MN7001 Summative Assessment 2 Report Sample
2 Assessment Brief
2.1 Introduction
This assessment mainly assesses learning outcomes (LO) 2 and 4 of the module, but builds upon LO1 and LO3, the LOs are that on successful completion of the module students will be able to:
• Analyse how technology is used currently and may be used in the future to deliver value (LO1).
• Critically evaluate the contribution of operations management and information systems to a business organisation’s strategic aims (LO2).
• Critically evaluate the key concepts and theories of digital business (LO3).
• Critique key concepts and theories within the areas of operations management, service operations, and process management (LO4).
2.2 Objective of the Assessment
The operations function of any enterprise has a direct and significant impact on the competitiveness and success of the firm. Upon completion of this project, you will have gained a deeper understanding of how the goals and objectives of an operation are realized in the way they do business. The project will draw upon one of the below concepts, theories and models about the use of operation management in your chosen company:
a) Lean Operations
b) Capacity planning and management
c) Inventory management
d) Material Requirement Planning (MRP)
e) Enterprise Resource Planning (ERP)
f) Quality management and improvement
g) Process technology
h) Supply chain management and logistics
i) Managing risks
2.3 Service or manufacturing Organizations: Case Study
Select an organisation that you can apply what you are learning on this course, and research relevant articles in journals and conferences. This could be a service operation, such as a coffee shop, project and construction companies, other retail or distribution, transport or manufacturing operation but it has to be one where you can identify the contribution of operations management. As suggestion, you may select the company from the following list (but are not limited to):
• FedEx
• NHS
• Tesco
• Amazon
• H&M
• Toyota
• ZARA
• Starbucks
• McDonald
• KFC
• VOLVO
• Nike
• Schindler UK
• Unilever
• Rolls-Royce
• BMW
• Intel
• Ford
• Boeing
• Xerox
• Burger King
Note: Avoid firms in a complex technology industry (production, manufacturing or service) unless you have deep existing knowledge; industry boundaries in the technology industry are blurred and the products and services complicated. Large firms like Apple that are very large and operate in multiple sectors of the technology industry are particularly challenging to analyse.
2.4 Required to answer in your report:
In accordance to learning outcomes 2 and 4, there are two main parts should be answered in your report. You need to concentrate on the following sections and questions while strategizing and preparing your report.
• Evaluate the objectives of the selected organisation. You might discuss aspects of operations strategy, goals and objectives, contribution to competitive priorities. Flowing on from this analysis, in a strategic sense what is operations management expected to deliver?
• How does the organisation do operations?
• How does Operations and technology management translate these organisational goals into tangible outcomes and processes?
• What does it aim to be exceptional at?
• How does operation management deliver on the competitive advantage identified above?
• Essentially address the question how does the operation management of your organisation deliver on the strategy?
• What are the opportunities and barriers of implementing operations management in your chosen company?
Please include at least one of the following operations management (OM) outputs into your coursework e.g. statistics, results, charts, figures, tables, reports with in-text citation
• process mapping, appropriate process measurements
• pull versus push system and just in time (JIT) outputs
• sources of wastes, lean production tools
• continuous improvement, Plan, Do, Check Act (PDCA),
• quality function deployment (QFD)
• level versus chase capacity plan and results
• economic order quantity analysis and calculations
• MRP analysis and reports
• supply chain network
• supplier selection and evaluation
• quality tools
• flow Principle
• TQM, EFQM, ISO standards implementation and results
• failure mode and effect analysis (FMEA) outputs.
• Assessing and reporting the impact of a process technology on OM performance e.g. IoT, Industry 4.0, RFID
2.5 Report Specifications
An essential feature of the reports is to illustrate how theoretical constructs or models can help to explain the actions of organisations in practice. You are thereforeadvised to read widely. In fact, unless you have read and referenced at least 10 discrete references, it is unlikely that you have done sufficient reading. Beware of sources from the Internet: apart from reputable and academic references that can be downloaded through the Internet, most Internet references are not considered reliable for an academic piece of work. Academic journals generally offer a better source than textbooks. Some of the suggested journals are as follows (but are not limited to):
• Journal of Operations Management https://onlinelibrary.wiley.com/journal/18731317
• International Journal of Operations and Production Management https://www.emerald.com/insight/publication/issn/0144-3577
• International Journal of Production Economics
https://www.journals.elsevier.com/international-journal-of-production- economics
• Supply Chain Management: an International Journal
https://www.emerald.com/insight/publication/issn/1359-8546
• International Journal of Services and Operations Management
https://www.inderscience.com/jhome.php?jcode=ijsom
• Journal of Cleaner Production
https://www.journals.elsevier.com/journal-of-cleaner-production
• Production planning & control
https://www.tandfonline.com/toc/tppc20/current
Please use the Harvard referencing system. This requires you to state the surname of the author(s) in the text of your report, followed by a comma and year of publication e.g.: “Kraljic (1983) states that….” If you use direct quotes, then the page number should follow e.g.: Kraljic (1983: 112) “The profit impact of a given supply item can be defined in terms of volume purchased, percentage of total purchase cost or impact on product quality or business growth”. Failure to reference properly constitutes a violation of university regulations i.e. plagiarism and is a serious offence. In your bibliography you provide the following full details of each reference: Kraljic, P. (1983) Purchasing Must Become Supply Management, Harvard Business
Review, Sept. – Oct., pp. 109-117.
Solution
1.Introduction
Starbucks is the titan of the bustling, fragrant coffee industry. With more than fair a caffeine settle, its recognizable green siren calls millions of individuals around the world. Supply chain administration (SCM) is the vital ensemble that powers a carefully arranged expressive dance of operations behind this charming façade. University assignment help, This complex framework is the establishment of Starbucks' victory, permitting the company to move easily from bean to cup and progress its objectives of yearning for worldwide development, undaunted client dependability, and a notoriety for ethical and economical authority. Examining the centre of this key framework, this report uncovers the keys to Starbucks' operational excellence and shows how supply chain management (SCM) drives the company's extension, cultivates relationships with its clients, and decides its course for the long term.
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Figure 1: Starbucks logo
Source: Starbucks Annual Report (2022)
1 Business Objectives
Starbucks is distant from serving coffee shots, and as the aroma of crisply brewed coffee fills the air, the company sets its sights on driven trade targets. With the bolster of shrewd store openings and successful operations, revenue growth and market share extension proceed to be essential objectives. In any case, Starbucks has objectives that go past fair making cash. Recurring business and brand dedication are guaranteed by fostering customer satisfaction and loyalty through individualized experiences and unflinching quality.
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Table 1: 4 V Analysis
Starbucks may be a dependable pioneer within the industry because of its solid brand picture and recognition, which are based on moral sourcing, environmental awareness, and advancement (Valerevna 2022). Last but not least, giving ethical and sustainable sourcing beats guarantees a secure and mindful future for the coffee industry while moreover being in line with shopper values. Each choice made by Starbucks is educated by this complex web of objectives, which too shapes the company's vital introduction and motivates its faithful journey of success through coffee.
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Figure 2: Polar Diagram of Starbucks Target and Actual performance
(Source: Made by Author)
2 Operations Management and Strategy
Starbucks' exact operations management framework works resolutely behind the scenes, luring clients with the smell of crisply brewed coffee from all over the world. Supply chain administration (SCM) may be a key drive that drives the organization toward its optimistic trade objectives inside this system.
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Figure 3: Business Model
Source: Apptunix (2023)
Growth in revenue and market share is unexpected upon Starbucks's cost-effective and proficient operations, as the company seeks after sustainable growth. Through a few channels, SCM makes this objective conceivable. When freight costs and item decay are diminished, assets can be liberated for store openings and market expansion. Typically accomplished through optimized logistics and transportation routes. Besides, by guaranteeing that the fitting items are accessible at a suitable time, data-driven inventory management techniques made conceivable by SCM diminish lost sales and increment salary.
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Figure 4: Starbucks revenue from year 2010 to 2022
Source: Macrotrends (2023)
Starbucks increases sales by 2-5% by optimizing item arrangement and store formats utilizing machine learning algorithms. Also, the trade employments AI-powered predictive ordering to upgrade inventory management and cut squandering, sparing an assessed $150 million yearly (D 2023).
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Table 2: Starbucks Annual Revenue
Starbucks annual revenue for 2023 was $35.976B, a 11.55% increase from 2022. Starbucks annual revenue for 2022 was $32.25B, a 10.98% increase from 2021. Starbucks annual revenue for 2021 was $29.061B, a 23.57% increase from 2020.
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Figure 5: Net revenue of Starbucks worldwide from 2015 to 2022
Source: Apptunix (2023)
Beyond its tasty beverages, Starbucks flourishes in giving helpful and individualized customer experiences. This leads to customer satisfaction and loyalty. By optimizing conveyance and acquirement methods, SCM makes a difference in accomplishing this objective. SCM-encouraged ethical sourcing and transparent origin following programs not as it was requested to naturally cognizant clients but to ensure reliable item quality, diminishing client disappointment and empowering rehash business. SCM-integrated technology moreover makes strides in comfort and diminishes wait times, which increases customer satisfaction and loyalty. Starbucks has created a culture where customers feel like they are part of a larger community. The company has built a rewards program that incentivizes customers to keep coming back by offering exclusive benefits, such as free drinks, birthday rewards, and early access to new products.
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Figure 6: Conceptual Framework
Source: Munifa (2022)
Starbucks is known for its one-of-a-kind brand image, which is based on innovation, environmental consciousness, and ethical sourcing. This image is upheld in numerous ways by SCM. A more grounded supply chain administration encourages straightforwardness and participation that offer to environmentally delicate customers and fortify Starbucks' commitment to sustainability. Moreover, SCM's ecologically friendly reputation is backed by its optimized waste decrease and energy-saving hones. In expansion, Starbucks can quickly source and dispatch unused, eco-friendly items, such as plant-based milk choices, much obliged to the adaptability and flexibility that SCM offers.
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Figure 7: Customer Satisfaction Elements
Source: Nguyen, (2020)
Starbucks places a high priority on coffee beans that are sourced responsibly and ethically; supply chain management (SCM) is a key instrument in finishing this (Perez Martos 2022). Greenhouse gas emissions and asset utilization are diminished when coffee is sourced and disseminated through the utilisation of productive logistics and transportation courses. Moreover, by promoting openness and participation in supply chain administration, Starbucks can screen the beginnings of its beans, embrace sustainable sourcing programs, collaborate with adjacent farmers, and ensure decent working conditions. The company's 2020 launch of a sustainable milk sourcing program, which is a coordinated result of its inventive and conscientious supply chain management procedure, illustrates Starbucks' commitment to ethical commerce hones past coffee (Starbucks Stories 2021).
3 Tactical Operations and Performance
Efficiency within the warehouse: Data-driven estimating and adaptable renewal strategies control Starbucks' compelling stock control. The commerce employments devices such as Prophet Retail Request Administration to look at neighbourhood inclinations, climate designs, and deal patterns in arrange to figure out requests and oversee stock levels. The "pull" system decreases waste and ensures item accessibility indeed amid top hours, whereas the conventional "push" approach increases waste. An illustration of this is found in a Statista report (2023), which showed that Starbucks' data-driven stock administration methodologies permit it to preserve an operational proficiency proportion of 10.3%, which is much higher than industry midpoints.
Coordinations and Acquirement: Moral and solid obtainment systems are vital to sourcing premium coffee beans. In arrange to guarantee reasonable exchange standards and feasible bean cultivation, Starbucks utilizes specialized sourcing groups that construct persevering connections with ethical coffee growers. Starbucks makes a difference to clients by giving transparency and traceability by following the beginnings of its beans in genuine time through the utilisation of blockchain technology in its supply chain management system. In expansion, commerce has made critical ventures to optimize shipping courses and logistics, decreasing carbon emissions and fuel utilization. Starbucks' 2023 sustainability report, which stresses a 50% diminish in greenhouse gas emissions as a result of enhanced coordination effectiveness, highlights these activities (Starbucks Stories 2022).
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Figure 8: Greenhouse Gas Emission
Source: Starbucks stories (2022)
Innovation Integration: Starbucks to step up rollout of 'digital flywheel' strategy. Starbucks' supply chain operations are fueled by innovation in each way. Machine learning-powered versatile requesting stages assist the requesting handle, cutting down on hold-up times and raising client fulfilment levels. The trade moreover employments savvy innovation in its stores, such as self-service stands and automated espresso machines, to assist in boosting efficiency and cutting costs. Starbucks' vital objective of advertising consistent and helpful client involvement is specifically supported by these tech-driven activities.
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Figure 9: starbucks digital flywheel
Source: zdnet.com
Quality Control and Continuous Improvement: Starbucks proceeds to put a tall need on keeping up consistent product quality through quality control and nonstop enhancement. As it were the best batches of beans make it into the stores much appreciated to exacting quality checks that happen at a few focuses within the supply chain. The commerce has to set up a nonstop change culture, utilizing incline concepts and Six Sigma instruments to discover and kill operational inefficiencies. Starbucks continuously achieves high customer satisfaction ratings, which highlights the viability of its strategic SCM activities and illustrates its commitment to quality control.
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Figure 10: Performance Comparison Graph
Source: Starbucks Annual Report (2022)
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Table 3: Performance Comparison
Execution Results: These strategic operations work together to give Starbucks extraordinary performance results. The company has over 34,000 stores around the world, all of which run remarkably reliably and proficiently. Its inventory turnover rate of 3.51, recognizably greater than.
4 Operational Excellence and Future
Adding to Sustainability: Sustainable hones are given top priority in Starbucks' supply chain management system for coffee. In an exertion to decrease its environmental impact and way better serve its ecologically cognizant clientele, the company continually explores substitute materials for bundling. Starbucks advance advances a climate of shared success and asset preservation by contributing to renewable vitality sources and collaborating with regional farmers. The company’s 2022 Environmental, Social, and Administration (ESG) report highlights a 50% waste generation diminishment and a 5% increment in renewable vitality utilization inside its supply chain as illustrations of these activities (Starbucks stories 2022).
Embracing Automation and AI: Starbucks is driving the way in this transformation of innovation, which is changing the retail industry. Mechanical arms are utilized within the packaging and simmering forms to extend speed and precision, and mechanized barista machines are utilized to customize and assist client orders. Moreover, in arrange to ensure item availability and decrease waste, counterfeit insights (AI) are vital to request forecasting and inventory optimization. According to a Starbucks’ financial growth and efficiency strategies (2023), these tech-driven activities ought to boost Starbucks' operational productivity by 15% over the following five a long time, assist in enhancing its competitive advantage.
5 Conclusions
In conclusion, the success story of Starbucks highlights the transformative potential of an operations management framework that's both key and energetic. Starbucks increments revenue develops customer loyalty, fortifies its brand, and advocates for sustainable hones by utilizing supply chain administration as a pillar. The company sources morally, embraces technology, optimizes inventory, and places a high priority on persistent improvement all of which lead to operational greatness and perceptible execution results. In arrange to meet upcoming challenges, Starbucks should proceed to be inventive and versatile. Future victory will depend on grasping computerization and counterfeit insights, expanding client personalization, and making progressing ventures in sustainability. Starbucks can keep up its position as a worldwide pioneer in coffee, committed to both benefit and societal well-being, by contributing to technological progressions and ceaselessly progressing its operations management system.
6 References
D., Parvind. (2023). Small retailers, big benefits: How AI and cloud solutions are making operations more efficient and profitable, Small Retailers, Big Benefits: How AI and Cloud Solutions. Available at: https://www.linkedin.com/pulse/small-retailers-big-benefits-how-ai-cloud-solutions-making-dutta/
Starbucks stories. (2022). Starbucks-Global-Environmental-Social-Impact-Report. Available at: https://stories.starbucks.com/uploads/2023/04/2022-Starbucks-Global-Environmental-Social-Impact-Report.pdf
Valerevna, I.S. (2022). Brand Evolution Based on Innovation: Starbucks Coffee Company Case Study. https://dspace.spbu.ru/bitstream/11701/40863/2/Master_Thesis_Ivanova_Svetlana.pdf
Perez Martos, D. (2022). Local sourcing as a sustainable strategy from a global company in the fast-food industry. https://www.theseus.fi/bitstream/handle/10024/753097/Thesis%20Daniela%20Perez%20Martos.pdf?sequence=2
Starbucks Stories. (November 17, 2021). Starbucks journey to Sustainable Dairy. Available at: https://stories.starbucks.com/stories /2021/starbucks-journey-to-sustainable-dairy/
Starbucks Annual Report (2022). Available at: https://s22.q4cdn.com/869488222/files/doc_financials/2023/ar/Starbucks-FY22-Annual-Report.pdf
Munifa, H. (2022). Customer relationship management strategy in Starbucks card optimization in the Pandemic era. International Journal for Educational and Vocational Studies, 4(1), 19-29. https://ojs.unimal.ac.id/ijevs/article/download/6817/3639
Nguyen, T. (2020). Starbucks Loyalty Reward application in Vietnam–identifying the impact of the app on Starbucks’ customers in Vietnam using the technology acceptance model. https://www.theseus.fi/bitstream/handle/10024/335323/thesis%20final%20Thien%20Nguyen.pdf?sequence=2
Apptunix. (2023) Starbucks business model: How does starbucks make money?, Apptunix. Available at: https://www.apptunix.com/blog/starbucks-business-model/
Macrotrends. (2023) Starbucks revenue 2010-2023: SBUX Available at: https://www.macrotrends.net/stocks/charts/SBUX/starbucks/revenue
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