Effects of Globalisation on Operations Management

Effects of Globalisation on Operations focal pointGlobal act have a go at itment in financial origination has de barrierinen unpredictable activities in young years due to planetary economic downturn and competition for market shargon. The key element which underpin world(a) surround will be internationalization and globalisation. Global cognitive member refers to dynamics which affect the public economy and successful integration of global dispersed function or activities. According to Yip(1995) global function can be refer to, among others global sourcing, to keep back manufacturing or divine service facilities world wide or to supply drivers of globalisation including global market, each of which append competitiveness through increase sales by expanding into new market. On the other hand, Slack, et al (2001) argues that globalization is the opportunities for operation motorcoachs to explain both supplier and customer relation in different leave-taking of the wo rld.Recent tactics in global competition among validations require extension of trade internation aloney by the build of foreign direct investment which has be givened emerging newly industrialising nation. In a highly competitive global environment, companies request to set a well localize operation objectives and plans to successfully compete in both domestic and global market.This assignment critically analyses the key global operation management techniques adopted by Barclays bank for its innovative process to distinguish itself as a unique global asset management firm offering tremendous service to institution and individuals. Barclays global investors argon one of the worlds largest asset managers and the world largest providers of structure investment strategies. The familiarity operation strategy should reflect its position in global, economic, political and affable environment. (See Appendix one)According to this assignment on that point are 8 study key factors f or global operation management to be considered belowGlobal substance Quality Management in service industries (TQM gurus)Global Inventory Planning and Control ManagementStrategies for Global Change ManagementGlobal Operation creation and ProcessGlobal Operations Planning, SchedulingGlobal Distributions and Supply Chain ManagementStrategy for Global Human Resources.Global strategy for operation ManagementGlobal strategies for operation managementOperation management is a systematic approach to address all the issues pertaining to the transformation process that convert some inputs into fruit that are useful and could fetch revenue for the system of rules. According to Slack, et al (2001) global operation management is the term used for the activities, decision and responsibilities of operation managers who manage the toil and ransomed of produce and service. The operation strategy should be part of the musical arrangement total strategy to grasp global dominance. Financial s ervice product slips unique contends which pauperization customers present during the production and service delivery. This requires Barclays to improve its operation process that will add value to achieve competitive advantage.Strategy for Managing Global Operation nasty-hitting operation through efficient use of resources world wide drive towards a globalize economic system. Global market imposes new standards on timber and time requires operation managers to think domestic market and penetrate the global market. To achieve its objectives towards globalization, thither should be improve communication technologies and open financial system. The company strategy should achieve adequate utilisation of resource and adequate customer service.This strategy has prove success by positioning itself as customer-oriented organisation and empowering customers world wide to confound different choices of innovative financial product to discover their needs.However, global strategy has th e follo drawg draw backsTo manage multinational operation faces challenges of oral communication and customs difference, different management style and different laws and regulation.The afoot(predicate) economic downturn has affected consumer spending and confidence in the banking industries.Complex global operation by multinational faces ethical and environmental challenges.Operation Strategy contentsIn global operation content, the decision and action should be specific to achieve the objective. The content reflects the four surveysOperation strategy as top- down perspectiveOperation strategy as bottom-up perspectiveThe market requirement perspectiveThe operation resources perspectiveGlobal total calibre management in financial service industries amount prize managementThe channel occupyers face immense pressure in todays turbulent competitive environment thats move forward by globalisation, macro-environment factors and advanced technological growth of internet. The strong market forces at bottom this competitive environment read developed global customers who are more aware of interchanges in the global market. hit quality management is an cardinal fauna in any business to surmount future challenges within the turbulent financial service environment. TQM provides the financial business leaders with a formalised process in setting clear and achievable corporate objectives and at the same time guides the management in planning strategies to maximise resources and to achieve win-win partnership.Total quality management (TQM) is an organization-wide process that revolves aroundthe Total Quality Triad. It assumes that there is never a state of perfection (Kelada, 1996).Hence, in order to that plans are developed in an integrated manner, three important totalquality principles must be adhered to participation and commitment by stakeholdersand senior management team, employee involvement and continuous improvements to dally customer satisfaction.Sour ce Bradford UniversityTotal quality management in global financial run environmentIn the global financial services environment, Total Quality Management (TQM) provides the overall concept that fosters continuous improvement in an organization. The implementation of a Quality Management System (QMS) does non equate to self-produced results.Continual improvementContinuous improvement of the QMS is of paramount importance for fiddleing and satisfying clients ever changing needs and requirements. The purpose of the plan is to identify quality improvement through Kaizen program, surgical process measurements benchmarking with appropriate key performance indicators and essentially conventioning a balanced scorecard to achieve continual improvement.Practices by non-financial organisationGood practices implemented by reflexion organizations in strategic partnerships alliances and knowledge management was identified and developed recommendations for improvements to gain competitive a dvantage in the construction industry.TQM not suitable for financial services environmentTQM is not really suitable for any service organisations but it really assistants the service organisations to focus on the participation of senior management team, involvement of all employees and managing internal process towards achieving customer satisfaction.Long Term client relationshipIn global financial services environment business strategy is building on long-term client relationships. Over 90 percent of the pee is repeated business from leal clients. This strategy yields cost advantages, profits, and growth, allowing them to attract and retain investors and thus fuel further growth.Quality Gurus there are a number of writers whose work dominates the quality movement. Their ideas and approaches shit stood the test of time and have come to from a body of accepted knowledge, to lead and advise their own movement in quality.They have become cognize as gurusCrosby Philip B.Deming W. E dwardsFeigenbaum Armand VIshikawa KaoruJuran Joseph MOakland john SShingo ShigeoTaguchi GenichiAll the above Gurus have presented their own work on quality management and have make a significant impact on the world through their contributions to improving not only businesses, but all organizations including national governments, public organizations, educational institutions, healthcare organizations, and many other take a shitments and organizations.Global inventory planning and potency managementWhat is planning and control?The purpose of planning and control is to go over that operations are work effectively and the production of products and services as required. There is another purpose of planning which is to minimise uncertainty and risk and a clear watch out of future forecasting.Financial planning and controlIt is a well known fact that a successful business jocks organisations to generate enough cash in order to cover costs and make some profit.The difference betwee n sales and cost is profit. The businesses are not always expected to be fat from the very first day but there should be an expected plan for them to become profitable.There should be proper financial controls for all the businesses. The records should be accurate and complete and should fulfil the legal requirements. The tight financial control always helps the financial organisations or any organisation to monitor their current place and always predict the future environment.The education derived from financial statement analysis can be used to establish future operating(a) goals (financial planning) and to determine how to meet established goals (financial control).Developing pro forma financial statements is an important part of the planning and control processes.Inventory planning and control in financial services environmentInventory planning and control in financial services environment is the method of organising the difference between demand and supply of financial produ cts and services.Inventory control is not a small matter from a financial perspective way. Inventory is really important and major current asset for any business including financial services organisations.As a result, there are always policies of businesses to keep the inventory as low as possible because too oftentimes cash hold up in inventory. The objective of reducing the inventory can be accomplished with modern inventory management processes that are working effectively.INVENTORY PLANNING AND CONTROLSupplyThe OperationOperations resourcesDemandThe MarketCustomer requirementsGlobal change management strategies in financial environmentIn todays world of economic and technological development, the organisations have changed significantly. The change had only been possible through restructuring, technological improvement and merging with other businesses.The most important challenge for the organisations is to implement such change to achieve the behavioural and cultural change t hat is most likely required to achieve the planned benefits.Behavioural change does not just happen in the organisation. Change will only occur if there is leadership, clear goals and planned benefits for its stakeholders. All of these should be properly communicated in a timely manner.Strategy for ChangeThree important principles to manage change areChange management is not the goal in itselfFor an organisation to be successful, change management plays an important portion. Change management is all about managing the process effectively and leads to an environment where an improvement in performance are realised.The change targets must play an active role in realising the changeChange in projects will identify and successfully communicate the image, therefore permit the employees know that the planned benefits have changed and play an active role in realising those planned benefits.Employees are the greatest asset for any organisationEmployees are potentially the greatest challen ge for any organisation. The image or goal of any purpose can only become reality if the employees believe in the project and have the desire to achieve it.Financial services environmentIn the last decade, financial services sector has undergone major changes. The financial sector is a rewarding field in which there is every chance to make or improve a career, particularly if staff is loyal, hard working and have given the correct back up support. It cannot be ignored that the current process of globalization and market deregulation has often led to restructuring within organisations. If these major changes have been mis-handled, then it would bring job insecurity and resulting increased pressure on work forces, which in turn can lead to higher work related stress, and a possible lack of commitment and motivation.Change requirement in current financial environmentCapital, currently, is grossly overvalued. Company objectives are all about maximizing value for shareowners, the provid ers of capital. This can lead to companies adopting strategies that do not necessarily benefit stakeholders such as customers and staff. The same emphasis on capital, and shareholder value, breeds an unhealthy focus on short-term results. Shareholders of stock listed companies want better results every quarter, leading management to take decisions that are not necessarily in the longterm interests of the company and its stakeholders. This needs to change.Global Operations DesignA global operation must be designed to enable efficiency and effectiveness. It must not happen by default. To design is to conceive the looks, arrangement and workings of something ahead it is constructed. (Slack, chambers and Johnston, 2007).Global operations design consist of process design, products or service design, process technologies and layout design.Process DesignSlack, house and Johnston, 2007 delimit process design as the overall configuration of a process that determines the sequence of activi ties and the flow of transform resources between them. Process design should reflect process objective.Processes should be designed so they can create all products and services which the operation is likely to introduce. (Slack, domiciliate and Johnston, 2007)The Volume-Variety Effect of Process DesignNormally, the design of a process for a financial services organisation within a country is ground on volume-variety. This also applies globally.Process type in service operationsProcess design will be determined by the volume and variety. When volume is low, there is the possibility that variety will be high. When volume is high, there is the possibility that variety will be low and so there will be standardisation.Professional services provide high directs of customised services based on customer needs. As a result may have high level of variety and low volume.Mass services process have a high number of transactions, often involving limitedcustomisation, example go equivalence.co m. As a result there will be high volume and so variety may be low.Service shops process are positioned between professional services and mass services, usually with medium levels of volume and customisation.In global operations design, FSO falls within the Mass Services category. This is high volume and less variety. Therefore, there is standardisation. This is becauseUniformityDue to globalisation, there is more movement of large number across the world. It is therefore important to create a uniformity of processes so that customers from different part of the world who have seen such a product or services at other parts of the world could easily identify and understand the processes. speak to SavingIn FSO, it cost of money to create a process. Some of the cost are the amount paid to consultants and key management staff to design a process to achieve efficiency and effectiveness. Hence such a process is copied by other branches throughout the world to save money.TimeThere is also a sight of management time in process design. It is therefore better for other branches in other part of the world to duplicate so that management time will be saved and spent on other activities.Human Resource ManagementGlobalisation has also lead to the movement of staff, especially senior and management staff across the world. To ensure that they fit into the system easily, process are standardised.Global Management Strategy intimately FSO now see the world as a global village. For that matter, top management see the world global operation as one unit. As a result, they adopt similar processes across the whole global organisation.Products or Service DesignProducts and services are often the first thing that customers see of a company, so they should have an impact. A good design is to satisfy the customer. (Slack, Chambers and Johnston, 2007). As customer gets satisfied, the organisation can achieve its vision (Lynch and Cross, surgery Pyramid).According performance pyramid d eveloped by Lynch and Cross (Advanced Performance Management, Essential text, 2007) Customers base their satisfaction on quality and delivery time. The organisation bases their satisfaction on process time and level of waste. This is known as level four.As level four is achieve, leads to level three. That is customers becomes satisfied, the organisation becomes flexible to meet customers needs and so productivity as whole increases.Level three leads to level two. The organisation then get market share and high gainfulness as a result of level three.Finally, the organisation finally achieve its vision.Aspects of products and servicesAll products and services can be considered as having three aspects. (Slack, Chambers and Johnston, 2007). That is, concept, package and process. The concept, which is the understanding of the nature, use and value of the service or product.FSO may manage the three aspects mostly through both external and internal environmental analysis by using SWOT Ana lysis (strength, weakness, opportunity and threat), Porters five forces and Porters Diamond.Supply network designSupply network includes suppliers and customers. It also include suppliers suppliers and customers customers and so on. It is the network of supplier and customer operations that have relationships with an operation. (Slack, Chambers and Johnston, 2007).The network has a supply side. That is, network of suppliers, suppliers suppliers that provide resources to an operation. The demand side is, chains of customers, customers customers that fulfil the products and services produced by an operation.The supply network must be designed to reduce time and cost. The shorter network, the shorter the cycle time and so the delivery time to the customers may also reduce.Process TechnologySometimes, FSO outsource some activities to reduce the supply network to save cost and increase speed.Furthermore, information engineering science has also help to reduce the supply network by elim inating intermediaries. Example, e-procurement can enable FSO to access a pool of suppliers directly. For the demand side, websites like moneysupermarket.com can be accessed by a wide range of customers directly.Global Operation Planning and ControlMost FSO fail because they fail to plan and control their resources globally. The situation of most banks in the current global recession is a typical example. Apart from HSBC and Barclays Bank to some extent, most banks nearly collapse. Northern Rock and Lloyds TSB are a example of misery to plan and control globally. This shows that planning and control are very important because global operation for FSO is a very high risk. Therefore, planning and control is important. This is to ensure efficiency and effectiveness globally.The whole world economy is interlinked. There is free movement of capital across the world. As a result, an economic downturn in one part of the world could affect the rest of the world. Example, the downturn of th e housing market in U.S.A. nearly leads to the collapse of Northern Rock as a whole. Furthermore, the current recession in Dubai has affected the Lloyds TSB in the U.K.Some of the things that are planning and control globally areCapacity Planning and ControlThis is the designate of setting the effective capacity of the operation so that it can respond to the demands placed upon it(Slack, Chambers and Johnston, 2007). That is how to deploy resources to able to meet demand. That can be termed as flexibility of resource utilisation. Globally, FSO must be flexible enough to cope with changing levels of operation. Failure in capacity planning and control normally lead to delay of delivering on time. As a result, customers get dissatisfied and the long term effect is lost of market share.Some of the factors that may affect global capacity planning and control arePolitical Example are political instability, government regulationsEconomics Recession, Exchange rate, Foreign exchange contr ol.Social Culture, Religion, handiness of staffTechnology Level of technologyEnvironmental Activities of environmental agencies and international policies onenvironmental issues.Legal Legislation like health and safety, anti monopoly laws job Planning and ControlA project is a set of activities with a definite start point and a definite end state, which pursues a defined goal and uses a defined set of resources. (Slack, Chambers and Johnston, 2007).It involves five stages. They are Understanding the project environment Defining the project Project planning practiced execution Project controlGlobal project planning and control is difficult and risky. This is because, it is very big, it covers wide area, time differences and it may involve a lot of resources. Poor planning and control of project can lead to misfortune. That is, more resources may be used than anticipated and the project may also not finish on schedule.A project can be planned and controlled by techniques such a s critical path analysis and Gantt charts.The introduction of information technology has help to manage global projects. The most popular software for managing global projects is Groupware.Global Supply Chain ManagementGlobal operations managers of FSO have to look beyond internal view if they want to manage their operations effectively. This is because, an organisation depends on other organisations for survival and so there is the need to manage the supply and distribution of product and service. Decisions have to be made regarding supply and distribution, to ensure that the needs of end customers are met. That is, supplying customers with the appropriate products and services when ask at a competitive price.The objectives of supply chain management are quality, speed, dependability, flexibility and cost.Internet and mobile phone have helped most global FSO to make relationship between suppliers and customer work more efficiently and effectively. Through internet, global FSO has gained access to wide suppliers and also has used internet and mobile to deliver banking services to remote customers in different countries.STRATEGIES FOR GLOBAL HUMAN RESOURCESHuman resources have got a key role in entering in to a new market to find out the risk and opportunity of the market. Human resources are concerned about staffing, recruiting and retain employees, training and development, cultural compatibility, communication and technology, and policies, procedures and structure.As organizations expand worldwide, human resource management has become increasingly more complex and challenging. The global business needs highly skilled and educated bulk for the operation and the HR management support these people to work as a team.Many companies have developed technological tools to address and overcome the HR challenges. In the global operation the HR managers struggled to communicate with the entire workforce effectively as they are spread all over the world. Many business es develop innovative tools to communicate effectively to the workforce.Some years forrader the managers are sending from the headquarters to the overseas business. With efficient HR management many companies recruiting people from local area and employing managers without concerned of their origin.The HR managers have to understand the issues arise in the global operation. Global human resource management mainly focussed on recruiting key professional. By establishing ethical standards and maintain these standards HR involved in the new operation, mergers and acquisition.The human resource management should have a total knowledge of companies business strategy, product and services to be successful in global business development. If the HR managers have no business knowledge their role will be limited to administrating and staffing. If the HR takes initiative responsibility for developing resource plans and solution for staffing they will have a key role in global business develo pment.When staffing for global operation the HR management should taken consideration of the timelines of establishing the new operation, the skills and expertise required the long term and short term staff requirement, the availability of local candidate and the position which need to be filled soon.The terms and condition of the duty includes payroll and compensations has to make clear before recruiting the employees. As in the global business many countries have different rules and regulations and its HR managers responsibility to change the terms and condition according to the country in which it operates business. The HR has to maintain a policy to all employees regardless of the place they work.There are four principle alternative between local adaption and global integration. They are international strategy in which knowledge transfer from head quarters. It is suitable for the when there is only few foreign business. The second one is multinational strategy which is local ad apted. The next alternative is globalisation strategy which is centralised strategy for all the global operation. The final alternative is the transnational strategy.The HR manager should involve in the due diligence process before acquisition or merger occurs. The due diligence includes analysing the experience and expertise of the proposed merging management, the employment practices and the pay and benefit practices.The consistent HR strategy would improve the efficiency of workforce and can retain trained employees which will reduce the recruiting and staffing cost. The HR should establish a consistent HR strategy as well as a consistent localisation strategy. Without a consistent HR strategy it is hard to recruit, retain and train employees.GLOBAL OPERATIONAL IMPROVEMENTAll the operations have got scope of improvement regardless of how well they managed. The managers should know their business and need to know how well they are operating at the present. The five performance obj ectives- quality, speed, dependability, flexibility and cost can be measure how well they are operating at the moment. The customer satisfaction is other tool for measuring the performance.The performance measures should be compared with a target. The target can be historically based, external performance based or absolute performance target. It can be also done by bench marking which is comparing with own performance or some others in the similar industry.The priority for improvement can be assessed from their performance and importance. The important-performance matrix can be used for this, which is a technique to compare the relative importance and performance to prioritize the improvement. Some other methods are using for improvement, such as break through improvement which is innovation based improvement, and the continuous improvement method as the name says it following the gradual improvement method. The business process re-engineering process is another method of improvemen t which recommends redesign of process to fulfil customer needs.To improve the operation, it should know the cause of failure of the operation. There are many reasons for operational failure. It could be design failures, facilities failures, people failure like errors and violation, supplier failures, customer failure and environmental disruption. Most of the failures root cause is human failures. As the failures can be controlled and improve the failures are an opportunity. at once the failures cause and effect understand the next step is try to prevent the failure in future. By maintaining the operation with care will minimise the chances of failure.The Total Quality Management could be use to improve the operation, by inspecting, controlling and assuring the operation will lead to improve the operation.The companies are improving their operation and product by experience and takeing from the world to be competitive in the global business. The companies have to innovate new prod uct and service to win the world. The traditional operational functions have to be change with the demand of the global economy for multinational organisations.The new technologies and sources able the companies to discover and access knowledge before their competitors. Therefore multinational companies have to act up on quick to the new knowledge they gain to sustain in the industry. The companies need to practice to learn from wherever the knowledge is generated. Once the knowledge is brought together it should be turned as an innovative product service or process which will help in global operation. The globally successful companies have the ability to spread their innovation across the global market.The companies have to obtain wide range of technology and techniques to be successful in global operation.GLOBAL OPERATIONAL CHALLENGEThe challenges of operational management are many, but the major challenges are the impact of the globalization of markets, the changing view of the s ocial responsibility, the environmental responsibility of businesses, the influence of technology development on operations management and the emergence of the concept of knowledge management.(Nigel slack, Stuart chambers, Robert Johnston).The challenge for operation is that it has to understand the changes in the economy