Category: Management

Abstract

In the not so distant past, companies were able to collect and process information by hiring a significant number of people that were tasked to collect and sort data and then file the same into storage cabinets. The old system was costly and inefficient.

However, due to the emergence of digital technologies, such as computerized systems and networking capabilities, present-day leaders have access to management information systems that made it easier to handle information especially when it comes to the following components: 1) input; 2) processing; 3) output; and feedback.

When a well designed MIS is enhanced with the integration of principles taken from a well-defined decision structure, corporate leaders are able to improve their ability to make high-quality decisions and improve the cost-efficiency of the business process.

Introduction

Changes in the way human beings conduct business operations are impressive, to say the least. There was a time when the technological advancements brought about by the Industrial Age, and the modern world was enough to keep human beings busy for centuries to come (Oz, 2009).

However, the emergence of new technologies based on computers and the Internet radically altered the way people view the business, the world, especially when it comes to managing information. In the not so distant past, critical information about the business organization is stored in filing cabinets. Business leaders were forced to hire hundreds of workers to manage voluminous amounts of information.

Nevertheless, the high payroll cost in maintaining the inefficient management of corporate data did little to improve the decision-making capability of the business leaders. More importantly, the said inefficient management of information generated by the company did little to improve the organizations capability to develop innovative solutions to some of the persistent problems that made life difficult, not only for the corporate leaders but also for the rank-and-file employees.

It is therefore good to know that radical advancements in digital technology made it possible to develop management information systems (MIS) that paved the way for efficient knowledge management and decision making.

Defining Management Information System

One can argue that those who do not have an adequate understanding of the nature of information systems oftentimes label it erroneously as an example of a management information system. Thus, before going any further, it is important to define data and information in the context of digital technology. According to computer experts, data refers to raw facts that describe a particular phenomenon (Govardus & Heijden, 2009, p. 2).

For example, the number of wheels in a typical car is data. The number of colors in a color wheel is an example of data. Thus, the information goes beyond the simple concept of data because the information is data with a particular meaning based on a particular context (Govardus & Heijden, 2009, p. 2). A cars color is just data, but a persons favorite color is useful information if someone is thinking of giving him a gift on his birthday.

There is no need to elaborate on the fact that in a typical business organization, the business leader, CEO, manager, and supervisor is surrounded by different types of information. The amount of products that the factory produces in a single hour is one example. The number of distributors that work in partnership with a manufacturing company is also an example.

The sales volume of a particular distributor is another example of information. However, one can also realize that a corporate leader is surrounded by different types of information that, at first glance, are not related to each other. As a result, there are problems and opportunities that are not obvious to the manager or the CEO. If there is an opportunity to increase the efficiency of the company, this information is not known to the corporate leader.

Thus, there is a need for a system that allows the leader to see the interconnection of different sets of information. For example, the manager or CEO must have access to computer software that helps him see the connection between the production rate of the factory and the demand for the said product. As a result, the production manager or the company chief operating officer can make appropriate decisions that will result in improvements in terms of the production efficiency of the company in order to meet current demands.

Based on the above-mentioned requirement, a management information system is created to provide managers and employees information that they will need to perform jobs as effectively as possible (Pride & Kapoor, 2010, p.464). The main purpose of an MIS is to distribute timely and useful information from both internal and external sources to the managers and employees so that they will have the necessary equipment and information that they will need to make effective decisions (Pride & Kapoor, p.464).

Therefore, a typical MIS is constructed around a computerized system that is made more powerful by a record-keeping and communication software, making it easy to provide leaders and employees with relevant information based on different types of data (Pride & Kapoor, 2010, p.464).

Types of Information Systems

It is common to see business organizations using computerized systems that are built around record-keeping and communication software. Thus, many people make the mistake of confusing an MIS with an ordinary information system. Therefore, it is important to point out that a companys MIS is an example of an information system. However, there are many different information systems that a company uses to enhance the efficiency of the business process.

One of the most popular types of information systems is the transaction processing system, and this type of information system provides support to the operation of a particular business. For example, the data related to sales order or production orders are recorded into the said system, and the employees and managers access the said information to keep track of inventory or to inform suppliers that there is a greater demand for a certain component or product.

The difference between an MIS and a transaction processing system is seen in the type of decisions that were made on account of both systems. In the first one, leaders and employees make short-term decisions. However, when it comes to the MIS, corporate leaders make long-term decisions that affect the strategies and policies of the company.

Another popular example of an information system is the Information Systems in Organization and the Decision Support Systems. These two systems go beyond the transaction type model because it collects information and processes the same information to help leaders and manager make effective decisions.

In these two types of information systems, there is a deliberate process of collecting and analyzing information. However, with regards to the Decision Support System model, the system goes beyond collecting information because it also generates statistical projection and data models, helping the leader enhance the quality of decisions made based on certain inputs (Stair & Reynolds, 2015).

The fourth type of information system is the Expert Systems and Neural Networks. This type of system is also known as a knowledge-based system, and corporate leaders utilize this system to analyze data, and at the same time, generate recommendations that leaders can use to make appropriate decisions.

The fifth type of information system is the management information system. It is different and similar to the four types of information systems discussed earlier on the basis of how it collects information generated by real-time business operations. In other words, it goes beyond the transaction processing system, because it utilizes the information generated from the transactions not only to react on the basis of short term needs, such as, the need to create invoices or to communicate to suppliers.

An MIS enables the leader of the company to have an overview of the business process. More importantly, an MIS allows business leaders to see how different components of the business process are interconnected. As a result, business leaders are able to make decisions that will impact the future success of the company.

Decision Structure and Importance to Companies

An effective MIS design is not only based on the ability of the system to collect and analyze data. It is also based on the identification of an appropriate decision structure because this is a need to feed the results of decisions to points in the organization and other decision-makers affected by and or contributing to that decision (Frankel, 2008, p.77).

A typical decision structure follows a pyramid form; at the top are leaders responsible for strategic management. The mid-level is made up of leaders responsible for tactical management. Finally, at the bottom of the pyramid are leaders responsible for operational management (Frankel, 2008).

Strategic managers are responsible for the creation of organizational goals and strategies. At the same time, they are also looking after the strategic performance of the business organization (Frankel, 2008). Those who are in the tactical management sphere are responsible for the creation of short and medium-range plans (Frankel, 2008).

Most of the time, the medium-range plans affect the schedules and budgets of a particular organization. When it comes to the sphere of operational management, the leaders develop short-range plans (Frankel, 2008). A good example is the creation of a weekly production schedule (Frankel, 2008).

It is important to create an appropriate decision structure so that the desires of top management must cascade to the mid-level tactical management leaders, and finally, to the operational management leaders. It is not wise to develop sophisticated plans if strategic leaders are unable to communicate their ideas and solutions to corporate problems to the other leaders and workers of the company.

MIS is an Asset

An effective management information system is an asset to the company. The value of an MIS is seen in the following components of the said information system: 1) Input; 2) Processing; 3) Output; and 4) Feedback (Stair & Reynolds, 2015, p. 9). The establishment of an MIS enables the company to enhance its inputs in the context of information systems.

Therefore, there is a way to gather important data that the company will use to improve the cost-efficiency of the business process (Stair & Reynolds, 2015). This will also help the company in terms of knowledge management. Leaders can develop an enhanced MIS design that collects other types of information. For example, leaders in a design firm create a system of collecting sketches and preliminary designs. The information collected forms a significant part of the companys resources or assets.

With regard to the processing component of the MIS, the company has access to a mechanism that enables leaders to convert raw data into something that is useful. The next step is the output stage, and in this component of the MIS, the leaders are able to access documents and reports that can help them accomplish goals in the most cost-efficient manner. Finally, one of the most important components of an MIS is the feedback, the type of information that leaders use to make changes to a particular business process or policy (Stair & Reynolds, 2015).

A well-designed MIS provides a clear view of the companys business operation so that a leader can see how the production process flows from one stage to the next. If there are external problems, the leader can analyze the business process using the information generated from the MIS to make necessary changes.

A good example is the case study on how the Pepsi Cola company utilized relevant information about the companys business process to resolve a difficult dilemma that the organization encountered a few years back. In the said dilemma, there were negative commentaries about the companys products that were spreading like wildfire across the nation (Rao & Krishna, 2009). The crisis was due to a rumor that says syringes and hypodermic needles were found inside Pepsi cans (Rao & Krishna, 2009).

Company executives had a difficult decision to make. The initial solution to the said problem was to react in a typical manner, and that was to order the recall of the products (Rao & Krishna, 2009. However, Pepsis corporate leaders realized that it was extremely expensive to recall Pepsi products, and at the same time, it will destroy the reputation of the company.

The corporate leaders decided to study the business process, and they discovered that there was no way that an outsider could have gained access to the production plants in order to insert syringes and hypodermic needles into the said Pepsi cans. In the end, the leaders found out that they made the correct decision. However, it would have been impossible to make the correct decision if they did not have access to the correct sets of information.

Conclusion

There are different types of information systems that corporate leaders can use to make effective and accurate decisions. However, the best type of information system is the management information system that takes into consideration the following components: 1) input; 2) processing; 3) output; and feedback.

An effective MIS also follows the design based on a decision structure that enables the different leaders of the company to receive feedback regarding strategic, tactical, and operational decisions. In the end, the value of a well-designed MIS is seen in the way it allows leaders to make high-quality decisions, and as a result, their respective subordinates are able to do their job well.

References

Frankel, E. (2008). Quality decision management. New York: Springer.

Govardus, J., & Heijden, M. (2009). Designing management information systems. New York: Oxford University Press.

Oz, E. (2009). Management information systems. MA: Thomson Learning.

Pride, W., & Kapoor, J. (2010). Business. MA: Cengage Learning.

Rao, V., & Krishna, H. (2009). Management: Texts and cases. New Delhi: Excel Books.

Stair, R., & Reynolds, G. (2015). Fundamentals of information systems.

Being an efficient human resource manager is not an easy task, given the fact that a true HR specialist must not only make choices regarding candidates employment and responsibilities distribution, but also concerning the strategies for employees skills training, as well as possible strategies of shaping organizational behavior (York 308). The given course has provided me with an opportunity to gain insight into the specifics of the work of a human resource manager.

Thus, to construct an assessment of the skills acquired throughout the given course, I will incorporate such concepts from the course into the given test as employees safety, human resource development, and employee and labor relations.

First and foremost, such an aspect of human resource management as employee and labor relations must be mentioned. It is crucial that the cooperation between different departments, as well as varying levels of the companys hierarchy, should be arranged. As long as the companys managers are aware of the staffs performance, as well as the employees key concerns, complaints and accomplishments, the performance of the staff can be coordinated by introducing the proper motivation to the employees. Seeing how an HRM specialist facilitates the communication between the staff and the companys managers, it is reasonable to suggest that the given aspect of an HR specialist is the most important and, therefore must be evaluated rather strictly.

Another important aspect of a human resource management experts work, the ability to tackle the compensation and benefits issue should also be checked in a candidate for an HRM position. According to York, by establishing reasonable compensation regulations and handling employee benefits questions (York 198), an HR manager can recruit competent staff and invest into their further professional growth, therefore, creating a team of experts, who will contribute to the companys evolution and bring the impressive firm benefits. Therefore, the ability to navigate in the given area with confidence is a doubtlessly important skill, which will be required for creating a team of valuable professionals.

The last, but not the least, the issue regarding safety at work must be considered as an element of an HRM specialist assessment rubrics. Though the issue of employee safety may seem unrelated to the process of facilitating efficient communication between the staff and the managers, it is still crucial that an HR specialist should ensure employees safety, as well as make sure that the latter is provided with decent working conditions. Hence, the final element of the assessment grid will contain the questions regarding an HR specialists diligence in checking the efficacy of the existing safety rules, as well as their ability to ensure that the employees should follow the safety guidelines.

The three items listed above are not the only qualities of a good HR specialist. However, they are among the most significant ones and, therefore, are to be sought in a candidate for an HRM position. I suppose that I would pass this test, with a minor problem regarding employee and labor relations, and, thus, deserve an A-. If I had an opportunity to take this course again, I would, probably, pay more attention to coming up with the practical application of the skills acquired in the course of studying, since some of these skills need to be trained more properly.

Works Cited

York, Kenneth. Applied Human Resource Management. 1st Edition. Thousand Oaks, CA: SAGE Publishing. 2010. Print.

Walmart is the company that took the dominant position in the market. The strategy of the business to provide the customers with the American products for the lowest price seems to be essential to the companys success. There is hardly an organization in the world that does not face challenges, and Walmart is not an exception.

According to recent researches, Walmart is an unethical business, and some arguments prove this statement. One of the biggest issues that face the employees at Walmart is unfair treatment. Women working for the company have small chances to get a promotion. Moreover, they are paid less than men. More than 70% of the workers are women, and only a few works in higher positions (Wal-Mart Unethical Business Practices  Business Research Paper, n.d.).

The discrimination is the problem that demands the solution. The next issue is the low wages of the employees. The primary objective of the company is to provide low prices; however, it is possible only with cutting the operation costs. That is, the employees are commonly underpaid. Some of the employees cannot afford health insurance. Also, Walmart highlights that people should be paid for every minute. This statement seems to be reasonable and increases respect for the company. However, in reality, people are not always paid for working overtime. To save money and cut operation costs the company uses illegal immigrants as the cheap workforce.

To prosper and make progress, the company should eliminate such problems and customers, as well as employees, will be satisfied. The business will only benefit from dealing with the issues as they are the obstacle on the way towards the accomplishment of the companys objectives.

Reference

Wal-Mart Unethical Business Practices  Business Research Paper. (n.d.).

Developing an elaborate cost management strategy is an essential requirement of any project, as it allows identifying possible issues in resource allocation and prevents the organization from losing significant amounts of money. However, even once a seemingly impeccable cost strategy is created, one must take the possibility of extra expenses into account (Harmening, 2013). Despite the fact that the policy chosen by the committee was aimed at increasing the financial assets of the project, the budget cuts resulted in even greater losses due to a significant drop in quality. Therefore, the budget-cutting decisions taken by the organization backfired in a quick yet predictable manner.

As a rule, four types of costs are identified when it comes to assessing the risks that entrepreneurship may face. These include external failure costs, internal failure costs, inspection, or appraisal, costs, and prevention costs. The former is traditionally referred to as the expenditures that a company takes in case certain faults are detected in a product after it has been delivered to the customer (Warren, Reeve, & Duchac, 2013). Internal failure costs can be defined as the faults of the products or services that have been identified prior to delivering the specified products and services to the target population. Inspection costs occur in the course of quality assurance. Prevention costs, in their turn, can be defined as the expenses that are taken as a means of preventing certain losses (Harmening, 2013).

Therefore, in order to locate the so-called good quality costs, one will have to consider the inspection and prevention costs rubrics. The above-mentioned types of costs do not imply that the products or services provided by the company are poorly made. Instead, the costs in question provide premises for improving the products and services under analysis. The expenses, which a company incurs due to the inspection process, can be defined as the costs of addressing the possible risks and reducing these risks to zero. In other words, the expenses spent on inspection do not harm the company; instead, they reduce the chances for an instance of customer dissatisfaction. Likewise, prevention costs block the possible problems from occurring by eliminating the tiniest threats to customers wellbeing during the use of the services or products delivered by the organization (Harmening, 2013).

The remaining two types of costs can be viewed a bad, as they presuppose that a defective product has been created and sold to the target customer. Consequently, the company suffers not only a minor financial loss due to the waste of raw materials and other resources used in the production process but also a significant drop in customer loyalty rates (Harmening, 2013). The latter scenario is typically attributed to an external failure cost, whereas the internal failure cost usually involves the losses incurring due to a mismanagement of the companys resources.

In order to calculate costs, one will have to use several basic formulas. Particularly, a careful overview of the recent expenditures must be conducted. Afterward, one will have to register the sample taken and report the review of the outcomes. As soon as the report is approved and a certificate is retrieved, a corresponding report is filed and archived (Harmening, 2013). Alternatively, the report is kept as a historical file. It is also recommended that costs should be classified according to the typology mentioned above.

Reference List

Harmening, D. (2013). Laboratory management: Principles and processes (3rd ed.). St. Petersburg, Florida: D. H. Publishing & Consulting.

Warren, C., Reeve, J., & Duchac, J. (2013). Managerial accounting. Stamford, Connecticut: Cengage Learning.

Supply chain is a necessary part of any kind of business. It is of high importance for the business and carries a number of benefits if it is properly managed. Supply chain management is capable to providing a business with competitive advantage is a number of aspects such as time, cost, quality, and efficiency (Seghal, 2011). Further in this paper this claim will be discussed in more detail.

Ensuring the best logistics and optimizing the way the products have to travel before getting to the consumers secures the advantage of time. The clients get what they need fast and this creates positive reputation for the business which is an extremely valuable feature for obtaining revenues, marketing and brand image promotion. Besides, supply chain management assumes closer communication with the suppliers. Collaboration and an ongoing dialogue are the keys to cost reduction and increased productivity.

Moreover, better understanding and closer communication with the suppliers would allow a company to influence them and persuade them to pursue more sustainable practices which will positively impact the product quality and the reputation of the whole business (Benefits of responsible supply chain management, n. d.). Besides, the sustainability of the supply chain may be documented and used as the basis for gaining more trust of the consumers.

In fact, this is a very poplar practice in the contemporary world where more and more people search to learn about the products they consume in order to ensure sustainability. This way, a responsible supply chain management is the way to win more customers and gain larger competitive advantage in the market.

In turn, positive relationships with the suppliers and the consumers minimize the risk of brand image damage and negative PR (Benefits of responsible supply chain management, n. d.). As a result, the business becomes a more favorable workplace for the employees, which helps to reduce the risk of such issues as skills shortage and turnover, increase job satisfaction and the retention of valuable human resources. Besides, hiring would be much easier for the company with good reputation as a workplace. In the modern world of business human capital is as important as the financial capital, so responsible supply chain management may result in acquisition of better and more qualifies human resources and ensure future development of the business.

A more sustainable and profitable business with high productivity, good relationships with the clients and suppliers will also become more secure and interesting for creditors and investors (Benefits of responsible supply chain management, n. d.). Reviewing the profile and reports of the business they will notice the value provided by the reliable and optimize supply chain and have higher trust towards the business.

As a result, this will facilitate additional funds and capitals that may be directed for the improvement of the product, brand promotion, or innovations. Besides, a reliable and a profitable business based on a well-built supply chain will have better chances of expanding to new markets and securing its own growth. Supply chain may be a good basis for the company branding as well, which will generate new market opportunities.

In conclusion, proper management of the supply chain improves business is a variety of ways and impacts its relationships with the suppliers, customers, employees, partners and investors and bringing competitive advantage in relation to product quality, cost, time management, and the efficiency of a business (Seghal, 2011). The aspects mentioned above make supply chain management as extremely valuable practice.

Reference List

Benefits of responsible supply chain management. (n. d.). CSR Compass. Web.

Seghal, V. (2011). Understanding Advantage. Web.

Introduction

The modern business environment presupposes the use and utilization of practices that guarantee the best possible outcomes and minimize the input. In other words, there is a high need for the optimization of all processes to generate a competitive advantage and ensure that a company can achieve all existing goals. At the same time, the continuous improvement of all aspects is needed to overcome the high level of rivalry and create the basis for further growth.

Under these conditions, effective management is critical for the achievement of desired results and becoming a leading company. Modern organizations face multiple challenges related to the impact on individuals, society, and attainment of appropriate sustainability levels. That is why lean management, as one of the approaches to accomplish the goals mentioned above, becomes a tool to be applied along with the operations management to attain success. The given paper reviews the literature devoted to the issue to enhance the understanding of this field and provide possible recommendations.

Background

Staring reviewing the topic, it is critical to determine the basic concepts associated with the idea of a lean company. First of all, it is operations management which is now one of the pillars of any successful firms work. It can be defined as the design, operation, and long-term enhancement of all systems that are needed to deliver and create products and services that are interesting for customers (Stevenson 22).

Operation management tends to utilize the most important and effective strategies that exist at the moment to optimize performance via a chain of strategies aimed at the gradual transformation of the company. In such a way, operation management might also presuppose the utilization of lean production to ensure that the firm can face all demands to the functioning of modern organizations. In this regard, the following review of the literature aims at the detailed analysis of the basics of the lean process and its correlation with operation management.

Literature Review

Lean systems thinking is one of the topical approaches nowadays that are investigated using numerous variables to outline the most critical peculiarities. There are multiple definitions of the given field. Pakdil and Leonard state that the lean process can be determined as the focus on the total elimination of waste by all members of the organization from all activities needed for its functioning (726). Regarding the main goals, it can be compared to the ideas of total quality management, just-in-time, and Six sigma approach because they also affect all elements of the functioning and it has a fundamental character. There are also some dualities related to the given process.

First, it should guarantee the continuous improvement needed for better functioning; second, there is a critical need for respecting people and employees affected by the transformation (Pakdil and Leonard 726). It also remains highly dependent on the organizational culture of the company as it impacts the success of the lean process implementation. Impacting individuals behavior, a set of values and approaches appreciated by the company precondition the level of their performance, and, at the same time, the degree to which all measures needed for the introduction of lean processes are utilized.

The existence of the given correlation also evidences that the lean process can be considered regarding operations management. Pakdil and Leonard emphasize the fact that the lean process is a broad concept that suggests multiple implications (728). These might also include group culture, individuals behavior, and their motivation to reduce waste and improve the work of companies. These domains are related to operations management which considers an increase of individuals awareness about operations a potent weapon to increase competitiveness (Pakdil and Leonard 728). In such a way, the lean processs effectiveness can be achieved only if there are effective strategies implemented to enhance all operations within the company and promote improved results.

Implementation of the lean process can also contribute to the generation of multiple benefits for various types of companies. Partida states that the adoption of the approach within supply chains and their main functions can help to achieve better results (78).

First, it will help to determine wasteful activities that deteriorate the functioning of the company and precondition the serious worsening of its outcomes (Partida 78). Second, the utilization of lean processes helps to completely eliminate them by providing new perspectives on critical processes and outlining methods of how performance can be improved.

At the same time, in the article, the authors offer statistics evidencing that companies devoting a particular part of funds to this sort of activity achieve higher results due to the improvement of procurement activities and reduction of non-value-added activities that demand much effort but do not generate income (Partida 79). In such a way, the utilization of this method can help to attain success while reconsidering the functioning of the company and creating a new approach to its managing.

Partida also emphasizes the fact that some companies support their lean strategies with continuous collaboration with their partners that are also focused on the achievement of higher sustainability levels, a decrease of waste, and the creation of the lean approaches (79). Regarding the modern business world, it becomes a potent approach that can help to eliminate unnecessary elements both in companies and their suppliers and improve supply chain management.

This idea is similar to some methods peculiar to operations management as they also presuppose the necessity to enhance various processes and employees work to achieve better performance levels. In such a way, there is another piece of evidence proving the existence of the direct correlation between the lean process and operation management that is used by companies to generate wealth.

Raschke et al. also support the idea of the increased importance of the lean process and its use in the modern world. The authors emphasize the fact that the majority of companies today feel a high level of pressure because of the need to operate more effectively and win the rivalry (Raschke et al. 2013). For this reason, companies have to use the most effective approaches which means the utilization of the loan process. It should start by examining the functioning of the company from the beginning to its end, without any barriers that might deteriorate outcomes or prevent from achieving the desired goals (Raschke et al. 2013).

As it has already been stated, the main purpose of the paradigm is to develop and implement processes that are both efficient as they reduce costs, and potent as they increase the quality and performance levels (Raschke et al. 2013). In such a way, the use of lean approaches might be useful for all companies presented in the modern business world as there is a critical task to improve results through the gradual elimination of unnecessary elements, options, and processes.

Through the prism of operation management, the given article also proves that this field is close to lean processes as they both precondition the continuous reconsideration of the firms functioning with the primary aim to achieve better performance levels and guarantee that new goals will be accomplished. Raschke et al. also emphasize the important role of risk assessment while implementing a lean approach into the companys functioning (49).

It can be compared to the operation management strategies that presuppose the in-depth evaluation of all aspects of the companys functioning with the primary aim to guarantee the successful optimization of all processes and achievement of success while transforming a company and trying to achieve needed goals. In such a way, both lean and operation management approaches can be used together while trying to attain better results, reduce waste, and guarantee the sustainable functioning of the company, its cooperation with communities, and the ability to compete with the closest rivals.

The importance of the lean transformation of companies is also supported by Testani and Ramakrishnan. In their work, the researchers outline the fact that the given model has already become a business imperative for multiple organizations in various spheres globally (1). At the same time, there are still many problems emerging during the transformation stage as many firms still fail to implement lean processes into their functioning and achieve higher sustainability levels (Testani and Ramakrishnan 1).

It means that there is a particular problem related to the understanding of the nature of the mentioned reconsideration and its successful utilization. The main causes for the achievement of desired goals are the lack of leadership support of all incentives introduced to transform companies and the lack of focus on organizational culture (Testani and Ramakrishnan 3). Both these elements remain critical for functioning as they guarantee an improved understanding of existing tasks, better collaboration between employees, and higher levels of their performance. In such a way, the concept of lean leadership as the idea of promoting change and minimizing waste acquires the top priority in modern organizations.

The development of a lean culture can be associated with operations management as there are several common efforts. For instance, Testani and Ramakrishnan state that promoting a lean change effort, leaders plan a specific set of actions that will foster the alteration of the organizational culture to achieve desired goals and attain success (5). This idea is similar to the paradigm cultivated by the operations management as it also emphasizes the necessity of the introduction of a scheduled change that will affect all departments and operations to optimize the process and minimize effort.

In such a way, both these concepts become interdependent because of their focus on basic elements of companies functioning and the demand for the radical alteration of the process. Finally, the success of the transformation is preconditioned by the degree to which a leader and employees are ready for new environments and methods as the lack of support will result in poor outcomes and deteriorate the planned results.

There is also another problem related to the implementation of lean approaches into the practice and reconsideration of the companies functioning. Rathi and Farris state that the adoption of the given parading is slower than it is expected and faces some barriers that prevent organizations from reducing waste and maximizing performance (1). One of the main reasons for the emergence of this tendency can be the lack of theoretical investigations and framework of how various peculiarities of the process sector can impact lean techniques and their applicability (Rathi and Farris 1).

In such a way, vital tasks managers might face today is the creation of the model that includes potent tools to implement lean practices into the functioning of the company. Moreover, the successful transformation of the company might demand an enhanced understanding of its current needs and wastes to guarantee that lean practices affect the needed domains and result in the attainment of planned results.

Ideas outlined in the paper emphasize the importance of the lean process to operations management. Being the paradigm that promotes the improvement of every operation performed by a company, it demands an in-depth understanding of all current needs and priorities to remain effective. In such a way, the introduction of lean approaches can support and operation managements incentives by reviewing all existing activities to find the most wasteful or ineffective ones and eliminate them by suggesting improvement practices or methods (Rathi and Farris 3).

It can become one of the most potent tools to reconsider the work of various companies with the primary aim to achieve success and guarantee their further development. Operation management, as the most important approach to the organization of firms work, becomes a critical element of the corporations functioning as it helps to reduce spending and achieve higher efficiency levels which are also one of the main ideas of the lean process and approach.

Reflection and Recommendation

The majority of sources mentioned above evidence the increased importance of the lean process and its direct correlation with the operation management. From the literature review, it becomes obvious that the use of this paradigm should become the main way of the companys development in the modern age. It promotes better companies functioning by improving all operations and minimizes waste by eliminating potentially undesired activities or states. At the same time, there is a focus on sustainability and respect for employees which is critical for the modern firm that is focused on the improvement of its work and image.

Debating about the role of lean incentives in the modern business world, it is critical to say that the advantageous position of lean incentives can be proven by multiple examples. For instance, the focus on lean manufacturing helped Toyota to achieve global success by eliminating all wasteful practices, solving the problem with overproduction, and creating an atmosphere beneficial for peoples functioning (Toyota Production System).

It helped to achieve success and form the basis for the companys growth. In such a way, it can be recommended to implement lean practices into the functioning of firms to transform them. One more recommendation is to shift focus to human resources as employees are the core of any brand and they precondition the success of a particular strategy. For this reason, it is essential to create the needed environment for them.

Conclusion

Altogether, the lean process is the popular paradigm today that affects the functioning of companies and result in the emergence of positive shifts in them. Promoting waste reduction and improvement of various practices, it creates the basis for the successful transformation of companies and their stable growth. At the same time, it can be associated with operation management as this paradigm also preconditions the fundamental reorganization of firms and all processes needed for their development. Implementation of both these approaches can help to create the basis for the effective functioning of employees and the companys further rise.

Works Cited

Pakdil, Fatma and Karen Moustafa Leonard. The Effect of Organizational Culture on Implementing and Sustaining Lean Process. Journal of Manufacturing Process and Management, vol. 26, no. 5, 2015, pp. 725-743.

Partida, Becky. Adopting Lean Process in Procurement Can Lead to Efficiency and Lower Costs. Supply Chain Management Review, 2014, pp. 78-80.

Raschke, Robyn, et al. Lean Process without Compromising Controls. Government Finance Review, vol. 29, no. 3, 2013, pp. 44-50.

Rathi, Naveen, and Jenifer Farris. A Framework for the Implementation of Lean Techniques in Process Industries. Proceedings of the 2009 Industrial Engineering Research Conference, 2009, pp. 1-7.

Stevenson, William. Operations Management. 13th ed., McGraw-Hill Education, London.

Testani, Michael, and Sreekanth Ramakrishnan. Lean Leadership Readiness for Change: A Methodology for Lean Change Readiness and Continuous Improvement. Proceedings of the 2012 Industrial and Systems Engineering Research Conference, 2012, pp. 1-11.

Toyota Production System. Toyota-Global. Web.

Introduction

In order to lead a firm to success, much attention should be paid to the position and responsibilities of a manager. In this context, a manager is a person who is responsible for organizing resources and activities according to a firms strategy and goals, and the purpose is to reach a high position in the market and maximize profits (Hirschey and Bentzen 35-38). The purpose of this paper is to analyze certain managerial issues faced by the selected company in terms of sustainability and with the focus on specific strategic steps to be taken to overcome such issues as the misallocation of resources, the manager-worker problem, the threat of a takeover, the impact of government regulations, and weak output decisions and pricing.

The Companys Present Situation

The company under discussion belongs to the manufacturing sector, and its profitability, sustainability, and the role in the market in terms of attracting customers and receiving orders from the government directly depend on effective management. However, currently, the company faces problems associated with inappropriate management, such as resource misallocation resulting in increased expenses, the manager-worker problem affecting the motivation of employees, the threat of a competitors takeover related to decreased profits, the pressure of government regulations, poor pricing, and ineffective output decisions. The previous manager who was responsible for developing commercial strategies and implementing financial goals was not successful in using the firms resources appropriately in order to achieve the economic profit because of inefficient practices and decisions associated with selecting suppliers, organizing the staffs work, controlling operations, and attracting investments.

Resource Misallocation

Effective economic decisions require the focus on the appropriate allocation of available resources. In this firm, resource misallocation is associated with the lack of outsourcing. The problem is that the company spends many resources in order to address technological tasks that are not directly associated with the firms operations and can effectively be outsourced without the necessity of purchasing needed equipment, hiring specialists, and changing work processes (Hirschey and Bentzen 742-745; Wei and Li 838). For instance, significant expenses associated with the development of the IT department in this company do not directly influence the firms profits as IT functions play only the supportive role in the companys operations without affecting productivity.

As a result, resource misallocation in the firm leads to the situation when significant financial resources are spent on organizing activities that do not influence the quality of produced goods, relationships with customers, and productivity. Expenses associated with hiring employees are also high, and they are not correlated with costs spent on retention practices to improve employees commitment and motivation (Baye and Prince 147-148). The research and development department, marketing, and the quality management programs remain to be under-funded, and this aspect decreases the firms possibility to maximize its profits because of the lack of innovation in operations and processes, problems with the quality of goods, and talent and financial shortages in several key departments of the company. From this perspective, the firm loses potential profits because of resource misallocation that is also associated with the factor of sustainability. The ineffective use of available resources has a negative impact on social sustainability with the focus on employees interests, customers, and community members, as well as on economic sustainability because of certain limits for the companys progress.

Strategic managerial decisions to address resource misallocation should include steps oriented to reallocating resources and funds into the strategically important areas in the companys work. Thus, it is possible to recommend investing more financial and human resources in the research and development department, operations management to improve performance and productivity, marketing, and quality management (Wei and Li 840). This approach will help the company maximize its profitability. Moreover, it is also necessary to outsource tasks and activities that perform a supportive role and can be completed by experts while using fewer resources.

Manager-Worker Problems

In the company, managers are interested in increasing profits because of having a certain share and bonuses if the economic performance of the firm is comparably high. However, the nature of the manager-worker problem is that profits are directly dependent on employees productivity and performance, but the staff is not motivated enough in order to work to increase the firms profitability (Baye and Prince 231-234; Gormley and Matsa 432-433). In this particular case, managers demonstrated the inability to motivate employees to increase their productivity not only because of the integration of new procedures and algorithms but also due to workers disinterest in contributing to the companys growth.

The following negative effects on the companys profitability can be observed: employees spend working hours ineffectively, decreasing productivity; they are not interested in improving their performance; employees do not realize the strategic role of improving the overall companys performance for them; workers are oriented to minimizing their efforts while working in the firm. All these aspects influence the firms sustainability because its social aspect becomes unaddressed as workers can feel dissatisfied with their position in the company (García et al. 298; Halac and Prat 3105). As a result, it is rather problematic for the company to implement changes and stimulate the staff to improve their performance and adopt new models of working. In order to achieve a sustainable growth in a company, much attention should be paid to relying on human resources interests.

Strategic decisions that can be applied in order to improve the situation are associated with providing employees with the fraction or bonuses that depend on the companys financial performance. It is possible to adopt the practice of profit sharing for this company because principles of revenue sharing and piece rates are not appropriate for the manufacturing sector. Thus, to address the issue, it is relevant to make the compensation of employees directly dependent on the firms profitability during a certain period of time (Baye and Prince 231-234). Moreover, this practice should be supported by the implementation of certain policies that demonstrate what activities can positively influence the companys profits and what regulations exist in this area. If an employee knows that his or her efforts and performance can contribute to improving the companys profitability depending on strategic goals shared by managers and to increasing his or her bonus, this factor can be used to boost revenues.

The Threat of a Competitors Takeover

At the current stage of its development, the discussed firm does not demonstrate a stable growth in profits, and the risk of a takeover is high. The problem is that any ineffective managerial strategies and weak decisions potentially influence companies status in the market, performance, and profitability (Baye and Prince 230). The presence of many managerial issues accentuates the fact that the previous manager did not perform his or her duties and responsibilities effectively, and the threat of a takeover is high because of decreased revenues and share premiums. This situation can lead to reconsidering the management of the firm from the perspective of investors and shareholders who are not interested in a manager who cannot guarantee the maximization of profits.

Thus, the previous manager was replaced with a new one, and the situation of the competition and the threat of a takeover were not viewed by the previous leader as risky and leading to the loss of his or her position. This process negatively affected the companys sustainability because the firm was not economically stable. The problem is that even weak outcomes and decreased profits did not make the manager reconsider his or her strategies, practices, and techniques in order to improve the situation in economic terms and avoid the necessity for investors to replace an ineffective manager with a new one in order to respond to the competition in the market.

The necessity of a takeover or replacing a manager in the firm negatively affects the companys operations because of costs related to training, improving policies, and implementing changes. In order to address this problem, it is important to emphasize the threat of a competitor at initial stages when a manager begins to perform his duties poorly (Lel and Miller 1589). If the situation does not change, it is necessary to create specific conditions that will contribute to saving costs while working with a new manager: it is important to prepare training programs, to focus the attention of a leader on cooperation and to accentuate specific benefits received by managers when profits of the company increase along with improving employees performance and customers loyalty.

Government Regulations

Working with orders from the government, the discussed firm faces the necessity of addressing regulations that are related not only to its operations and human resource practices but also to controlling relations with the government. The companys operations are negatively affected by the government regulations regarding anti-discriminatory laws and norms regarding the trade within states and nationally. As a result, the company needs to address some regulations that limit its possibilities to hire experienced professionals requiring higher wages and extended benefits and compensation plans, that determine the principles of taking the governmental orders, and that limit trade opportunities (Hallward-Driemeier and Pritchett 122-123). Another category of regulations that can negatively influence the firms progress is associated with taxes and relevant laws.

Therefore, the management of the company needs to focus on revising policies to address government regulations and reduce costs associated with their implementation to practice. The problem is that changes in governmental regulations can directly influence operations of the firm, and managers can be forced to alter their procedures to adapt operations to a new regulatory context (Baye and Prince 184; Gormley and Matsa 432). The latest changes in governmental regulations were related to the taxation policy. An unstable situation regarding the used regulations negatively influences the companys sustainability. In this context, it is also relevant to analyze how the company followed regulations regarding hiring employees according to anti-discriminatory laws.

In order to decrease potential negative consequences of these changes, a new manager needs to focus on decreasing costs where it is possible in order to compensate for increased taxes and associated expenses. Another strategic step is connected with improving human resource practices with the focus on revising hiring procedures, performance evaluation procedures, and compensation policies because a number of governmental regulations are directly connected with changes in regulating employer-employee relationships (Hirschey and Bentzen 410-412). Alternative variants for addressing changes in taxation and human resource policies and regulations should be developed by managers depending on the latest tendencies in legal and economic areas.

Poor Pricing and Output Decisions

Output decisions made by managers, as well as proposed pricing strategies, can be ineffective in many cases if fluctuations of prices in the market and actual fixed inputs are not appropriately taken into account. If a manager fails to determine minimum and maximum relevant prices for the produced goods in the selected market with reference to the involved costs, it is almost impossible to focus on efficient pricing that can lead to maximizing profits (Hirschey and Bentzen 573-574). In addition, the impact of poor output decisions on a firms progress is even more critical. Weak output decisions become the result of the ineffective analysis of inputs that can be controlled by a manager in order to achieve maximum outcomes (Baye and Prince 184). If output decisions are inadequate, it is rather problematic for the company to determine its position in the market and develop toward domination and price leadership.

From this perspective, it is important to pay attention to the fact that ineffective pricing and output decisions negatively influence the firms sustainability with reference to its economic aspect. When output-reaction curves are analyzed inappropriately, risks of wrong decisions that can influence the economic profit for the firm are high (Hirschey and Bentzen 501-503). Ineffective pricing decisions in the context of the intense competition in the market also do not contribute to stabilizing the position of the firm and making it sustainable (Gormley and Matsa 432). As a result, it is necessary to adopt efficient pricing strategies in order to address the experienced problems in terms of output decisions and their effects on profitability.

For the case of the discussed firm, it is possible to recommend referring to the principles of peak-load pricing in order to address the supply-demand issue within the market in the most efficient manner. The specifics of the goods produced by the firm, as well as provided services, allow for determining certain obvious peaks in purchasing products which can influence pricing (Baye and Prince 429). Therefore, manipulating prices that depend on the periods of higher and lower demands, it is possible to achieve increases in profits and address competitors strategies. Moreover, it is also important to recommend changes in making output decisions with reference to the necessity of analyzing inputs and fixed costs before planning activities and forecasting revenues. The thorough analysis of inputs and external factors is the most appropriate option in this case that will allow the manager to become successful in realizing financial strategies and predicting actual profits. These strategic steps need to be taken in order to help the company win the leading position in the market within the shortest period of time.

Conclusion

This paper has presented the analysis of five specific managerial issues that were faced by the selected company and that negatively influenced its profitability. It has been found that the misallocation of resources and the inability of the company to effectively use the outsourcing option, reduce costs, and change investment and funding plans affected not only manufacturing operations but also the overall performance of the firm while decreasing its potential revenues. Therefore, certain steps to address this problem have been proposed and described in the paper. In addition, it has been found that the manager-worker problem significantly influences the quality of employees work, resulting in negative impacts on financial gains. As a result, the focus on changing the compensation plans has been offered in order to provide employees with a significant financial incentive that can influence the quality of work in addition to a traditional salary.

The threat of a takeover has also been discussed, and certain techniques to overcome the observed problem in the company have been described with reference to the recent literature on the topic. Moreover, the company also faces the problems with the impact of government regulations on operations and the problem with weak pricing and output decisions. Effective steps to be used to address these issues have also been analyzed. The firm needs to be prepared for relying on flexibility while addressing changing government regulations. Much attention should also be paid to altering approaches to making pricing and output decisions in the context of this firm in order to avoid failures in attracting customers and receiving revenues. It is possible to state that the listed strategic steps are oriented to decreasing the negative impact of the determined problems of the companys sustainability in order to guarantee its adequate progress and associated increases in profitability.

Works Cited

Baye, Michael R., and Jeff Prince. Managerial Economics and Business Strategy. 8th ed., McGraw-Hill/Irwin, 2014.

García, Jose A., et al. The PrincipalAgent Problem in Peer Review. Journal of the Association for Information Science and Technology, vol. 66, no. 2, 2015, pp. 297-308.

Gormley, Todd A., and David A. Matsa. Playing It Safe? Managerial Preferences, Risk, and Agency Conflicts. Journal of Financial Economics, vol. 122, no. 3, 2016, pp. 431-455.

Halac, Marina, and Andrea Prat. Managerial Attention and Worker Performance. American Economic Review, vol. 106, no. 10, 2016, pp. 3104-3132.

Hallward-Driemeier, Mary, and Lant Pritchett. How Business Is Done in the Developing World: Deals Versus Rules. Journal of Economic Perspectives, vol. 29, no. 3, 2015, pp. 121-140.

Hirschey, Mark, and Eric Bentzen. Managerial Economics. 14th ed., Cengage Learning, 2016.

Lel, Ugur, and Darius P. Miller. Does Takeover Activity Cause Managerial Discipline? Evidence from International M&A Laws. The Review of Financial Studies, vol. 28, no. 6, 2015, pp. 1588-1622.

Wei, Chu, and Chuan-Zhong Li. Resource Misallocation in Chinese Manufacturing Enterprises: Evidence from Firm-Level Data. Journal of Cleaner Production, vol. 142, 2017, pp. 837-845.

Introduction

Operation management aims at ensuring that functions in a company/business are conducted in the most efficient manner, so as the end results are satisfied customers and reduced cost of production. It has elements of managing and directing processes. To be effective an operating manager should implement a ten decisions of operational management strategy the decisions are Design of Goods and Services, Managing Quality, Process Strategy, Location Strategies, Layout Strategies, Human resources and job design, Supply-chain management, feasible and efficient production schedule, and Maintenance (Anil-Kumar, 2006). Hard Rock company, started in 1971 as a small café but it has spread to have over 110 cafes under its name. This achievement is due to an efficient operating system. This paper discusses how Hard Rock implements each of the ten decision of operation management.

How the 10 decisions of operations management are applied at Hard Rock Cafe

Design of Goods and Services

The cafés products are food and hospitality services. The company puts a lot of emphasis on product development and ensuring that customers are satisfied with their products and services.

Managing Quality

To maintain and control quality Hard Rock only produces those products that it can get quality raw material from their suppliers and have expertise in the product making. In the area of service, it maintains highly motivated staffs who serve customers with passion. It regulates music to ensure that they keep track on what their customers want.

Process Strategy

The company manages its operations from the earliest time possible. In making food product it ensures that raw materials used are of the right quality and quantity. Processing duties are vetted for efficiency, cost reduction and quality production. The cafes aims to keep their customers satisfied at all times.

Location Strategies

The cafes ensure that they are located in areas where target customers can access them easily. They are present in tourists destination sites and major cities. The worlds largest of all is in Orlando, Florida.

Layout Strategies

Hard Rock has a layout that strengthens collaboration between departments. There is good communication in various departments a move that leads to high efficiency in terms of costs, business environment and product development (Nigel, Stuart & Robert, 2007).

Human resources and job design

Hard Rock understands that to be effective in ones business human resources are important. Employees are highly motivated and given room to speak their minds. Creativity and innovation is highly welcomed. When recruiting it ensures that it gets quality employees from the market. Career path is well defined.

Supply-chain management

The company maintains a just in time supply management where it ensures that there is materials required in a certain production and customers get products and services when they need it.

Inventory, the quality and level of inventory is maintained by adopting an inventory management system that advices management on various issue regarding stocks. The areas include reorder level, expire data and suppliers name among others.

Feasible and efficient production schedule

To maintain efficiency and customer satisfaction, the company interpolates all processes and recognizes the amount of resources (human and physical) required. After this has been known, plans are made to ensure that adequate resources are available. This helps the company to deliver its products in time.

Maintenance

Hard Rock has well structured mechanisms to ensure reliability and stability. There is a continuous appraisal of the systems at one particular time and if there is need for improvement it is done. Standards are set to ensure close monitoring.

How to determine the productivity of the kitchen staff and wait staff at Hard Rock

Kitchen is responsible of making food and wait staff to offer services. Quality of food can be measured by the level that it satisfies customers; if customers show appreciation or complains then a decision is made on whether kitchen is doing good job or not. There are evaluation reviews that customers make either online or dropping a note in suggestion box. Hard Rock gauges its productivity from 1-7, anything less than seven is considered to have a deficit. Turnaround time should be minimal and one that meets the needs or promise made to a client. Wastage is another area that should be checked; for an effective kitchen management, proper management of raw ,materials and proper disposal of wastes.

Wait staff offer services, they should be passionate of their job and serve customers whole heartedly. To evaluate if they are doing this, customer reviews should be considered, time of service should also be considered.

To ensure quality, there is continuous training of kitchen staff and wait staff (Jae, & Siegel, 1999).

Conclusion

Operational management ensures that all areas in an organization are functioning well. In hospitality industry, products and service provided determine the success of a business. Hard Rock success can be traced to an efficient operational management which touches all areas in product manufacture and service provision. It employs ten decisions of operational management which are Design of Goods and Services, Managing Quality, Process Strategy, Location Strategies, Layout Strategies, Human resources and job design, Supply-chain management, feasible and efficient production schedule, and Maintenance.

References

Anil-Kumar, S. (2006). Production and Operations Management. New Delhi: New Age International.

Jae, K. and Siegel, G.(1999). Operations Management.New York: Barrons Educational Series.

Nigel, S., Stuart. C. and Robert, J. (2007). Operations Management. London: Pearson Education.

Contemporary Modern Definitions of Management

Management is the activity of administering an organization. It includes the formulation of the strategy for an organization, as well as the effective coordination of the efforts of the people who are employed in that organization with the purpose of achieving its goals via the utilization of the resources available to the organization (Wilkinson, Armstrong & Lounsbury 2017).

Current Practice, Major Roles

There are several types of management roles in the current management practice. Top managers formulate strategic goals and make key decisions, setting the direction for the whole organization. Middle managers direct front-line managers and communicate the key decisions of top managers. Lower managers coordinate the work of employees, directing their efforts.

Relating the Practice and Roles to an Organization

For instance, Tesla, Inc. is governed by its stockholders and the Board of Directors; the Chairman of the Board, Elon Musk, is also the CEO. There are two top managers directly subordinate to the Board, namely, Chief Technical Officer and Chief Financial Officer (Tesla n.d.a). These top managers provide strategy and direction for middle managers, who, in turn, oversee lower managers.

HRM  Management Relationship in the Organization

The human resource managers in Tesla, Inc. are subordinate to the middle managers of the organization, who communicate the strategy and direction of the company to them. HRM is responsible for recruiting and training employees, as well as for maximizing their performance (Tesla n.d.b).

Does HRM Absolve the Management of Their Responsibilities?

The HR managers do not absolve the management of their responsibilities, for the management still have to provide adequate strategic goals, direction, and take the responsibility for providing the resources needed for adequate employee management and for the maximization of their performance.

Flip-Charting Response

The management structure in Tesla, Inc. could roughly be charted as follows (Tesla n.d.b):

Does HR Serve as Support or Barrier to Line Managers?

On the whole, HR serves as the support for line managers, because they provide the opportunity for line managers to use the potential of the employees more fully while not having to engage in employee coordination directly. On the other hand, HR may be a barrier to line managers if there is incongruence between the HR and line managers.

Do Some Line Managers Hide Behind HR When Making Difficult Decisions?

It is possible for line managers to hide behind HR when there is a need to make a difficult decision that is related to the personnel. In this case, line managers may abstain from making decisions, stating that it is not their sphere of competence, for decisions pertaining to employees are to be made by HR managers (Panagiotakopoulos 2016).

Managers Responsibilities When Managing a Team

When managing a team, the manager ought to supply their team members with direction (i.e., set the goal for the team), as well as with instruction and guidance (that is, explain what needs to be done, and guide team members through the process if necessary). Team leaders also need to provide leadership, giving the employees motivation and helping them work together as a unit.

Considering Staffing, Rewards, and Development

When a team is created, the manager of the team ought to select the suitable employees to staff the team appropriately. They should also provide rewards for those members of the team who work well, as well as for high-quality collective performance. Finally, the manager should help the team members to develop their professional relationships with one another so that they could work together, as well as to enhance their skills that are needed for good performance.

Reference List

Panagiotakopoulos, A 2016, A short guide to people management: for HR and line managers, Routledge, New York, NY.

Tesla n.d.a, Corporate governance, Web.

Tesla n.d.b, Tesla, Web.

Wilkinson, A, Armstrong, SJ & Lounsbury, M 2017, The Oxford handbook of management, Oxford University Press, Oxford.

As it might be clear from the title, the main focus of Customer Relationships Management is customers and their relationships with the company, as well as the influence of those relationships on the companys sales and revenue. CRM is based on three pillars: getting new customers, fixing the leaky bucket, and creating brand/organization advocates. All three pillars are interconnected. If Center Parcs is able to attract more new customers, it also has to address the leaky bucket (the leaving customers).

Information about and observation of attending and non-attending customers will help the company understand what issues have to be addressed immediately. At the same time, gathered feedback and improvements based on it can assist the company in gaining new advocates, i.e., those customers that will translate joy and positive emotions related to the brand (Nguyen & Mutum, 2012). I believe that Center Parcs needs to focus on customer retention and loyalty because increased customer loyalty is more likely to create advocates who will be able to attract more new customers.

It is evident that CRMs primary focus is customers and customer perception of the brand or the company. The focus may shift depending on customers needs. The main points that Center Parcs should consider are an increase in customer satisfaction and its market share. Both of these points will enhance customer perception of the product as a product of value; increased customer satisfaction will indicate that the company provides quality services, and increased market share can reduce the number of switching (or leaving) customers, thus fostering customer loyalty.

As can be seen, the company currently experiences difficulties in communication with its customers because it cannot yet adequately analyze the customer groups and their value. Moreover, the organization seems to ignore the importance of communication, which results in changing customer flow. The second issue is honesty; with lacking communication, there is little chance that customers will have clear expectations of the services. According to Manesh, Naami, and Shoshtari (2015), consumers perception of a sources honesty can influence their trust in this source.

Therefore, the company needs to work on its brand image as a one that will be associated with serious, honest operations and marketing to avoid any discrepancies in customer expectations. Another issue that seems to remain unaddressed is the companys online advertising and general brand image in social media. Customer feedback can be gathered via social media platforms, and customer perception of the company can also be analyzed with the same tools. Still, it appears that the company does not engage the Web and other digital sources in improving customer relationships and communication.

To understand how Center Parcs can increase customers expenditures, the company needs to maintain steady communication with them. However, this is rarely possible without an extensive online presence. The company needs to increase its brand awareness and presence in all types of social media (Facebook, Twitter, Instagram, YouTube) to gather direct customer feedback. Company-related online community with a discussion forum is also an option.

To address the identified issues and better manage customer relationships, Center Parcs can review the tourism industry or Disneylands customer-oriented operations and services. As Tsang, Lee, Wong, and Chong (2012) point out, it is crucial for an organization to understand employees participation in and influence on the delivery of services and their relation to the companys image. Disneylands CRM is not perfect, but a thorough analysis of its services can provide valuable information to the company. Tsang et al. (2012) suggest that extensive long-term training of the staff will improve their ability to maintain service quality. The placement of employees is also important to facilitate customers navigation. As can be seen, Disneylands experience can provide valuable lessons to the companys management.

References

Manesh, F., Naami, A., & Shoshtari, A. (2015). Investigating the effect of CRM factors on consumer perception: Evidence from banking industry. Uncertain Supply Chain Management, 3(2), 117-122.

Nguyen, B., & Mutum, D. S. (2012). A review of customer relationship management: Successes, advances, pitfalls and futures. Business Process Management Journal, 18(3), 400-419.

Tsang, N. K., Lee, L. Y., Wong, A., & Chong, R. (2012). THEMEQUALAdapting the SERVQUAL scale to theme park services: A case of Hong Kong Disneyland. Journal of Travel & Tourism Marketing, 29(5), 416-429.