How does an understanding of the influences on operations contribute to business success?
Operations refers to the business function that involves the transformation of a businesses inputs into outputs that satisfy consumer needs and wants. Operations management is influenced by a range of factors from the external business environment that are out of the businesses control. These influences include globalisation, technology, quality expectations, cost-based competition, government policies, legal regulation, environmental sustainability and corporation social responsibility and can pose opportunities or threats to the business. Examples of businesses that demonstrate an understanding of these influences and are able to use this understanding to contribute to business success include Qantas, Nike, McDonalds and Jack Daniels.
There are a number of ways to measure business success. Business success can relate to operational success including efficiency, quality of product/service and customer service, financially including profit maximisation and market-based success including high market share and a strong customer loyalty.
Globalisation refers to the removal of barriers of trade between nations. McDonalds now operating in over 100 different countries have felt the need to adapt their menus to reflect the different tastes and local traditions for every country in which they have restaurants. In India beef in strictly off limits resulting in McDonalds only offering chicken and vegie style burgers. Despite introducing new processes to the business operations and reducing economies of scale, entering the global market has increased McDonalds potential customer base and has resulted in worldwide strong global brand whereby consumer’s feel a sense of confidence that they can trust McDonalds products wherever they are.
Technology refers to use of machinery and other innovative devices that enable businesses to undertake the...
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