Principles of Operations Management

This document provides an overview of the principles of operations management. It covers topics such as the role and responsibilities of operation managers, core operational activities within an organization, the impact of current trends on operations management, and the influence of internal and external factors on business operations. It also discusses the impact of CSR on operations and the response of managers. The document includes a case study on Subway and provides insights into their operations.

Principles of
Operations
Management

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
1. Introduction to the Organisation.........................................................................................1
2. Role and Responsibilities of Operation Manager...............................................................1
3. Core Operational Activities Within Organisation..............................................................2
4. Impact of Current Trends Upon Operations Management.................................................3
6. Impact of Internal and External Factors of the Business Environment Upon Operations. 3
7. External and Internal Analysis of Business Environment for Subway..............................4
8. Influence of CSR on Operations and Response of Managers ...........................................7
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Operations Management is the administration of different business practises which are
carried out in an organisation so that the achievement of efficiency in their operations could be
achieved (Alayón, Säfsten and Johansson, 2017). The main concern here is related to the
conversion of raw material into final products and services for the satisfaction of customers.
This report makes its focus over explaining internal and external factors of business impacting
upon operations along with influences of CSR on operations in addition to this, it will also
provide an analysis of internal as well as external analysis of organisation along with support
provided by operation function on organisational strategy and decision making. Lastly, the
discussion will be made about the various types of controlling and planning methods in relation
to the examples related to different companies along with contribution of quality systems,
operations management and value throughout the supply chain.
MAIN BODY
1. Introduction to the Organisation
The company chosen for the completion of this assignment is Subway and the
establishment of this organisation was made in the year 1965 and is headquartered in Milford,
Connecticut, U.S. The company provides their customers with different types of products and
services such as submarine sandwiches, Pizzas and salads and many more for the satisfaction of
their employees.
Objective: To bring customers into stores and keep them coming back.
Strategy: Appealing customers about healthy restaurant and for wider range of targeting
customers.
Mission Statement: Delight every customer so they want to tell their friends with great value
through fresh, delicious, mode-to-order sandwiches and some other experiences as well.
Vision Statement: To become the first quick service restaurant franchise in the world, while
delivering sandwiches and on exceptional experience.
2. Role and Responsibilities of Operation Manager
 The area of oversight of Operations Manager is the management of supply chain
procedures and inventory tracking which comes under an important responsibility.
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 It is also another role of Operations Manager to look over the staffing requirements of the
organisations at different levels so that there should not be any deficiency of personnel in
organisation (Gibson and Parkman, 2018).
 The role also includes about overseeing budgeting, reporting, planning and auditing along
with supporting worker communication with management tram.
3. Core Operational Activities Within Organisation
The key operational activities within an organisation such as Subway are provided as
under:
Manufacturing: Every organisation producing goods are engaged in manufacturing activity with
the help of which goods are produced in order to provide something to customers for their
satisfaction.
Sales: Another activity with the help of which goods and services produced by an organisation
are made avail to employees so that profit and revenues of the business could be increased.
Advertising: This following operational activity is carried out in an organisation in order to make
the people aware about the products and services of an organisation so that possible increment in
the market share of an organisation could be made possible and for getting an estimate of
possible demand for a period of time.
There has been significant interrelation in between different operational activities in an
organisation such as Subway. For example, the relation in between production and marketing is
important because with the help of performing marketing activity, it is possible to know about an
estimated demand of products and services for a period of time which gives direction to
manufacturing department to carry out their processes (Grant, Trautrims and Wong, 2017). It
also prevents the market to suffer from the condition of deficiency and excess. In this, way, it is
important and provides value to organisation because there is a reduction in cost of production as
both the conditions of excess and deficiency are bad for companies. It is important to have
proper coordination and cooperation in not only among these three activities but to the overall
organisation. It is because with the help of this coordination and cooperation ,it will be possible
to make efficiency running of business operations of an organisation and to achieve their goals
and objectives. In case of any errors and mistakes, it will be possible to know about the place of
error because of proper and structure working processes helping in knowing about places of
deviations and ways to eradicate them forever (Wild, 2017).
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4. Impact of Current Trends Upon Operations Management
Technology: One of the most important trend which is in trend in current times. Every
organisation who had a distinct place and wants to achieve a distinct place in market is making
use of technology in its working. With the implementation of technology, the services provided
to customers are made more delight and with increased satisfaction. So it is also important for
Subway to focus on implementation of technology in their organisation as well to the extent to
which it could give them with positive results and competitive advantage.
Ethics: Customers are king of the market and also are now educated. Not like the old time,
illiterate and all. So this knowledge of customers has made its important for organisations to
manage their working ethically. In case, it is not done properly than this will impact upon brand
image of organisation in marketplace and even abolish the business from the market. So this has
become an important trend for organisations to focus on due to increasing issues of organisations
ethical working in marketplace (Hazen and et. al., 2018).
Global Relations: It refers to the relationship in between different countries and economies of
the world. Every country needs to import and export some or the other material from their own
country to the other and from other countries to their own countries. This could only be possible
when there is a existence of good relation in between country to country. Due to this reason, this
has also become trend to focus on making good relation with not only countries but also with
organisations as well.
The above provided trends impacts upon the organisation in both positive and negative
ways. However, positive impacts are for those organisations which are currently making use of
of them and negative is related to those organisations which are not working according to current
trends (Schönsleben, 2018). Along with this, the knowledge about the use of trends such as
knowledge about use of technology, ways to work ethically, knowledge about working at global
level also decides about an organisation's future for success and failure. So consideration
regarding these factors is also important for the companies.
6. Impact of Internal and External Factors of the Business Environment Upon Operations
There has been a significant impact of the internal and external factors of the business
environment on the working of an organisation. As such in case of Subway, the impact of these
factors are presented as under:
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Internal Factors: The following factors which influences upon performance of company
internally. The explanation is provided below:
Employees: These are the core assets of an organisations which makes possible the efficient
performance of company. This internal factormakes sure about the improvement in
organisational efficiency (Alves and Alves, 2015). In case, employees are performing well than
this will impact positively upon the operations and vice versa. Improvement in performances of
employees could also be made by providing them with training and development programs.
Managers: These people are assigned with the task of managing different tasks in the
organisation so that their effective accomplishment could help in the achievement of goals and
objectives of the organisation. The development of suitable policies and proper guidance
provided to employees will help in achieving good performance to employees. So this will
impact positively on the business operations and vice versa in case of negative responses from
managers.
External Factors: The following factors impacts upon the performance from outside the
organisation. The influence of these factors on Subway is provided as under:
Competition: It is very intense external factor impacting upon the success and failure of an
organisation such as Subway. In case of tough competition, it will become hard for organisation
to survive in the market and will impact upon sales, revenue, position of the business and also on
the operations as well, so in case of low competition, it will be easy for Subway to deal with the
situation and does not push much on operations (Chiarini and Vagnoni, 2015).
Government: Another important factor impacting upon the operations of business as such the
restriction made by government on use of specific material in production, so this will impact
negatively on business operations and in case of favourable policies and rules of government it
will impact positively on business operations.
7. External and Internal Analysis of Business Environment for Subway
The impact of external factors on the working of an organisation will be known by
making use of PESTLE Analysis. This analysis or tool is used so as to know about the impact of
different external factors on the working of an organisation. The description has been provided
as under:
Political Factors: In these factors, the influences created is known with the help of factors such
as political stability in a country, employment, consumer related laws and many more factors that
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given an organisation with favourable and unfavourable results. In some countries, there has
been negative impact of health guidelines issues by government related to packaging and
distribution so this will make organisation to follow guidelines to prevent itself from bad
consequences of government interferences.
Economical Factors: These factors are mainly covers interest rates, disposable incomes of
people of a country, bank rates, GDP of a country and some more factors influencing the
working of a company (Holweg and et. al., 2018). As such in West, customers are having more
disposable income than ever, so this will provide the company with positive consequence as on
revenues and incomes of organisation are increasing because people are spending much.
Social Factors: These factors are mainly related to the feelings, facts, faith, belief, tastes and
preferences of people, community or society impacting upon the working of a company in both
positive as well as negative ways. Depending upon the tastes and preferences of people as
Subway provides Non-Veg Items as well, so some people do not prefer to buy Veg Items from
those companies as well who makes No-Veg Items. So this could wallop negatively on the sales
and revenues and also the working of the organisation as well.
Technological Factors: The following factors influences on the performance of a company due
to changes in technology and other factors influencing an organisation's performance. By making
use of technology such as the use of social media, it has been possible for the organisation to
increase awareness of their products and services and also to provide people with their menu
online so that services could be made availed to them.
Legal Factors: These are those factors influencing on the performance and operations of an
organisation due to some specific laws that has been introduced by government in relation to
some specific industry or organisation (Jasti and Kodali, 2016). Quality standards have been set
up by the government which is important for the companies to follow to eradicate government's
influence in the operations of a company. So these kinds of impact could be created by not
following government regulations and strictness of rules also differ from country to country.
Environmental Factors: With the help of these factors, it will be possible for them to know
about the influence which has been created by a company on the environment such as pollution,
emission of harmful gases and many more which will influence on the operations of a
organisation in positive or negative way depending upon the company as well. However, the
working of this organisation is not impacting much on the environment but the contribution
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made by it towards environment will help in improving brand image and awareness of company
in the minds of people and society.
So from the above analysis, it has been found that Subway is capable of dealing with the
environment but needs to focus on continuous improvement in their products and services to
increase the level of customer satisfaction.
Internal Analysis which will be done with the help of conducting SWOT Analysis. The
following analysis is used in order to know internal strengths and weaknesses and opportunities
and threats to the company from the surrounding environment. The application of this analysis
on Subway is provided as under:
Strengths Weaknesses
 Global Existence is covered under its
greatest strength. The third largest food
chain in the world (Kliuchnikova and
Pobegaylov, 2016).
 Customised Sandwiches is another
point of strength for Subway which is
not provided by any other organisation.
 Different information provided by
customer service executives provides
the customers with different feelings.
 High employee turnover is also counted
among the weaknesses of Subway.
Threats Opportunities
 From the local as well as the
international competitors, Subway is
facing threat.
 The condition of political instability is
not only threat for Subway but also for
other companies.
 Diversification is considered as the
most suitable opportunity for the
company which is available and
provide it with maximum benefit.
 There are also some other places which
are untouched by Subway apart from its
current presence in the world (Zhou,
2016).
The above presented strengths and weaknesses of Subway makes it important for the
company to focus on the implementation of those strategies and policies with the help of which
weaknesses of the company could be reduced. In addition to this, with the help of taking
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opportunities, Subway could ensure their proper growth and survival along with long term
sustainability in the marketplace.
8. Influence of CSR on Operations and Response of Managers
CSR (Corporate Social Responsibility) is the tools which helps organisation in order to
become responsible socially, themselves, stakeholders and the public as well. With the help of
conducting CSR Activities, it is possible for companies to have positive impact on their social,
economic and environmental factors. By conducting CSR activities, it becomes possible for
organisations to create good image in the marketplace as well as in the minds of people also.
This will help in attracting good and talented employees for an organisation in their organisations
so as to increase their level of efficiency in work. In this way, conducting CSR Activities will
help the organisations such as Subway to make improvement in their efficiency level. On the
other hand, in case of bad image of organisation, it will not possible for them to attract good and
talented employees to work in the organisation and this will diminish the efficiency level and
impact negatively on operations of an organisation. Another positive impact of CSR is related to
increase in job satisfaction and employee retention rate in the organisation as well. It is because
employees wants to work in well reputed and known companies because this will also increase
their image and will help in future career growth and development.
In response to this, managers could make employees aware about the needs and
importance of CSR Activities in order to achieve sustainability in their business. As organisation
knows about that conducting CSR activities will help in reducing government interference,
improvement in goodwill and brand image of company, so it will make their employees aware
about importance of CSR to their employees and the need as well (Hitomi, 2017). Further,
managers will also make their employees to bring new ideas that could provide organisation with
different place in the market and will make sure about proper growth and development of the
organisation.
On the other hand, CSR also provides an organisation with opportunities to grow and
develop as well as to create their positive image in the minds of customers and good place in the
market. It is also an important concept and by putting focus on this aspect, companies will be
able to make improvement in their processes and image in the market as well. Government is
also another important legal factors which impacts upon the working of an organisation in both
positive as well as negative ways (Joglekar, Davies and Anderson, 2016). So ethical working and
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proper CSR activities will help in creating positive image of company for government that could
provide it with several positive impacts such as reduction in taxes, subsidies and many more for
the betterment and growth of business in the market.
Operation Function is the term which means to express about the main operations of the
organisation are designed and controlled. For example, the meaning is different for different
industries as such in case of manufacturing industries, it is related to transformation of raw
material into usable and products and in case of sales, it is related to the ways how product is
received and presented to people who are purchasing. Operation Function is important for an
organisation because it is the base of business on which the business will run. So at the time of
implementing organisation strategy in the working of an organisation such as Subway, the focus
is on providing the best benefit to the operation function to achieve highest level of profitability
because the impact of strategies is directly made on operation functions of organisation
(Kopardekar and et. al., 2016). So in this, way it is said that with the help of proper which is
operations function, it will become easy for companies to make their organisational strategy to
sustain for long term in the market. As such as planning related to marketing strategies, hiring
authority, financial planning and many more. The decisions taken by managers are also focused
on improving operation functions so that highest level of efficiency could be achieved by
organisation for the achievement of their goals and objectives.
The explanation of different types of planning methods are provided as under:
Strategic Planning: These plans are made in order to achieve the future long term goals and
objectives of an organisation. For example, Subway is continuously focusing on making
improvement in their quality of services, so this plan will not end in a year or two but will
continue forever.
Tactical Plans: It refers to those plans which are made in order to achieve the strategic plans
which are long term and these plans are short term plans. For example, setting up standards for
quality of products and services for a year. After the completion of year, new quality standards
will be implemented so this shows about Tactical Plans.
The use of these planning methods also depends upon the duration, use of plans as such
long term and short term plans (Gölzer and Fritzsche, 2017). For example, the use of strategic
planning is done at the time of making long term plans for the organisations and on the other
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hand, the use of tactical plans are made when some short term goals are an effort to achieve the
long term goals and objectives of the organisation.
The explanation of controlling methods are also provided as under:
Non Quantitative Methods of Controlling: These methods are used by managers at the time of
performing other managerial functions such as planning, organising, staffing and so on for
controlling overall performance of organisation. For example, the target set by companies related
to production for period of time involves these functions such as planning and so on with the
help of which performance is controlled (Mahadevan, 2015).
Quantitative Methods of Controlling: The methods which makes use of Quantitative Items
such as budgets, audits and many more for controlling the working of organisation. For example,
the yearly maintenance of records is part of this type of controlling.
Quality Systems helps an organisation in achieving sustainability and customer
satisfaction in their organisation. So the different quality systems are provided as under:
Policy Management: In case Subway implements new policies in the working of organisation to
make improvement in quality be setting standards so this will help in inspecting the quality of
products and services for organisation (Skurka, 2017).
Training Record Management: By keeping this record, it will be clear to keep an eye on the
benefit received from implementation of training programs. On the very basis, the improvement
made by them in performing their tasks will also be easy to notice.
From the above two systems of quality, the best will be Training Record Management as
with the help of this system, it will be possible to know about time period and gap in between
training periods, clear record of every employee, improvements made and some more which
makes this concept broader than others.
Proper Management of Operations will help in delivering best output for company to
their customers. As with the help of this, it will be possible to control over the quality of raw
material, production process and finally the goods delivered to customers will be high quality
impacting positively on their satisfaction level (Slack and Brandon-Jones, 2018).
Quality control is also an important aspects which needs to be considered at the time of
working on some projects (Choi, 2015). With the help of these methods, it is made sure about
proper implementation of methods along with positive impact on the quality. As with the help of
proper quality it will be possible to achieve goals and objectives in an effective an efficient
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manner. It has been analysed that with the help of food quality management system, a set
standard will be developed by the management team in order to produce high quality products
and services. There are various types of quality control used by the management team of Subway
which includes Policy management, change control, training record management, equipments
and asset management and many more. All these methods assist in maintaining the overall
quality of the products and services offered by the company to their customer's. A good quality
management system assist in making huge number of data, so that managers can emphasis on the
pressing issues and problems.
CONCLUSION
From the above assignment, it has been concluded that PESLTLE Analysis and SWOT
Analysis are important as they help in knowing internal and external conditions of market and
their own as well so that suitable strategies and policies could be implemented. Additionally, it is
concluded that by inheritance of current trends will provide companies with competitive
advantage. Lastly, the conclusion has been drawn that by using different quality systems,
planning and controlling methods, it will be possible to provide customers with best quality
products and services well.
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REFERENCES
Books and Journals
Choi, T. M., 2015. Sustainable management of mining operations with accidents: A mean-
variance optimization model. Resources Policy. 46. pp.116-122.
Gölzer, P. and Fritzsche, A., 2017. Data-driven operations management: organisational
implications of the digital transformation in industrial practice. Production Planning &
Control. 28(16). pp.1332-1343.
Hazen, B. T. and et. al., 2018. Back in business: Operations research in support of big data
analytics for operations and supply chain management. Annals of Operations Research.
270(1-2). pp.201-211.
Hitomi, K., 2017. Manufacturing systems engineering: A unified approach to manufacturing
technology, production management and industrial economics. Routledge.
Holweg, M. and et. al., 2018. Process Theory: The Principles of Operations Management.
Oxford University Press.
Joglekar, N. R., Davies, J. and Anderson, E. G., 2016. The role of industry studies and public
policies in production and operations management. Production and Operations
Management. 25(12). pp.1977-2001.
Schönsleben, P., 2018. Integral logistics management: operations and supply chain management
within and across companies. CRC Press.Choi, T.M., 2015. Sustainable management of
mining operations with accidents: A mean-variance optimization model. Resources
Policy. 46. pp.116-122.
Slack, N. and Brandon-Jones, A., 2018. Operations and process management: principles and
practice for strategic impact. Pearson UK.
Wild, T., 2017. Best practice in inventory management. Routledge.
Zhou, B., 2016. Lean principles, practices, and impacts: a study on small and medium-sized
enterprises (SMEs). Annals of Operations Research. 241(1-2). pp.457-474.
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