Operations Management Case Study

This assignment requires you to analyze and compare the operations management strategies employed by two distinct businesses: Starbucks Coffee and The Canvas Cafe & Creative Venue. The analysis should encompass various aspects of their operational processes, including decision-making, productivity, and sustainability practices. Drawing on academic literature and real-world examples provided, the task is to critically evaluate the effectiveness of each company's approach and highlight key differences and insights gained from comparing their operations.

Operations
Management and
Service Excellence

TABLE OF CONTENTS
1. Introduction and overview of The Canvas Cafe:....................................................................3
2. Analyze the ways of operations management processes that support the Canvas cafe:.........4
3.Critically discuss the 5 Performance Objectives to the Canvas cafe and what improvements
need:.............................................................................................................................................6
4.Explain the supply chain of organization and critically evaluate it..........................................8
5. Define similarities and differences between the Starbucks and Canvas Cafe......................10
CONCLUSION .............................................................................................................................12
REFRENCES ................................................................................................................................15
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1. Introduction and overview of The Canvas Cafe:
Introduction and overview:
The Canvas Cafe is a small social organization which manufactures freshly baked
products; hosts event operates its business as a cafe. The canvas cafe is situated in 0.5 miles
north of Liverpool street station, by the touristic street brick lane in London. This cafe is started
by Ruth Rogers( The Canvas cafe & creative venue, 2016). She is a former actress who after
successful campaign with her charity body gossip. After this campaign she decided to open the
cafe by keeping in her mind that they focusing on making London happier through making a
innovative area. In that venue, customer shares their felling by writing on cafe’s walls and also
enjoys their home made goods. The cafe has been started since October 2014 and operated by
only 6 people. In the canvas cafe they operate baking, hosting events and barista activities.
The canvas cafe is special because of the customers are able to write on store walls and
express their thoughts and feeling. The Cafe sells product like cakes and sandwiches which are
of £3-5, range of coffee and beverages are £2-4 and the event bookings range is £60-150 per
occasion. They give special rates to its customer for charities. The store operate timing is
Tuesday to Friday 9am to 9pm, Saturday to Sunday 10 to 8 pm and it is closed on Monday. The
store outsources some baked goods from other local bakeries and also prepares on the spot
orders of cakes and other goods. The key competitors of mentioned store are Cafe at Second
Home, The Truman Brewery food market, Doppio, Joe's Kid, Nude Espresso, DF Mexico.
Accordingly cafe layout in This store has 2 floors the upper floor is used as a cafe and
the bottom was used as cafe and also used in events time. The both floor are transformed during
its events and occasion. The store has a garden which is used as a cafe area and additional space
is also utilized at the time of events. The map of location and layout of canvas cafe are:
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4

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customers were served during visit is shown on below diagram:
The capacity of canvas cafe is during rush time they served approx 100 customers and in other
day they served 50 to 60 customers per day. The busy time for canvas cafe in a day is between
14:00-16:00, the busy day in week is Saturday and in year the busy month for mentioned cafe is
October.
2. Analyze the ways of operations management processes that support the Canvas cafe:
Operation management process supports the organization in many ways. Operation
management process transforms inputs i.e. labor, capital, land, building, material and
information into outputs i.e. products and services which adds value to the customers. The
canvas cafe must try to enhance quality of their operational process to meet customer preferences
and needs. Controlling of operational process and its cost makes it difficult for the competitors to
produce goods of the same quality as per the original product(Brown, Bessant, and Lamming,
2013. ). This controlling helps the organization to achieve goods of high quality. The operational
process support to canvas cafe ,if they provides training to employee and keeping qualified
workers and mangers in organization. The environment of work place is user friendly for the
customer that will help the user in effective function, further it support the operation process of
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management(Campbell, Jardine and McGlynn, 2016). The store adopted new technologies and
control system in its work place and integrating them. These all are ways for effective
operational management process.
It has been evaluated that The Canvas Cafe store has faced many operation challenges
which are given below:
Volume: The canvas store is a low volume and low staffed for operation process. The
store provides to customer short order which depending on customer demand and have
comparatively low repetition of products. Hence, because of low repetition it increases
production cost of store. The other challenges faced by store are low amount of staff. Due to this
reason, the staff performing own job but more job also. The result of this issue the staff being
highly skilled which reduce the repetition of work. Though the staffs are expected to perform
number of task the large majority of responsibilities fall on the owner. The owner is also
involved in day to day activity. The high production cost the store cornering itself in with a
increasing amount of cost with market forced limits to sales price. The other coffee shops which
are the competitor of canvas store also offer their customer more unique and personal
atmosphere.
Variety: The other operational challenge of canvas store is its variety. The canvas store as
compare to its size they offer high variety. They offer customer 7 types of brunches and 8 types
of lunches including daily specials. The cafe offers also 9 types of coffees with teas and so on.
The menu of canvas cafe changes according to season, however due to the size of the store, it is
fairly flexible to tailor goods according to the customer needs(Evans and Lindsay, 2013. ). The
events which cafe holds have no standardization in place, its change week by week and with the
upcoming events they updated on websites their events. Due to this, the cafe is unable to output
the advantage of 'economic scale', as most of the products are purchase locally in small batches
from local bakeries and it depends on the frequent basis.
Variation: In Canvas cafe the demand variation are accordingly seasonal. In this cafe
during January the cafe suffers a shortage of customers due to closes for Christmas period. The
figure of customers in Canvas cafe is shown on already in above diagram in introduction. The
perception foe people to go to into coffee shops has changed time to time. In Canvas cafe the
variation demand increases towards the weekend when events are held in the cafe. Though this
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poses a larger threat of restaurant and pubs competing at the market area(Christopher, 2016). No
important changes in the staffing have been known meaning an increase in stock and becoming
understaffed. This result in a lack of utilization of resources at time.
Visibility: Hence The '4Vs' model purposes that customer will have a relatively they not
like to waiting for receive their needs. The business wants to provide to customer a welcome and
home-like culture and when customer enter in cafe, each item handled with care. According
present people perception they pay more for the quality of the goods. It is very difficult for the
Canvas cafe to achieve high resource productivity which outcome is high cost operation. To
enhance their efficiency the manager ensure that the human resource of business are completely
customer oriented.
Furthermore, According layout of Canvas cafe there is little visibility for extra space
down stairs, which outcome is that the customer not wanting the enter supposing the cafe is at
full capacity.
3.Critically discuss the 5 Performance Objectives to the Canvas cafe and what improvements
need:
The performance objectives of Canvas cafe:
There are five main performance objectives of cafe i.e Quality, Speed, Dependability,
Flexibility and Cost. The ways in which the Canvas secures, utilize their resources will have
important impact on the level to which they successfully follow specific performance objectives.
 Quality: it is a objective of performance of organization which Referred as a doing
things right. The business provides products which are fits for customer purposes and
produced according customer specification(Hill and Hill, 2012. ). The customer
expectation for Canvas cafe is that they provide high quality, ethically sources products,
provide high quality product and services and provide comfortable environment.
Performance against objective: The Canvas cafe ethically locally sourced and home
made produce. The atmosphere of cafe is friendly and welcoming. The cafe provides high quality
products to their customer as customer needs. The cafe is wiling to source transformed products
and input resources to meet customer needs. This is identified that Canvas in the customer
satisfactions rate for quality of food is 78% are in satisfied category and in quality of services
68% are satisfied. The cafe has received negative feedback that environment is not comfortable
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in venue. This negative feedback which outcome is its reduced satisfaction of customer. Hence
the Canvas cafe make strategies for improve their environment which satisfied employee. Speed: it is a refereed as a doing things fast which also a objective of performance of
venue(Mahadevan, 2015. ). The minimize time between the placing of order and
receiving the product. The customer main expectations of speed services is that the fast
service on products and fast respond of queries and orders.
Performance against objectives: The delivery services of Canvas is sluggish because
sometimes customer will wait for their orders. Occasionally coffee that are not up to the standard
of barista's expectations are thrown out which outcome is that the cost per unit in increased,
increasing overall cost and increasing wait times. This is indicated in the online feedback of
canvas cafe is that the delivery service is dreadful service(Google, 2015.), Where 32% are
neutral and dissatisfied with services. Hence the improvement of delivery time is also important
for canvas cafe which is reduce through making some strategies. Dependability: it is referred as providing product and services to customer when they are
needed. It includes service according to customer expectations i.e stock available for
orders, open as advertised, keep customer in queues to a minimum and provide products
in according customer needs(Oakland, 2014).
Performance against objectives: The canvas meets this objective they provide products
and services to customer in the time scale quoted in mostly time. The stock always available in
cafe which fulfill the customer demand. Sometimes the food and coffee takes time to deliver
according customer needs. The cafe not make any specific strategies to resolve this problem.
This is especially important during morning peak hours when so much rush in cafe and all
customer wants their orders, but cafe provide try most that the goods are received on time. Hence
the delivery to customer in peak hours they need to improve through make specific strategies.
 Flexibility: Customer expectations in flexibility is that they respond to demand in
capacity, quick to respond to queries and keep queries minimum(Dahlgaard And et. al.,
2013. ).
Performance against objective: the staff of cafe occasionally find it difficult to adjust to
change in needs of customer. The canvas cafe does not have any specific strategies to cope with
an increase or decrease in demand meaning that the staff are left cafe because of overworked or
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not doing something productive. The outcome of this result is increase stock which increase the
cost per unit. The flexibility of workforce is also improve in canvas cafe.
 Cost: Cost is a referred as a price of product that the cost is fixed accordingly quality of
product(McIvor, 2013. ). The cost expectation from customer to canvas cafe is that high
quality, high price and competitive pricing.
Performance against objective: The Canvas cafe is ordered stock twice per week which
provide sufficient resources, there is a limited opportunity to source from lower alternatives. In
the finding of survey shows that most of the customer of Canvas believe that the the cafe provide
products in reasonable prices. The cost of the goods is limited unproportioned to the selling
price, which may increase according to the competition.
4.Explain the supply chain of organization and critically evaluate it.
Supply chain is a network between the organization and its consumers. It also includes
production and distribution of a product with the channel of distributions from one process to
another (Chandes and Paché, 2010). Canvas Cafe supply chain describes the steps by which product is produced and given to
the ultimate consumer. Canvas Cafe is dealing in Baked food, events and operating in
cafe products and It provides various types of coffee like green coffee, black coffee etc
(Foropon and McLachlin, 2013).
 Sourcing and outsourcing: Product outsourcing began as cost cutting measure, but
Canvas Cafe creates real sustained value for far strategic ends. Organization sourcing
practice performed with the operational infrastructure. While in outsourcing includes the
practice used by the different companies to reduce cost by transferring portion of work to
the other organization. Outsourcing is effective cost saving strategy when it is used
properly by canvas cafe. The supply chain management is all about delivering right product to right people at the
right time and at the right price (Fredriksson and Persson, 2011). In real life, it is difficult
to carry out this thing but with in a systematic manner and with the proper planning it can
be effectively executed. In Canvas cafe, professionals are help to the company in supply
chain management in the organization. Following steps can be considered in supply chain
management of Canvas Cafe:
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 Identify: It is the first step in the working of supply chain management. The organization
identifies the network of Canvas Cafe (Kobbacy and Vadera, 2011). The organization set
the activities which help in connecting with the customers. Measure: In this step, Canvas Cafe measures performance of the supply chain
management and compare to the external and internal factors of the organization
(Petersen, Aase and Heiser, 2011). For example cost, technology, etc.
 Recognize: supply chain management helps to know and remember about the product or
services of Canvas Cafe. Because of previous knowledge or experience of the product. In
this, organization wants evaluates the whole system (Piercy and Rich, 2015). For
example services given by the Canvas Cafe.
In Canvas cafe, following process is to be adopted for supply chain of products in the
organization: Strategic Planning Process: the company will design,, evaluate performance and
optimize supply chain of the organization (Yagci, 2011). The company should design
from where the raw material should be purchased and plan all the process. Demand Planning Process: It will help to determine the demand of the products by the
customers of Canvas Cafe (Brown, Bessant and Lamming, 2011). It helps in identifying
the forecasting of demand, demand planning etc. Supply Planning Process: Further, it also assists in planning method that how to supply
and deliver product by outsourcing (Cooke, 2012), distribution planning etc. In Canvas
café, organization is planning for its safety stock planning. Procurement Process: in this, the company monitors the receipts and verifies its purchase
order and supply of goods to the consumers (Leseure, 2010). Manufacturing Process: In this step, organization does production planning of the
product (Mahadevan, 2015). Canvas Cafe manufactures its product (coffee) by supplying
raw material in specific sequence and within the given time frame. Warehousing Process: It involves storage of product which are used on demand arises in
Canvas Cafe. It includes the physical inventory or products of Canvas Cafe. Order Fulfillment Process: It involves the sales order process in terms of order. It
includes delivering the product to consumer which is demanded by them.
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 Transportation Process: This step focuses on transportation planning, and execution
(Chandes and Paché, 2010). In transportation process of Canvas cafe, it includes the
freight costing and transportation of product to its customers.
Above description provides importance of supply chain management of Canvas Cafe, but
there are some drawbacks which critically evaluate for the organization are as follows: Extensive training and planning required: Supply Chain Management of Canvas gives
just in time services which take less time (Foropon and McLachlin 2013). But, it can be
critically evaluated that implementing this system requires extensive training and
planning. Very expensive to implement: Supply chain management consists of different steps for
completing the plan of Canvas Cafe. Thus, it involves highest cost to implement the
process of supply chain management (Kobbacy and Vadera, 2011). Competitors can easily copy the strategy: It is also a disadvantage of Canvas Cafe
because supply chain management consists of the process of completing the plan. The
whole strategy can be easily copied by other competitors (Yagci, 2011).
 Difficult to manage: Sometimes, it is difficult to manage all functions of the Canvas Cafe
because Supply chain management includes different steps so it becomes tough to
manage at same time. Inequality supply chain: When demand planning is not easier or harder, it makes
challenge towards the organization (Piercy and Rich, 2015). Thus, it can be criticize to
manage the demand of the Canvas Cafe. Staff Resistance: In the Canvas cafe, staff will be resistant with another one, because they
might be dissatisfied by the policy of the organization.
 Time consuming process: In the Canvas cafe, Supply chain management take more time
for the supplying of products to its customers. Thus, it will be difficult for the company to
manage time (Brown, Bessant and Lamming, 2013).
 Higher risk: Supply chain of an organization makes the high risk of cost, supply,
customer satisfaction, etc (Chandes, and Paché, 2010). In case of Canvas Cafe supply
chain create the high risks of towards the organization. It can be critically evaluated for
organization.
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 Specific performance: Canvas Cafe provides the service to its clients that is specific
performance of providing goods and adopt those parameters which are suitable for their
purpose (Leseure, 2010).
5. Define similarities and differences between the Starbucks and Canvas Cafe
Starbucks serve one of the widest varieties of coffee apart from the snacks, sandwiches
etc. organization is serve the highest premium quality to the highest price on the coffee. It is vary
from country to country (Foropon and McLachlin, 2013). Starbucks adopt attribute control
system of quality control which is help in the making of transparency and other benefits to the
organization (Gregory, 2015).
It help to the Starbucks in the following terms:
 Design of product: Attribute control system of Starbucks can help in design the product
of organization.
 Quality management: Starbucks also use the term quality management. For this
company carefully use the coffee beans for their product (Mahadevan, 2015).
 Location strategy: Starbucks occupies wide area as location of it urban market. It also
occasionally uses same geographic market area of its competitors to gain market share
(Yagci, 2011).
 Job design and human resources: Starbucks's human resource management actively
participate in all area of business. Its functional position less emphasis on work team of
whole organization (Kobbacy and Vadera, 2011). Supply chain management: Starbucks's product is supply all over the world, ans it is
also helpful to the increase the value of economy from the farmers. This program uses
ethical sustainability to the market of the organization (Chandes and Paché, 2010).
 Comparison
As comparing to the Starbucks with the Canvas cafe, Canvas Cafe used for quality
assurance by preventing the failure outcome of the organization. It can be used when company
well trained its employees to exercise this control (Brown, Bessant and Lamming, 2013). It
helps to the Canvas Cafe in the following terms: Good staff important for quality assurance: It is maintain for manufacture a food product
that ensure right quality of product (Chandes and Paché, 2010).
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 Hazardous storage of chemical: In order to overcome this problem of Canvas Cafe focus
on prevent of problem arising in quality of the organization. It is applicable on a whole
system of the organization (Foropon and McLachlin, 2013). Quality assurance is help in
hazardous storage of chemical in the Canvas Cafe. Customers requiring special bread: The quality assurance of Canvas Cafe constantly
operating and help to improved the standard of a company. Location strategy: The Canvas Cafe gives its product on small geographic area. Thus, it
occupies very short area of market as compare to the Starbucks.
 Contrast between Starbucks and Canvas Cafe
Starbucks and Canvas Cafe dealing in food item and beverages. It shows the quality
assurance towards the product of the company. But in some case they follows their elements
separately and contrast between them (Kobbacy and Vadera, 2011). In both organization
following are the contrast includes:
 Efficient for cleaning: In the term of Starbucks organization follows the high premium
quality towards the product of the organization. While in Canvas Cafe organization has
not follows the high premium quality of the product. It shows the less efficient towards
the customers as compare to the Starbucks. It shows the less efficient for cleaning
towards the customers as compare to the Starbucks.
 Focus: Starbucks uses the high premium quality product because it focus on the customer
perspective. But Canvas cafe follows the high quality of service with comfortable
environment.
 Storage: Starbucks not store the inventory control. It provides only on time service
while Canvas Cafe build up of inventory which increase the cost of company.
 Pricing Strategy: Starbucks adopt the high quality of product. Thus, it apply the high
pricing strategy. In contrast to this, Canvas Cafe adopt the low cost of services with the
low cost of pricing strategy.
 Targeting customers: Starbucks mainly target on the middle class and standard class of
people. While Canvas cafe target mainly all class of people. For example Starbucks target
to the all age of groups but Canvas Cafe target only young generation of people.
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 Services: Starbucks has self-services everywhere of the world. As comparing to this
Canvas Cafe gives table service to its customers. For example Starbucks provides clean
online booking and delivery service to the customers while Canvas Cafe provides only
table services.
 Flexibility: Starbucks not easily flexible its policy due to changing of the respond to the
customers or any other things. While Canvas Cafe flexible to the respond of customers
expectations like quick response, demand capacity etc.
CONCLUSION
It is concluded that the operation management process is impact on Canvas cafe
performance. The main objective of performance in canvas cafe is quality, speed,
dependability,cost and flexibility which is change according customer expectations. In this report
evaluates the supply chain of Canvas cafe and also defined drawbacks of supply chain. There are
many differences and similarities between Starbucks and canvas cafe. The Canvas Cafe should
trained their employees to improve their services. The cited Cafe focuses on quality of product,
environment and delivery system because these things reduce their value and decrease their
customer. The Canvas Cafe should make some strategies for its cafe and. The company ensure
that the product and services are customer oriented. The supply chain effective in canvas cafe
when they delivering right product and services to right people at the right time and at the right
price.
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REFRENCES
Books
Brown, S., Bessant, J. R. and Lamming, R., 2013. Strategic Operations Management. Routledge
Campbell, J. D., Jardine, A. K. and McGlynn, J., 2016. Asset management excellence:
optimizing equipment life-cycle decisions. CRC Press.
Cooke, J., 2012. Operations Management - The Art & Science of Making Things Happen.
Ecademy Press.
Evans, J. R. and Lindsay, W. M., 2013. Managing for quality and performance excellence.
Cengage Learning.
Hill, A. and Hill, T., 2012. Operations management. Palgrave Macmillan.
Hristopher, M., 2016. Logistics & supply chain management. Pearson Higher Ed.
Leseure, M., 2010. Key Concepts in Operations Management. SAGE.
Mahadevan, B., 2015. Operations management: Theory and practice. Pearson Education India.
Oakland, J. S., 2014. Total quality management and operational excellence: text with cases.
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Dahlgaard, J.J. And et. al., 2013. Business excellence models: Limitations, reflections and
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538.
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Foropon, C. and McLachlin, R., 2013. Metaphors in operations management theory building.
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Kobbacy, K. H. and Vadera, S., 2011. A survey of AI in operations management from 2005 to
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