Vietravel: Operational Management Principles, Analysis, and Planning

This report provides an in-depth analysis of Vietravel's operational management principles, focusing on key decisions related to products and services, quality management, process and capacity design, location strategy, layout strategy, human resources, supply chain management, inventory management, scheduling, and maintenance. It evaluates Vietravel's strengths and weaknesses in these areas, highlighting the company's diversification of products, extensive distribution network, and attention to human resource development. The report also critiques the implementation of operational management principles within Vietravel, noting inconsistencies in service quality management and high inventory costs. Furthermore, it explores the concept of continuous improvement, including Lean Production and Six Sigma, and proposes a continuous improvement plan for Vietravel to enhance service quality, streamline processes, and reduce costs. The aim is to provide practical recommendations for Vietravel to strengthen its operational efficiency and maintain a competitive edge in the tourism industry.

CONTENTS
INTRODUCTION............................................................................................................3
MAJOR FINDINGS.........................................................................................................4
1. OPERATIONAL MANAGEMENT PRINCIPLE OF VIETRAVEL........................................4
a. The operations management principle................................................................4
b. 10 Critical operations management decisions.....................................................5
2. THE CONCEPT OF CONTINUOUS IMPROVEMENT.....................................................12
a. Lean Production................................................................................................12
b. Six Sigma...........................................................................................................13
c. Critique of the implementation of operations management principles within
Vietravel tourism company.......................................................................................14
3. THE CONCEPT OF CONTINUOUS IMPROVEMENT......................................18
a. The advantages and disadvantages of continuous improvement in reality........18
b. Continuous Improvement Plan..........................................................................19
CONCLUSION...............................................................................................................22
REFERENCES...............................................................................................................23

INTRODUCTION
Vietravel tourism company is a business that operates in the travel and service industry.
Vietravel is founded on December 20, 1995, with its headquarters in Ho Chi Minh City.
Additionally, Vietravel owns approximately twenty domestic branches and representative
offices in international countries including the United States of America, France,
Australia, and Cambodia.
With a unique style of operation, the company has left numerous positive impressions on
visitors and established a strong reputation in the tourism market by consistently
achieving high standards and winning numerous domestic and international awards.
Additionally, Vietravel strives to provide consumers with exceptional travel experiences
through the company's service packages. Vietravel opted to grow its operational division
since it has a large and decisive impact on the company's operations and revenue. This
department is critical in guaranteeing the company's stability and serves as the focal point
for implementing all employment, operating programs, and providing tourism services
with assured recovery alternatives. service and strive to provide the best possible
experience for guests.

MAJOR FINDINGS
1. Operational Management Principle of Vietravel
a. The operations management principle
Operations management is the process of creating value in the form of
commodities and services by transforming input materials into output items (Heizer
& Render, 2011). In particular, input materials include raw materials, technology,
equipment, labor, etc., whereas output products include services, goods, etc. All
industrial processes that transform raw materials into finished products. Planning,
coordinating, and managing operations management methods improve industrial
operations' profitability and productivity. The primary objective of operations
management is to achieve a balance between supply and demand.
VIETRAVEL TRANSFORMATION PROCESS
Inputs Outputs
Raw Materials Products and Services
Human Resources Financial Results
Capital Information
Technology Human Results
Vietravel has built procedures and protocols to ensure the department's peak
efficiency, which has benefited the company. The department's workers will design
and administer all travel programs for the firm, including hotel room registration,
transportation services, and visas, to meet quality criteria. The Vietravel Company
planned, created, organized, and assigned the department's team to save costs while
attaining exceptional work performance. The company would also minimize long-
term personnel policies and payrolls to save money while still engaging staff.
Transformation process
Employees’ Work Activities
Management Activites
Technology and Operations
Methods

Vietravel has a sensible, efficient, and logical functioning equipment for each step
of development. The operating room personnel plans, organizes, and provides travel
services to clients. Efficiency and productivity measure the executive team's ability
to use tourism's inputs and resources to generate good service, design quality
service programs, and diversify while saving costs, meeting tourists' needs and
preferences, maximizing profits, and positively impacting the social and tourism
environment. To accomplish its tasks for the company and its clients, the executive
department must assure high-quality travel programs, meet tourist needs, and
maintain close relationships with tourists, key agencies, and suppliers. The
executive department investigates and identifies the potential or niche of resorts,
restaurants, hotels, and tourist attractions to build diversified tourism programs
customized to each segment and the tastes of travelers. The department's primary
goal and target market is foreign and local visitors. The sleeping team in the
operation room is concerned with tourists' fears, travel interests, and needs. The
operation room will deliver high-quality, cost-effective travel programs, fulfill
customers' travel fantasies, fully satisfy customers' requirements, preferences, and
passions, and establish customer trust through trips, all with the purpose of giving
them the finest practical experience possible. Vietravel's efficient and high-
productivity structure has resulted in many benefits for the company. Vietravel's
initiatives aim to expand Vietnamese tourism's regional and international reach.
b. 10 Critical operations management decisions
 Products and Services
Currently, Vietravel offers the following tourism products and services:
- Packaged tour
- Room booking service
- Air ticket and hotel combo service
- Transportation and hotel combo service

Vietravel has implemented a strategy of diversification to its products and services
in order to suit the needs of tourists and provide them with a variety of travel
options. With the Package Tour offering, tourists can instantly go on a domestic or
international tour. In addition, the domestic tour package is divided into three
items, including package tour, family tour, and Vietnam trip. In addition, the airline
offers combination services with discounted rates for reserving hotel tickets, buses,
and hotels. In addition to offering a variety of travel packages, Vietravel aspires to
improve the quality of its services by establishing the first tour selling network in
Vietnam. Using cutting-edge technology, guests may book tours with a few taps on
the website or mobile app. Additionally, there is a function that is difficult to locate
on other travel websites (tour sale networks). This is the tour comparison
functionality. With this function, you can select the tours you wish to take and
compare them. Vietravel will provide the most comprehensive information to
compare the tours you require, including price, duration, mode of transportation,
products, cuisine, and incentives.
 Quality Management
Senior executives oversee and direct the branches to design strategies,
procedures, and measures to mobilize the participation and ingenuity of all
employees in order to enhance the organization's capability and provide the highest
quality service. Strict management at each stage of service delivery and quality
assurance ensures customer satisfaction. After a customer completes a service at
Vietravel, the company will send the consumer an evaluation of the service's
quality. Managers and leaders are thereby aware of the service quality of
employees, the company team, and service suppliers. The organization will record
client feedback, overcome and rectify deficiencies, and advertise the
accomplishments that have been made. Due to the fact that Vietravel is a major
corporation with numerous representative enterprises in Vietnam and overseas, the
supreme leadership is unable to exercise direct control over all of them. Each
location's service quality is. Especially for offices in other nations, the discerning

client market is still unsatisfied with the given service. Therefore, it is sometimes
company policy, but many branches are still not in charge of their services or have
not fixed faults in a timely manner.
 Process and Capacity design
The enterprise's core competency is the capability at which it excels relative to
its other internal competencies.
Vietravel's core competency is a professional management system: every year,
Vietravel organizes training programs to train and re-train staff, the two main
training disciplines being Operation & Sales of tours., Guides... particularly staff
have the opportunity to learn the facts and confidently organize a complete tour,
from marketing, program design to operating accommodation, dining, transportation
services...
Distinctive competency: a set of competencies that a company can execute better
than its competitors; it enables a company to gain a competitive edge.
- Technology know-how
- A breakthrough in service quality
- Financial strength
 Location Strategy
Vietravel
Headquarters Branches Representativ
e office
Tourist
registration
office
Online
Vietravel has chosen to implement a strategy of extensive distribution.
Vietravel's distribution network is fairly extensive, with 16 branches in major cities
and provinces and 5 overseas representative offices. In addition, Vietravel operates
three distinct tour selling network channels, each having a distinct purpose.
Vietravel is able to supply information on trips and tours to any domestic and
international customers who require it.

 Layout Strategy
Vietravel has a vast network of national and international agencies to
Heacollaborates with over 2,000 domestic and international airline, restaurant, and
hotel partners. With the motto "Cooperation builds strength - Sharing creates
success," Vietravel aspires to continue cooperating with partners for sustainable
development in order to jointly explore the vast ocean and seize new chances.
resulting from international integration In addition, Vietravel focuses on
technological change in accordance with the digitization 4.0 trend. This shift
toward streamlining, standardizing, and automating the company's operations
increases efficiency and productivity on the job.
 Human Resource and Job Design
Vietravel's more than one thousand highly qualified and motivated workers are
a great asset. Corporate culture is the foundation of human resource management at
Vietravel. Consequently, the company's leadership is always attentive to each
employee's objectives, stimulates and gives practical support for material life and
collective solidarity, such as providing training courses. Create short,medium and
long-term professional skills to increase employee credentials; hold internal
competitions such as good tour guide, good salesperson, emulation movements,
etc. Vietravel is a business that, in addition to creating a professional work
atmosphere, implements the compensation system for its employees. With periodic
salary and bonus systems on holidays, bonuses based on business performance, and
incentives for employees with innovative ideas at work.
 Supply Chain Management

If a company wishes to conduct business, it must establish a professional and
rigorous implementation procedure for efficient operation. The leadership of
Vietravel, a firm with a lengthy history, has established "standard" practices that
serve as a guide for staff to follow and adhere to. Not to mention that this is also
advantageous for the consumer, as they will be aware of how to manage service-
related inquiries and concerns. (Sutono, 2019)
 Inventory Management
Vietravel offers in-demand goods and services that cannot be stocked.
 Scheduling
Employees at Vietravel will perform their given shifts in the morning,
afternoon, or evening. They can also choose the length of their transition from four
to sixteen hours. Employees might also choose to rotate or change shifts to meet
their schedules. Within the organization, management and top executives typically
enjoy flexible schedules. In this manner, the dictatorship can inform its minions of
upcoming events or schedule adjustments. As a result, Vietravel is attempting to
streamline all of its internal procedures in order to maintain consistency across all
levels of management.
Travel Agent
Online booking
or direct
telephone
booking
Tour Operator
Assembles the
product
Airline &
Airport
Services
Airport
Transfer/Taxi
NTO, hotels,
restaurants,
visitor
attractions,
care hire,
tours, etc.

 Maintenance
Regular maintenance must be performed on the IT infrastructure, servers, and
other infrastructure at the headquarters and branches. To accomplish this, the
branch collaborates with IT partners to perform routine facility maintenance. The
management board operates the company's branches to maintain the equipment's
functionality.
Maintenance requires both infrastructure and personnel. Appropriate training
programs for certain positions will ensure seamless operation. In addition, service
delivery methods are continuously improved to provide the best client experience
possible.
Strengths and Weaknesses of 10 Operation Management Decisions
Operation management
decisions
Strengths Weaknesses
Goods and services Diversification product
with a variety of travel
options
Offline and Online (tour
sale networks)
Offering discounted rates
Quality management Strict management at each
stage
Aware of of service
quality
Unable to exercise direct
control
Some branches are still
not in charge of their
services or have fixed
faults in timely manner
Process and Capacity
Design
Staff have chances to
learn and train
professionally
Execute better than
competitors
Location Operating three distinct
channels
Be able to supply
information
Layout design and
Strategy
Having a vast of agencies
Keep pace with present
trends

Human Resources and Job
Design
Corporate culture
Give practical support
Attentive to staff’s
objectives
Holding internal
competition
Good at motivating
employees
Supply Chain
Management
Establishing professional
procedure
Inventory Offering goods and
services that can not be
stocked
Expensive costs
Scheduling Flexible schedule due to
staff’s conveniences
Attempting to streamline
Need to appeal to
effective procedure
Maintenance Appropriate training
programs
Delivery methods
improved
Must be performed on IT
Requiring both
infrastructure and
personnel
Review and Critique the Implement of OM
While the administration and operations of Vietravel are relatively
straightforward, there are substantial risks that jeopardize the brand.
Firstly, according quality management, the company is not consistent in checking
and managing service quality. This can lead to customer dissatisfaction and the risk
of losing customers. The company needs to have a stricter and more effective
management strategy and quality control process.
Secondly, inventory cost is high because all services are unable to be stocked. As
a result, it's very difficult to control the inventory and it can negatively affect to the
revenue of the company.
Thirdly, procedure is not very effective, this can affect the productivity and work
efficiency of the company.
Lastly, Maintenance must be updated and keep pace with the 4.0 technology era, it
is necessary to have a maintenance system to optimize productivity.

2. The Concept of Continuous Improvement
Continuous improvement, often known as progressive improvement, is a method
for incrementally and substantially enhancing a product, program, or methodology
(asq.org (a), 2021). Although small deviations are unlikely to have a significant
impact on the production process, their accumulation leads to significant
improvements and innovations. As a daily procedure, it facilitates improvement by
reducing the likelihood of making a huge leap to achieve the same objective.
a. Lean Production
Lean Manufacturing, also known as Toyota Product System (TPS), is an
operation management concept developed by former Toyota Chief Engineer
Taiichi Ohno. It allows you to reduce and eventually eliminate the seven wastes,
including:
- Delay, waiting, or time spent in a line without contributing value;
- Oversupply
- Excessive processing or lack of additional value
- Transportation
- Unnecessary action
- Inventory
- Product defects
Many individuals interchange the terms "Lean Manufacturing" and "Lean
Production" while discussing TPS. In Wilson's (2010) terminology, it is referred to
as "Lean" because, in order to save money, time, and resources, it is essential to
employ the smallest amount of material possible.
Ohno added that the seven wastes may be addressed in a variety of ways. Just
In Time and Jidoka are the foundational foundations of the TPS. JIT is a
mechanism for delivering exactly what is needed, when it is needed, and in the
exact quantity (Wilson, 2010). JIT aids in inventory management and reduces