Principles of Operations Management

This document provides an overview of the principles of operations management and their application in Domino's Pizza. It covers topics such as the roles and responsibilities of operational managers, core operational activities, interrelationship between activities, current trends, and external and internal environmental analysis. The document also includes a SWOT analysis and PESTLE analysis of Domino's Pizza.

Principles of
Operations
Management

Contents
Contents...........................................................................................................................................2
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1. Introduction of organisation....................................................................................................1
2. Explanation of operational manager roles and responsibilities...............................................1
3. Core operational activities of Domino's Pizza.........................................................................3
4. Interrelationship between the operational activities................................................................3
5. Current trends..........................................................................................................................5
6. External and Internal environmental analysis..........................................................................5
7. Internal and External factors of organisation...........................................................................7
8. Operation management and it supports to long-term Strategic goal.......................................8
TASK 3............................................................................................................................................9
Determine the appropriate allocation of resources for operation management...........................9
TASK 4..........................................................................................................................................13
Conduct a strategic analysis (SRA) on the operations functions of an organisation.................13
CONCLUSION..............................................................................................................................14
REFERENCES..............................................................................................................................15

INTRODUCTION
Operation management can be defined as a process which is focused by business entities
for the purpose of administrating all the business practices for the purpose of reaching long term
strategic goals. It is focused by managers in companies to covert labour and material in product
and services and then generates higher profits. There are various principles of operation
management such as reality, humility, success, change, accountability, quality control etc. which
should be focused by all the top level executives for attaining growth for business. All of them
can provide higher level of visibility in to the operations so that effective decision for future
could be formed appropriately (Savino, Manzini and Mazza, 2015). For better understanding of
the concept of operation management a restaurant named Domino's Pizza is selected. It was
founded by Dominick DiVarti, Tom and James Monaghan in year 1960. It is one of the largest
restaurant chains which are operating business all around the world. This assignment covers
various topics such as understanding of impact of business environment on operations and the
purpose of operations in support of organisational strategy. Additionally, appropriately allocation
of resources for operation management along with strategic risk analysis on the operation
functions are also covered in this project.
TASK 1
1. Introduction of organisation
Domino's Pizza is a fast food restaurant chain which is execution operational activities in
different locations around the world. CEO of the enterprise is Richard E. Allison. It is public
limited company which is operating business under food delivery franchising industry. It
operates business in around 16000 locations and the operations are carried out with the help of
more than 290000 staff members (Choi, Wallace and Wang, 2018). There are various types of
items which are sold by it to the customers. These are pizza, pasta, dessert, chicken wings,
submarine sandwiches etc. The entity is growing continuously because of its good market image
and high quality of eatables and beverages which are sold by it to the customers.
2. Explanation of operational manager roles and responsibilities
Operational manager is a person who is responsible to make sure that all the operational
activities are performed systematically. In Domino's Pizza there are various individuals are
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working on this job profile for the purpose of executing the operations in systematic manner.
There are various roles and responsibilities of them which are as follows:
Roles: Operation managers are one of the key personnel in upper level of management which
makes sure that company performs with full productivity. Their role involves keeping control on
multiple areas of the business and its operation. Some of the rules of the operation manager of
Domino's Pizza are as follows:
Workflow and staffing: The basic role that operation manager perform is to handle the manpower
requirement of the different department of organisation. They play a major role in working with
HR of the company to select and train employees along with handling issues (Vivaldini and
Pires, 2016). As they are aware of the needs of department they are effective in adjusting the
workflow and fulfilling the staffing demand to improve performance of operation.
Monitor inventory and supply chain: another role that operation manager performs is to
supervise supply chain processes and track inventory for the operations. They are also
responsible for properly stalking the finished product and delivering it to the retailers to meet the
demand. Each and every department is busy in their specific processes while operation manager
supervise the entire process and interfere to make adjustment.
Responsibilities: this is a requirement of the job provide profile of operation manager in the
organisation. It is their duty to comply with all these responsibilities so that organisation can
perform with full productivity. Some of them are as follows:
Frame policies and strategies: one of the major responsibility that operation manager in any
organisation perform is to make strategies that align with companies vision and mission
statement. They are also responsible for framing policies for different departments so that rules
and laws are fully implemented in the operations of the Domino's Pizza.
Working with senior stakeholders: operations manager roles are concerned with supervising and
controlling overall operations and thus is it it is needed that it works with upper level
management of the organisation (Cotrim, Leal and Filho, 2017). This is one of the major
responsibility as oral strategies are framed so that operations can function smoothly and achieve
organisation objectives.
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3. Core operational activities of Domino's Pizza
Domino’s Pizza production process is well structured and design according to customers
demand. There is stepwise process by which cool operational activities of production is carried
out in the organisation. The steps are as follows:
Demand forecasting: in order to plan demand and manage inventory it is important that
demand is forecasted effectively. This forecasting is then communicated to production
department of Dominoes which also increases overall supply chain and its efficiency. It also
helps companies to control its inventory Stop distribution, optimise orders on the basis of
distribution and meeting quality standards.
Supply chain management: Dominos consider make to stalk approach on the basis of just-in-
time technique. The sales organisation to make orders when there is demand so that stock cost is
kept minimum (Davis and et. al., 2018). Through this approach demands are met faster along
with certain advantages like consistency in Quality, effecting by buying power to reduce cost of
fluctuating prices and minimising issues of packing material.
Quality management: in Dominoes quality is maintained so that brand image can be improved
and industrial laws are regulated. There is agreement between suppliers and Domino's Pizza
regarding the quality of raw material and packaging. Along with this controlling system check
the safety and consistency Of food ingredients. There is a mechanism which analysed and check
samples and monitor customer feedback to maintain quality.
Innovation: this with application of radical innovation by the dominoes in its supply chain
system Mr the technique of viral marketing introduced by Domino's Pizza is one of the greatest
example of position innovation. The process of delivering pizza in 30 minutes has a great
creative approach. Along with this it is important that product is protected from my sure,
physical damage, heat and stickiness (Soto-Silva and et. al., 2016).
In all the above are the core operation activities that are carried out by Domino's Pizza in order to
be effective in its operations and meet the specifications demand of the customer.
4. Interrelationship between the operational activities
Operation are integral part of the organisation and strategies are made accordingly to achieve
objectives. So there is a need that different operational activities into relate with each other so
that proper management can be achieved. The interrelationship or as follows:
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Planning: operation management has responsibility to call collaborate with other departments
and their heads so that planning for the overall operations can contribute to the long-term
strategy of company. This also helps to assist functional component of the strategies and
activities are planned according so that they can contribute to the overall performance of the
organisation. This into relationship includes deter mining policies for management, budget and
support services (Lelieveld, Holah and Gabric, 2016). This into relationship shows that Dominos
Pizza ensures that all functional units are aligned with the direction for effective overall
operations.
Direction: to ensure that the plan is this effective operation management is also responsible to
provide direction to different departments. There is a need that all departments complete their
functions according to the planning so that productivity golden standards are achieved. There's
also need That necessary corrections are taken so that quality standards can be met. This shows
into relationship in coordination between the operation management and other departments of
Domino's Pizza.
Coordination: operation management also assist in achieving organisational strategy goals with
the help of coordinating functions of various functional unit of the company. The sales in
improving efficiency by maintaining relationship between the department and even allow them
to operate independently. In this operation management please a major role in coordinating and
directing the activities in maintaining relationship between the different departments of the
Domino’s Pizza.
Production and other departments: an organisation is a system of several soft departments
which work together to achieve organisational objectives. Manufacturing department or the
production unit uses raw materials, machinery to turn it into Finnish product which has some
value for customers (Syed, 2016). All such sub-systems are interdependent and maintain
relationship in order to make production department efforts successful. There are number of
activities that are interlinked between production and other departments so that they can
effectively meet ever changing demand of consumer for Domino's Pizza.
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5. Current trends
Domino's Pizza is currently facing challenges in protecting its position in the industry and
expanding into international markets. To overcome this company is focusing on these trains so
that it can have sustainable competitive advantage in the industry. Some of them are as follows:
Store sales: Company is witnessing slow growth rate in the stores in recent years. Still the
company is enjoying out growing strategy due to its wide profit margin. Does it will help
company to attract investors with the vision of capturing market share with the growth rate of
store sale. Still there are many untapped areas where Domino's Pizza can expand its operations to
increase its international market share through its outlet.
Store footprint: The recent growth in the store in different global locations with the help of
operation management. The management of the company believes that there are future growth
and development opportunities as well to efficiently operate larger chain of restaurants
(Chalbaud and Tigert, 2017). Company is adding new stores every year to capture international
market and other untapped market which has potential for growth. Company is aggressively
analysing different segments to penetrate into the market with growth opportunities along with
financial strength for new launches.
Capital spending: there is rise in products moving in operation over the last five years which
also help in building new supply change in the market. There is a need that Domino's Pizza
spend on innovation so that digital delivery and ordering can be enhanced. As there is a need that
company regulate its capital state spending and make effective planning to accelerate its growth
rate.
6. External and Internal environmental analysis
SWOT Analysis: This analysis helps in identifying strengths and weaknesses of
organisation so that opportunities and threats are find out.
Strengths
Its main strength is delivering services within
30 minutes otherwise pizza is delivered free of
cost.
In order to attract middle and lower class
customer Domino's Pizza offers low price
Weaknesses
one of major weaknesses is company is not
successful in creating effective ambience in
their outlets to attract customers (Eaidgah and
et. al., 2016).
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menu. There is no facilities like birthday events and
business launch party which it lack from its
competitors.
Opportunities
there is opportunities for Domino's Pizza to
redesign its outlets so that better environment
and floor space can be provided.
Like other restaurant it should include take
away facilities to capture more customers as
well (Harrison and Lock, 2017).
Threats
Major threat is competitors like Pizza Hut
which have better facilities and menu to
capture market share.
New chain of restaurant are entering into the
market and thus creating threat for Domino's
Pizza.
PESTLE Analysis: It provides complete understanding about challenges that company faces
from external factors and are not in control of organisation as well. Thus it has major impacts on
business and its operations from ever – changing environment.
Political: These are factors related to political aspects which have impact on long – term
profitability on business in the country in which it operates. Being global chain of restaurant
there are number of factors that has impact on its operations like political stability, level of
corruption, safety regulations, interference of state. They have both positive and negative impact
on Domino's Pizza as their actions and strategies should align with these factors.
Economic: these include factors like inflation rate, interest-rate call my canonic cycle of
the country, savings rate, etc. This has impact on companies growth rate, Labour cost, skill level
of workforce and comparative advantage in the industry. In case of Domino's Pizza Factor like
financial market which affect the capital raising in the local market for the company (Nair,
Jayaram and Das, 2015). The growth of the Country also affects the development of company in
the particular region it operates. Does, it has both positive and negative impact on the decision
making of the company.
Social: this includes factors like believes, attitude, customs and behaviour that impacts
the buying process of consumer. In order to have competitive advantage in the industry Domino's
Pizza need to understand the customers in their given target market. For this company need to
understand class structure, culture, attitude, demographics and spending habits Of the consumer.
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Technological: In the recent year technology kill development has disrupted the
industries which also has impact on the Domino's Pizza. There is a need that it should analyse
this technology kill aspects so that it can have competitive advantage. For this company need to
understand recent development and technology by its competitors, cost structure and impact of
change structure in service sector.
Legal: there are number of frameworks and rules that protect the intellectual property and
lead industry in terms of legal aspect. It is important that form carefully evaluate all the related
factors before entering into country. There are a number of laws that Domino's Pizza needs to
analyse like discrimination law, Data protection, health and safety law, consumer protection act,
etc. These frameworks create impact on the decision making of the company as these need to
align all its operations which would compile to all these rules (Carter and Price, 2017).
Environmental: there are different environmental stand dirt which have impact on the
corporate social responsibility of the industry there are different laws and rules which company
needs to abide to avoid any legal action. Before entering into a region it is necessary that
Domino's Pizza analyse factors like climate change, waste management, environmental pollution
rules, air and water pollution regulations, renewable energy, etc. All these have impact on the
operations of Domino's Pizza as there is need of strategies and course of action which leads to
compile with all above laws.
7. Internal and External factors of organisation
Operations management comprises of processes like planning, directing, controlling and
change management so that there is continuous improvements to achieve higher productivity.
Principles of operations management are fundamentals for daily work to understand factors for
decision making related to planning processes (Schönsleben, 2018). There are number of
internal and external factors that has impact on operations of organisation, some of them are
follows:
Internal factors: Managers and leaders have control over such elements of organisations and
have significant impact on business operations:
Leadership: It refers to all those factors that takes decisions related to human resources,
marketing, budget, sales, etc. Such helps company to have clear vision for future growth and
strategies for course of action to achieve it. In Domino's Pizza leadership have impact on creating
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structure that makes employee empower along with directing them to meet organisational
objectives. This has major impact on selecting appropriate leadership style according to
situations and need of organisation.
Employees: These are human resource of business and treated as assets thus it is
important that relations are maintained with effective communication. To ensure this Domino's
Pizza managers provides training and encourage personnel to participate in decision making.
This also impact on HR department policies and procedure so that talented and skilled personnel
are employed and retain for long.
External factors: These elements of business environment are not in control of management
thus affect majorly the decision making process of organisation:
Customers: It is important that business understand needs and expectations of buyers so
that it have sustainability in market place. Domino's Pizza conduct research with the help of
feedback forms to understand changing taste and preferences of consumers and offers product
accordingly (Mahadevan, 2015). This has impact on designing and manufacturing products
which are acceptable by customers in market place in which business operates.
Competitors: There are number of other companies who offer similar products in market
place with less prices and same quality. This is one of major aspect of external environment
which have major impact on business operations of Domino's Pizza. This has impact on
strategies while dealing with competitors, employing promotional activities, etc.
8. Operation management and it supports to long-term Strategic goal
Operation management has major role to provide plans for operation and functions of the
organisations were that resources can be optimally utilise. Operations strategy is define specific
policies so that company can have long-term competitive advantage (Slack and Brandon-Jones,
2018). Operation management is one of the central function which is responsible for managing
resources effectively.
Operation management directs the operations of the overall business to achieve this
strategy goal of the organisation. It helps in framing strategies which are straight forward
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directed to the long-term advantage of the organisation. In case of Domino's Pizza planning
activity of operation management is directed to words achieving customer demand and
specifications so that company can regain its position in the industry again.
Operation also assistant supply chain management by effectively managing suppliers in the
market and maintaining relationships so that cost can be controlled. In case of Domino's Pizza
innovation is maintaining the supply chain management so that stock cost can be minimised and
demands can be achieved effectively (Slack, N., 2018). The relationship between the different
functional departments with the help of operation management align all activities of the business
to go to strategy goal attainment. Not every decision of the operation marmalades to long-term
strategy achievement but it is also help in managing routine activities of organisation. A business
which is constantly moving to her just started it direction ultimately leads to long-term
competitive advantage in the industry. This is one of the basic idea between the operation
management leads to ultimate achievement of organisational goals. Operational processes of
Domino's Pizza Leeds each and every function to have continuous improvement so that quality
can be maintained and there is continuous innovation in the process which will lead to long-term
strategy goal accomplishment.
TASK 3
Determine the appropriate allocation of resources for operation management
Resources management strategies: Strategies of resource management linked with the
business practices where focus on the attracting, developing, rewarding and holding staff
members for the advantage of both the staff member as individual and entire business activities.
To achieve all the goals required to human resource management department focus on the
activities and help for the goals of the rest of company (Choi, Cheng and Zhao, 2016). These
strategies mainly applied by the Domino's effectively to achieve their goals and objectives in
appropriate manner. As a result it helps to apply resources at right place, at right time in the right
quantity as per the requirement. To identify all the better resources apply the VRIN model that
helps to recognise different types of resources.
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Resource based view: The resource based view is defined as a model which sees
resources as key to superior firm performance. When resources exhibits VRIO attributes, the
resources allows a business to achieve and sustain competitive advantage. To analysis the
different resources of the company apply the VRIO model in the context of Domino's. It is a tool
that is applied to find out different abilities of an organisation (van Aken, Chandrasekaran and
Halman, 2016). There are focusing on different four aspects which as assessed by the manager
like valuable, rare, inimitable and organised. For Domino's consist of four all elements is as
follows:
Capabilities Valuable Rare Inimitable Organised
Financial
Resources
✔ ✗ ✗ ✗
Distribution
network
✔ ✔ ✗ ✗
Arrange Funds ✔ ✔ ✔ ✗
Brand image ✔ ✔ ✔ ✔
 Valuable: There are focusing on those factors which is valuable for the company such as
financial resources are highly valuable that supports to business in investment to gain
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external opportunities that arise. High customer range, employees and patent is also
consider as valuable resources. All these resources are providing advantages and help to
achieve all the competitive advantages effectively. Rare: Financial resources of company is not rare because many companies have same
resources to compete with the other organisation effectively. Distribution network is
valuable and rare for the Domino's because it supports to recognised all the competitors
in particular are with lot of investment and better distribution network system (Ketokivi
and McIntosh, 2017).
 Inimitable: There are considered those resources which is costly for the company.
Financial resources and distribution network is not inimitable for company but arrange
funds of the organisation is consider as inimitable because every organisation does not
easily arrange fund from the other companies.
 Organised: Distribution network, financial resources and arrangement of fund are not
considered as organised because only brand image of the company is organised. It helps
to capture large market area and takes long period to set up a good image in the mind of
customers and for other entities it is not possible to harm its image.
Company objective: To objective of Domino's to produce best food product and cover
large market area to measure, manage and share important things. To achieve objectives
identified two effective model in the context of Domino's for the betterment of company: Minimise costs: Domino's apply different strategies in order to detect the cost of
manufacturing so it will help to increase profitability and productivity in effective
manner. If company reduce the costs so set effective price structure for different food
items. As a result people attract for the company and visit here for the food and company
achieve their objectives.
 Increase revenue: To increase revenue of the company require to focus on unnecessary
expenditure that reduce revenues in direct manner.
Total quality management
It is a continual procedure of reducing as well as deducting of errors that exists in
producing, streamlining supply chain management, increasing the customer experience and
assuring about staff members to speed up with the help of training (Prashar, 2015). Total quality
management specifically apply in the those companies who produce their products and sell out to
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customers. The main aim of this strategy to holds all parties that consist of manufacturing
procedure that responsible for entire quality for the final product or service. Domino's select this
technique to deduct cost effectively. Such as Domino's take products in particular quantity from
the suppliers then proceed further procedure to bake food. To manage quantity at each level and
proper utilise so for this required to apply total quality management that provide guidance how to
proper utilise in less cost with good quality.
McKinney's 7's model
It is a tool that evaluating the firm's design so for this focus on the internal elements such
as structure, system, shared values, staff and skills in order to recognise in effective manner and
connect with the business to attain their objectives (Gong, 2015).
 Strategy: It is a developed plan where required to achieved sustained competitive
advantages and get all the success according to market environment. Domino's develop
effective strategy where focus on the sound strategy and others to attract customers.
 Structure: In this represent of different departments of the company and how to organised
in proper manner where consider the information of who is accountable to whom.
Domino's structure is flat structure where junior direct contact with the superior.
 Systems: It is a procedure as well as manufacture of an organisation that revel all the
business activities on the basis of daily operations that help to take effective decisions.
Domino's is focused on manager to determine on the organizational change.
 Style: It manage by the top level managers in order to communicate with about other
actions. After recruited, provide training, encouraged and provide rewards regarding to
their work.
 Staff: These are important assets of any company that contribute to achieve objectives of
a business effectively. Domino's recruit effective people who have knowledge about the
particular sector in effective manner (Christodoulidou and Chainoglou, 2015).
 Skills: These are defined as a abilities that have to firm staff members to present in front
of customers and serve food effectively. Due to change stature of the business in
Domino's provide reinforce its new strategy as well as new structure.
 Shared Values: It is one of the important factor which is required to direct to staff
members and take appropriate actions effectively.
Cost benefit model
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A cost benefit model is a continuous procedure which is applied by the different
organization in order to take effective decision. The business analysis the advantages that change
according to situation as well as action then less the cost from the appropriate action. The
company set some consultant that develop this models in order to identify all the intangible item
like benefits and cost related some town.
TASK 4
Conduct a strategic analysis (SRA) on the operations functions of an organisation
Risk management standard and Benchmark
To manage any risk in the company require to apply effective risk management standard
which is published in 2009 where consist of different principles and guidelines regarding to risk.
It highlight on the different types of risk and their uses in the company.
The meaning of benchmark is minimum expected result. The company apply is
measurement tool in order to analysis efficient and where is required to apply different strategies
in proper manner. It is a ongoing procedure where analysing the performance and focus on
different products, services or procedure against of another company where focused on the best
in the industry.
Use of SWOT and PESTLE models
The Dominoes apply SWOT and PESTLE model in order to identify all the internal and
external activities which is changing as per the business environment. It impact on the
performance in direct manner and reduce the profitability. Through these models identify all the
related risk that help to develop contingencies and mitigate risk. Through both model identify
the risk such as: Higher interest rate: The economic factor help to identify the higher interest rate
in order to take loan from other sources (Ng, 2019). So sort out this problem proper allocate all
the resources and cut down that cost through mitigate risk where produce proper plan regarding
to risk and overcome from them by Domino's. Through PESTLE identify this and provide all the
possible solution.
Risk mapping tool: This tool is used by the different types of organisation in order to
recognise, control and management of risk. It is defined as first step of the risk management and
help to reduce risk regarding to management procedure for the Domino's that not yet build up a
full ERM system.
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Relation between stakeholder and risk, particular investors, suppliers and customers
In the business different department related with each other and provide information in
any report to stakeholders. They are analysing the report and related risk that arise in future and
impact in negative manner. In domino's have some investors who invest in different activities to
gain amount from the company so for this they focus on the financial report and related risk that
arise any time. Suppliers is important part of any company who supply the products for the food
and different ingredients that required for the further procedure. When suppliers provide
products after that company start further procedure and serve food to the customers who arrive in
Domino's.
CONCLUSION
It is acknowledge from the above report that operation management is the process by which
different functions of the organisation or manage to achieve organisational objectives. There are
different roles and possibilities and operational management performance so that organisational
objectives are attained effectively. There are core operational activities like production, quality
management, supply chain management and innovation to have company to have sustainable
competitive advantage. There are different current trends president business environment which
have impact upon the operations of the organisation for future growth and development. Swot
analysis helps in identifying strengths and weaknesses which affect its opportunities and threats
present in the environment. Pestle analysis shows different macro environmental factors which
are uncontrollable from the organisation point of view and have direct and indirect impact on
business operations. There are different internal factors like employees and culture which
Impacts operation management. There are some external factors like customers and competitors
that need to be analyse before meeting policies and strategies.
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