Factors Impacting Operational Management: A Unit 4 Management Report

This report delves into the relationship between leadership and management within a contemporary business environment, focusing on factors that influence operational management and decision-making. It analyzes key elements such as corporate culture, values, ethics, and corporate social responsibility (CSR), along with stakeholder expectations. The report explores the dimensions of the business environment, including the interplay between leadership and management in the context of CSR, culture, values, ethics, and sustainability. It examines the importance of these factors, providing examples and highlighting their impact on the wider community, including environmental and social dimensions, as well as the ethical considerations of globalization. The report also discusses the role of operations and stakeholders within CSR, emphasizing the significance of ethical considerations and responsibilities towards various stakeholders. The provided content is a comprehensive analysis of the subject matter.

UNIT 4: MANAGEMENT AND OPERATIONS
LO4 Demonstrate an understanding of the relationship between
leadership and management in a contemporary business
environment

LEARNING OBJECTIVES
The learner should be able:
 To assess the factors within the business
environment that impact upon operational
management and decision-making by leaders and
managers
 To do the analysis and evaluate the different
factors that affect the business environment and
wider community

TASK in the ASSIGNMENT
WORKSHEET
4.0 Factors within the business environment that impact upon operational management and
decision-making by leaders and managers
(Assess and analyse how these factors impact upon operational management and decision-making
by leaders and managers and wider community)
Corporate Culture
Corporate Values
Corporate Ethics
Corporate social responsibility
 Expectations of stakeholders
(Identify the stakeholders of Fruitapeel and state their expectations)

(Different dimensions of contemporary
business environment:
The relationship that leadership and
management have in the context of corporate
social responsibility; culture, values, ethics
and sustainability.
The relationship with stakeholders and
meeting stakeholder expectations in the
context of encouraging, developing and
sustaining entrepreneurship and
intrapreneurship)

Leadership and management in Contemporary
Business Environment
• In today’s global environment, organisations need to be
increasingly receptive to change, responsive, more
flexible and less structured
• The organisations are always dependent on the skills of
the senior management to get the right plan and
directions to act accordingly.
‘the job of leading company has never been more
demanding, and it will only become more
challenging amidst the global dynamism businesses
face today’ (also cited in Bertocci, 2009:3).

Operations and Business Environment
Corporate Culture
Corporate Values
Corporate Ethics
Corporate social responsibility

CORPORATE CULTURE
 Corporate culture is a fundamental part of a company and it can be
said to represent the character of a company (Schrader and Self,
2003).
 The values, beliefs, assumptions, ideologies and ways of doing things
are in essence when corporate culture is defined (Linnenluecke and
Griffiths, 2010).
Naturally, companies represent their own distinct corporate cultures
that vary according to, for instance, country context, the age or history,
size and industry of a company.
 As organizational culture defines the proclivity and ability of a
company to conduct business operations either responsibly or
irresponsibly.
 Organizational culture is described by Robbins & Coulter as the
shared values, beliefs, or perceptions held by employees within an
organization or organizational unit.
 Because organizational culture reflects the values, beliefs and
behavioral norms that are used by employees in an organization to
give meaning to the situations that they encounter, it can influence
the attitudes and behavior of the staff .

Corporate Values
Core values are what support the vision, shape the culture and reflect what the
company values. They are the essence of the company’s identity – the principles,
beliefs or philosophy of values.
Many companies focus mostly on the technical competencies but often forget what are
the underlying competencies that make their companies run smoothly — core values.
Establishing strong core values provides both internal and external advantages to the
company:
Core values help companies in the decision-making processes. For example, if
one of your core values is to stand behind the quality of your products, any
products not reaching the satisfactory standard are automatically eliminated.
Core values educate clients and potential customers about what the company is about
and clarify the identity of the company. Especially in this competitive world, having a set
of specific core values that speak to the public is definitely a competitive advantage.
Core values are becoming primary recruiting and retention tools. With the ease
of researching companies, job seekers are doing their homework on the
identities of the companies they are applying for and weighing whether or not
these companies hold the values that the job seekers consider as important.

Corporate Values
Importance of Values
Provide understanding of the attitudes,
motivation, and behaviors
Influence our perception of the world around
us
Represent interpretations of “right” and
“wrong”
Imply that some behaviors or outcomes are
preferred over others

Corporate Ethics (MORAL CODE)
The broad area dealing with the way in which a
company behaves towards, and conducts business
with, its internal and external STAKEHOLDERS,
including employees, investors, creditors,
customers, and regulators. In certain national
systems minimum standards are required or
recommended in order to eliminate potential
conflicts of interest or client/employee
mistreatment

EXAMPLES OF SOME VALUES AN
ORGANISATION CAN EMBRACE.
 Accountability – Acknowledging and assuming responsibility for actions, products, decisions, and
policies. It can be applied to both individual accountability on the part of employees and
accountability of the company as a whole.
 Balance – Taking a proactive stand to create and maintain a healthy work-life balance for workers.
 Commitment – Committing to great product, service, and other initiatives that impact lives within
and outside the organization.
 Community –Contributing to society and demonstrating corporate social responsibility.
 Diversity – respecting the diversity and giving the best of composition. Establishing an employee
equity program.
 Empowerment – Encouraging employees to take initiative and give the best. Adopting an error-
embracing environment to empower employees to lead and make decisions.
 Innovation – Pursuing new creative ideas that have the potential to change the world.
 Integrity – Acting with honesty and honor without compromising the truth
 Ownership – Taking care of the company and customers as they were one’s own.
 Safety – ensuring the health and safety of employees and going beyond the legal requirements to
provide an accident-free workplace

Examples of ethical dilemnas
Leave work early under pretext of meeting a
client or start work late.
Taking undue credit for a work done well
when it was actually performed by other
colleagues
When working with clients, employees giving
misleading information to get their custom.

CORPORATE SOCIAL RESPONSIBILITY
“Corporate social responsibility is the continuing
commitment by business to behave ethically and
contribute to economic development while
improving the quality of life of the workforce and
their families as well as of the local community
and society at large” (Slack, Brandson-Jones,
& Johnston, 2013:674)
“CSR is about how companies manage the
business processes to produce an overall positive
impact on society” (Slack, Brandson-Jones, &
Johnston, 2013:674)

• Corporate social responsibility (CSR) is about
how businesses align their values and behaviour
with the expectations and needs of stakeholders -
not just customers and investors, but also
employees, suppliers, communities, regulators,
special interest groups and society as a whole. CSR
describes a company's commitment to be
accountable to its stakeholders.
• CSR demands that businesses manage the
economic, social and environmental impacts of
their operations to maximise the benefits and
minimise the downsides.
What is CSR?

The European Union defines corporate social responsibility as:
“a concept whereby companies decide
voluntarily to contribute to a better society
and a cleaner environment”.
This can include both remedial and positive actions:
• energy (heat and light) conservation
• transport for both products and employees
• waste disposal and paper recycling
• ambient chemicals
• supporting volunteering or charities
• sponsoring local community projects.
Corporate Social Responsibility-(CSR)

Through an effective CSR programme,
companies can:
• improve access to capital
• sharpen decision-making and reduce risk
• enhance brand image
• uncover previously hidden commercial
opportunities, including new markets
• reduce costs
• attract, retain and motivate employees
Advantages of CSR

Stakeholders
A stakeholder is anyone with an interest in a
business.
Are individuals, groups or organisations th
at are affected by the activity of the business.

STAKEHOLDERS OF FRUITAPEEL
SHAREHOLDERS
GOVERNMENT
SUPPLIERS
EMPLOYEES
CUSTOMERS
PUBLIC
PRESSURE GROUPS
COMPETITORS

Different Factors and their
Impact on Wider Community
The Environmental Dimensions of CSR and its
impact on Community
The environmental sustainability defined by World
Bank as ‘ensuring that the overall productivity
of accumulated human and physical capital
resulting from development actions more than
compensates for the direct or indirect loss or
degradation of the environment’ (also cited in
Slack, Brandson-Jones, & Johnston, 2013:676).
The individual organizational perspective of
environmental sustainability is dealing with the
perceptions of ‘green’ issues.

Different Factors and their
Impact on Wider Community
Social Dimensions of CSR
This is the fundamental idea that the business
and society are interlinked.
The businesses should accept that they bear
some responsibility towards the welfare of society
and to balance the external ‘societal’
consequences of their actions with the more direct
internal consequences, such as profit.
Society is composed of different elements such as
individuals, groups and organisations. Each
reflects the simple unit of economic exchange.

Different Factors and their Impact
on Wider Community
Social Dimension of CSR
Nestlé donated £700,000 to support children
‘Action for Children’ UK in 2015. Nestlé’s
employees raised this amount in a period of
three years whilst running marathons and
through different challenges. This donation
was aimed at providing further support to most
vulnerable children, teenagers across the UK (
www.nestle.co.uk).

Different Factors and their Impact
on Wider Community
The Ethical Globalisation
The International Monetary Fund (IMF)
defines “the growing economic
interdependence of countries worldwide
through increasing volume and variety of
cross-border transactions in goods and
services, free international capital flows, and
more rapid and widespread diffusion of
technology” (Slack, Brandson-Jones, &
Johnston, 2013:677).

Different Factors and their
Impact on Wider Community
The ethical globalisation aims at providing the following:
Acknowledging shared responsibilities to address the
global challenges and assures that the common goal
towards humanity will not be affected or stop at
national borders
Identifying that all individuals are equal and without
any discrimination consider their right to certain
entitlements, rather than treating them as an object of
benevolence or charity
Comprising the significance of gender and pay
attention towards the social issues associated with
women and men

Environmental Dimensions of
CSR
The operations manager is responsible for the
environmental protection not only for the
organization but in general for the
organizational better performance. The
operations failure many times has become a
reason for the pollution disaster such as the
BP’s operations cause environmental pollution
(emission of Sulphur oxides SOx in 2015)
including BP shipping (Oil Spillage in sea).

Operations and Stakeholder
Dimension of CSR
According to Slack, Brandson-Jones, & Johnston
(2013:685) “customer’s welfare is directly affected
by many operations decisions.
The most obvious is their safety might be
compromised. If a product is badly assembled or if
the equipment used in a service (such as rail
transport system) is not maintained, customers can
come to harm’.
It is important that that customers’ safety is not only
harm by the defective product or poor packaging but
it can also be harmed or at risk by the degree the
operation discloses the details of its activities.

Operations and Stakeholder
Dimension of CSR
The community also expects that the
organization should play fair and safe
therefore, to adopt a responsible attitude
towards the welfare of community.
Suppliers are also a part of ethical dilemma
for the business operations. It is not
reasonable to put an extra burden on
supplier to restrict them doing business with
other organisations, either to ensure that
you are getting the accurate services from
them.

Dimensions of CSR
The environmental dimension: it highlights the
cleaner environment
The social dimension: It shows the relationship
between business and society in general
The economic dimension: Socio-economic or
financial aspects, including describing CSR in terms
of its impact on the business operations
The stakeholder dimension: considering all
stakeholders or stakeholder groups
The voluntariness dimension: Actions not
prescribed by law. Doing more than you have to
Source: Adopted from Slack, N., Brandson-Jones, A., & Johnston, R. (2013:675),
Operations Management. Seventh Edition, published by Pearson

References
Essential Reading
Slack, N., Brandson-Jones, A., & Johnston, R. (2013), Operations
Management. Seventh Edition, published by Pearson (pp. 674-
685)
Further Readings
Crane, A., McWilliams, A., Matten, D. and Siegel, D.S. (editors)
(2009) The Oxford Handbook of Corporate Social Responsibility
(Oxford Handbooks in Business and Management), OUP, Oxford.
Harvard Business Review (2003) Harvard Business Review on
Corporate Responsibility, Harvard Business School Press,
Boston, MA.
Kotler, P. and Lee, N. (2005) Corporate Social Responsibility:
Doing the Most Good for Your Company and Your Cause, John
Wiley & sons, Inc., Hoboken, NJ.