Malakooti (2013) asserts that operations management and supply chain are critical aspects that determine the achievement of desired success in contemporary business organizations. The goal of business managers is to reduce costs and expenses incurred in all aspects of organizational operations and increase their output. Managers also need to develop a clear strategy that integrates all aspects of operation management and supply chain processes to achieve the desired success (Thodore, Patricia, & Chas, 2015). This paper provides a detailed analysis of different organizational management concepts in relation to operations management and the supply chain.
There are different strategies used in the effective integration of all aspects of management operations and the supply chain. However, aligning the supply chain with organizational goals through the continuous integration of sales and operations planning can be the best strategy (Alexander, Walker, & Naim, 2014). Appropriate integration mechanism can help in filling the gaps existing between business strategies, its financial system, and operations. Integrated business planning which supports the collaboration between business technology elements, people, and processes can also be a critical way of bridging the gap created in the supply chain.
Effective business operation management and supply chain are two critical factors that determine the success of a given business firm. According to Alexander, Walker, and Naim (2014), operation management entails appropriate execution of business practices at the highest level of efficiency as well as converting different organization inputs such as labor and materials into finished goods. Effective operation management also entails the appropriate and efficient provision of quality services by a given business organization to the targeted customers.
According to Charu and Kumar (2011), efficient delivery of goods and the required services results in customer satisfaction and creates a positive image of the organization. This positive image is critical in attracting more customers and helping the organization achieve its goals. Similarly, a successful supply chain entails a sequential management of different organizational processes in a manner deemed efficient to produce the recommended goods and services (Alexander, Walker, & Naim, 2014).
Malakooti (2013) argues that the sustainability of an organizational supply chain depends on the continuous commitment of various stakeholders including producers or manufactures, the distributors or suppliers, the wholesalers or retailers and finally the consumers. These stakeholders have an integral role to play in ensuring that all the goods produced by a given business company are delivered to the final consumer in the correct shape, size, and quantity. However, quality remains one of the most critical factors that stakeholders involved in the supply chain management must keep in mind in order to satisfy the needs of customers (Alexander, Walker, & Naim, 2014).
According to Malakooti (2013), failing to distribute the goods and services to the final consumer in the recommended size, shape and quality can have far-reaching negative effects on a business firm. Apart from increasing the ethical concerns of customers, poor quality and quantity goods can scare away customers and cause serious financial losses. As a result, an appropriate business strategy is required to ensure that the operations carried out by a given business firm work in line with its supply chain to ensure continuous customer satisfaction. Alexander, Walker, and Naim (2014) identify the integrative model as the best strategy that can result in the overall achievement of the organizational needs in terms of linking its supply chain and its operations management.
According to Malakooti (2013), this integrated strategy also allows business managers to devise new and viable decision which results in continuous improvement of organizational operations management and the entire supply chain. These ideas are critical in the creation of a sustainable end-to-end process which helps in ensuring that the business achieves its strategic goals. The strategy also reunites the organizational operating plan with its financial goals through the use of cloud technology (Charu & Kumar, 2011). This technology is important in connecting the processes incurred during sales and planning with overall business planning to allow the organization to attain the balance between demand and supply.
Risks and Ethical Concerns Regarding Operation Management, the Supply Chain, and International Operations
There are different ethical issues that firm managers experience in regard to operation management, supply chain and international operations. In operation management, some workers may indulge in misconduct which may hinder the success of the organization (Alexander, Walker, & Naim, 2014). For instance, some workers may compromise with the efficient operations of the organization by revealing private information to unauthorized. This disclosure may lead to loss of critical organizational information. Organizations need to develop sustainable workplace policies to manage such misbehavior to ensure successful operation management. Operation management may also be confronted with the challenge of theft and loss of crucial organizational information (Alexander, Walker, & Naim, 2014).
Malakooti (2013) adds that firms need to introduce refined controls alongside budgetary control measures to manage theft issues. However, the greatest ethical dilemma in operation management arises when seeking to resolve organization problems occurring in technical fields. The worst situation occurs in regard to the increasing cases of computer and internet fraud where companies are increasingly incurring monetarily loses as a result of employees' theft. Organizations have to spend a lot of monetary resources to counter these losses which may result from corruption, misappropriation of assets, and false financial statements (Alexander, Walker, & Naim, 2014).
Nevertheless, different ethical issues dominate the supply chain, which consists of various parties including producers, suppliers, retailers, and consumers (Malakooti, 2013). For instance, producers may be unethical when duplicating other companys products and exploiting their employees through poor compensation, continuous pay cuts, and lack of insurance and medical covers. Suppliers may engage in unethical business practices when they chose to compromise with the quality of raw materials sold to the producers. Some suppliers may also form a cartel which results in the manipulation of the market by paying low prices to the sources of their raw materials and claiming higher payments from producers (Alexander, Walker, & Naim, 2014).
According to Malakooti (2013), retailers and distributors usually engage in unethical practices by changing the packaging and labeling of products in order to exploit customers and make profits. Such retailers tend to employ pseudo-marketing methods to create a good image of their products at the expense of customers. Consumers engage in unethical practices by purchasing counterfeit products due to their cheapness and affordability. Their best approach to purchasing is built on price and not quality and value (Alexander, Walker, & Naim, 2014). Hence producers, suppliers, retailers, and distributors end up engaging in unethical practices by compromising with the quality of goods to increase their sales and generate more profits.
According to Alexander, Walker, and Naim (2014), firms with international operations also face a plethora of ethical issues which may inhibit their sustainability. An ethical dilemma arises when companies are forced to exercise corruption and bribery by giving gifts and commissions in order to remain sustainable in a foreign market. Additional ethical challenges may occur when companies try to use alternative strategies to evade paying foreign taxes. It often becomes difficult to operate in such a market especially when the government starts raising its restrictions and regulations requiring continuous promotion of ethics (Malakooti, 2013).
Differences between a Requirement Philosophy and a Replenishment Philosophy of Inventory Management
There are striking differences between a replenishment philosophy and a requirements philosophy. Charu and Kumar (2011) define inventory replenishment as the manner in which a given business firm develops sufficient strategies to prevent any shortages associated with its processes of sales and production. Continuous deficits in terms of stock may yield ultimate losses since the employees involved in the production process may lack the applicable resources required to compete for batches.
This deficiency may either stagnate or halt the operation of the entire business firm. Replenishment strategies frequently focus on internal or external business routes (Charu & Kumar, 2011). The internal replenishment entails a periodic transfer of merchandise from the reverse storage to the business warehouse. External replenishment deals with the way in which the production employees work with the accounting personnel to send purchasing orders to business vendors and other service providers.
On the contrary, the requirements philosophy exist as a form of merchandise requirements and refers to the product of processing sales expertise and the associated knowledge, especially when considering the evaluation of consumers needs and the expected bulk orders (Charu & Kumar, 2011). Understanding the differences between these two philosophies plays a critical role in helping organizational managers to conduct a comprehensive review of the business production logs while comparing them with the pending sales orders. This comparison helps the company management to determine whether they will have adequate merchandise to achieve the organizational commercial obligations (Charu & Kumar, 2011).
Relationship between MRP and ERP, and how They Fit into the Business Strategy
There is a strong relationship between Enterprise Resource Planning (ERP) and Material Requirement Planning (MRP). Thodore, Patricia, and Chas (2015) define ERP as a business management technique that facilitates effective storage, coordination, and management of organizational activities. ERP is also associated with a continuous reduction in the costs of business operations, reduction in inventories, and reduction in administrative costs. Appropriate ERP system increases business efficiency and attracts more customers to the organization.
Similarly, MRP software enables business firms to effectively manage the processes involved in product manufacturing through the use of its inventory control systems and production planning. Therefore, these two concepts are exclusive to business manufacturing processes. MRP software is also a subset of ERP which directly caters to the specific needs stipulated by the manufacturer (Thodore, Patricia, & Chas, 2015). MRP helps managers to ensure effective utilization of organizational resources.
Organizational managers have a critical role to play in setting goals and developing strategies to achieve them. However, the attainment of this goal calls for a clear understanding of the operation management and supply chain processes. This understanding can help managers to understand different risks and ethical concerns associated with operation management, supply chain, and business international operations in pursuit of success. Other critical issues relevant to the effective management of business operations include understanding the differences between the two types of inve...
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