1.2 Service and manufacturing operations have differences, but also similarities.

For example, both

create mission statements and a vision for how the organization will be run and perceived by
customers. Each provider or manufacturer wants to lead the market in its specific industry.
However, manufacturing and service operations answer different questions and formulate different
strategies when it comes to planning and managing the way in which an organization is run.
Characteristics
Manufacturing operations produce tangible goods, which are physical products that can be
held and seen. Manufacturing can be broken down into two branches: process and discrete
manufacturing. While process manufacturers produce goods that typically use a formula and
ingredients, such as soda pop or pharmaceutical drugs, discrete manufacturers produce goods
from parts, such as electronics, appliances and automobiles. On the other hand, service
operations provide certain intangible services that may not be easily identifiable. Service
operations can be classified into many industries, such as banking, hospitality, advertising
and consultancy.
ustomization vs. Standardization
In general, manufacturers have a standardized way of producing goods. Goods are produced
en masse in a factory or warehouse-type environment. One finished product is generally the
same as the next. Service operations, by contrast, have more opportunities to customize the
services they provide. For example, beauticians and hairdressers must customize the styling
and treatments to match the customer's hair, shape of face and other characteristics. Even in
service operations where you receive a tangible product, the service you receive from
workers may not always be the same.
Related Reading: How to Improve an Operations Plan in Customer Service
Production Environment
Manufacturing and service operations both plan the environment in which work takes place,
but they focus on different elements. Manufacturing operations, for instance, consider the
manufacturing layout. For example, the manufacturing layout can be fixed, process-focused
or product-focused, such as in an assembly line factory. These issues affect the
manufacturer's workforce performance and total output. Service operations, by contrast, plan
the environment according to how it affects customers. For example, service operations are
concerned with how the atmosphere appears to customers. Dimensions of the service
environment include the layout of furnishings, arrangement of signs and tangible cues, such
as colors and sounds designed to enhance the customer experience.
Operations Management
In a manufacturing environment, operations managers oversee the activities required to
produce goods from raw materials. Issues managers in this environment face include
managing the space to store raw materials, the flow of materials through the manufacturing
process, how much product to produce and quality of output. In a service operation,
operations managers schedule workers to handle customer demand. They must coach and
train employees to provide optimal services to customers. Service operations that also sell
physical goods also face inventory control issues, such as how much to stock and when to
order.
Similar Issues
Service and manufacturing organizations face many similar issues that affect the end result of
the operation. For example, both face issues of cost control. Manufacturing operations must
find suppliers of raw materials at the lowest cost -- and highest quality -- possible. Likewise,
service operations' indirect cost of providing services must be kept low so that the
organization can provide competitive prices to customers and still turn a profit. Other issues
both types of operations face include forecasting demand for products and services and
staying competitive in the marketplace.

1.3 INTRODUCTION
Operations management in tourism and hospitality refers to the work done in the different
fields of hotel industry. Jobs in the hospitality industry, such as hotels, restaurants, catering,
resorts and casinos as well as other hospitality positions that deal with tourists generally,
refers to hospitality. Hospitality involves the relationship process between the hotel and a
guest and the act of being hospitable, such as guest reception and entertainment with
friendliness, goodwill and liberality. Tourists who travel for recreation or leisure purposes is
related to tourist management. In recent years, tourism has become a popular global leisure
activity among worldwide customers. The project is about Ramada Encore London West.
TASK ONE
1.1 Quality and its benefits within the Hospitality context
Quality means, serving in a manner which suits to the tourist within the limits of the industry.
It also refers to the quality provided to the people who have visited an individuals place. The
best of the services provided by the operations team is called quality.
Delivering quality service is one of the major challenges facing hospitality managers in the
opening years of the millennium. It is be an essential condition for success in the emerging,
keenly competitive, global hospitality markets. While the future importance of delivering
quality hospitality service is easy to discern and to agree on, doing so presents some difficult
and intriguing management issues.
Since the delivery of hospitality service always involves people, these issues centre on the
management of people, and in particular on the interactions between guests and staff,
interactions that are called service encounters. In the eyes of our guests, our hospitality
businesses will succeed or fail depending on the cumulative impact of the service encounters
in which they have participated.
It is easy to check the importance of managing these service encounters. Think back to the
last time you visited a hotel or restaurant. Service encounters are the building blocks of
quality hospitality service. First, hospitality managers should identify each encounter in the
chain that they wish to take apart, and then single out those that are of operational or strategic
significance in effect, focusing in on the few encounters that really make a difference to
guest experience and thus to the bottom line.
Second, apply what we have called the 6 Ss to improving these critical encounters through
effective redesign.
While the first step may seem obvious, it is important to identify a service chain and then to
break it down into the component encounters. Too much detail takes time and resources,
and may confuse rather than clarify. Too little and we may miss important problems. The
process is iterative, with more detail needed in some areas and less in others, and with an
overriding consideration that the chain is assessed not just from the point of view of a
manager but also from that of a guest.
Those that add significant value to the guest, those that cost in time or money, those that help
to differentiate the business from its competitors, and those where significant innovation is
possible or occurring.
Hospitality service encounters run the gamut from those that are very trivial to those that are
highly critical. They vary greatly in their nature and may be simple or complex, standard or
custom, low tech or high tech, remote or friendly, low or high skill, frequent or occasional,
and so on. They can be instrumental dealing with the performance of necessary utilitarian
activities or can involve emotion-laden hospitality events.
An initial management task is to understand a service encounter by discerning and dealing
with those attributes that are most important to guests. In doing so, pertinent questions must
be raised about the specific service encounter(s) under consideration. With respect to a
particular service encounter, hospitality managers might raise many questions like the
following:
The specific encounter(s) under consideration will, of course, indicate the kinds of questions
that should be pursued. It is important to obtain adequate information to understand the
situation thoroughly. Determining the context of a situation relating to a hospitality
encounter that has gone wrong establishes parameters for improvement.
All this is part of the second step. With the information at hand hospitality managers can
organize, and analyze the data and it is here that the 6S approach can help. These are:
Specification Staff Space System Support Style
Specification means clearly detailing information about the what, when, where, and how, of
service encounters. It requires giving careful thought to the linkages between particular
service encounters and others in the service chain.
When hospitality managers have carried out these two step process they will be in an
excellent position to make decisions that will both improve the quality of hospitality services
provided and guest perceptions of them. Zeroing in on hospitality service quality in this
manner will help hospitality businesses meet the service challenges of the millennium,
enhance their market positions, and reap the associated profit rewards.
Staff in the hospitality industry must be trained to enhance all the issues resolved in time,
before the consumers enable to dismantle the theory of having been not satisfied with the
hotel staff and the services provided.
The hotel must have a very good accommodation to have all its clients feel at home. A good
space leads to more impressive and lucrative offers for the consumers to come at regular
intervals. Space means a big area being controlled and operated by the hotel management and
the staff.
There should be discipline in the work being allotted to each and every department. That
means that the system of working as a family and in a healthy atmosphere be supplemented
and enhanced to face any number of customers in the hotel.
Support from all the managerial staff makes a real sense of developing the adjustments made
by the hotel.
The presentation of the hotel should be in such a way that it attracts the eyes of the clients.
The style applied to all the rooms, bar, restaurant, pool side and the lobby must be so much
eccentric that the onlookers feel proud to be the part of such an organization.
More than ever it is important for businesses to be offering the best service to their clients
and ensuring that their needs are being met so they stay loyal customers. The increasing use
of electronic communication benefits business with efficiency gains but can be detrimental
with the interaction with clients. We all need to hold onto and look after our customers and
one of the best ways to obtain quality time with valuable clients as well as potential clients
and top performing employees is to take them to an exclusive or very popular event such as a
high profile sporting event demonstrating to them how much you value them. The best way to
spend time at an event is going with a corporate package, for many reasons.
Firstly by doing it in style and creating a special occasion people will remember it for years
to come and will certainly show how much you value them by going that bit further than
buying tickets to the event. Taking employees and clients here will pay you dividends in the
future as it will encourage loyalty and continue bringing in valuable income.
Using hospitality facilities will provide you with space to spend time with valuable clients
and those contacts that you want to convert into customers. Having that prime location at the
event gives you a huge benefit over sitting in a crowded and noisy stadium. It is a much
better suited environment to enjoy the event while talking business too.
Going with a hospitality package can often give you the opportunity to network as other
companies will be sharing the facilities with their clients. You can find valuable clients and
contacts this way.
Supplier selection criteria for a particular product or service category should be defined by a
cross-functional team of representatives from different sectors of your organization. In a
manufacturing company, for example, members of the team typically would include
representatives from purchasing, quality, engineering and production. Team members should
include personnel with technical/applications knowledge of the product or service to be
purchased, as well as members of the department that uses the purchased item.
Common supplier selection criteria:
Previous experience and past performance with the product/service to be purchased.
Relative level of sophistication of the quality system, including meeting regulatory
requirements or mandated quality system registration (for example, ISO 9001, QS-9000).
Ability to meet current and potential capacity requirements, and do so on the desired delivery
schedule.
Financial stability.
Technical support availability and willingness to participate as a partner in developing and
optimizing design and a long-term relationship.
Total cost of dealing with the supplier (including material cost, communications methods,
inventory requirements and incoming verification required).
The suppliers track record for business-performance improvement.
Total cost assessment.
Methods for determining how well a potential supplier fits the criteria:
Obtaining a Dun & Bradstreet or other publicly available financial report.
Requesting a formal quote, which includes providing the supplier with specifications and
other requirements (for example, testing).
Visits to the supplier by management and/or the selection team.
Confirmation of quality system status either by on-site assessment, a written survey or
request for a certificate of quality system registration.
Discussions with other customers served by the supplier.
Review of databases or industry sources for the product line and supplier.
Evaluation (SUCH AS prototyping, lab tests, OR validation testing) of samples obtained from
the supplier.
The Journal of Quality Assurance in Hospitality & Tourism serves as a medium to share and
disseminate new research findings, theoretical development and superior practices in
hospitality and tourism service quality. The journal aims to publish cutting-edge empirically
and theoretically sound research articles which advance and foster hospitality and tourism
research and practices. Academicians and practitioners explore current and important
development information on quality planning, development, management, marketing,
evaluation, and adjustments within the field. As a result, this journal will help readers to keep
up-to-date on the latest theory development and research findings, improve business
practices, stay informed of successful hospitality strategies, maintain profit requirements, and
increase their market share in this complex and growing field.
Comprised of conceptual and methodological research papers, research notes, case studies,
and review books and conferences the Journal of Quality Assurance in Hospitality & Tourism
offers readers examples of real world practices and experiences that involve: organizational
development and improvement operational and efficiency issues quality policy and strategy
service quality improvement and customer satisfaction managerial issues, such as employee
empowerment & benefits, quality costs, & returns on investment the role and participation of
private and public sectors, including residents international, national, and regional tourism;
tourism destination sites; arid systems of tourism
Allowing readers the opportunity to share experiences and thoughts with colleagues in the
field, this journal also contains several columns that examine different and valuable
information sources, including:research notes significant findings related to the goals of the
journal dissertations and masters theses abstracts examine quality assurance & related
topics book reviews recently published works that discuss the strengths & structure of the
book, subject matter, readability, and discussions about the works contribution to existing
practices and knowledge in the field conference reviews highlighting & discussing specific
papers presented at conferences & their importance in the field web site reviews interesting
& helpful hospitality & tourism web sites.
Covering several crucial areas in each issue, this journal provides essential information that
can be applied to businesses, the classroom, and new research projects. Bringing together a
variety of perspectives from around the world, the Journal of Quality Assurance in
Hospitality & Tourism has the current, comprehensive, and vital information necessary to
evaluate the quality of services and improve customer satisfaction in a cost-effective manner.
1.2 Quality Awards/Systems that Hospitality Organizations operate within
The concept of quality management in hospitality industry is very important. The hospitality
industry is one of the most important industries in the world that has been growing at unique
rate owing to the increased rate of globalization. The amplified activities in tourism industry
and improved international trade are among the factors that have led to increased growth of
the hospitality industry. There has been increased trend towards equivalence of services in
the hospitality industry and this is being driven by the need for augmentation of quality of
services. As the level of competition increase in the industry, the competitive advantage has
been created through provision of high quality services. In order to understand the trend in
enrichment of quality of services in the industry, this paper will review a number of studies
on the subject.
The case of Ramada Encore London West discusses how total quality management has been
used in London in the enhancement of quality in the hospitality industry. This
acknowledges that total quality management is a concept that has gained increased use in the
hospitality industry. In recognition of the importance of quality management in the
hospitality industry, the ISO 9000 has been an important step in setting standards for the
implementation of total quality management in the industry. Enhancement of quality in the
hospitality industry is cited to increase the level of customer satisfaction, increased sales and
better profits for business in the hospitality industry.
Total Quality Management (TQM) is however sometimes difficult to implement in
hospitality industry owing to the difficult in identifying some of the most appropriate quality
measures. This study identified the need to use the quality triangle in hospitality industry
including focus on customers, team work approach to unify goals, and use of scientific
approach in decision making. Through comparing TQM in manufacturing and hospitality
industry, the study gives important review on how hospitality industry can use the TQM
concept to improve their services. This study is important since it shows how organization in
the hospitality industry can actually use TQM concept to enhance quality in their products
and services. It is important to understand that TQM is s wholesome approach which doesnt
only look at one aspect of quality management but concentrate on quality in on all aspects.
HACCP is one of the most important aspects in TQM that defines quality. HACCP defines
the important points at which quality should be ensured. Through understanding the
important points in the process of food production or offering of service where quality can be
enhanced, it become easier to enhance quality. While HACCP is an important factor in
quality enhancement process that has been used in large food manufacturers, it has been
slowly employed in the small business especially in the hospitality industry. The study found
out that there are more than eleven barriers to enhancement of HACCP in enhancement of
quality. This has one of the most comprehensive studies in implementation of HAACP in the
hospitality industry. The findings of the study are important since they show the importance
of HACCP in enhancement of quality of products and services in hospitality industry.
Quality enhancement is important in determining the rating of hotels in hospitality industry. It
is also related to princes of products and services in the industry. In their study on Quality
and Pricing in the Hotel Industry: The Mobil Star and Hotel Pricing Behaviour, Henley,
Cotter, and Duncan (2004) argues that price is closely tied to pricing of products. They argue
that quality is one of the most important determinants of price not only in hospitality industry
but also in other industries as well. However, they concede that it is fortunate that in the
hospitality industry, quality evaluation and prince information are availed for consumer and
have also been published in consumer guides. They give the example of The Mobili Travel
Guides as one of the most important sources of information regarding quality and price of
products offered in hospitality industry. To find whether hotels usually do change their
pricing and quality strategy when their rating is affected in such consumer guides. This study
found out that price is tied to quality of services and products. Most hotels raises their prices
when their rating goes higher and lowers the consequently when their rating is lowered, and
the same happens at Ramada Encore London West. The results are important to
enhancement of quality in hospitality industry. It reveals that quality of service offered has an
effect on rating of the hotels and hence the price of their product.
There are different factors affecting the quality of services in the hospitality industry. In their
review of different factors affecting quality in the Ramada Encore London West shows that
the growth of tourisms industry in different parts of the world have led to increased attention
to quality assurance in the hospitality industry. The hotel looked into influence of consumer
perception on quality of services, the study found out that different factors like previous
acquaintance with the hotel, perception and efficiency, perception of value, type of restaurant
services, quality of conference facilities, and staff attitudes are among the important factors
that affect consumer perception of quality in a given hotel. It is important to operators in the
industry who want to improve their quality since they would focus on these factors. It
implies that to enhance quality, hotels must understand the important factors that are used by
consumers to assess quality of services and products and henceforth improve them.
Employees of Ramada Encore London West have a lot of influence on the quality of service
offered by the organization. Employees are the main point of contact between organization
and the customers. Following the HACCP model, this is an important point and there should
be efforts to enhance quality at this point. In deed, this point has been reinforced by Kattara,
Dina, and El-Said in their study on the impact of employee behaviour on customers service
quality perceptions and overall satisfaction. In this study, Kattara et al., (2008) attempted to
investigate the relationship between the positive and negative employee behaviour, customer
sensitivity of the quality of service offered and the satisfaction of the employees. This study
revealed that employee behaviours whether negative or positive are well correlated with
customer satisfaction. Through review of past and current literature, the study found out that
customer discernment is mainly influenced by the quality of service they received at a given
hotel. This study is important enhancement of quality in the hospitality industry since it
looked at the relationship between employees and their customers.
Consumers are also important determinant of the quality of service offered in the industry
through their reviews. Consumer awareness is an important factor that can be used by
consumers to show the level of quality in the industry. While a manager may think that their
service are quality, customer many think otherwise. Therefore the author suggests setting up
a program that will assist in monitoring go standards of services to enhance quality.
Quality management is not only about ornamental quality of goods and services.
The hospitality industry in has not been keen on integrating occupation health and safety with
quality management systems. If OHS is not integrated with quality management system,
most organization can degenerate from health participatory process to mere bureaucratic
management tool. The findings of this study are important since they show the importance of
integrating OHS and quality systems. Both concepts are closely related and enhance each
other.
1.3 Internal System within the Front Office Area
The Front Office utility of a Hotel is to act as the public face of the hotel, chiefly by greeting
hotel consumers and checking in guests.
It also provides assistance to guests during their stay completes their lodgings, food and
beverage, accounts and receives payment from guests.
Department is typically poised of
1. Reception
2. Reservation
3. Concierge
4. PBX (phone service system)
5. Telephone
a) Front Office: Sell guestrooms; register guests and design guestrooms. Coordinate guest
services provide information. Maintain precise room statistics, and room key inventories.
Maintain guest account statements and complete proper financial settlements
b) Reservation: Receive and process reservation requests for future overnight
accommodations. With technology development, the Reservation Department can, on real
time, access the number and types of rooms available, various room rates, and furnishings,
along with the various facilities existing in the hotel Edgar Dsouz
FRONT OFFICE is the nerve center in the entire hotel operations. All the transaction
passes through within this department.
The Front Office Department comprise of the Reception, Guest Service Offices, Bell
Services, Reservation, Operators, Executive Club, Health and Recreation Center and
Business Center. The purpose of the Front Office Department is to provide guests assistance
with luggage, transportation, information concerning the hotel and the city, and any other
service arrangements needed during their stay.
Employees of the Front Office Department often provide the first and last impression of the
hotel to our guests. It is therefore vitally important that employees display a prompt and
courteous attitude to all guests and demonstrate the excellence in service.
The Front Office Manager who comes under the direct supervision of the Director of Rooms
and supervises the Front Office Department
Important of Front Office Department to the Hotel
.Hospitality, warm welcome
.Often provide first and last impression.
.Often have longest contact with guest.
.Continuity: Long term service, recognition of repeat guests, remember names, guest
histories.
.Acquaint guest with hotel.
.Sell hotel food and beverage outlets.
.Upsell: Suggest deluxe and suites.
.Smoother over disgruntled guests.
TASK TWO
2.1 Supply Chain Management Strategies
For the organizations which are concerned in tourism, competence is conditioned, among
other determinants, by the harmonization and synchronization of all participants efforts from
the unambiguous performance chain: tourism services suppliers, tour-operators, travel
agencies and tourists themselves. Among these participants, a special role is assigned to the
tour-operators. Going from certain tourism attractions, they take upon themselves the
manufacture of those products that are required by tourists, assembling the different basic and
complementary tourism services that are offered by numerous services suppliers, and further,
distributing them to the retailers, or directly to the tourists. The impact of their activity is very
strong because through the realized products they incorporate different types of tourist
services. Going from these aspects and analyzing in a similar manner the tourism activity as
the material goods manufacturing activity from logistical point of view, it can be said that,
successful activity can be achieved when those different participants categories act like a
system, into a supply chain. On tour-operators level, the supply chain management
incorporates, among the others, planning and management activities concerning purchasing
suppliers selection, internal logistics management, as well as collaboration with all
marketing channel partners. Internal logistics involves activities that refers to purchasing,
operations support and some aspects that are similar with physical distribution, the supply
chain being structured by cooperation between a various number of participants, from raw
materials suppliers (their impact is visible especially in catering, foods or beverage suppliers
services), up to end consumers. Otherwise, the role of the last category is more important
because they lend the tourism activity specific nature, through theres participation on a
successful holiday product.
Supply chains evolve in harmony with changes in the market and their ambitions. The
fruition of supply chain is correlated to different elements of progress in the business context
referred to as performance capacity, innovation and clock speed. These correlations are the
starting point of moving the chain towards the higher goals and therefore are of most
importance. In order to assure that the chain is moving on the right path in its evolutionary
journey, the journey must start based on the most precise data available.
Different firms and diverse supply chains have dissimilar business strategies and value
propositions, and answering those questions is often harder than one might imagine. To
illustrate, lets look at some examples of metrics that are mis-aligned: cases in which a
company discovered that they werent measuring the things that really mattered to their
customers.
Companies must always be concerned with their competition. Todays marketplace is shifting
from individual company presentation to supply chain performance: the entire chains ability
to meet end-customer needs through product availability and responsive, on-time delivery.
Supply chain performance crosses both functional lines and company boundaries. Functional
groups (engineering/R&D, manufacturing, and sales/marketing) are all instrumental in
designing, building, and selling products most efficiently for the supply chain, and traditional
company boundaries are changing as companies discover new ways of working together to
achieve the ultimate supply chain goal: the ability to fill customer orders faster and more
efficiently than the competition.
To accomplish that goal, you need performance process, or metrics, for global supply chain
performance improvements. Your performance measures must show not only how well you
are providing for your customers (service metrics) but also how you are handling your
business (speed, asset/inventory, and financial metrics). Given the cross-functional
environment of many supply chain improvements, your metrics must prevent organizational
silo behaviour which can hinder supply chain routine.
Supply Chain Strategies are the critical backbone to Business Organizations today. Effective
Market coverage, Availability of Products at locations which hold the key to revenue
recognition depends upon the effectiveness of Supply Chain Strategy rolled out. Very simply
stated, when a product is introduced in the market and advertised, the entire market in the
country and all the sales counters need to have the product where the customer is able to buy
and take delivery. Any glitch in product not being available at the right time can result in
drop in customer interest and demand which can be disastrous. Transportation network
design and management assume importance to support sales and marketing strategy.
Inventory control and inventory visibility are two very critical elements in any operations for
these are the cost drivers and directly impact the bottom lines in the balance sheet. Inventory
means value and is an asset of the company. Every business has a standard for inventory
turnaround that is optimum for the business. Inventory turnaround refers to the number of
times the inventory is sold and replaced in a period of twelve months. The health of the
inventory turn relates to the health of business.
In a global scenario, the finished goods inventory is held at many locations and distribution
centers, managed by third parties. A lot of inventory would also be in the pipeline in
transportation, besides the inventory with distributors and retail stocking points. Since any
loss of inventory anywhere in the supply chain would result in loss of value, effective control
of inventory and visibility of inventory gains importance as a key factor of Supply Chain
Management function.
2.2 Supplier Selection Process
Supplier selection criterion for a particular product or service category should be defined by a
cross-functional team of representatives from different sectors of your organization. In a
manufacturing company, for example, members of the team typically would include
representatives from purchasing, quality, engineering and fabrication. Team members should
include personnel with technical/applications knowledge of the product or service to be
purchased, as well as members of the subdivision that uses the purchased item.
Common provider selection criteria:
Previous experience and past recital with the product/service to be purchased.
Comparative level of sophistication of the quality system, including meeting regulatory
requirements or mandated quality system registration (for example, ISO 9001, QS-9000).
Ability to meet current and potential aptitude requirements, and do so on the desired delivery
schedule.
Financial stability.
Technical support availability and willingness to participate as a partner in developing and
optimizing design and a long-term relationship.
Total cost of dealing with the supplier (including material cost, communications methods,
inventory requirements and incoming verification required).
The suppliers track record for business-performance improvement.
Total cost assessment.
Methods for determining how well a potential supplier fits the criteria:
Obtaining a Dun & Bradstreet or other publicly available financial report.
Requesting a formal quote, which includes providing the supplier with specifications and
other requirements (for example, testing).
Visits to the supplier by management and/or the selection team.
Confirmation of quality system status either by on-site assessment, a written survey or
request for a certificate of quality system registration.
Discussions with other customers served by the supplier.
Review of databases or industry sources for the product line and supplier.
Evaluation (SUCH AS prototyping, lab tests, OR validation testing) of samples obtained from
the supplier.
TASK THREE
3.1 Possible issues encountered by Operations Managers
Lack of capital is often the most critical challenge that a successful manager or leader faces
as its very success creates this and it quickly becomes a vicious circle. Without very diligent
cash flow management and/or mounting of more capital, including debt, the business often is
constrained by capital as it grows. Often the profit in one operating cycle is insufficient to
fund the extra working capital required for the next operating cycle. Many capable managers
cannot overcome the obstacles in their businesses cash flow cycle and cannot understand why
bankers and other lenders often cannot provide the financing as the manager often does not
have the security to support the debt.
The solution is often easier than most entrepreneurs realize.
It often starts with a plan to see what your cash needs are and when your cash needs arise.
Then one is in a position to manage it and focus on the cash management techniques most
likely to be successful in his/her business.
Lack of management sk
Lack of management skills is a problem that is very difficult to deal with in most small and
medium enterprises as the size of the senior management team is necessarily limited. These
areas of weakness could be in finance, human resources, marketing or any area where the
current management does not have the expertise, or the time to deal with the issues.
It can be solved by determining the weak areas and then developing a plan for dealing with
those challenges. Solutions can be as simple as assigning the responsibility to an existing
manager with a requirement to watch for the obvious pitfalls, to hiring a person part-time or a
consultant.
Lack of focus
Ignoring risks in their assessment of alternatives and opportunities
Lack of a plan
Failure to plan for issues absorbing the majority of your time
3.2 Resolving the Issues
An operations manager should be more proficient regarding his/her department when
operating a staff of Tourism and Hospitality. The faces of the staff repair the atmosphere in
the hotel for the customers. Issues should be handled and resolved with timely interviewing
of the needs and responsibilities of the staff.
It is compulsory for the managers to be more precise over the issues and no favours should be
given to any particular person on gander basis. Its the most aspiring issue which hinders the
work at the work place and creates a substance of non judgemental circumstances for the
front line managers.
Operations manager must be focussed on the resolution and proper usage of time in work.
This can be implemented on focussing on the demands of the staff which speak of the
customers. By not giving any heed to the needs, the managers sometimes bring a bad and
deliberate reputation to the designation and the atmosphere gives no other chance rather than
5.1 THE external environment plays a critical role in shaping the future of entire industries
and those of individual businesses. To keep the business ahead of the competition, managers
must continually adjust their strategies to reflect the environment in which their businesses
operate.

It is a useful exercise to do an external analysis at the start of the strategy review process.
Gather your team together to do a PEST analysis. After the analysis, you will get an overview
of the environment that your business is in, the factors that may affect it, and the issues that
require attention in the strategy.During the discussion, the leader should fill in the factors
suggested by the team regarding the political, economic, social, and technological conditions
or PEST for short. On a flip chart, draw a large square with four parts as shown in Figure 1.

Figure 1: Flip Chart for PEST Brainstorming
POLITICAL
ECONOMIC

SOCIAL

TECHNOLOGICAL


Under political analysis, your team may want to consider the political stability of the region,
what the chances of military action are, the legal framework for contract enforcement, trade
regulations and tariffs, intellectual property protection, who the favoured trading partners are,
and related topics.

Under economic analysis, discuss the types of economic system in the countries the company
operates, the amount of government intervention in the free market, the efficiency of the
financial markets, infrastructure quality, the skill level of the workforce, labour costs, and
relevant factors.

The various central banks can lower the reserve requirements of the countrys banks so that
in difficult times, they dont have to keep high deposits at hand and this leads to freeing up
more money for loans to companies.

For social analysis, look into the demographics, education, class structure, culture,
entrepreneurial spirit, and health and environmental consciousness. The values and attitudes
that members of a firm bring to the workplace are derived from sources such as religion,
family, and social institutions. These are attitudes towards change, success, work, risk-taking,
use of time, competition, achievement motivation, and authority.

For the technological analysis, discuss the recent technological developments, the
technologys impact on cost, impact on the value chain structure, and the rate of
technological diffusion.

PHOTOS: SS
Many technological innovations have change
the way many industries operate. Those that are too slow to change have no choice but to
fold. For example, the MP3 music format has changed the record industry. The sale of music
albums have fallen drastically while the purchase of single songs online has proliferated. The
popularity of reading E-books has affected the sales of hard copies.

The PEST analysis is merely a checklist to ensure that you have analysed the salient factors.
It is a great help to guide the group through the initial analysis. When the team gets an
accurate picture at the beginning of the strategic process, it will lead them to adopt a
successful strategy.

Some scholars have put forth other specific forces that will have an impact on business
organisations. They include the stockholders, customers, the public, financial institutions,
material suppliers, competitors, and labour unions.

Management Tips
While the office party is a good place to get to know the other colleagues better, employees
must take good control of themselves and their behaviour and not be carried away and do
something that they will regret later. This is especially so when there is free flow of alcoholic
drinks.

When one is drunk, one has no control over what words come out of the mouth. Senior
management will have poor opinions of staff who drink too much and pass out at the
function.

There will be those who want to show that they can drink more than others and yet remain
sober. They will go from group to group and challenge others to yam seng. Dont fall for
this challenge, just politely refuse to bottoms up. There is really no loss of face by losing to
such challenges.

Once I attended a staff dinner with plenty of liquor as the company had many expatriate staff.
An assistant manager pretended to be drunk and picked a fight with his manager to settle a
score. During the scuffle, he broke the managers pair of spectacles. Some staff members
were sure that he wanted to take revenge on the other party. The following day, he had to
apologise to the manager and pay for the replacement of the lenses. Although no disciplinary
action was taken against him, he lost much respect from his colleagues after the incident.

We can learn from the success of Spanish company Inditex, which is well known for its Zara
brand. Quoted in the book Growth Champions, Inditex runs a highly integrated vertical
supply chain from raw materials supply to its retail stores. The firm encourages store
managers to focus solely on being as efficient and profitable as possible.

The firm has built a culture that encourages autonomy, quick decision-making, continuous
improvement, and retaining the services of its best people. Its chief executive officer Pablo
Isla says: We take small decisions and improve every day. Everything in our company is
bottom-up. This has a lot to do with our entrepreneurial spirit. The first person with a big
entrepreneurial spirit is the store manager. One of the characteristics that the managers
mention is the autonomy they have. Store managers feel like the owners of their stores.




3.4
Businesses must constantly monitor current trends and take them into account in their
strategies and operations management. In this section we touch on some of the key trends
that are occurring in businesses around the world.
1. The Internet and e-business. The Internet offers great potential for business organizations,
but the potential as well as the risks must be clearly understood in order to
determine if and how to exploit this potential. In many cases, the Internet has altered the
way companies compete in the marketplace.
Electronic business, or e-business, involves the use of the Internet to transact business.
E-business is changing the way business organizations interact with their customers and
their suppliers. Most familiar to the general public is e-commerce, consumerbusiness
transactions such as buying online or requesting information. However, business-tobusiness
transactions, such as e-procurement, represent an increasing share of e-business.
E-business is receiving increased attention from business owners and managers in developing
strategies, planning, and decision making.
2. Technology and technology management. Technological advances have led to a
vast array of new products and processes. Undoubtedly the computer has hadand will
continue to havethe greatest impact on business organizations. It has revolutionized
the way companies operate. Applications include product design, processing technology,
information processing, and communication. Obviously there have beenand will
continue to bemany benefits from technological advances. However, technological
advance also places a burden on management. For example, management must keep
abreast of changes and quickly assess both their benefits and risks. Predicting advances
can be tricky at best, and new technologies often carry a high price tag and usually a high
cost to operate or repair. And in the case of computer operating systems, as new systems
are introduced, support for older versions is discontinued, making periodic upgrades necessary. Conflicting
technologies can exist that make technological choices even more
difficult. Technological innovations in both products and processes will continue to
change the way businesses operate, and hence, require continuing attention.
3. Globalization. Global competition, global markets, global supply chains, and global
operations are having a growing impact on the strategies and operations of businesses,
large and small, around the world. The General Agreement on Tariffs and Trade (GATT)
of 1994 and later agreements of the World Trade Organization reduced the tariffs and
subsidies in many countries, expanding world trade.
In addition, the Free Trade Agreement and NAFTA have increased trade with the U.S.
to as much as 80 percent of total foreign trade of Canada. The implication is the need for
improved efficiency and increased quality. However, occasionally there is protectionism,
such as U.S. tariffs on Canadian softwood lumber.
4. Supply chain management. A supply chain is the sequence of organizationstheir
facilities and activitiesthat are involved in producing and delivering a product or
service. The sequence begins with basic suppliers of raw materials and extends all the
way to the final customer. Facilities might include warehouses, factories, processing
centres, offices, distribution centres, and retail outlets. Activities include forecasting,
purchasing, inventory management, information management, quality assurance, scheduling,
production, distribution, delivery, and customer service.
Figure 1.7 provides an illustration of a supply chain: a chain that begins with wheat
growing on a farm and ends with a customer buying a loaf of bread in a supermarket.
Notice that the value of the product increases as it moves through the supply chain.

A growing aspect of supply chain management is outsourcingthat is, buying goods
or services rather than producing goods or performing services within the organization.
5. Agility is the ability of an organization to respond quickly to demands or opportunities.
The Toyota production system (just-in-time) and rapid new product development
are examples of agility. A major requirement for this is flexibility.
6. Quality and process improvement. Given a boost by the quality revolution
of the 1980s and 1990s, quality is now ingrained in business. Where once quality was
a criterion for being an order winner, it has now become a criterion for being an
order qualifier. Some businesses use the term total quality management (TQM) to
describe their quality efforts which emphasize customer satisfaction and involve teamwork.
Process improvement can result in improved quality, cost reduction, and time
reduction.
7. Environmental issues. Pollution control and reduction in waste and energy use are
key issues managers must contend with. There is increasing emphasis on reducing waste,
using less-toxic chemicals (e.g., lawncare services shifting to environmentally friendly
approaches), recycling, making it easier for consumers to recycle products (e.g., including
a shipping container for returning used laser printer cartridges), and designing
products and parts that can be reused (remanufacturing products such as copying
machines). The term environmentally responsible manufacturing is sometimes used to
describe these policies.
Canada is a signatory to the Kyoto agreement which is to reduce greenhouse gases,
including CO2, to 6 percent below the 1990 level, by the year 2012. Some companies such
as Dofasco Steel have implemented voluntary measures to achieve this.
8. Working with fewer resources due to layoffs, corporate downsizing, and general
cost cutting is forcing managers to make trade-off decisions on resource allocation, and
to place increased emphasis on cost control and productivity improvement.
Cost control has always been at least somewhat important, but lately it has taken on
added significance due to a combination of economic pressures and increased competition.
And productivityoutput relative to inputis gaining added attention as organizations
attempt to remain competitive while they tighten their belts.
9. Ethical issues are commanding increased attention of management at all levels.
Accounting scandals, stockbrokers releasing misleading information of stocks, product
liability claims, breaches in privacy and security of computer files, and sharing personal
customer information among financial and other businesses are just some of the behaviours
that have led to public outcries and government investigations.