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Operations Management: Tesco's Capacity Management - Essay Example

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Operations Management: Tesco's Capacity Management Table of Contents Introduction 3 Background Information 4 Company Strategies 5 Conclusion 9 References 10 Bibliography 10 House of Lords. (2008). Waste Reduction: 6th Report of Session 2007-08: Vol. 2 Evidence: House of Lords Paper 163-II Session 2007-08…
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Operations Management: Tescos Capacity Management
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Download file to see previous pages In other words, the operations managers are held responsible for accomplishing the business process effectively and efficiently. Efficient handling of business process includes the underlying technology which assists in production as well as monitoring the factor output ratios. in addition, the supply chain of the production process too is counted as part of operations management. Hence, the operations managers are responsible for incorporating competitiveness in their production process. The diagram alongside shows the intrinsic nature of operations management process where the manager’s decision is the ultimate force operating behind the choice of inputs. This choice is entirely based upon the manager’s efficiency and discretion of choice given the costs associated with the production process. The manager on the other hand, acts on the basis of information that he acquires from the market. These inputs are employed in the production process which yields the final output that is sold to the customers. Based on the feedback of customers, the managers decide to continue with their chosen input endowment. This is where the question of competition crops up (Waters, 1999, p. 4). The present paper examines this very aspect of Tesco and attempts to demonstrate the degree to which changes in operations management could actually lead to improvements in its level of competence. Background Information Tesco was founded by Jack Cohen in 1929 in UK after being impressed by the concept of supermarket chains in different parts of USA. The prime motto of Cohen while he conceived the idea of Tesco had been that of purchasing large stocks of goods and selling small units of those commodities to retail customers, thus accumulating the difference between wholesale buys and retail sales, as profit margins. The year 1947 saw the company being embodied as a joint-stock company and in 1956 it opened its first self-service store. Post 1960s, the company decided to expand its business through acquiring a number of companies. However, the company still had a long way to go in order to make its presence felt among the English people. It laid the foremost importance upon the aspect of price competition which is historically regarded as playing one of the primary functions guiding customer decisions. The company had been employing a variety of measures beginning from producing on a large scale through indulging in merger and acquisition activities. Another innovative method that the company implemented in order to allure its customers had been that of issuing stamps to their shoppers which the latter could either convert into cash or trade for some other gift. However this strategy did not work for long with British customers as they gained more and more wealth thus demanding for luxury commodities rather than the commonplace ones produced and marketed by Tesco. As Tesco could not respond as quickly to customer demands, they felt the brunt of a looming crisis with receding customer demands thus forcing them to concentrate upon their supermarket stores and shutting their retail stores. In fact, the worsening state of the company had been one of the reasons why Imperial Tobacco dropped the idea of including Tesco in their portfolio while planning a diversification; their main concern had been that of a blemish upon their popular image following this incorporation. To improve their corporate image, the company deci ...Download file to see next pagesRead More
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