Report on Managing Business Activity: Fonterra's Operational Processes

This report provides a detailed analysis of managing business activities, using Fonterra Co-op Group as a case study. It explores the interrelationship between organizational processes and functions, evaluating how Fonterra sets and achieves its goals and objectives, including the importance of market and production functions. The report examines the design of operational plans, emphasizing the alignment of resources, and the implementation of quality management systems. It further discusses monitoring and control techniques to meet operational plans, including quality planning, control, and improvement processes. Additionally, the report covers risk assessments and the practical application of health and safety policies within the workplace, offering insights into continuous improvement and reporting on proposed changes within the organization. The report concludes with a comprehensive overview of the critical components of effective business activity management, with a strong focus on the Fonterra example.

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Running Head: MANAGING BUSINESS ACTIVITY
MANAGING BUSINESS ACTIVITY
STUDENT NAME:
STUDENT ID:
SUBJECT CODE:

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Table of Contents
Introduction......................................................................................................................................3
LO 1:................................................................................................................................................3
1.1) Evaluating the interrelationship between the different processes and functions of the
organization:....................................................................................................................................3
1.2) Justifying the process of organization’s goals and objectives:.................................................4
1.3) Evaluating the output of the process and guilty gateways:......................................................4
LO 2:................................................................................................................................................5
2.1) Designing plans for promoting goals and objectives of own area of responsibility:...............5
2.2) Understanding specific objectives to align people and other resources effectively and
efficiently:........................................................................................................................................5
2.3) To implement the appropriate system to budget and meet organizational standards of
quality:.............................................................................................................................................6
2.4) Carrying out activities through effective monitoring and control to meet operational plan:...7
LO3:.................................................................................................................................................7
3.1 Designing system to manage and monitor quality standards specified by the organization.....7
3.2 Demonstrating quality culture to ensure continuous monitoring and development of the
process.............................................................................................................................................8
3.3 Recommending improvements which align with the organization’s objectives and goals and
which result in improvements..........................................................................................................9
3.4 Reporting on the wider implications of proposed changes within the organization................10
LO 4...............................................................................................................................................10
4.1 The various risk assessments that are essential in the health and safety workplace................10
4.2 Demonstration of the effective utilization of the health and safety policies in the workplace11
4.3 A systematic review of the organizational health and safety policies and procedures............12
4.4 The practical application of the health and safety policies in the workplace..........................13
Conclusion:....................................................................................................................................13
Reference list.................................................................................................................................14

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Introduction
In this study, discussion on the management of a business and the activities related to
achievement of objectives and goals has been exhaustively explained. By taking the example of
an organization namely Fonterra Co-op Group, to understand the way they manage the functions
of the organization by taking proper measurements of the processes. Furthermore, the operation
plan for achieving the goals and objectives of own area of responsibility has also been discussed.
Moreover, explanation on monitoring systematic approach to improving organizational
performance has been given.
LO 1:
1.1) Evaluating the interrelationship between the different processes and
functions of the organization:
Organisation strictly deals with the management of work, not the performance of the work.
Process means the work performed by the organization and the organization projects the
effectiveness in completing the task by the concerned employee of that organization. On the
other hand, functions define the various departments of the organization which conducts
activities to be performed through the defined process (Benavides-Velasco et al. 2014). In this
study Fonterra Co-op Group, a multinational dairy co-operative organization has been taken to
understand their process and functions of operations. Since functions of an organization means
the various departments which take specific responsibility divided into specific departments.
Based on this certain processes are defined to carry on the activities related to each functional
department, which are discussed below, taking the example of Fonterra Co-op Group.
Processes Functions
 To fix objectives
 Allocating the jobs into groups
 Defining responsibilities
 Defining relationship between superior and
subordinates
 Motivating employees to achieve objectives
 Production function
 Marketing function
 Purchase function
 Research and development
function
 HRM function

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 Coordinating employees and work  Accounts and finance function
From the above table it can be illustrated that in order to meet the functional objective of an
organization, these mentioned processes have to be followed collectively to operate each and
individual functions. In this case, Fonterra has effectively conducted market function by
implementing determination, responsibility, coordination and proper allocation of a task.
Fonterra first planned an objective to do the survey in the market, then it has allocated the job
and its deadline among the different group of marketing executives, secondly subordinate and
superiors has collectively planned tactics to complete the marketing function.
1.2) Justifying the process of organization’s goals and objectives:
Contributing to the context of an understanding of the interrelationship between processes and
functions of an organization and methodologies followed to evaluate the interrelationship,
justifications have been outlined (Spofford Jr, Russell & Kelly, 2016). It has been observed that
market functions and production function are the two pivotal functions of this organization since
dairy industry requires conducting production function on a regular basis and to support the
production function market analysis is required to attain the idea of demand and supply and
customer preferences in the market. Fonterra has been implementing the organizational plans in
order to meet its objectives and goals, but the methodologies that have been taken into
consideration by Fonterra are discussed and justified. The organization should have done
qualitative survey rather than a quantitative survey to understand customers better by
approaching numbers of its product users and attain their opinion. This process could have been
done both online and offline, ensuring effective market function considering measured processes.
On the other hand, production function could have been conducted after achieving the desired
and final result of the market function, in order to avoid inefficiency and failure. Proper time
management and proper coordination are highly required in this process because production is
completely dependent on the efficiencies of labor and time taken by them.
1.3) Evaluating the output of the process and guilty gateways:
From the above analysis on methodologies applied to map the processes to the organization’s
goals and objectives, outputs have been evaluated. It has been observed that Fonterra has
implemented a certain process to achieve its goals of high production and selling unit and
objectives of carrying on the function with the right process. Nevertheless, in the context of

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methodologies applied regarding the production and selling functions, few drawbacks have been
observed resulting in failure in reaching expected production rate and due to this sale, the unit
has been decreased. Possible reasons could be, ineffectiveness and inefficiency in understand
process properly and operation of the market survey has been conducted untimely. Lack of time
management and poor coordination among the subordinates and superiors led to failure attempt
in achieving the goal of high production output (Garengo & Biazzo, 2013). On the other hand
market survey was conducted without proper planning and thus created complacencies in
understanding the review of customers. Whereby, the other objectives, and goals of Fonterra
have been met due to the proper option available them on the ground of effective process. For
example, HRM process is very encouraging and the workers of this organization have barely any
issues.
LO 2:
2.1) Designing plans for promoting goals and objectives of own area of
responsibility:
It could be understood from the above-discussed scenario, that in order to implement the
operational plan, certain measurements by the way of developing plan need to be made. The
responsibility of carrying on the activity requires accurate managing process and before this,
generating plans could render the own area of responsibility more flexible. For example,
identifying own strengths and weakness, so that these concerning areas would no more remain
questionable. Secondly, own areas of vulnerability should be evaluated to find out the positivity
and thirdly own potential areas of growth should be determined, in order to know the better
outlook personnel.
2.2) Understanding specific objectives to align people and other resources
effectively and efficiently:
Attaining the outcomes of the goal oriented objectives is a complex process to some extent
because sometimes it is found that objectives are created but goals are not achieved. Hence after
evaluating these issues, it has been found that objectives should be sketched in terms of
specification, measurability, attainability, realist ability and time based to align people and other
resources in an effective and efficient way. Linking to this context, these objectives are discussed
below.

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Improving cooperation
Improving cooperation will help in aligning people and other sources effectively. Since
cooperation among the subordinates and superiors would help in contributing efficient time
management.
Improving responsibilities
Responsibility factor is the concerning point, without any responsibility achievement of
performance goes weird.
Improving motivational factors
Quality is preferable than quantity, and this principle rules over the motivational factors because
given task can be completed without motivation, but the quality of the task will be degraded.
2.3) To implement the appropriate system to budget and meet organizational
standards of quality:
Based on the firm’s nature and types of operational outcomes, Total Quality Management would
be the appropriate system in the company to meet its goal along with successful attainment
required quality and specifications. In this context, under the TQM system the company needs to
plan the quality before the production process so that the progress of quality output at the time of
production would be ensured. However, in the opinion of José Tarí et al. (2013), quality
management in an organization also needs proper coordination of management and other
strategic levels to approve right decision at right time towards accomplishing right goals and
objectives. Under the system, the strategic level is liable to estimate financial resources that
would be acquired at its exact amount. This would help the company to ensure avoidance of
unnecessary fund acquisition and thus, an increment in cost of borrowings. Furthermore,
scheduling would be a significant part of its quality management system to delegate tasks and
complete both individual task and the entire business cycle (Parast & Adams, 2012).
Implementing this suggestion in the quality management process, the business would ensure
quality production of dairy products within time constraints and allocated budget. However,
entire system as mentioned above needs effective supervision to track the progress and ensure
fulfillment of all requirements at its real means.

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2.4) Carrying out activities through effective monitoring and control to meet
operational plan:
In order to meet operational plan, effective monitoring and control technique has been
implemented. Whereby control technique means the understanding the degree of relative work in
the context of an operational plan. In this article, some monitoring and control technique has
been used, which are discussed below (Beck, 2013).
Conducting regular meeting
In this activity members in the meeting provides feedback and response to the undertaken task.
Using critical path analysis
In this activity, those areas of the task have been evaluated which are somehow delayed or
under-tasked.
Using earned value analysis
In this activity, the performance of the completed task has been analyzed to draw necessary
requirements for meeting the gap between what is done and what needs to be done.
LO3:
3.1 Designing system to manage and monitor quality standards specified by
the organization
In order to maintain the quality of the product and service the organization has to follow some
basic steps and these steps are quality planning process, quality control process and quality
improvement process. These processes of Fonterra help to maintain the quality of product and it
helps the organization to become one of the famous dairy companies in Australia. In order to
design the system to manage quality standards, these processes of Fonterra has to be discussed
here. Therefore, in the case of the quality control process, the company has to evaluate the
process and the company has to compare the process with its goals. Otherwise, the company will
not be able to achieve the objectives of growth with the help of this process. According to quality
control process, the organization has to take different actions for the different situation in order
to maintain the quality of service and product (Sallis, 2014). Otherwise, the company will lose
the market share if Fonterra is not maintaining the quality of the product.
In order to monitor and manage the design of quality standard, Fonterra has another process that
is quality control planning process. In this case, the company plans the way to manage the

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quality of the product and the Fonterra is bound to follow these processes otherwise, the quality
of the product of the organization will be deteriorated. In this context, the organization should
identify all the resources that can help Fonterra to produce the quality product. In order to
maintain the quality of the product the company has another process that helps the organization
most and the process is quality improvement process. In this process, the company has to
develop a proper infrastructure to maintain the quality of the product. In this context, the
organization can use modern technology in order to produce a quality product (Goetsch & Davis,
2014).
3.2 Demonstrating quality culture to ensure continuous monitoring and
development of the process
In order to maintain the quality culture in the organization, Fonterra has to employ a sufficient
and skilled workforce in the company otherwise, the organization cannot achieve the higher
growth within a short period. In this case, the company has to concentrate on the labor
employment and the company can arrange training and development program in order to
maintain the quality culture within the organization. In this context, Fonterra can adopt a proper
leadership style within the organization that helps the Fonterra to maintain a quality culture
within the company. There are different kinds of leadership style and the company has to follow
a particular style in order to maintain quality within the firm. In addition to that, the company
can adopt another mechanism in order to maintain the quality within the firm. In this case, the
other mechanisms are customer perception and employee involvement. In the case of customer
perception, the company has to follow some basic rule of customer satisfaction. If Fonterra is not
able to provide better customer service and the company is not able to produce according to the
demand of the customer then the quality culture will not be maintained (Kim, Kumar & Kumar,
2012).
As per the situation, employee involvement plays an important role in order to maintain a quality
culture within the organization. Fonterra has to include those employees in the organization who
has the capacity to increase the value of the company. The firm has the objective to get more
profit from the production plant. Therefore, the company needs to train the employee in order to
make the employee efficient. Otherwise, the company will not be able to increase the market

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share within a short period and Fonterra will not be able to gain comparative advantage over the
competitors within the dairy industries (Wang, Chen & chen, 2012).
3.3 Recommending improvements which align with the organization’s
objectives and goals and which result in improvements
There is a necessity to understand the objective of the Fonterra to recommend the ways by which
the company can achieve the improvements. In addition to that, there is a necessity to understand
the business strategies of the company otherwise; the recommendation will not be relevant.
Therefore, the objective of the company and the business strategies of Fonterra will be discussed
first. The objectives of the company are to achieve growth and huge market share within the
short period and the company has the objective to minimize its cost by maximizing profit. It can
be said that the Fonterra has one more objective that to earn a monopoly power within the
industries (Straskraba, tundisi & Duncun, 2013). In this case, the company has some identical
business strategies that help the Fonterra to achieve all its objectives in the short period. Fonterra
follows a cost-minimizing production technology that helps the company to maximize profit in a
short period. In addition to that, with this production plan the company is enjoying a monopoly
power within the Australian dairy industries. However, still, the Fonterra has a need a series of
recommendation in order to improve their business plan and strategies. The recommendations
are:
● Fonterra use modern technology in order to reduce the cost of production
● The company has to choose an efficient labor in the organization who can increase the
value of Fonterra
● A proper marketing strategy is needed for Fonterra because the company needs to
increase the market share
● Fonterra has to adopt training and development program in order to get an efficient labor
force in the organization
● Fonterra has to use a production plan which is capital intensive which helps the company
to produce more product within a short period
● Fonterra has to set the price according to the income structure of the market otherwise,
the company will lose the market share

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● A proper market research is required for the Fonterra otherwise, the firm will be unable to
understand the market trend
3.4 Reporting on the wider implications of proposed changes within the
organization
If the firm wants to achieve growth within a short period then the Fonterra has to follow all the
recommendation. Therefore, the organization needs to conduct a market research in order to
understand the market trend, consumer demand, and preferences. Otherwise, the organization
will not be able to produce the product according to the market demand (Butler et al. 2013). In
addition to that, the Fonterra has a need to understand political, social and economic factors of
the production, therefore, the company needs to conduct a market research. Furthermore,
Fonterra needs a proper and effective marketing plan to inform the consumers about their
product. A proper marketing plan will also help the company to attract a new set of customers
that will help the company to increase the market share. Fonterra can incorporate modern
technology in their production plan by which the firm can reduce the cost of production and able
to increase the profit. In addition to that, the company will choose an appropriate labor force who
can add the values in the organization. The company has a need to adopt the capital-intensive
technology, which may be costly at the first stage, but it will be helpful for the company. With
the help of this technology, Fonterra will be able to increase the production within the short
period and it will reduce the cost of production in long run (Gimenez-Espin, Jiménez-Jiménez &
Martínez-Costa, 2013).
LO 4
4.1 The various risk assessments that are essential in the health and safety
workplace
In the nation of Australia, the diary organizations as big as Fonterra not only displays a positive
impact but also gives birth to various risks that are interlinked with the context of the
implementation of the policies. The information gathered from health and social care workplace
services is beneficial for providing proper safety measures in the health care in the corporate
organization, Fonterra. The useful and detailed understanding of the risk assessment can collect
this information. According to Laschinger (2014), the risk assessment refers to the hazard
identification, degree calculation in respect of the monitoring the risk. It also refers to the various

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steps taken by the organization to implement the risk control in any organization. This
information is required for the benefit of the formulation of the individual care and safety
planning procedure. There is different type of risks in the health and social care services like:
➢ Resource implication- This implies to the use of the various resources in the structural
part of the organization. If the resources are not introduced properly to the workers of the
organization then the individuals or the workers may suffer in times of need.
➢ The risk to self and others- Sometimes the animals in the dairy firm tend to be excited in
the process of mating or in the seasonal change. The various employees and the workers
working in the dairy firm sometimes get hurt in the process and hence the chance of
physical harm in increased in the process. Therefore, the risk of hurting self or others is
prevalent in the healthcare organization.
➢ Different type of priorities in accordance with the various types of stakeholders- In the
healthcare organization, the stakeholders primarily consists of the people visiting the
dairy firms and the customers that consume the various dairy products. The priorities
differ from one stakeholder to another as the requirements differ from one to other. The
requirement of the customers might differ from that of the visitors. The service providers
find it hard to meet the needs and demands of the various stakeholders that the service
users may possess in the organization or the company.
➢ The various rights pertaining to the service users and various laws relating to the safety
consequences- There are various rights that are to be followed by the service providers of
the diary organizations, failure to which may result in the punishment of the workers.
4.2 Demonstration of the effective utilization of the health and safety policies
in the workplace
The various laws and the policies that are implemented by the Australian government in lieu to
the health and safety procedures are strictly followed by the management of the Fonterra
organization. The various laws that are to be implemented for the utmost care of the animals in
the dairy firms are to be of optimum level. The employees or the service providers of the dairy
company or organizations need to also follow strictly the Care Standards Act (2000) which
implies the workers to provide utmost care to the animals that help in the production of the milk.
It is necessary for the production of the dairy products, which begets profit to the organization.

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It is necessary for the employees to implement the laws so that the animals in the dairy firms are
taken utmost care and the safety regulations are to be maintained in the workplace so that the
accidents can be prevented and the risks can be mitigated.
4.3 A systematic review of the organizational health and safety policies and
procedures
According to Tombs and Whyte (2013), the health and safety legislation is extremely needed in
any dairy company and corporate organization in the nation Australia. The changes in the social
and health care organizations are mainly affected by the various demands of the stakeholders.
The various rules and the regulations are also being changed constantly due to the various
internal and external factors occurring in the dairy company or organization. The dairy company
workers or the service providers need to comply with the different terms and conditions
mentioned in the Health and Safety Work Act, 1974. According to this act, the workers and the
service providers are to provide optimum safety to the animals and the visitors. According to this
Act, any staff or the service providers of the dairy company or organization has to report each
incidents relating to the health of the animals, however, trivial it may be to the management or
the specific professionals so that it can be treated accordingly. The employees or the service
providers of the dairy company or organizations need to also follow strictly the Care Standards
Act (2000) which implies the workers to provide utmost care to the animals that help in the
production of the milk. It is necessary for the production of the dairy products, which begets
profit to the organization. The service providers of the dairy company or organizations need to
also follow strictly the Health & Safety (First Aid) Regulation Act 1981, which implores to the
authentic medicine to be given to the animals that are sick and in utmost need of them. It also
implies the implementation of the first aid to the animals whenever and wherever the animals or
the service users in the healthcare organizations need it. The service providers of the dairy
company or organizations also need to provide security measures for the proper evaluation of the
diseases for its rightful treatment, implementation of the emergency evacuation procedures in
times of need. They have to also analyze the risk assessment issues that crops up within the dairy
company or organization and try their level best to mitigate them totally from the dairy company
or organization.