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Decision Areas in Operational Management

Question:

Discuss about the Operations Management of Mobile Company for Computer.

There are various operational activities in every organization. These activities can be used to purchase, develop and effective utilization of resources. The operational activities are key attributes of every business that is helpful in gaining profit. This report is about identifying the operation management areas of the Oman Mobile company. For the discussion, famous mobile company Samsung Gulf is selected. Samsung Gulf is the world leader and digital convergence technologies. The company started its operations in Oman in 1995 and now it is the most trusted brand among the customers. Company has wide range of products including TVs, laptop, computer, washing machines, mobile phones, cameras and CD players etc. The company has adopted operation management process in order to provide best quality products to the customers (Samsung, 2018). The report identifies operation management decision areas along with the suggestions to improve them. Along with this, report also analyzes the operation strategies of the company and their impact on achieving competitive advantage in market.

Each and every business is managed by various business functions within the organization. Operation management basically is the business function that is responsible for managing the process of business. It generally includes organizing, planning, coordinating and controlling all the resources that are required to achieve the goals and objectives of the company. The decision areas in the operation management can be related to managing people, technology, equipment, information and all the process that are important to manage the business effectively in the operating market. In order to stay competitive in the market, Samsung Gulf has adopted various operational decisions. These decision areas are helpful to gain higher profit as compared to the competitors in Oman market. There are various operational areas that include responsibilities of ensuring the business operations are effective in terms of using the resources and meeting the consumer demands. With the effective business operation process, Samsung has positioned itself as the market leader of smart phones. Three important decision areas of operation management of Samsung are research and development, layout and process design and supply chain and logistics (Slack, Chambers & Johnston, 2010).

Research and development- Samsung Gulf has invested around 9% of its revenue on R&D. Employees in the research and development department work every day to identify the new market trends and set new standards for excellence. The company is aware that people and investment is the core asset of successful R&D and superior technology. Around 40% of employees are engaged in R&D department. The number of turnover of the company has proved that the investment in R&D turn out to be worthy (Chun, 2015).

Operational Decisions of Samsung Gulf

Layout and process design- Most of the procurement operations of in Samsung are intra firm. Samsung seeks to develop a group of recognized suppliers and advertize the opportunity only to them. Rather than focusing on the external suppliers, company focuses on intra-firm process as it produces the components itself (Khanna, 2015). Samsung has the ability to understand the functions and initiate for them. The company has ability to manufacture the products quickly as the contract manufacture. In order to perform the manufacturing processes efficiently and completing the development cycle for the electronic products, Samsung has used well planned stages. Each stage is arranged in such manner that product development can be cost and time effective. The manufacturing operations include conceptualization, research, and circuit design (Tassey, 2014).

Supply chain and logistics- This is one of the pillars that support the growth of the company. The most important supply and logistics technology used by Samsung is advanced planning and scheduling system (APS) which is considered to be highly successful. The logistics operations are managed in such manner that most of the products are absorbed within the Samsung group and by its associated business (Samsung, 2018). So the company is operating in highly integrated systems. The entire business operations and manufacturing system in Samsung is vertically integrated that assist the company is excelling in the supply chain. The operation management in Samsung focuses on the innovation of products. The company is using six sigma programs in order to produce highly qualified and talented supply chain specialists. Moreover, in order to bring internal department closer, company is using system called ‘voice of business’ so that internal requirements can be gathered (Carmignani, 2009).

Although the company has effective operation management system but there is the need to focus on some areas in order improve the operational strategies. The operations management of the company should ensure that the strategies used in the business are objective-oriented in order to deal with mistrust from the targeted market. The managers should be encourages to avoid making wrong decisions in the business. Further, Samsung should invest more in the research and development in order to upgrade new technologies in smart phones that could appeal to the consumers to buy those products (Palepu & Healy, 2013).

Next, in case of highly effective and efficient supply chain and product systems, it is crucial for Samsung to enhance the leadership position in the market. it is recommended that Samsung needs to implement more obedient approach in order to deal with the issues available in the supply chain. For dealing with the issue of discrimination in logistics, company needs to implement a fair trade policy. It is also important Samsung to have codified regulatory system that must be equivalent to all the supply chain partners to conduct fair business (Jung, 2014).

Research and Development

Apart from this, it is also recommended that Samsung should also use reverse logistics that will be helpful for the company to overcome from the environmental sustainability issues and minimize the wastage. By the reverse logistics, Samsung will also be able to support recycling, recovery and reuse of the used products to help the environmental conservation.

Samsung has wide range of existing product catagories and that could concentrate on strengthening the existing ones. Company should develop its weaker product catagories in order to enhance the sales. Along with this, Samsung should invest its money to enhance the R&D department and activities in order to develop environmental friendly products as this field will be the most promising field in future.

In order to manage the business efficiently, Samsung has adopted some operational strategies. Those strategies are as follows:

To a large extent, Samsung has adopted most modern supply chain techniques. The supply chain network of the company is well defined and structured in order to ensure the efficiency in the operations management. Samsung is focused on building strategic partnership with the top-most suppliers based on mutual trust (Heizer & Render 2014). Company has adopted fair and transparent process in operating the supplier registration system for the new suppliers in order to sustain competitive advantage and minimize the relevant risks (Kashmanian, 2015).

Samsung has implemented risk management operational strategy in order to minimize the risks in the business. The risk management operations are implemented before the manufacturing of the specific products. There is a risk department with the identification and management of risks. Samsung has adopted satisfactory risk management strategies (Tan & Matthews, 2009).

Samsung has adopted innovative culture that encourages adoption of innovative market strategies. The products are manufactured based on the preferences of the customers. Samsung has different product features as compared to the rivals. The difference attributes are interesting to the customers that give them the reason to choose the particular products. Low-cost is another approach by which the products are products are purchased by price sensitive buyers (Nisen, 2013).

By the operation strategies, Samsung is able to achieve competitive advantage in the market. The strategies are used by the company to fir in the market of Oman perfectly. Based on the operational strategies, Samsung is the market leader in some areas due to its core strengths.

Low-cost provider- Samsung has competitive advantage as the low cost provider company. Company keeps the prices low so that there can be massive customers on a specific product. Samsung has created fantastic smart phones in the low costs and achieved more sales. This means, by the innovative R&D Samsung is able to achieve competitive advantage over the rivals (Valdani & Arbore, 2012).

Layout and Process Design

Differentiation- By the strategies, company is able create broad differentiation in the products from the competitors. The differences can be viewed in terms of software and design. Prices are also different to make the customer loyal for the products. By the operational strategies, Samsung is able to develop the products that are low priced for the people in the target market.

One of the key issues in logistics of Samsung Gulf is that the company focuses on the domestic companies as compared to global companies. Although quality is due importance but company is practicing discrimination that have negative impacts on the logistics partners of Samsung. Another issue of logistics is that the company is non-adherence to environmental and social standards.

In order to stay competitive in the market, there are some recommendations for Samsung Gulf.

  • Company should develop the task force in order to examining the similarities and differences with competitors’ products,
  • Company should develop new and innovative technology to differentiate the products from competitors,
  • Company should focus on more software and services to achieve competitive advantage, and
  • Company should focus on the vendor specifications in order to develop competitive advantage and excellence in supply change.

Conclusion

Based on the overall discussion, it is observed that Samsung Gulf is the leading mobile company in Oman due to its innovative products and effective operational strategies. The company has adopted various innovative strategies in order to stay competitive in the market. Company has set layout and process design process and logistics and supply chain services that are the key factor of the success of Samsung. But, it is observed that there are some issues and challenges that must be addressed on the priority basis. Some recommendations are provided for Samsung so that the operational activities can be improved to stay competitive in the market.

References

Carmignani, G., (2009), Supply chain and quality management: Business Process Mgmt Journal, 15(3), 395-407

Chun, J., (2015), How Samsung Electronics’ Organizational Structure and Culture Affect Its Innovation, Denmark: Ibp Union.

Heizer, J. and Render, B., (2014), Operations Management: Sustainability and Supply Chain Management, (11th), Pearson Prentice Hall

Jung, S. C., (2014), The Analysis of Strategic Management of Samsung Electronics Company through the Generic Value Chain Model: International Journal of Software Engineering and Its Applications, 8(12), 133-142

Kashmanian, R., (2015), Building a Sustainable Supply Chain: Key Elements. Environmental Quality Management, 24(3), 17-41

Khanna, R., (2015), Production and operations management, Prentice-Hall Of India

Nisen, M., (2013), Samsung Has A Totally Different Strategy From Apple, And It's Working Great, accessed on 13th March 2018 from https://www.businessinsider.in/Samsung-Has-A-Totally-Different-Strategy-From-Apple-And-Its-Working-Great/articleshow/21250813.cms

Palepu, K. & Healy, P., (2013), Business Analysis and Valuation, Florence: South-Western

Samsung, (2018), Operations & Management, accessed on 13th March 2018 from https://www.samsung.com/global/business/networks/solutions/operations-and-management/

Samsung, (2018), Responsible Management of Supply Chain, accessed on 13th March 2018 from https://www.samsung.com/us/aboutsamsung/sustainability/supply-chain/

Slack, N., Chambers, S. and Johnston, R., (2010), Operations Management, (6th), FT Prentice Hall

Tan, K. & Matthews, R., (2009), Operations strategy in action, Cheltenham, UK: Edward Elgar

Tassey, G., (2014), Competing in advanced manufacturing: The need for improved growth models and policies: The Journal of Economic Perspectives, 28(1), pp.27-48.

Valdani, E. & Arbore, A., (2012), Competitive strategies, New York: Palgrave Macmillan.

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