Operations Management: Leadership, Management, and Quality in Business

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Unit 24- Management Operations
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Introduction
Operations management is a branch of management that deals with the process of administration
of the activities that are practised in an organization. Operations management is aimed to
increase the efficiency of an organization. The conversion of raw materials or resources and
labour into productive goods and services in order to increase the profit margin of the
organization is a part of operations management. A leader is one who is responsible for leading
an assembly of people in a particular direction. Therefore, it can be said the success of an
organization depends upon the leader and the management of its operations.
In this assignment, leadership and management has been defined along with it the differences in
their functions have been elaborated. The process of transformation of operations management
has been illustrated and the importance of “Quality” in an organization has been discussed along
with the description of capacity management.
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Discussion
LO1 Analyse and differentiate between the role of a leader and function of a manager by
effectively applying a range of theories and concepts.
Management is defined as the process of organising people or possessions. In other words, it can
be defined as the process of getting things done by people is termed as management. The way in
which things or people are handled by properly supervising the activities of the people is known
as management. A person who is in charge for the administration or supervision of the activities
of an organization is known as manager (Christopher, =2016). The management of an
organization administers several functions, namely recruitment and training of employees,
managing finances, planning, marketing and promotion of the products and services of the
organization, and others.
Leadership is defined as the process of leading a team of folks or a company. The procedure of
guiding a team of people in a direction such that the aims and objectives that have been set can
be achieved is termed as leadership (Bolman and Deal, 2017). The main purpose of a leader is to
influence the people in a way such that they act as per his or her direction and supervision. The
leader is one who is responsible for driving a team or n organization towards success.
Difference between the functions of a leader and a manager
According to John Kotter, a well-known leader in areas of leadership, modification and business
there is a difference between the functions that are practised by a leader and a manager. The
difference between their functions has been described below:
Leadership Manager
 The leaders mainly focus on folks or
people.
 The process of thinking of the leaders is
mostly outwards.
 The leaders are responsible for setting
the goals and objectives that has to be
 Management is all about focussing on
materials rather than people.
 The process of thinking is inwards.
 The manager is one who is responsible
for the execution of strategies in order
to attain the goals.
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achieved.
 The leader is in charge for the
development of positive relationship
with the employees and winning their
trust.
 The leaders are answerable for the
creation of modifications, serving the
subordinates and doing the right
things.
 The leaders are responsible for
influencing the people and are expected
to proceed decisively such that the
activities of the team can be governed
properly.
 Instead of empowering the comrades, a
manager is responsible for directing
and controlling the subordinates.
 The management of the change that is
implemented in the organization is the
responsibility of the manager.
 For the proper governance of the
subordinates, a manager uses power or
authority and is expected to work
responsibly.
Table 1: Difference between leadership functions and managerial functions
(Source: Kotter, 2007)
Management by Objective
Management by objective is the process of managing a performance by having proper balance
between the objectives or goals of the employees and the organization. Peter Drucker, who was a
management consultant, defined management by objectives (MBO) as management by results.
Management by objectives illustrated that the objectives that an organization has to achieve must
be set in collaboration with its employees and that the formulation of the objectives must be at
quantitative as well as qualitative levels (Drucker, 2012). The objectives formulated must be
efficient enough to motivate the employees and it stated that it is necessary that the performance
of the employees must be monitored daily furthermore they must be rewarded if their
performance meets the standard. It stated that the main purpose of MBO is development and not
punishments.
However, MBO can succeed only if it receives full support from the top levels of management.
Sometimes, it also creates pressure on the employees, as they need to meet the objectives on a
daily basis as set by the management. It is a time-consuming process and mainly emphasizes on
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goals that are set for a short period. The achievement of goals set for a group is difficult as the
focus of MBO is to balance between the goals of the employees and the organization.
Nevertheless, MBO improves the process of communication or contact between the employees
and the management, makes the employees to become aware of the organizational goals in a
better way. It eradicates all kinds of confusion in the organization (Drucker, 2018).
Management Roles Theory
Henry Mintzberg, the professor at Desautels Faculty of Management stated that the roles of a
manager in an organization could be divided into three parts, namely interpersonal informational
and decisional segment or category.
Interpersonal Segment: This segment is mainly concerned with the relations that exist between
the manager and the employees of an organization. In this segment, the manager is expected to
exercise all kind of symbolic duties. As a leader, he must encourage the employees and must
develop a good environment in the organization (Mintzberg, 1971). A leader must also acts as a
connection or linkage between the various levels of management in the organization. This
segment mainly emphasizes on the relationships that the manager of HSBC BANK stores
establish with the staffs of the organization.
Informational segment: The manager of an organization is liable for the analysis of data or
information. A manger must monitor the all sorts of data associated with the organization and
must convey the data to the staffs of the organization properly. A manager is also responsible for
representing the organization at other places. This segment emphasizes on the proper
conveyance of the data or information such that no situation of confusion arises in the company,
that is, the information regarding the change in the rates of taxes and interests at different areas
HSBC BANK was communicated effectively.
Decision Segment: The managers of an organization are responsible for making proper decisions
at various levels. A manager is responsible for devising and initiation of modifications or
strategies. A manager is also liable for the resolution of any kind of issues or problems that may
arise at his or her workplace. In addition to this, a manager controls the use of resources owned
by the organization and negotiates with other organizations in order to serve its interests. This
segment focuses on the decision-making capability of a manager like the decisions that the
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management of HSBC BANK took when it was hit by problems related to information
technology in 2018 such that it can be dealt effectively.
Leadership Trait Theory and styles
Leadership Trait theory illustrates the identification of various traits of an individual’s
personality or character. As per a recent study in Spain, there are certain traits of a person that
differentiates him or her others, that is, there exists a difference between the lower and upper
levels of supervisors. The most desirable traits in leaders have been described below:
Intelligence: A leader must be smart and intelligent such that he or she is able to guide and drive
the team towards success (Lord et al., 2017).
Responsible: A leader must be responsible such that he or she can take responsibility on his or
shoulders.
Emotionally Stable: A leader must be emotionally stable such that they can manage their
emotions and must not overreact in any kind of situation (Meuser et al., 2016).
Trustworthy: A leader must be trustworthy such that the members of his group or organization
can depend on him or her.
Decision-making capability: A leader must be confident enough such that he or she can analyse
any matter properly and make proper decisions.
There are seven styles of leadership out of which two leadership styles have been discussed
below:
Autocratic Leadership is also known as authoritarian leadership in which a leader is free to
make decisions without consulting with the group members.
Participative Leadership is also known as democratic leadership in which a leader makes
decisions after proper consultation with the team members (Anderson and Sun, 2017). The
management of HSBC BANK makes decisions after properly communicating and discussing the
topics with the employees of the organization.
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Hard Management skills and soft leadership skills
Hard management skills are those skills that can be stated as well as measured, that is, the
ability of a person to write, type, read, and code. The logical and analytical capability of a person
or the ability of a person to solve mathematical problems is also termed as hard skill. These skills
of a person aid him or her to manage a group of people or an organization effectively.
Soft leadership skills of person are the skills that cannot be measured like the etiquette of a
person and his or her interpersonal skills (Matteson, et al., 2016). These skills aids a person to
become a perfect leader since leadership is not only about attaining the objectives but to move
forward together in a team.
The heights that HSBC BANK has reached clearly signify that the leaders and managers are
skilled enough to lead an organization that employs more than 232 thousand people.
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LO3 Critically evaluate application of operations management and factors that impact on
the wider business environment.
Transformation Process
Transformation process is a part of operations management that deals with the transformation or
conversion of raw materials or inputs into useful products or outputs that serves its clients. The
change or modifications that are taking place in the world of technology have changed the
lifestyle of people and the mode of operation of organizations. The introduction of biometrics
has changed the customer experience as it has made the experience of the customers more
comfortable and convenient. The commencement of digital market that has encouraged cashless
economy and reduced the use of paper as well as cash has made huge modifications in the
operation of HSBC bank .
Net banking through mobile, laptops and PCs has aided the organization to enable its customers
to transfer or receive money without running to the banks in order to serve their interests. It has
made the lives of people easier, however, HSBC bank had to complete a number of processes
such that money can be transferred as well as received safely without much hassle.
Quality
Quality can be defined as an attribute that signifies the effectiveness of a material or an object.
The satisfaction that a person gets from the use of a particular object or material depends upon
the quality of that commodity. It is a calculation of excellence of a product. The quality of the
products and services offered by an organization aids to determine its performance thereby
assisting its management to take measures in order to conquer the shortcomings that its products
have.
Costs of quality
Quality costs are also termed as costs of quality. It can be defined as the procedures that are
followed in an organization in order to decide the range up to which the resources or materials
can be used to prevent the quality of its product to fall. The costs that needs to incurred by an
organization to provide good quality products to its customers is known as the cost of quality.
There are four costs of quality that has been described below:
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Prevention Costs: The costs that are incurred to prevent the quality of a product from
degradation are known as prevention cost. The framework, performance and the preservation of
the management system of quality needs expenditure and these expenditures are known as
quality costs (Vetrò et al., 2016).
Appraisal Costs: The costs that are related with the activities of supervision of the quality or
attribute of the services or products of an organization are termed as appraisal costs. It includes
verification of the input and confirmation of the proper functioning of quality system. The
suppliers are also rated in this in this process.
Internal Failure Costs: The cost that an organization has to incur in case its products are found
faulty before it is being delivered to the consumers is known as internal failure cost. It includes
waste and rectification such that the failure of the products can be analysed and rectified.
External Failure Costs: Once the products are delivered to the customers and then the products
are found faulty then the costs that an organization has to incur are termed as external failure
cost. It includes repair works and warranty. It also includes the complaints lodged by the
customers and the cost that is incurred when the organization needs to recall its faulty products.
Total Quality Management
The efforts that the management of an organization puts continuously in order to improve the
quality of the products and services it delivers to its clients by making improvements in the
procedures it follows are known as total quality management. This process lays special attention
to the feedbacks of the customers such that the attributes of its products can be improved and the
organization can grow (Mosadeghrad, 2015). The roles played by managers in total quality
management have been described below:
 Recruit proper and diligent employees who can take the responsibility of maintaining the
quality of its system.
 The manager needs to convey the advantages of the implementation of total quality
management to the employees of the organization effectively.
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Just-in-Time approach and waste reduction in operations
Just-in-Time approach in operations is defined as the process in which resources or materials and
labours arrive just at the time when it is required in the process of manufacturing. It is used to
increase the efficiency of the manufacturing process such that inventory costs and wastes can be
reduced (Filippini and Forza, 2016).
Waste reduction is the process of minimising the quantity of wastes or scraps produced. It aids to
promote the creation of sustainable environment. It aids to improve the quality of the products
and reduce the total cost of manufacturing process. It also reduces overproduction and
transportation cost such that the cost of operation of the organization can be minimised.
Capacity Management
Capacity management is the process of shaping the capacity of production of an organization
such that the changing demands of the customers can be met effectively. It pertains to the design
or the framework of the capacity, that is, the highest quantity of work that an organization can
finish within a particular period. There are three methods that are used for capacity planning
which has been explained below:
Lead Strategy: When an organization increases its capacity of production in anticipation that the
demand of it products will increase is known as lead strategy (Boyabatlı, et al., 2017).
Lag Strategy: When the demand of the products of a company actually increases then the
capacity of production is increased accordingly is known as lag strategy.
Match Strategy: When an organization makes small modifications or increments in its capacity
of production as per the modifications in the situation of the market is known as match strategy.
The leaders need to be very strong and the managers must be practical such that the organization
can be driven forward in the path of success. They must have the excellent decision making
capability such that the adverse situation that might arise in the operation of the organization can
be dealt effectively. The managers and leaders must have the capability to mange time
effectively such that the works can be finished on time.
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