Activity No.

1: (Operations and Operations Strategy)

1. Define operations management and the functions associated with it.

- Operations management refers to the activities that develop and create

products or services that a certain company offers to the public and its consumers. It
also pertains to the process of developing resources from the company into goods
and services. While operations management is responsible for ensuring that the
day-to-day activities are going efficiently and effectively, there are also other
functions that are associated with this management. One of these functions is
finance, it is important to ensure that the financial resources of the company are
properly allocated in the operations department and should not waste finance on
unproductive activities or tasks. Formulation of strategies is also one of the functions
of operations management, ensuring that the company has made plans or tactics
that could give them the advantage against their competitors. Lastly, the product
design and maintaining its quality. Designing a product that is aligned with the trends
in the market and customer’s wants is one of the main functions of operations
management, alongside with maintaining the quality of the goods or service that a
company offers so that customers will continue to purchase the said goods or
service.

2. Contrast the operations management in a company that produces goods with a

company that offers services.

- A company that produces goods or tangible products uses less labor,

employees, and uses equipment to put raw materials in a conversion process in
order to produce the final output that will be served to the company’s consumers. We
should emphasize that a company that produces goods has tangible output and
each tangible output that is purchased by customers will be the basis on creating the
company’s inventory. A company that offers services rely on more labor and
employees, less equipment and possesses a wide-range variety of the output
produced by a certain company. A service company has also continual customer
contact, giving them a quick feedback on the firm’s rendered services. One of the
noticeable differences between a company that produces goods and a company that
offers services, is the customer’s feedback on the output given by each company. A
customer from a manufacturing company, takes time to consume the product and
internalize on whether he/she is satisfied with the purchased goods. While a
customer from a service company can give real-time feedback regarding to the
service being rendered to him/her.

3. In ensuring ethical and social responsibilities in business, what are some

challenges in operations that a company may face?

- A lot of challenges may arise since operations are one of the main functions
of an organization. One of the responsibilities of the operations department is to
create the inventory of the company. Failing to do these tasks properly may affect
other departments and their functions, as well as affecting the decision making of the
top management on creating plans for the future of the company. The welfare of the
employees may also be a challenge in the operations of a company. A company
must ensure that all employees as well as the equipment that they are using, are
safe and functioning well. A company must also ensure that the quality and safety of
the outputs that they are producing in order to avoid any backlash from the
consumers and the public.

Operations departments also experience challenges like constantly pursuing

effective coordination with other departments present in the company. As we all
know, clear and concise communication is essential within a company to avoid any
disruptions and misunderstanding in their activities. Operations is also responsible
for dealing with the creation of long-term customer and employee strategies,
developing practices to sustain its relationship with their customers and employees
for the long run. Operations also deals with executing steps to actively engage public
relations by corporate social responsibility. It is essential that all stakeholders should
be considered before making decisions within the operations department and any
other departments to avoid any unnecessary conflicts with the parties involved in a
certain company.

4. Discuss the advantages and disadvantages of the different operations strategies.

- Functional Strategies or Department Strategies, are made specifically for a

particular department in an organization. Strategies developed in the said
departments will act as a guidance on what they should do to achieve their
objectives and vision but only limited to their department. Developing functional
strategies may vary since every department has different roles and responsibilities to
fulfil.

Business level strategies are divided into three parts. These strategies are
made to aid companies gather their competitive advantage in the market. First
strategy is Low-Cost. When companies are using this strategy, they are aiming to be
competitive in terms of cost advantage. They may be spending on less expensive
raw materials or controlling the price based on the market standards. In this strategy,
a company should consider that the quality of the produced outputs will not be
compromised since they have purchased low-cost raw materials or equipment. The
second strategy is Differentiation. In this strategy, companies are encouraged to
create something different and unique for the market. An organization must be
innovative in creating goods or services that will attract customers and gain the edge
against their competitors. Examples of disadvantages in this strategy is that the
uniqueness of the output from creating something different may not be valuable or
the price of the product or service may be too expensive for the customers. Last
strategy is Focus. Companies using this strategy are developing and selling products
for a particular target market. Upon using these strategy, companies have to be
aware that even if their products are unique, new entrants may imitate and can form
new competition.

Corporate-Level Strategies are developed so that companies can make

proper decisions for the whole company. First strategy is Horizontal Integration, this
is where a company finds a similar company in the same industry. With this strategy,
a large amount of market share and profit will be generated since two companies
have been combined. But this strategy has also downsides such as combining
companies may lessen competition resulting into limiting the available choices for the
consumers or some government agencies may limit the combined companies in
gaining the profit that they are acquiring. Second strategy is Vertical Acquisition,
where a company finds another company that is present in the same industry but
different in the production level. This strategy aims to secure the supply of essential
goods, avoid disruption in supply, and restrict supply to competitors. There are also
potential pitfalls on this strategy such as; it requires a large capital, a confusion may
arise since it has companies that have different functions, and it can create market
barriers.

Quality-based strategies are used on companies to ensure that the quality of their
work and their performance are above-average or attaining parity based on the
market. Utilizing this strategy aids companies to develop a good image to its
consumers. There are also disadvantages present in this strategy such as; aiming
for a high quality product or output is expensive, a lot of resources will be used, and
it takes years to see tangible results.

Time-based strategies are developed by companies to lessen the time needed on

executing activities present in an organization. This strategy helps companies to
reduce expenses by improving the productivity and efficiency in making their
products. The downside of having a time-based strategy is that the quality of the
output may be compromised since the production is given a very limited time.