Running Head: OPERATION MANAGEMENT

EMAAR PROPERTIES

Operations Management
OPERATION MANAGEMENT

Executive Summary

This report is study focused on operation management of Emaar properties; a UAE found
company. In introduction paragraph details of the company and its mission is being
discussed. It also has details of current strategies of the organisations and the significant role
of it in organisational competitiveness. The next section talks about the operation
management and the supply chain of the Emaar properties, how it plays a major role in
effective success of the Emaar properties. After this section there is analysis and explanation
of the inside and outside factors of organisation with the support of SWOT analysis. That
how good they analyse the market and make implementations according to it. This discussion
has also evaluated the five performance objectives of the Emaar properties and their
contribution in the success of the organisation. In lasts of the report the recent position of the
industry has been stated with the help of some suggestions for the future development for
achieving great success and profits by them.

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Contents

Introduction ................................................................................................................................ 3

Competitive advantages of Emaar ............................................................................................. 3

Effective supply chain policies .................................................................................................. 4

Analysis and Explanation of Internal and External factors (SWOT) ........................................ 5

Swot Analysis ........................................................................................................................ 6

Strength: ............................................................................................................................. 6

Weakness: .......................................................................................................................... 6

Opportunities...................................................................................................................... 7

Threats................................................................................................................................ 7

Five performances Objective ..................................................................................................... 8

Quality: .................................................................................................................................. 8

Cost: ....................................................................................................................................... 8

Speed: ..................................................................................................................................... 9

Reliability / Dependability: .................................................................................................... 9

Flexibility: .............................................................................................................................. 9

Recent position and Recommendations ................................................................................... 10

Conclusion ............................................................................................................................... 10

Bibliography ............................................................................................................................ 11

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OPERATION MANAGEMENT

Introduction

Operations management majorly focused on the procedure of design and control in the
production and rearranging the business process in producing the goods and services
(Bromiley & Rau, 2016). It is also plays an important role in supply chain, marketing and
human resources of a company. It is majorly connected with planning, organising and
supervising the things related to manufacturing of products and availability of services.

Emaar properties was set up in 1997 and deals in managing the commercial and residential
properties in real estate. Emaar is operating in more than 15 countries including; UK,
Indonesia, India, Saudi Arabia, France, UAE, etc. The unique selling proposition of this is his
innovation and providing high quality in the real estate development. It has won so many
awards for his accomplishment and most differentiated and innovative projects in industry.
They are providing the best services quality to its customers and it has also achieved the ISO
certification of 28000: 2007 because of its supply chain management.

The objective of this report is to find out and shows all competitive elements which provide
competitive advantage to Emaar properties. There is analysis and explanation of the inside
and outside factors for the success in its operation management. After that, there is the
analysis of its strength, weakness, opportunity and threats. At last, there is some
recommendation that have been made to Emaar properties for its long term growth and
success in competitive market.

Competitive advantages of Emaar

It is one of the most leading companies in development of real estate industry. It’s most
important advantage is that is always thinks and produced something more creative and
innovative for its customers. The government of UAE (Dubai) also supports the Emaar in its
operations. It is highly reputed and produces so many elegant and innovative residential
projects which represents a different life style to its customers. This attribute help him in
giving the high competitive advantage in facing the competition in Dubai or in all over the
world. Emaar properties are majorly known for his high quality which is also noticeable from
ISO certification of his 9001:2000 (Abou , 2017).

This success of his also lies on its human resources or its employees. If they did not work
with Emaar for achieving its goals and objective, then it became hard for him to get success

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in this era of competition. It also made so effective human resource policies for his
employees to make them loyal and feel satisfied (Dubey & Gunasekaran, 2016). It also
promotes its employees branding and emphasis on giving individual attention to its
employees, which also plays an important factor in its success. By seeing all these factors
used by Emaar which provide a competitive advantage to it in achieving its global success
(Go & Hart, 2016). They required to keep this strategy unharmed and also keep adding new
ideas and keep implementing more effective strategies in his management and business plans
for his more success.

Effective supply chain policies

There is no business which can be complete without the effective supply chain. It helps in
cutting the cost, improve efficiency and to be more flexible by taking actions on it. The
specific policy to increase the profits may vary from industry to industry; there must be
certainty in picking the design of a supply chain (Ashby et al., 2018). These are the major
elements which are considered by Emaar’s in his operations strategy and in its supply chain
management.

They have a very strong leadership in their industry. Emaar has appointed the right
individuals on the top positions so that the decisions will be more flexible and accurate
because sometimes if there is wrong or less experienced person is appointed in the top place
and took wrong decision then it lead to business failure. So, to appoint right individual by
them on the top key position with the experience as a team member will help in translation in
high functioning of supply chain in industry. Team management and communication in
Emaar’s internal structure help it to achieve his long-term success, and it starts from his top
positions (Giannakis & Papadopoulos, 2016).

Emaar is constantly wide spreading its flexibility by taking all the modern advancement, its
relationship with his customers to produce more enhanced product and services for its
customers. It always focuses the needs and wants of its customers and produces and provides
service and product according to that only (Aslam et al., 2018). This extend its routes and
options availability within supply chain in the emergency situation, so that they can react to
the moment when they notice some change in the behaviour of their customers by having a
backup plan for its consistency in services. Otherwise its customers lose their faith in the
company.

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They are majorly focused on the modification in their services and products because in this
modern society the customers expect a personalized experience when it comes to spending
their hard earned income on it. Through customisation they directly influence the customers
by addressing all their needs and wants which they are fulfilling through their product and
services (Huo et al., 2016). Therefore, its customisation will definitely support in fulfilling
more needs and wants of the customers by identifying their recent trends and in generating
maximum profits. If any company neglects the needs and wants of their customers then will
are not able to survive for long in the market. This helps Emaar for his long success and
building good brand image in the market.

It is having a strong supply chain strategy and he implemented in his major places of business
and helping the growth of business, it doesn’t mean to sit back and enjoy the growth. Emaar
continuously takes an eye on the growth of his company by doing the minor improvements in
the established strategies according to the change in the market to cope up with it (Tsanos &
Zografos, 2016). The supply change is ever-changing and the chances of improvement are
always there in everything. This is a good strategy adopted by them for the long term
relationship with their customers and to be their favourite for a long time.

Analysis and Explanation of Internal and External factors (SWOT)

The success of any business in market place depends on the factors which will utilise by the
company for its development. After knowing all the positive and negative aspects inside or
outside the company, they can make the perfect strategy according to the situation to face it
(Bull et al., 2016). Therefore, identifying the internal and external factors is considered the
most valuable task for the company before implementing any strategy in market.

Emaar properties are one of prime developed organisation in real estate sector of Dubai with
brand name in Mid-Eastern area and expending its work in other areas such as: North
America, Asia etc. It is well established and ready to take benefit of real estate growth, the
current crises in financial market of the globe will help through the declining rates of the
properties in Dubai.

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Swot Analysis

Strength:

Government Support: The government of UAE has staked in Emaar around 32%, and some
extra entry to requirement of lands for property development, with less strict rules and
procedure for developing economics. In support of this the UAE government also shows his
support and willingness for helping the business at the time of crises, as in currently shown.
Government of UAE provide $6800 million to bank to cope up with current interchange
ability problem (Vignal, 2016). When Emaar is in wants any backup they support him by
providing adequate capital and finance operations to expand its markets. This support of
government will help him in expanding and to cope up even from a difficulty situation.

Business Model: A successful business model is being developed by Emaar. They have
expertise in making the best planned community to global market. Their main focus is on
providing a lifestyle for living and not only for providing the property. Emaar’s innovative
services such as; self-contain community which integrates with parks, schools, retail centres,
etc. which help them in providing a winning combination to them (Kadhim & Al-Akiely,
2015). They provide mix of villas, flats, and housings and also provide the offers on land for
investment purpose to his clients. His innovative idea is backed by providing the time
delivery to its customers of its products with the high quality. A total no. of 22.26 million
square meters of land is been acquired by them by joint venture strategy with Bawadi LLC
(Tenhiälä & Helkiö, 2015). It also has partnerships with other development companies such
as; Arabtec, Nasa Multiplex etc. for his long term growth.

Weakness:

Dubai Overexposure: Emaar is entering in global market to decrease its reliance on Dubai.
In form of domestic sales volume it decreases from the last year and in terms of % it has
increased from 79.91% to 86.96%. As an outcome, along with entering in global market, it
didn’t reduce its exposure in Dubai. In previous year the rating of Emaar were downgraded as
long term credit rate from A- to BBB+ which shows the rating of lowest grade in medium
credit of an organisation. This downgrading was done because of weakness in real market of
Dubai and uncertainty of it. Previously ratings were high because of the government support
of there (Bull et al., 2016). This can be improved by implementing the necessary measures

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like investing to those places where no situation of crisis is and by doing the proper research
about the market area and the requirements of its customers.

Operations and Funding: Emaar’s funding strategy focus on restricting the funds from its
mother company to acquire financially of land or construction related to groundwork.
Funding was fixed to 8% from the mother company for its cost. More funds raised by the pre-
sale and strategic sale. Emaar can face difficulty in raising the cash as a result of
downgrading (Young, 2017). Therefore, they bear the more interest rate from previous or on
the new debts. Their operating margins had downgrade from 30.42% to 13.61% in previous
years. There is also declining of return on equity and the annual growth rate and return on
assets were also reduced in last some years.

Opportunities

Domestic Market Positioning: Emaar is having good focus in increasing its existence in
other countries. They can acquire the areas in other countries and planned constructive
activities according to that. It has partnership with Bawadi which will help in supporting the
financially to the company for acquiring the land. Emaar has done with the recent
construction of Burj Khalifa in Dubai which is a key asset for him. It has also open some of
his hotels in Dubai which also help in supporting the Emaar properties for his better future
(Vigna et al., 2018). All this help in coming out from the downgrade of the company and in
expanding in the market of the company. This will also provide the exposure for opening
their business in other countries and capturing more customers in their loyalty programme
and to increase their revenue.

International Diversification and Expansion: Mission of Emaar is to become a single place

for globally availability of lifestyle. In taking this goal, they have made so many investments
in areas like; school, hospitals, malls, hotels and resorts. For achieving all this company have
done purchasing and being joined with their surviving companies to start and expand their
work of products and service. It can expend to more developed global areas for achieving
potentially high growth. They should focus on the countries whose GDP is more than 15%
from the past 3 years (Van Meeteren & Bassens, 2016).

Threats

Economic Protectionism: Some countries developed rules and procedures in connection to

direct investment in certain infrastructure sector. US home lobbies have succeeded in

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investment concerning by stating real distinguish major concerns relating to security like;
there is a case which involve the ports of Dubai world in US (Turner et al., 2017). These
restrictions can delay or either denies Emaar properties for executing its successful growth
plan.

Global economic Downfall: Dubai is focus of emigrant from the Western Europe and US,
and they will be considered major factor for the rise of Dubai. It should not be neglected that
they are comprise of 80% of population. Losing the job at a maximum number and blocking
the market credit will not support Dubai in investing the required capital and it will affect the
company’s sale on major reason (Wippel et al., 2016). So, at the time of taking the decision
the Emaar has to take care of all these points in mind and then appropriate decision for his
success.

Five performances Objective

These five performance objectives allows the management to give attention to all the areas
inside the organisation that is not performing good and help in giving opportunities to them.
They provide the benefits from both the aspects internally or externally by getting more
creative and competitive in market.

Quality: It is the most seen thing which shows that what an operation do and act which is
consistently shows the expectation of the customers. The operation needs to do the thing right
is related to the kind or nature of the business (Hafeez et al., 2016). The major objective of all
the operation management is quality of its product and services. On the basis of quality the
customers judge the product and services and purchase them. They see that is it right product
which they require and did it fulfil all the requirements of their and etc. It is a fundamental
thing and it plays a major role in influencing the customers like and dislike. The perception of
high quality in customers will satisfy their needs and vice-versa. Emaar is very particular
about their product and service quality they provide the best quality in their products that is a
reason they have got the certificate of ISO for their best quality services.

Cost: For some companies who compete in market on the basis of price, the cost of it is
considered by them their major operation objective (Frangopol et al., 2017). They cut their
cost in production of their product and service which help them in providing those products
and services in fewer amounts to customers. Even some companies who did not compete on

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price still try to cut down their cost of production. Emaar also applies the same thing they try
to decrease the cost of their production so that they can attract more customers and provide
goods and services in reasonable cost, even though they provide the best quality in their
product and services. This helps the company in their long run and success in market place.

Speed: This means in how much time the product is being delivered to customer after
getting the demand of it. The lesser the time is involved in providing the product and service
to the customers it will help in increase in demand and they will also able to pay a little extra
for that product. Emaar is implementing the same speed delivery approach to his customers
by proving them their properties on time or before deadline which attract more customers
towards it. They also try to respond the quarries of external customers which help them in
speedy decision making in organisation and implementing the currents needs and wants of
their customers (Mishrif & Al-Naamani, 2017).

Reliability / Dependability: It means completing things on time that exactly means the
product and the services will be delivered to customer when they are needed by them or at
least at the time of deadline not after that. They will see the reliability of operations of the
company only depending on the delivery of that product or service. Emaar has doing the
same they are completing their projects on time and delivering them to the happy customers
which help them in making loyal customers by completing things on time and providing the
best modern and quality in their products (Gunasekaran et al., 2015). If any mechanic garage
is cheap or fast one and they do things later then their promised time and the same mistake is
done by them every time then the customer will go elsewhere. So, Emaar is implementing
this five performance objective to removes these barriers from his operations.

Flexibility: It means the operation can be change in some way according to the market
condition. It means that changing what operation does how it does it or when it is doing it
(Wei et al., 2017). The customers need this flexibility in operations so that if there is a change
in their requirement then it can be done in their operations. Emaar is taking care of this by
implementing new and modern services, and giving a wide variety of product mix and
services (Steenhuis & Pretorius, 2017). They are trying their best in holding the flexibility so
that they can adopt quickly the change condition of market in their organisation and have a
competitive edge in market from their competitors.

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Recent position and Recommendations

On the basis of discussion of this report, it is seen that Emaar properties is achieving great
success. They are contributing towards the economy as well as making tourism and
hospitality side more attractive in UAE. Emaar has done so many attractive projects and
some are on the verge of accomplishment. These projects are world class in all aspects and
help in generating economy in UAE tourism. They are getting all support from their
government which help them most in their success factor. But there is still room for some
improvements as everybody knows that the eternal environment is very unstable and increase
in competition. Emaar has to make some good marketing strategies for expansion in Asia and
other parts of globe. It helps him in achieving great success. They can start planning its
operations in London and France by development of hotels and restaurants there. It helps in
great expansion in globally for them. They can invest in China with the joint venture or
through subsidiaries. China is one of emerging country which makes huge investments in
infrastructural development. It is also vested by many tourists from all over globe which is a
good opportunity for Emaar for providing his world class hospitality services to its
customers.

Conclusion

From this entire report one can say that the operation management plays and important role in
any industry. It helps the company by providing the help in knowing the changes and the
recent trends in the market. It helps in reducing the cost and attracts more customers. The
Emaar properties majorly focused on the customer satisfaction and providing the high class
and quality product and services to its customers. They have implemented the HR policies
which help them in retaining the employees with more loyalty and resolve internal disputes
and make healthy relations with each other.

Emaar is using the best supply chain and appointed the right and qualified employers on the
right place which help him taking the best decisions for the business growth. The five
performance objective also plays an important role in his success and attracting more loyal
customers by focusing their issues. This whole report shows that Emaar is doing well in
market and chances of his expansion and earning more profits will be there. The government
is supporting them too which is a great advantage to them. At last there are some suggestions
which can be implemented by them for fast growth and more smooth expansion in globally.

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