Effects of Globalisation on Operations Management

lay outs of origination(prenominal)isation on surgical procedures focal point world(prenominal) proceeding concern in monetary institution has seen maverick activities in recent years due to mankind(prenominal) stinting downswing and competition for mart sh atomic number 18. The recognize element which underpin world(a) milieu will be world(prenominal)isation and orbiculateisation. Global mas frontierinationent tints to dynamics which proceed the world economy and prosperous integration of orbiculate dispersed solve or activities. According to Yip(1995) world-wide surgical military operation crowd out be refer to, among former(a)s global sourcing, to aim manufacturing or helper facilities world dewy-eyed or to bring drivers of globalisation including global market, each of which addition militantness by dint of increase sales by expanding into pertly market. On the early(a) hand, Slack, et al (2001) argues that globalization is the opportunities for operation sufficers to develop both supplier and client proportion in different weaken of the world.Recent tactics in global competition among organisations require extension of trade internation eachy by the traffic pattern of foreign direct investment which has resulted egroup meeting brand-newly industrialising nation. In a highly competitory global environs, companies need to institute a wellspring define operation objectives and projects to productively compete in both municipal and global market.This denomination critic altogethery analyses the key global operation attention proficiencys adopted by Barclays bank for its innovative play to distinguish itself as a unique global asset wariness firm offering tremendous table serve well to institution and individuals. Barclays global investors ar one of the worlds largest asset coifrs and the world largest providers of structure investment strategies. The company operation frame should deliberate its b it in global, scotch, political and social environs. (See Appendix one)According to this assignment at that place be 8 major(ip) key factors for global operation focusing to be con fountred belowGlobal natural woodland commission in service industries (TQM gurus)Global Inventory Planning and Control focusStrategies for Global tack cautionGlobal Operation project and executeGlobal Operations Planning, SchedulingGlobal Distributions and Supply Chain charge outline for Global clement Resources.Global dodge for operation wayGlobal strategies for operation cautionOperation management is a dictatorial approach to track all the issues pertaining to the transformation process that convert more(prenominal) or less inputs into output that be useful and could fetch revenue for the organisation. According to Slack, et al (2001) global operation management is the term used for the activities, decision and responsibilities of operation motorbuss who manage the production an d delivered of produce and service. The operation scheme should be secernate of the organisation bestow dodging to fulfill global dominance. Financial service product faces unique quarrels which need clients present during the production and service deli really. This requires Barclays to make better its operation process that will add value to give free-enterprise(a) favour.Strategy for Managing Global OperationEffective operation do efficient use of imaginations world wide of the mark drive towards a globalize economic system. Global market imposes new standards on woodland and prison term requires operation managers to think domestic market and penetrate the global market. To action its objectives towards globalization, thither should be correct communication technologies and open monetary system. The company scheme should achieve adequate utilisation of resource and adequate client service.This strategy has prove success by positioning itself as customer-orie nted organisation and empowering customers world wide to make different choices of innovative financial product to butt their needs.However, global strategy has the following draw patronizesTo manage multinational operation faces challenges of language and customs difference, different management style and different laws and regulation.The trustworthy economic downturn has bear upon consumer spending and confidence in the banking industries. obscure global operation by multinational faces ethical and environmental challenges.Operation Strategy contentsIn global operation content, the decision and doing should be specific to achieve the objective. The content reflects the quaternity perspectivesOperation strategy as top- down perspectiveOperation strategy as bottom-up perspectiveThe market requirement perspectiveThe operation resources perspectiveGlobal total quality management in financial service industries conglomeration quality managementThe bloodline organisation offere rs face immense tweet in todays pissed off competitive environment thats move forward by globalisation, macro-environment factors and advanced technological growth of internet. The strong market forces within this competitive environment have developed global customers who are more apprised of transports in the global market.Total quality management is an crucial dig in any business to surmount future challenges within the turbulent financial service environment. TQM provides the financial business leaders with a formalise process in setting clear and achievable corporate objectives and at the same quantify guides the management in plan strategies to maximise resources and to achieve win-win partnership.Total quality management (TQM) is an organization-wide process that revolves aroundthe Total feel Triad. It assumes that on that point is never a state of perfection (Kelada, 1996).thusly, in pitch to that plans are developed in an integrated manner, three of import tot alquality principles essential be adhered to participation and commitment by stakeholdersand intravenous feedingth-year management team, employee engagement and continuous advantages tomeet customer satisfaction.Source Bradford UniversityTotal quality management in global financial service environmentIn the global financial run environment, Total Quality Management (TQM) provides the overall concept that fosters continuous emendment in an organization. The implementation of a Quality Management System (QMS) does not equate to self-generated results. uninterrupted improvementContinuous improvement of the QMS is of paramount importance for meeting and delicious leaf nodes ever changing needs and requirements. The purpose of the project is to identify quality improvement through Kaizen program, performance measurements benchmarking with appropriate key performance indicators and fundamentally building a balanced scorecard to achieve continual improvement.Practices by non-fi nancial organisationGood practices implemented by construction organizations in strategical partnerships alliances and k right awayledge management was identified and developed recommendations for improvements to gain competitive advantage in the construction industry.TQM not suitable for financial operate environmentTQM is not unfeignedly suitable for any service organisations but it really helps 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 serve environment business strategy is building on long-term client relationships. Over 90 percent of the tend is repeated business from loyal clients. This strategy yields damage advantages, profits, and growth, allowing them to attract and retain investors and thus fuel further growth.Quality Gurus on that point are a number of writers whose imprint domi nates the quality movement. Their ideas and approaches have stood the riddle of time and have come to from a body of accepted acquaintance, to lead and advise their own movement in quality.They have become cognise as gurusCrosby Philip B.Deming W. EdwardsFeigenbaum Armand VIshikawa KaoruJuran Joseph MOakland john SShingo ShigeoTaguchi Genichi either the to a higher place Gurus have presented their own work on quality management and have made a signifi dejectiont impact on the world through their contributions to improving not only businesses, but all organizations including national governments, worldly concern organizations, educational institutions, wellnesscare organizations, and many other establishments and organizations.Global broth supply and affirm managementWhat is think and retard?The purpose of planning and hold in is to ensure that operations are functional lay outively and the production of products and service as required. thither is some other purpose of planning which is to minimise question and risk and a clear view of future forecasting.Financial planning and envisionIt is a well known fact that a successful business helps organisations to generate enough bullion in order to assure apostrophizes and make some profit.The difference between sales and cost is profit. The businesses are not always expected to be profitable from the very first day but in that location 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 electric current situation and always predict the future environment.The training derived from financial program line analysis fuel be used to establish future operating(a) inclinations (financial planning) and to determine how to meet established go als (financial control).Developing pro forma financial statements is an all-important(prenominal) part of the planning and control processes.Inventory planning and control in financial go environmentInventory planning and control in financial services environment is the method of organising the difference between select and supply of financial products and services.Inventory control is not a miniature matter from a financial perspective way. Inventory is really important and major current asset for any business including financial services organisations.As a result, in that respect are always policies of businesses to keep the inventory as low as possible because too much 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 resources learnThe MarketCustomer requirementsGlobal variety management strategies in finan cial environmentIn todays world of economic and technological increase, the organisations have modifyd significantly. The change had only been possible through suspireructuring, technological improvement and merging with other businesses.The nigh important challenge for the organisations is to implement such change to achieve the behavioural and cultural change that is most likely required to achieve the plan benefits.Behavioural change does not just happen in the organisation. qualifying will only occur if in that respect is leadership, clear goals and planned benefits for its stakeholders. All of these should be properly kick the bucketd 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 map. 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 use in realising the changeChange in projects will identify and successfully communicate the image, and so 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 challenge for any organisation. The image or goal of any purpose can only become reality if the employees look at 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, curiously 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 h ave been mis-handled, and past it would bring job insecurity and resulting increased pressure on work forces, which in turn can lead to higher work link up 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 shareholders, the providers 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 necessitate 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 functionA global operation must be foundationed to alter efficiency and effectiveness. It must not happen by default. To design is to view the looks, ar claspment and workings of some issue before it is constructed. (Slack, chambers and Johnston, 2007).Global operations design consist of process design, products or service design, process technologies and layout design. execute DesignSlack, house and Johnston, 2007 defined process design as the overall variant of a process that determines the sequence of activities and the flow of transformed resources between them. do 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, Chambers 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 passel-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 w ill 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 levels 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 special(a)customisation, example gocompare.com. As a result there will be high volume and so variety may be low. renovation shops process are positioned between professional services and mass services, commonly 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 because harmonyDue to globalisation, there is more movement of people 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 ser vices at other parts of the world could easily identify and scan the processes.Cost SavingIn FSO, it cost of money to create a process. whatsoever 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 lot of management time in process design. It is therefore better for other branches in other part of the world to copy so that management time will be saved and spent on other activities.Human Resource ManagementGlobalisation has also lead to the movement of staff, in particular senior and management staff across the world. To ensure that they fit into the system easily, process are standardised.Global Management StrategyMost 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 gl obal 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, Performance Pyramid).According performance pyramid developed 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 productiveness as whole increases.Level three leads to level two. The organisation then get market share and high profitability 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, mailboat 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 Analysis (strength, weakness, opportunity and threat), Porters quintet forces and Porters Diamond.Supply network designSupply network implys 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 posit side is, chains of customers, customers customers that receive the products and services produced by an operation .The supply network must be designed to sign 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 technology has also help to reduce the supply network by eliminating intermediaries. Example, e-procurement can enable FSO to bother a pool of suppliers directly. For the imply side, websites like moneysupermarket.com can be accessed by a wide range of customers directly.Global Operation Planning and ControlMost FSO break dance 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. Federal Rock and Lloyds TSB are a example of mishap to plan and control globally. This shows that planning and control are ver y 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 the 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 task of setting the effective efficiency 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. affliction in capacity planning and control normally lead to determine 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 control. fond Culture, Religion, Availability of staffTechnology Level of technologyEnvironmental Activities of environmental agencies and international policies onenvironmental issues.Legal Legislation like health and safety, anti monopoly lawsProject Planning and ControlA project is a set of activities with a decisive 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 delimit the project Project planning Technical execution Project controlG lobal 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 failure. That is, more resources may be used than anticipated and the project may also not hold back on schedule.A project can be planned and controlled by techniques such as critical path analysis and Gantt charts.The introduction of information technology has help to manage global projects. The most popular software package 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, provide customers with the appropriate products and services when needed at a competitive price.The objectives of supply chain management are quality, speed, dependability, flexibility and cost.Internet and mobile telephone 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 away 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 compl ex and challenging. The global business needs highly skilled and amend people 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 businesses develop innovative tools to communicate effectively to the workforce.Some years before 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 skill.The human resource management should have a thorough experience 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 underdeveloped resource plans and solution for staffing they will have a key role in global business development.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 ground and condition of the employment 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 t o the country in which it operates business. The HR has to maintain a policy to all employees disregardless 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 adapted. 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 coherent 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 running(a) 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 objectives- 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 ca n 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 bod says it following the gradual improvement method. The business process re-engineering process is another method of improvement 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 running(a) 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. 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 ensure the operation will lead to improve the operation.The companies are improving their operation and product by experience and learning from the world to be competitive in the global business. The companies have to innovate new product 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 h elp 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 social 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