Evaluation of supply chain management, operations strategy and critical performance principles

Research Paper (undergraduate), 2018

14 Pages, Grade: A


Table of Contents

1. Introduction
1.1 Company Background

2. Key Operations Management Processes
2.1 Operations Management in Service Industries
2.2 Operations Quality Control
2.3 Innovation Culture
2.4 Supply Chain Management Processes
2.5 Operations Capacity Management

3. Performance Measurement
3.2 Performance Objectives of Operations Management
3.3 Speed of Operations
3.4 Achievement of customer satisfaction
3.5 Production processes
3.6 Value Addition
3.7 Quality Improvement

4. Evaluation of SCM at Zappos

5. Recommendations to improve Operations Management

6. Conclusion


1. Introduction

To manage the resources correctly, operational management is essential to the organization to develop services and products successfully. Resources of an organization are including people, technology, materials or information. To generate such products and services, it is essential that the resources are consumed technically and wisely. Thus carefully handling the elements is all about proper operational management that is producing results such as services and products. To generate goods and services, the operation management helps in combining all the activities going on in the organization (Heizer, and Render, 2016). The report below explains the procedure of evaluation of supply chain management, operations strategy, and critical performance principles. Using the operation management different kinds of competitive strategy is analyzed. It is believed that operations management is used to improve the organization’s strategies. In the end, few suggestions and recommendations are given to help in enhancing the four operation strategies consumed in the chosen companies.

1.1 Company Background

Headquartered in the United States of America, Zappos is known to be the worldwide famous online footwear and apparel store. However, it is controlled via a system of global call centers. It is an online store retailing footwear through a drop-shipping enterprise model; Established in 1999, in earlier 2004, the most significant issue they realized was customer care. So they tried to adjust to thrive in the weak economy. Apparently, they stumbled as well as fell and together with gain knowledge from mistakes. However, they strike an essential milestone of achieving $1 billion in profits in 2008. Tony Hsieh The chief executive of Zappos, when took charge in the year 1999, the yearly product sales of the business boost over $1 .6m. He created two essential targets at the time of 10 years; the very first objective was to attain $1bn yearly sales and second of all, to create the business ideal amongst all. The business tradition performs a significant role in building the work and ambiance fascinating, As per Hsieh (2010), Zappos created a playful environment, and they believed in the principles of being weird and created joy, and for this reason, the workers continued to be encouraged and labored effortlessly to attain the goals (Hsieh 2010).

The primary target of a company is the explicit strategy of handling vendors, investors, clients, and workers. The business use blogs for every information to ensure that the outsiders could be informed regarding the transparency in their projects. According to Hsieh (2010), company’s culture performs an essential part in attaining long-lasting achievements and it functions as an asset for the benefit of the business. Ideal values, traditions, and beliefs make the workers feel proud while doing work for this type of company and the work environment becomes livelier (O’Brien, 2009).

2. Key Operations Management Processes

2.1 Operations Management in Service Industries

Operation management is the process that involves the transformation of unfinished goods into finished goods. Therefore; it includes management in the tertiary sector too. The activities of the Production industries includes, converting inputs that is , raw material, labour and capital into the final product that is in demand by the customers. The service sector perform the same activities, the basic difference is that service industries convert the inputs into unseen outputs. Slack et al (2012) is of the view that both the assembling and service organizations enterprises endeavour is to create the items and provide services within an apportioned spending plan and ensure that the merchandise are appropriately being conveyed to the business sectors and the quality is as indicated by the necessities of clients, this demonstrates the effectiveness of the operations (Mahadevan, 2010). The administration operations methodologies are clarified by the assistance of following outline which speaks to the fundamental segments of administration operations.

2.2 Operations Quality Control

The possibility of value control is distinctive in both the sectors, that is, assembling and administrative ventures. Administration quality is estimated utilizing subjective methodologies and the nature of substantial merchandise is estimated while utilizing quantitative methodologies (Christopher, 2016). It is difficult to convey the best quality items in the market as it requires experienced and skilled representatives and the workers ought to have great entomb individual abilities to snatch the consideration of the clients (Cheryl 2010). Furthermore, Operations directors are required to concentrate on nature of the merchandise alongside working under the spending imperative to make the items in the most practical way. The servicing business confront numerous complexities when contrasted with assembling ventures as the administration business is work escalated and it ends up plainly troublesome for the chiefs to concentrate on the execution of every last worker.

2.3 Innovation Culture

Development is tied in with enhancing the effectiveness in every one of the elements of an association. Advancement will prompt the enhanced quality items and diminished cost of generation (Slack et al., 2012). The idea of advancement is a key idea in both assembling and service organizations enterprises. Assembling business can have the case of development in a way that an organization is fabricating another model of auto which expends low fuel. Service organizations industry can use development by enhancing the client benefits with the goal that the turnover rate of clients can increment, for instance, benefit industry can offer the assistance and direction to its clients 24 hours per day. Administration enterprises can likewise draw in new clients by offering advantages and advantages, along these lines not just an organization would have the capacity to pull in new clients yet additionally can have the capacity to hold the old customer base.

2.4 Supply Chain Management Processes

Supply chain work incorporates every one of the exercises which occur initially from arranging towards the completed merchandise (Mahadevan, 2010). As indicated by Lee and Billington (2002), production network is the mix of exercises which begins from purchasing of raw material, changing over the material into semi completed or completed merchandise lastly conveyance of the completed merchandise to the clients by utilizing different appropriate channels of Transportation, coordination and acquiring are the vital elements of store network administration. Inventory network administration guarantees the accessibility of right amount in the markets to guarantee the fulfilment of clients' demand in the most effective way. Both assembling and service organizations businesses oversee inbound coordination in the comparative way, which implies, obtaining of unfinished material and moving the material into definite item (O’Brien, 2009).

2.5 Operations Capacity Management

Limit ion operations conveys an essential message about the operations technique and procedures. The understanding of actual working, production and important activates in the technique of operations. Limit can be named as the esteem included movement which, if appropriately oversaw can serve the best in basic circumstances of operations administration. In service organizations industry, the limit is kept up as indicated by the requests of clients and this errand is finished by operations directors (Coyle, et al 2014). In service organizations industry, it is expected that under use of limit is productive at that point losing the clients against contenders. Time assumes a critical part in dealing with the limit as indicated by the fluctuated requests of the clients. Projection of interest is done on various criteria like the amount and time of clients; the service organizations required to serve singular clients and the privilege and booked assets so as to meet the requests of the clients (O’Brien, J., M. (2009).

3. Performance Measurement

Performance management is about to keep a check on the performance by getting feedbacks from customers and within the organization. The prepared done to ensure that the products and ventures are being created and conveyed by the prerequisites of the clients and execution administration additionally helps in enhancing the general service organizations given by the associations (Hollins and Shinkins, 2010). The key segments which are considered in execution administration are asset use, benefit; advertise execution and representative execution (O’Brien, 2009). Service organizations gave to the clients can be estimated through incorporate score cards, measurable process control and benchmarking. Administration ventures measure their exhibitions while utilizing subjective approach by assessing the client service organizations being conveyed to the clients by their representatives.

3.2 Performance Objectives of Operations Management

It was the belief of the company that it gives the great services of the customer. Services such as free call number, returns and free shipping, 24/7 availability and return policy of 365 days are very famous incentive or service amongst all others. The Zappos tried for delivering their promises; because of which their brand name is sustained in the market. They believe in strong and powerful relationship maintenance with their vendors and their dealing with the vendors are transparent because of their belief in the collaborative partnership. Their vendors can see levels of inventory, sales and profitability and because of this their relationship remained sustained and maintained (Greg, 2011).

In the operation management, review of the performance by Zappos has considered activities of the manufacturing and production at factories located in Asia, the planning for delivering products worldwide, effectiveness of supply chain management, distribution strategies. Hence, all aspects of the conversion of the raw material in finished goods are also available to the customer in stores also taken into consideration. Collaboration with the knowledge management systems, suppliers, improvement in the quality, and supply-chain management are also some significant performance goals of a company. According to Greg, (2011), improvement of performance strategy for the operations are consist of the selection criteria for setting the initiatives of the performance, change management and resource deployment for delivering the high opportunities. Also Schonsleben, (2016). ), argued on the performance achievement objectives which are not limited for enhancing bottom line of the business, yet it also provide causes of the customer involvement and employees engagement.

The performance objectives at Zappos are based in achieving long term customer relationship.


Excerpt out of 14 pages


Evaluation of supply chain management, operations strategy and critical performance principles
BPP University
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ISBN (eBook)
ISBN (Book)
business operations, operations management, Zappos, change mangement, operations management processes, Operations Quality Control, Supply Chain Management Processes, Operations Capacity Management, Performance Measurement, Performance Objectives, customer satisfaction
Quote paper
Muhammad Khurram (Author), 2018, Evaluation of supply chain management, operations strategy and critical performance principles, Munich, GRIN Verlag, https://www.grin.com/document/489723


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