Operation Management of Firm Based in Singapore - Case Study Example

Operations Management Part Operations Management Plan Introduction XYZ is a multinational firm based in Singapore. The basic operations of XYZ include marine engineering, facility management, technologies for land securities, engineering consultation, traffic system intelligence and maintenance and planet operations. The MNC has established its operations worldwide and its present target market is Middle East. At present, a representative office has been established in Dubai and the objective is to understand and evaluate the market for further development and launch of company offerings. Human Resource Evaluation In this step, the overall requirement of human resource as well as other associated capacities will be evaluation. Initial team: the initial team will be composed of operational and management heads of each SBU to be launched in middle-east market. A total of 14 operational and management heads will be appointed for heading the entry and initial development phase of XYZ in Middle East. Apart from that, a research team will be appointed where one specific research manage will accompany the SBU heads with the objective of analyzing the market. An example below reflects the hierarchy of one SBU. (Source: Author’s Creation) Staff Estimate: Estimated staff requirements for the current year and next two years have been determined below;  Staff Volume Current Year Year 1 Year 2 Administration 5 7 7 Marketing and Sales 15 20 25 Management 15 20 20 Operations 21 35 45 Secretarial 2 7 7 IT and Systems 7 10 10 TOTAL 64 99 114 (Source: Author’s Creation) Financial Evaluation and Resource Funding Financial evaluation and funding of resource will be calculated on the basis of the short term and long term objectives and organizational plans. 1. For smaller project finances, the overall budget will be determined through simple models estimating project expenditure and income for each separate strategic business unit, the overall expenses, expected revenue and profits funding and any gaps in funding. In addition, this budget analysis will have three scenarios such as best case, expected and worst case and accordingly, subsequent strategies will be developed (Jisc, 2010; Chermack, 2011). 2. For bigger operations such as shipping, product and service launch, advertising and promotion and infrastructure development, future forecasting will be conducted (Berry & Hill, 1992). Here, estimated sales and net profit will be used and penetration strategies will be developed accordingly. Financial Projections for year one and two  (Source: Author’s Creation) Target Market and Competitive Advantage Middle East is being touted as one of the fastest growing markets across the globe. It is also the most developed market in Asia, after Japan and with its oil reserves, its importance is being realized by other MNCs. Construction and operations are two major sectors growing rapidly in the Middle East. However, there is an acute shortage of skilled employees in IT and construction sector. Therefore, XYZ will provide accurate solution to the increasing industry requirement through its consulting and management services (Gryskiewicz & Taylor, 2007). Agreements and Contracts Agreements and contracts are essential while establishing new business in foreign markets in order to safeguard the rights to service and unique offerings (Bryman & Bell, 2007). Few important contracts and agreements which have been planned for initial entry in Middle East are as follows; Contract/Agreement Contract or Agreement Current Status Contract for purchase of business  Contract Awaiting copy from solicitor. Franchise Agreement  Shop Lease Agreement Awaiting financial approval.  Equipment Purchase  Agreement Acquired as business plan Intellectual property rights  Contract  Supply and purchase contracts Contract Under process Rights for distribution Contract Under process Supply and purchase contracts  Contract Written and informal agreements Service Contracts  Contract Under Process Contactors agreement Agreement Informal agreements Cooperation from other businesses Agreement Ongoing informal talks (Source: Author’s Creation) Assessment of Risk and Mitigation Plans While developing an operational plan for internal business development, it is critical to analyze the risks associated and develop appropriate strategies to mitigate these risks (Ivert & Jonsson, 2010). Being an engineering and consulting organization, XYZ is associated with various risks. Major risks and their mitigation strategy are explained below; Risk Assessment Occurrence Influence Priority level Mitigation Strategy Alternative Plans Loss of life or property due to fire L H H The preventive action will include installing effective sprinkler systems and smoke alarms. These will be regularly checked and staff will be trained for emergency execution. Execution plan will be made for both head office and representative offices. Appropriate insurance policy will also be established. A part of the financial resource will be kept for emergency actions such as new office building or lease and employee compensation in case of accidents, while the company waits for insurance claims. Sudden change in suppliers L M M Mitigation strategy includes establishing written contracts with supplies, maintaining good relationships and maintains capital reserves. Keep alternative suppliers by maintaining good relationships and engage them in tertiary activities Breakdown of machineries and equipments H H H Buy quality and standard equipments and machineries from certified manufacturers and suppliers. Frequent monitoring and auditing of equipments and regular training for staff, employees on equipments and machinery handling and management Investigate the source of breakdown and keep contractual agreement with suppliers for spare machines during emergencies. (Source: Author’s Creation) Analysis of Operational Capacity Operational capacity will include assessment of the present operations requirements; 1. Supply and purchase Suppliers and purchase will be distributed according to the strategic business units of XYZ. Contractual suppliers will be established for facility management, marine engineering, land security and traffic system technologies and planet operations. For engineering consultation and maintenance services, agreement will be made with government and non-government companies. 2. Production and operations process This will include all operating processes and facilities planned in Middle East market. At present, XYZ has established a representative office in Dubai. However, the company is planning to establish a full-working subsidiary office in Dubai. After a period of 1-2 years, XYZ expects to establish a branch office in each state of the Middle East nations. 3. IT and communication systems IT and communication systems will include computerized POS system linked with the accounts department. All transactions will be processed, managed and stored in the internal database of XYZ. Performance Analysis A major factor which is ignored during the operational management process is performance analysis. By assessing the overall operational process every six months, the company will be able to assess the weaknesses and shortcomings in the current plan and make amendments wherever possible (IISD, 2013). Aspects of Operations Rating out of 10  Improvement Methods Current Expected (6 months) Equipments 5 9 Frequent Audits and Monitoring Flexibility 6 10 Workplace contacts and Agreement Skill Levels 6 8 On the job mentoring, training and coaching Safety 7 10 None Service 4 10 Service and skill training for staff Technology 8 8 Training on job Innovation 6 9 Evaluating the changes in government and business patterns and changes in client demands (Source: Author’s Creation) Part 2: Self Reflection For certain reasons, my high level operations and business development plan did not satisfy the expectations of my boss and was disapproved. It was highly disappointing as substantial times, energy and resources were exploited during the completion of the operations plan. Nevertheless, I kept on analyzing the Middle East market and further rectify the areas which according to my boss were not appropriate. In the mean time, a senior Singaporean manager was sent to run the operations in Dubai. The market turned out to be much tougher and complicated than expected and after one year of constant hard work, our company got one single government project to implement ITS solution in Abu Dhabi. However, the implementation process tuned out to be a nightmare and the company’s reputation was in jeopardy. Realizing the mistake, I was sent to Dubai to recover the project as well as company’s image. My first action after landing in Dubai was to conduct a meeting with all company members present in Dubai addressing the road blocks and mistakes. A detailed discussion revealed various observations, I found that majority of executives had little or no knowledge about the culture and society of Middle East indicating a lackluster initial market research. Most of the issues faced by XYZ employees were communication problems and conveying our offerings to them. Even though Middle East clients wanted high end solutions such as advanced security systems for their houses and offices, lack of proper communication resulted in failure of meetings each time (Leonidou, 1995). After having a thorough discussion with the senior manager from Singapore, I realized the big strategic mistake in their planning and implementation process. The manager from Singapore was following a one-size-fits-all strategy for all consumers and potential clients across Middle East. As a result, even though products offered were qualitatively better compared to local solutions provider, clients preferred local suppliers to XYZ. After analyzing the issues and major roadblocks, I prepared initial strategies for image makeover, building effective communication. Trends: My next step in the initial two months was analyzing the trends in the target market. This included customer analysis, detailed competitor analysis as well as analysis of their products and services offerings. One critical analysis for the failure of the implementation process was lack of personalization (Grimson & Pyke, 2007). The local suppliers and solution providers excelled in providing personalized services. Another observation was the trend among clients. While Middle East is becoming a burgeoning centre for advanced IT, people still prefer technologies which can be accessed and handled easily (Feng, D’Amours & Beauregard, 2008). This was major reason behind the implementation failure and initial response suggested that people were finding the new technology difficult to handle. Decision: After detailed analysis of the trends, communication gap and other issues in the implementation process, various decisions were made for the first two months. The first decision was appointed of certified suppliers. It was found that there was a huge gap between delivery of equipments and submission of requests. The suppliers selected were not certified and equipments were of low quality. After proper supplier selection, the next step was to appoint a secretary for enhancing communication between the clients and staff. While there was a lack of single communication language, there was also a huge difference between body language and non-verbal communication. Therefore, the field executive and staff who were in constant communication were given special training in verbal and non-verbal communication. The training was very effective and the results were quick indicating better relationships between the staff and the government officials. I was always accompanied by my secretary whenever I had a meeting or appointment with the top management of the government organization we were working. Behavior: After reaching Dubai, I was a little skeptical regarding my role in the change process. I was also unsure about me behavior towards the exhausted employees and staff and grunted client. However, I had a meeting with VP before leaving for Dubai where I was exposed to some quick behavioral tricks helping me to manage the employees and clients. These learning came in handy while communicating with Middle East government. One strategy will helped me a lot was making a copy of every document in Urdu language and distributing them to every concerned client. Asking for feedback and visiting the client’s office on a regular basis was put on the priority basis, as the first few months were dedicated to amend the relationships and resolve any queries or miscommunication between clients and staff before completing the implementation process. Overall, my behavior during the first two months was taking all the heat and providing strategies for reducing pressure among the client as well as staff. Image makeover: My first task was to amend any broken or misguided relationship between the client and the company. It was found out that the there was a huge gap between the initial solutions offered to ITS solution and the actual services provided during the implementation process. An appointment with the ITS managers was conducted through which detailed discussion about their issues and feedbacks were analyzed. After that, all the necessary amendments were incorporated in the halted project. Further, regular meetings will the client were conducted where XYZ’s successful achievements were discussed. This was followed by client dinners and gatherings as these are considered as fruitful in Middle East market. Though the overall expenditure exceeded the cost, I realized that this was a long term investment for development of further clients in Middle East market. My first two months in Dubai were successful in amending the relationship between the government and the company management and I was able to implement the process without any hindrance. References Berry, W. & Hill, T. (1992). Linking systems to strategy. International Journal of Operations and Production Management, 12(10), 3-15. Bryman, A. & Bell, E. (2007). Business research methods. New York: Oxford University Press Chermack, T. (2011). Scenario Planning in Organizations: How to Create, Use, and Assess Scenarios. San Francisco: Berrett-Koehler Publishers, Inc. Feng, Y., D’Amours, S. & Beauregard, R. (2008). The value of sales and operations planning in oriented strand board industry with make-to-order manufacturing system: Cross functional integration under deterministic demand and spot market recourse. International Journal of Product Economics, 115(2008), 189-209. Grimson, J.A. & Pyke D. F. (2007). Sales and Operations Planning. 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