Comprehensive Report: Global Operations Management at ASDA

This report provides a comprehensive analysis of ASDA's global operations management. It begins by outlining the nature and size of ASDA as a leading UK retailer, detailing its vision, mission, aims, objectives, and organizational structure, including its hierarchical design and legal structure. The report then explores the crucial role of operations in the running of the organization, examining key aspects such as store management, inventory management, receipt management, supply chain management, customer service, and premises management. Furthermore, it delves into different operation management methods employed by ASDA, considering the company's current practices and suggesting potential improvements for the future. The report offers insights into ASDA's approach to maintaining its competitive edge in the retail sector, emphasizing the importance of customer service, efficient supply chains, and effective inventory control.

Global Operation
Management

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
1. Nature and size of the business organization..........................................................................3
2. Role of operations in the running organization.......................................................................7
3. Analyse the current use of operations management methods and consider the alternatives. .9
4. Plan and justify the alternative potential improvements that company can use in the future.
...................................................................................................................................................12
CONCLUSION .............................................................................................................................15
REFERENCES..............................................................................................................................16
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INTRODUCTION
This report includes the organization that has some domestic and global interests that is
ASDA which is the second biggest retailer in the UK and describe the nature and size of the
business organization that includes vision, mission, aims, purpose and objectives. It also explains
about the scope and products of the ASDA and the organizational structure which is hierarchy in
nature. It explains about the legal system which is being adopted by the ASDA that is preamble
association which includes articles and section for the selection of board of directors and what
are the policy they can apply to run the organization better. It explains about the role of operation
in the running organization that includes the management team who operates the store such as
store manager, inventory manager, staff at billing counter, customer service etc. This report also
discusses about the different types of operation management methods and alternative potential
improvements which can be improved in the future.
TASK 1
1. Nature and size of the business organization.
ASDA is the UK's second largest retailer chain was founded by J.W. Hindell in 1949,
Leeds, United Kingdom. It has opened the first store in Watford with over 64,000 sq.ft. And
shortly after new distribution centres were opened. ASDA is a public limited company, it works
in retailing sector and it is own by an American retailing company called Wal-mart and has been
the largest subsidiary since 1999 (Lasserre, 2017). The UK's supermarket has become more
competitive, therefore, for retail stores price competition plays an important role as customers
like price competition so they can buy goods at low prices and save money. ASDA helps
customers to buy products at low prices.
Vision Mission and Purpose
ASDA mission helped the stakeholders to understand the direction in which the company
is heading. The decision making process must be share between the organization so that it does
not affect the route of the organization. The organization can set a long term direction with the
mission statement. ASDA's mission is to become the Britain's best-value retailer which can also
satisfy the needs of the customer (Lasserre, 2017).
All businesses have aims to achieve what they want and set objectives to achieve those
aims. Thus, aims are the overall goals and purposes that the business strive to fulfil. ASDA also
has a purpose statement that helps the stakeholders to understand about the existence of the
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business. ASDA purpose is to provide goods and services at the low prices as compared to the
other retailer's stores which can be affordable for everyone. The other key objective of ASDA is
to reduce packaging and are considering every steps to achieve this goal. Their main objective is
to make more revenue than their expenses. They want to become the affordable supermarket in
the country, they are planning to reduce their own label packaging by 25% in the next 12
months, they are planning to improve their services than previous year, to increase its sells of
products (Akhtar and et.al., 2018).
ASDA follows a number of values, they have moral statements which help them to
compress the company's beliefs which helps them to improve their decision making and actions
takes place in the market place. The values they follow are respect for the individual, struggle for
excellence and services to the customers. For e.g. ASDA also signed up the Ethical Trading
Initiative (ETI) which includes respecting their workers, rights for freedom of association and a
living wage. Organization can build customer loyalty by many ways but in case of ASDA does
not build relationship with customers through cold approach like promotion and activities
whereas it gains customer loyalty through the warm method of using its values to help the
community by doing positive things. They sell products what customers like involving the
community which differentiate them from other organizations in the marketplace.
Size and scope
ASDA recognizes the importance of their employees and have a workforce around
1,80,000 and providing services to the 19 million customers per week and generating billions of
revenue every year (ASDA's Competitors, Revenue, Number of Employees, Funding and
Acquisitions , 2019). The future scope of the company depends on the talents of their employees
and valuing their talents. As challenges like autonomy and agility is an important skill that every
employee should enjoy freely and stop resisting it, the company are helping their colleagues to
understand providing good services and meeting future business they must be able to manage
these skills. For better scope in the future the company need to support employees to stay happy
and productive. The output of employees can help them to track mood, measure motivation and
aspirations which is helpful the for better scope in the future. ASDA specially focus on things
like waste performance, wages, sales and customer satisfaction. Employee analytics helps the
company to understand time to complete task, quality, service, time to deliver etc. and then by
centralizing this data they can set targets and standards that can train and encourage employees
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to achieve certain level of performance for the customer. The ASDA has a Chief Customer
Officer whose role is to determine the customer insight and intelligence and how the business
can use this information. Its job is to measure and monitor the customer actual behaviour which
can be helpful in comparing the information with competitive market.
Products
ASDA has the variety of branded products which they sell at smart prices such as cheese,
frozen foods, fresh pies, ready meals and detergents (Greene and EKMK LLC, 2016). The
company have 30,000 varieties of products which green vegetable, fresh bakery and dairy
products, fruits and cereals etc. which they provide at reasonable rate so that the customers can
afford it. ASDA tend to buy familiar products which can fulfil the needs of customers. They put
discounts of 10% on every products so that they can make the difference with other retailer
stores. They only sell organic products which are good for customers health.
Organizational Structure
ASDA follows Hierarchical structure which includes many levels and this structure is
only applicable for the big company like ASDA which is UK's second biggest retailer company.
In hierarchical structure instructions are passed down from one person to another until it reaches
to the bottom of the organization (Mangan, Lalwani and Lalwani, 2016). If any problem occurs
in the structure, then it moves from bottom to up to resolve the error. It takes time to move the
information and also workers are not the part of this structure which can decrease their
motivation level. The communication can be poor between the department and also it is in
written form as it takes time to pass the information to the person.
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Illustration 1: ASDA Structure and Leadership
(Source: ASDA Structure and Leadership,2019.)
Legal Structure
Preamble is the association which provide organization the maintenance and development
of high standards of business ethics. It follows various articles with various sections to maintain
the ethical tradition of the organization.
Article I
Board of Directors
 Section 1 : This section tells about the total number of members in the organization. The
Board of Directors should consist of nine members.
 Section 2 : Qualified members are eligible for the nomination and election as a director.
 Section 3 : Director must serve for 2 years until the next successor are elected and
qualify. By the affirmative vote of any six members can remove any director or officer
with cause.
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 Section 4 : This section discussed about the three types of meeting which is necessary for
all the members of the board members i.e. regular, supplemental and special. The regular
meetings between the board of members must be held four times in a year. The
supplemental meetings called by the president if necessary. Special meeting held by
president or by the written request of other five board members (Kerzner, 2018 ). The
time and place of the meeting is decided by the Board and 10 days notice period should
be given before fixing the meeting through email or phone.
2. Role of operations in the running organization
The operations in retail business depends upon the activities of the employees that helps
to keep the store function properly (Akhtar and et.al., 2018). The experience of customer
depends upon the good services provided by the company and carries perception about the store
which will strive the customer to visit in future again. The operations executives are responsible
to make the customer shopping experience memorable.
Store Management
ASDA is the biggest retailing store which has revenue over billion pounds and customers
are attracted because of their variety of products at reasonable prices and values towards
customers and employees. The store manager James Oxbrough at ASDA has responsibilities
such as
 Maintaining cleanliness and checking the stock of goods are available in the store
 Planning, scheduling, and staff organization, inventory and expenses are monitored by
store manager
 Motivates and boost the staff to achieve sales goals and upgrade the store to increase the
profitability
 Examine the needs and complaints of the customer through communicating with them
and can communicate with the head office when it is required.
Inventory Management
David Green is the inventory manager at ASDA which has the following duties like
 The receiving of the products from vendors and noting down the inward entry of the
product.
 Removing or returning the damage products and check the quality of the products.
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 Arrangement of products must be in appropriate way so that they can catch the attention
of the customer. For e.g. most used products must kept at the eye-level and less one on
the high shelves and heavy products at the bottom shelves.
Receipt Management
ASDA uses different modes of payment for the products sold they accept cash, credit
card, debit card as it is the large store they have facility to accept this type of payment. ASDA
turnover is over billion pounds so it is hard to take cash whereas for small retailers they prefer
payment by cash only.
Supply Chain Management
ASDA uses this management to sell varieties of products in their stores. It is the
management of materials, information and finances which moves from manufacturer to
wholesaler and then retailer to customer (Kerzner, 2018). ASDA have 30,000 type of products
because they have developed the relationship with supply chain members to a great extent.
Customer Service
The management of any retail business depends the services they provide to the
customers. ASDA's entire staff is trained for the customer service. Every employee responsibility
is to make the good interaction with the customer so that they can have better shopping
experience. The staff at billing counter have a great knowledge about the products and good
communication skills which will build the great perception of customer about the store. ASDA
acquired the trained staff members to manage the cash counter and they are trained to do fast
billing for the customer who bought less than 10 products so that they don't have to stand too
long in the queue (Greene and EKMK LLC, 2016).
Premises Management
Managing premises is important for any retail store, it includes various tasks such as to
determine working hours of stores that will depend upon the location of the store, retailed
products and target audience.
ASDA has many products and the store size is also big so chances of stealing increases
that's why the attached electronic tags on products which can be sensed at the gates and they also
installed cameras for monitoring the movements. ASDA is a large department store so it requires
high security.
Operation management of ASDA has two main objectives
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Performance objectives
The production department of ASDA should be responsible to increase the efficiency and
effectiveness to achieve the organizational goal. The services provided by ASDA satisfied the
customers because of their ethics and values and by providing the qualitative goods on
reasonable rates make them visit again to the stores.
The flexibility of the ASDA is excellent as they have over 30,000 variety of products
depending upon the needs of the customer. ASDA uses the workforce and machines efficiently
and effectively to increase the revenue more than the expenses.
Cost Objectives
ASDA has a good relationship with the customers and they have gain their loyalty by
giving them products at the low prices so that everyone can afford it. They can minimize the cost
of goods and services by maintaining the supply chain such as supplier, manufacturer and
distributor.
3. Analyse the current use of operations management methods and consider the alternatives.
As Asda is very big company in retail sector in the UK and worldwide it deals in so many
some merchandising product like food, grocery, housing products etc. in their stores. In the year
2004, Asda had around 259 retail outlets and 19 storehouses in all over the UK. The company
mainly deals in the in wide range of consumer products (Frynas and Mellahi, 2015). Operation
management means the ways from which the business manages its resource for the creation of
goods and services which includes materials, machines, people and technology. As operational
management, managers and business owners improve the process so they become more
competitive. Operation management is the technique which gives the chance to the business to
decrease the costs, enhance customer satisfaction, increase the revenue and improve the overall
operation of the Asda so they can use the increase the productivity for future. Finance always
plays an important role in any organisation weather it is big or small. It is essential that the
department of operation management of Asda must utilize the finance properly to carry out all
the functions related to finance such as to creation of services so the customer needs could be
satisfied.
Operation management methods are
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Total Quality Management (TQM)
Presently the company is using the Total Quality Management tools. It helps Asda to
identify, analyse and assess the quality and quantitative data that are relevant for the
organisation. These tools help in to identify the procedure, ideas, cause and effect any other
issues that are relevant for the organisation. TQM tools gives the direction and best practice
method to the company and staff. TQM tools helps in to understand of complicated information
such as Identification of target audience, market analysis competition analysis, customer need
analysis, work flow analysis, financial analysis, model creation etc. TQM tools can be used for
any number of reasons and they are extremely effective if it is used properly. Some TQM tools
are
Pie chart and Bar Graphs
They used to identify and compare the data and relate to the issues and as a whole such as
budget, extent of funds etc.
Histograms
To illuminate and examine the various data in order to make the decision regarding to
have effective while comparing to statistical survey or as a questionnaire results.
Force field analysis
This analysis is used by Asda to identify the restraining process functions as it have and
that need to be improved in order to attain higher level of efficiency (Song and Parola, 2015).
Principles of Total quality management are
Customer Focused
Customers are very wise they will ultimately drive the level of quality. For this
organisation must have to do all the things which foster in improvement of quality such as
training the employees, integrate the quality or upgrade the software to focus on the customer.
Asda is much focused on workers.
Total Employee involvement
Participation of all employees is there for working towards common goal. Commitment
of employee can only be obtained by the fear has been driven from the organisation. Asda has to
do the high performance and integrate for the continuous efforts for the improvement and also
provide the proper environment for the employees.
Process centred
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Fundamental part of Asda is a focus on process thinking. Process is the series that will
take the input from the suppliers and also transforms them into the output which is being
delivered to the customers. In this process performance are evaluated at each step and is being
monitored in order to detect the unexpected variation.
Integrated System
Every organisation is being consist of many specialities of functions often organised by
the Asda into the department of vertically structure. As this is the horizontal process so the focus
of TQM is on the functions.
Other operation management tools
Six Sigma
Support of senior executive
It will be effective if the quality engineers or the managers of the department are
supported by senior executives. Many times support of executives is not enough and the
initiatives of six sigma fails due to lack in executive leadership fails.
Top down Training
Every people in the company, division or department should receive the training on Six
Sigma as senior managers, leaders understands the value of business and how to implement it at
the same time non technical managers knows how to work. Engineers should know how to do it
and workers must know how to communicate their issues to the engineer.
Listen the voice of the customer
One important measure of success is 'Happy Client' who buys our product and come back again.
So to know there reviews about the engagement will start listening the customers regarding
quality of the product and services offer by the company, surveys, complains and many other
tools from which they listen to the customers.
Create an infrastructure to support success
Big organisation have to maintain the high quality production, for this the entire
organisation must communicate about the errors and defects and give the way to eliminate it.
Just in Time
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It is one of the system of operation management where the production is made as per the
demand at a particular time. The aim of this approach is to reduce the activity which are non –
profitable and make the system more flexible and eliminated the cost associated with carrying
and marinating the inventory. Various methods in which just in time can be achieved so all the
methods are important but not comprehensive.
 Elimination of waste and defects.
 Balancing the flow and schedule the output.
 Skilled labour force to carry out the specific operation.
 Maintained the equipment and machinery for flawless operations.
 Making of small batch etc.
Just in time is beneficial for organisation in many ways some advantages are
 Just In Time is the method which can reduce the time for set-up and having low wastage
and it is very helpful for Asda.
 Asda deals in the retail market so it helps in flow of goods from warehouse to shelves and
improve the service of Asda.
 Asda employees having the multiple skills and that can be used efficiently by the
organisation.
 In retail there is always having the chance of breaking of inventory, but just in time is the
approach which decrease it.
4. Plan and justify the alternative potential improvements that company can use in the future.
As currently the company Asda is using the TQM approach but the company can use the
Six sigma approach in the future. Six Sigma is relatively new approach as compared to TQM.
Six Sigma
Six Sigma is more than just a process as they are based on the concepts which
continuously works for the quality improvements to the next level. Six Sigma also focus on
improving of quality by minimising the number of defects and produce the better quality of
products and helps in reducing the operational cost by keeping focus on reduction of defects and
also do the cost saving. Six Sigma incorporates several small changes in the process to ensure the
effective results and get the better customer satisfaction. Six Sigma aim to have continuous
improvement and it is ongoing process and if it is applied correctly it will give the yield benefits
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