobs chances for the domestic public (Oliva, R. and
Kallenberg, R., (2013).
 Social: Due to various changes of UK customers choice and preferences due to the
baby boom generations. This leads to shift in the tested of personal, it should taken
into the account by Tesco. For e.g. the adoption of Online shopping by Tesco for its
grocery products is an approach that takes youth people.
 Environmental: In the press essential emphasis is made on natural desators and the
consequences connected with it. For e.g. the rise in averaging temperature is leading
to a melting of the Arctic ice and it is envisaged that in the future there will be an ice
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free summer. Tesco is adopts a huge number of measures that are needed for the and
to protect the environment.
 Technological: It is a critical for supply chain management of Tesco. Large retail
sector of the company develop supply chain management system to gaining the
competitive advantage from the market. Hence, cost efficiency (Adam Jr and
Swamidass (2015).
 Economic: In this kind of factor, interest, recession, inflation, growth rate of an
economy etc. aspects included which create impact on the business up to the greater
extent. For instance: If inflation rate increases in the economy then price of products
and services of Tesco will enhance. Therefore, number of customers will decline and
create adverse impact on the operations.
 Legal: There are number of laws that impact on the business of Tesco. Organization
market a huge range of products and services. For e.g. as the agriculture products the
UK governor body is reviewing the path direct subsidies will be divided to farmers.
Such measures can lead to lower subsidies, which affect the ability of farmers to meet
the agricultural standards set by Tesco and the prices agreed with organisations
engaged in the supermarket sectors (Coughlan and Coghlan (2014).
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