Operational Management Business Plan of a Special Event - Essay Example

?Operations Management Introduction Operations management (OM) of a business entity is based on a complex process of designing, applying and optimizing the various components and systems that help produce and deliver the different products and services offered by the company. Operations management can also be defined as the proper planning and utilization of resources that are required for the organization to deliver its business responsibilities. Operations management is often regarded as an integral part of operations research, although such conclusions are incorrect. Siegel (2009, Pg. 21) says that this domain constitutes an important and critical part of business that governs the efficiency and quality with which products are manufactured or services are provided and involves numerous human intensive procedures. In fact, operations management also encompasses the effective distribution and supply of goods to customers. The history of operations management can be traced back to the Second World War when various researchers undertook complex studies to understand the various basic processes that influenced the course of army operations such as logistics, troop movement, supply routes etc (Pycraft, 2009, Pg. 43). This extensive focus on analyzing the pattern of military operations led to the evolution of military systems and provided the much needed insight into understand multilateral and interdisciplinary process that constitute the field of operations research. The discipline of operations research thus encompasses various scientific domains and depends on solutions like statistics, modeling and structured algorithms to provide some useful answers to complex problems that pertain to various business processes and operations within an organization. In this context, operations research does not rely much on considering the exact nature or area of specialization of the organization. According to McMahon (2007, Pg. 87), the sole purpose of employing operations research methods is to determine a scientific answer to a given complex scenario that can enhance the performance of the company and thus requires the collaboration of experts from several disciplines to understand the problem from a quantitative perspective. Thus, operations research provides numerous tools, methods and procedures that help solve many issues pertaining to operations management (Wagen, 2009, Pg. 63). Operations management is also influenced by industrial engineering that helps understand a given problem area from an engineering perspective and develop requisite solutions. The current paper describes the usefulness of operations management in organizing special events like seminars and conferences. Various issues pertaining to event management like planning, purchasing, inventory management, logistics, budgeting and quality will be considered when describing the applicability of operations management to this particular business area. The manner in which different components work together in organizing a successful event and the role of operations management in reducing costs and ensuring profitability has been highlighted. Specifically, the paper discusses the usefulness of operations management in organizing a networking event for reputed firms such as an investment bank. Investment banks regularly organize such events to interact with potential customers, forge new contacts with major players in different industries and strengthen relationships with existing customers. Typical attendees to these events included high profile representatives from several prominent companies operating in various industries. Role of operations management in organizing events A networking event, such as the one discussed in this paper, is not just a luxurious business party, but is in fact an important marketing exercise for investment banks that is aimed at promoting their services through personal interaction with potential clients. While the event has to display the reputation and prominence of the investment bank, the primary goal of the event organizer is to keep the costs to a minimum and satisfy all requirements of the client to full satisfaction. Recent economic events such as the global financial crisis have also forced banks to reduce their spending which must also be taken into account when planning any extravagant events. The networking event is nevertheless a unique opportunity for an investment bank in terms of brand positioning, developing new contacts and identifying potential target firms for some of the core services including mergers and acquisitions (Parry, 2009, Pg. 120-125). Given the importance of such events and the large number of expected attendees, the planning and organization has to commence at least 3 months in advance. Adopting this strategy allows invitations to be prepared and sent out as early as 2 months before the date of the event. This practice will ensure maximum attendance by allowing potential attendees to mark their schedule in advance. The planning phase shall focus upon determining the venue, entertainment facilities, essential provisions, accommodation and other factors that are required to host the event. To provide maximum flexibility, the event will be organized over the weekend as it minimizes any disruptions to the normal working routine of attendees besides preventing any juxtaposition with other major corporate events (Berman, 2007). Several prominent hotels offer weekend discounts which is another reason for choosing a weekend as this would deliver more flexibility to the budget besides reducing hosting expenses (Getz, 2007, Pg. 62-64). Event management and organization All components of the event must be meticulously planned. The primary aim in terms of quality is to provide as many details as possible in all segments and components of the event. Thus, all aspects ranging from decorating the guest rooms to the seating arrangement at the conference venue will be planned and executed in a detailed manner. For example, every meal shall be customized to the tastes and preferences of individual guests and prepared accordingly (Wright, 2008, Pg. 54). Guests will be able to enjoy refreshments at all times and can approach guides stationed at various locations throughout the venue in case they require any assistance. The goal behind giving attention to such detail is to leave an everlasting impression on each attendee thereby helping generate more business for the bank (referred to as the client). The networking event is a two-day conference which shall comprise numerous sessions. These sessions are structured to address individual objectives of the agenda as required by the client. Every session will be organized by taking into consideration the optimum atmosphere that has to be projected during individual sessions. Procedures and protocols will be established to receive guests upon arrival as well as assist them upon session conclusion. Some sessions require all attendees to be present together while other specific sessions target a subset of the participants based on their respective industry group. Electronic equipment including laptops, projectors, microphones and speakers shall be rented and provided wherever required to assist speakers in their interactions (Parry, 2009, Pg. 68). Generally, sessions in such formal conference are varied in nature. For example, sessions during the daytime are usually formal in nature while themes during evenings are often casual. Sessions during the end of the day shall be based on a party theme where attendees will have the opportunity for extensive social interaction and networking. It is extremely important to reflect each of these themes during the event as it facilitates the conference to be paced according to the different moods and preferences of the attendees (Getz, 2007, Pg. 126). Adopting this strategy can provide the maximum benefit to the client as it helps create an impact on most of the participants. The conference rooms at the venue also consist of adjoining gathering rooms that will allow guests to interact at a personal level at all times. Interdependence of various tasks Budget The budget for the entire 2-day event is ?2 million. According to Berman (2007), the average spending for corporate events, especially for established global companies is in the range of ?3-15 million. Given the vast resources required for the event and the impact it has to generate, matching expenditure with budget is the real challenge. The key solution to managing a tight budget against numerous expenditure elements is to segregate these expenses into fixed costs and variable costs (those dependent on the number of attendees or other factors). A reliable, pre-configured and multi-user operations management software tool like EventPro will be used to keep track of available funds, calculated variable expenses and determine the budget room on a real time basis. This provision eliminates the need to keep a constant track on expenses by shifting the focus towards allocation and meeting customer expectations (Allen, 2009, Pg. 48). The budget tracking tool also allows for expenses to be grouped based on their type (such as venue, dining, accommodation etc.). This categorization is helpful in comparing ongoing expenditures on items like food and beverages with similar events in the past (using historical comparison). In fact, comparisons will also be made on sub-categories such as the percentage of beverage expenses on alcoholic drinks etc (Kamauff, 2009, Pg. 93). Besides helping keep track on expenditure, these metrics are immensely useful during negotiations with the client over budget allocations and are capable of reducing several overheads. Individual expenditure categories will be assigned a priority to devote more time and funds to the most important tasks when situations of mutual exclusion arise. The software will also be configured to generate various customized reports from the collected information, to arrive at conclusions like the percentage of expenses spent on meeting rooms or in arranging airport pickups for attendees (Robinson, 2010, Pg. 152). However, it also appears that extensive dependence on information from a software system and frequent comparisons with past trends can lead to certain deficiencies if the proposed budget management strategy is not managed properly. Metters (2010) notes that monitoring expenses based on individual expense categories like catering, equipment providers and hotels have sometimes led to the development of sustained relationships between the company and specific vendors over time. It is thus important to understand that while dedication towards organizing a successful event is crucial, analysis of historical information must be used to negotiate better deals with existing suppliers or find alternative providers who can compete at lower costs and better quality (Robinson, 2010, Pg. 128). It is therefore important that the supplier database be expanded to facilitate the search for new providers on a constant basis. Materials Management While much of the material concerning boarding, lodging, dining and seating arrangements will be managed by the hotel, a number of items need to be stored and managed by the event organizer. Every session requires the distribution of different flyers, posters and media kits among participants, which must be made available before the commencement of respective sessions (Parry, 2009). Prior to the beginning of the conference, each attendee shall be provided with a registration packet upon arrival along with a DVD containing the general agenda of the event. During the latter stages of the conference, participants will be presented with souvenirs as a symbol of the event and its purpose. All along, regular sales promotions will also be undertaken through the distribution of relevant flyers and newsletters (Getz, 2007, Pg. 70). The event director is responsible for overseeing the development of all promotional material which will then be grouped and packed separately based on individual sessions and purposes. All material stocks will contain an additional 5% excess over the pre-determined quantity to overcome any potential cases of shortage or unexpected increases in attendee turnover. Segregating the promotional material beforehand and labeling individual packets according to session and purpose is also useful in selecting the correct packets for a given session (Allen, 2009, Pg. 142). All packets will be transported to the venue and stored in a single room. Details of each packet including their type and cost will be recorded beforehand into the budget management application. One of the modules in this tool provides a graphical association between individual sessions and the various materials that must be supplied to each of them. This module issues alerts to relevant event managers an hour prior to the commencement of the session. Packets will then be transferred to the session rooms and their status updated accordingly (Kamauff, 2009, Pg. 56). Material that is distributed during the session also required a status change. All leftover and unutilized material will be collected and their quantity recorded against the respective session to arrive at a cost estimate. Schneider (2009) says that this strategy has been immensely helpful especially during shortages when event managers can pinpoint the precise packet containing the relevant material and supply it to the designated conference room without any delays. From the perspective of the event organizer, the key objectives from organizing this networking event successfully is two-fold. The primary goal of this project is to develop a strong relationship with the client by providing the best quality of service at the lowest cost. As mentioned earlier, investment banks organize reputed conferences on a regular basis that also receive widespread coverage from the press. Thus, it is important to deliver effective and qualitative service to achieve recognition with the client and develop an established market presence (Voss, 2007). The second objective is to constantly innovate and develop the internal workflows required to organize such complex events (Wacker, 2008). Such improvement can only be achieved by working in real time and adapting to the situation as required. Thus, the key motivation behind applying operations management to organizing events is to generate value to the customer (Bertrand, 2009). In these challenging times, when companies are hard pressed for funds, using operations management also provides an opportunity to generate some savings for the client (from the budget) which can then be reinvested in other important activities. Achieving such objectives is also necessary for promoting further business with the client in future events and conferences. Conclusion Analyzing the role of operations management in organizing a conference event has demonstrated the need to reduce investments into these events and thereby free up more funds for the client. Operations management (OM) provides the capability to determine the precise types and quantities of the services and components required to organize the event. Besides, OM provides an estimation of the effective capacity required to manage individual sessions. Thus, it can be said that OM is useful in planning, organizing and managing the event across all phases of its lifecycle (Shibli, 2008). The extensive use of technology has proved useful in determining realistic budgetary estimations that can keep the quantity of the inventory at minimum levels, thereby reducing costs of storage and transport. The OM software also helps improve responsiveness towards customer needs besides facilitating a better utilization of the personnel and resources available at hand. Organizing such a complex event does have its potential pitfalls that can cause discomfort to participants and harm the reputation of the client. Besides liaising with the staff at the hotel venue and other segments, it is also important to keep a close oversight on the flow of material (inventory). Shortcomings in this area can lead to wastage, improper use and theft. Thus, it is important to entrust the responsibility of managing the inventory to an experienced event coordinator. Accounting for all expenses is another serious issue to consider. Improper accounting practices that deviate from established accounting standards can lead to erroneous results when monitoring the budget (Tyrrell, 2007). Thus, the accounting estimates and assumptions in the OM tool will be configured by an experienced accounting professional prior to the commencement of the event. References 1. Allen, J., 2009. Event Planning Ethics and Etiquette: A Principled Approach to the Business of Special Event Management. New York: John Wiley. 2. Berman, B., 2007. How to delight your customers. California Management Review, 46(2), pp.140–152. 3. Bertrand, J., 2009. Operations management research methodologies using quantitative modeling. Operations Management Research, 21(1), pp.221-245. 4. Getz, D., 2007. Event management & event tourism. Chicago: Cognizant Communication. 5. 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