Essay 1- Explain the impact of 2 influences on the strategic role of operations.
Introduction
The strategic role of operations is how the key business functions work interdependently to achieve the business’s goal such as profit maximisation which involves the use of cost leadership where you have the lowest cost of production than competitors in the market, creating a competitive advantage and product differentiation where goods and services from a business are changed to stand out and attract more customers in a market. The strategic role of operations is impacted by operation influences as it can affect a business’s ability to achieve cost leadership and influence product differentiation for a business.
McDonalds the world’s leading food service organisation and global outdoor, lifestyle and sports company Kathmandu are businesses that respectively demonstrate how operation influences impact the strategic role of operations.
Quality Expectations
Quality expectations refers to the expectations that a consumer has about the quality of a product or service. Quality expectations impacts the strategic role of operations as it affects the business’s ability to achieve cost leadership as it can determine the production costs and features of a good or service. Furthermore, it also affects product differentiation as depending on the expectation of quality the consumer has it will affect the quality and features of the product/service.
McDonalds demonstrates this in effect as statistics from 2011, state that after receiving negative feedback regarding their coffee, McDonalds change the product to meet customer expectation which resulted in them selling 220 million cups of coffee per year. As a result, this showcases how quality expectations impact strategic role of operations as due to the product not living up to customer expectations, McDonalds had to change the quality of the product in order to meet expectations and in the process, change the production costs which as a result affects McDonalds’ ability to achieve cost leadership. Therefore, through McDonalds it showcases how quality expectations impacts the strategic role of operations as, it can affect the business’s ability to achieve cost leadership through what the consumer expects of the product and how the quality expectations of the consumer influences product differentiation.
Corporate Social Responsibility
Corporate social responsibility is where a business goes beyond their compliance costs and aims to become environmentally friendly and ethical. Corporate social responsibility impacts the strategic role of operations as it affects the business’s ability to achieve cost leadership as it can leads to waste minimisation in the production process. Moreover, it also affects product differentiation as it can lead to products being more eco-friendly.
Kathmandu demonstrates the impact of their influence as they recycle 9.3 million bottles into gear. Hence showcasing how corporate social responsibility impacts the strategic role of operations as due to Kathmandu recycling gear, it leads to waste minimisation in the production process which reduces production costs which affects Kathmandu’s ability to achieve cost leadership as well as leading them to changing their products to be more eco-friendly. Therefore, Kathmandu displays how corporate social responsibility impacts the strategic role of operations as it can lead to business partaking in waste minimisation in the production process thus affecting their ability to achieve cost leadership as well as making them more inclined to incorporate eco-friendly and ethical changes to their product.
Conclusion
In conclusion, operation influence impacts the strategic role of operations through quality expectations and corporate social responsibility affecting cost leadership and product differentiation as evident by how they have affected McDonalds and Kathmandu in their ability to achieve cost leadership and how it has influenced their product differentiation.
Introduction
The strategic role of operations is how the key business functions work interdependently to achieve the business’s goal such as profit maximisation which involves the use of cost leadership where you have the lowest cost of production than competitors in the market, creating a competitive advantage and product differentiation where goods and services from a business are changed to stand out and attract more customers in a market. The strategic role of operations is impacted by operation influences as it can affect a business’s ability to achieve cost leadership and influence product differentiation for a business.
McDonalds the world’s leading food service organisation and global outdoor, lifestyle and sports company Kathmandu are businesses that respectively demonstrate how operation influences impact the strategic role of operations.
Quality Expectations
Quality expectations refers to the expectations that a consumer has about the quality of a product or service. Quality expectations impacts the strategic role of operations as it affects the business’s ability to achieve cost leadership as it can determine the production costs and features of a good or service. Furthermore, it also affects product differentiation as depending on the expectation of quality the consumer has it will affect the quality and features of the product/service.
McDonalds demonstrates this in effect as statistics from 2011, state that after receiving negative feedback regarding their coffee, McDonalds change the product to meet customer expectation which resulted in them selling 220 million cups of coffee per year. As a result, this showcases how quality expectations impact strategic role of operations as due to the product not living up to customer expectations, McDonalds had to change the quality of the product in order to meet expectations and in the process, change the production costs which as a result affects McDonalds’ ability to achieve cost leadership. Therefore, through McDonalds it showcases how quality expectations impacts the strategic role of operations as, it can affect the business’s ability to achieve cost leadership through what the consumer expects of the product and how the quality expectations of the consumer influences product differentiation.
Corporate Social Responsibility
Corporate social responsibility is where a business goes beyond their compliance costs and aims to become environmentally friendly and ethical. Corporate social responsibility impacts the strategic role of operations as it affects the business’s ability to achieve cost leadership as it can leads to waste minimisation in the production process. Moreover, it also affects product differentiation as it can lead to products being more eco-friendly.
Kathmandu demonstrates the impact of their influence as they recycle 9.3 million bottles into gear. Hence showcasing how corporate social responsibility impacts the strategic role of operations as due to Kathmandu recycling gear, it leads to waste minimisation in the production process which reduces production costs which affects Kathmandu’s ability to achieve cost leadership as well as leading them to changing their products to be more eco-friendly. Therefore, Kathmandu displays how corporate social responsibility impacts the strategic role of operations as it can lead to business partaking in waste minimisation in the production process thus affecting their ability to achieve cost leadership as well as making them more inclined to incorporate eco-friendly and ethical changes to their product.
Conclusion
In conclusion, operation influence impacts the strategic role of operations through quality expectations and corporate social responsibility affecting cost leadership and product differentiation as evident by how they have affected McDonalds and Kathmandu in their ability to achieve cost leadership and how it has influenced their product differentiation.