Identifying Critical Components of Operations Management

Globalization has changed the scenario of doing business. Companies are becoming multinational by expending their business overseas. Operating in several countries at a time requires them to manage their operation in an effective way so that they can control their operation in different countries. Operational plans are most critical management element of the organization operating in such business (Thomas, et al. 2018). “Yusen Logistics” is one of Australia’s biggest logistics companies. In 1955, Kokusai RyokoKosha was established for handling of the general travel and air cargo industry. In 1959, Nippon “Yusen Kabushiki Kaisha” (NYK) acquires stocks in the company and created as a subsidiary company called Yusen Air Services Company Limited. With other various market collaborations, finally in October 2010, registered as Yusen Logistics Co. Ltd. In Australia, the company headquarter is located in Sydney. In 2016, with the acquisition of Hitech Asia Pacific company includes Canberra and extended its business in Auckland, New Zealand (Yusen Logistics. 2018c). With this merger, company is the one of the biggest supply chain business covering 19 locations.

Global network of the company is consisting of 203 bases in South Asia and Oceania, 104 bases in Europe, 91 bases in East Asia, 79 bases in Japan, and 63 bases in Americas (Yusen Logistics. 2018c). To operate in different nations effectively company owns an operational plan that is essential to make the global operation easy and efficient. In this business supply chain management is the key role player during the all the operational activities. This report describes critical components of an operational plan that are Objectives, Deliverables, Quality Standards, Business Targets, Risk Management, Sourcing and Staffing, Implementation, and Monitoring Process. These components of an operational plan are key elements while making business decisions.

Operational plan is defined as a plan that is prepared by the management of an organization that describes different actions that are required to achieve the desired objective of organization business for its service (Alderson, Brown,& Carlyle, 2014). In order to develop such an operational plan, different components are essential to be defined clearly to make the plan effective and efficient as well. These components of an operational plan are: Human Capital, Financial Requirement, Risk Management, and Project Lifespan, Sustainability and Exit Strategy (Bako,&Božek, 2016). Yusen Logistic also follow an operational plan helps the organization to make its operation to the Retain logistics business effectively as well as efficiently. These components of an operational plan make this service more clear and efficient for an organization to operate its business with greater effectiveness.

Human resources are the key components of any organization to be operating efficiently and make its operation effective. To complete the whole process of retaining logistics company requires human staff and skill to implement their operation. At operational level organization engage HR management to provide sufficient human resources. In Australia, Yusen Logistics has 460 people covering the whole business of freight forwarding, contract logistics services, warehouse clearance, and sensitive freight solution (Yusen Logistics. (2018a).In order to make the business efficient in terms of economic and efficiency, the company recruits skilled professionals in their business. Key human resources of the company are most important for making decisions for company business growth. In the process of decision making and maintaining the value chain of the organization human resources are key elements as these are the only source of the company to maintain their service with effective implementation of value chain activities. In order to meet these objectives of making the right decision to support their retail logistics service company has 24,702 employees globally as of 31 March 2018.

Evaluating Principles and Methodologies for Decision-making in Operations Process Planning

Company business operates a supply chain for many organizations to help them in transporting their luggage from one place to another place. In this process, a complete supply chain is followed by the organization employees that need not  be broken at any cost. Yusen Logistics’ supply chain management has an efficient human resource power to control its operations.

Financial support is the most important component of an operational plan. Operational plan depends on the financial support of the organization to implement it effectively. Yusen Logistics has a strong financial support to its business showing a significant business growth in terms of net sales as well as net income of the company (Cuervo, Vanovermeire, &Sörensen, 2016). While planning for an operation plan company’s financial position defines its operational plan activities to meet the financial requirements. Earning report of the company for the first six months of fiscal year 2017, reports a significant growth in company sales and net income. Reports states that the net sale of the company, in first six months of FY 2017, has increased to 10.2% from 9.6% of first six months for FY 2016. Also, the net income of the company has increased from 189 million Yen in 2016 to 497 million Yen in 2017 (Yusen Logistics. 2017). In the process of decision making financial growth of the company may affect in positive or negative way. A positive business growth affects the operational plan in a positive way making it easier for management to plan with a higher budget with low risk. Such decisions taken on the basis of financial growth of the company affect the value chain activities too (Ahmed, et al. 2014).

Risk management is a diverse field grown beyond the rich work of insurance and finance including the accounting. An operation plan includes a risk management component to evaluate the risks associated with each and every activity of the plan (Yang, Hsu, Sarker, & Lee, 2017). This critical component of an operational plan includes different stages of risk management such as, identifying the risk, analyzing risk, assessing the risk, and controlling the risk impact on the plan. In order to manage risks of an operational plan decision are to be made to control these risk in such way that it does not affect the operational activity that much but must control the risk impact on operation plan (Howlett, & Ramesh, 2016). To maintain a high-value chain performance operational plan must have less risk and should be implemented with maximum effectiveness (Giannakis, & Papadopoulos, 2016).

Operational plans are developed to ensure business sustainability for as long as possible. Project lifespan is about the time period for which the project will last. This comes under the sustainability of business as the sustainability strategy is made to increase the lifespan of a project to last for as long as possible (Epstein, 2018). Sustainability planning is also considered for the same purpose. Sustainability of an organization or business consists of the different factors like, social, environmental, and economic factors that need to be concerned about any business’s sustainability planning. This planning of sustainability is made on the basis of the current existing business strategy of the company (Tola, &Contini, 2015). Yusen logistics also consider its sustainability while preparing its operational plan. Sustainability strategy of an organization consists of different elements like, objectives, activities, enhancements of quality standards, risk management, and monitoring the strategic activities. While making decisions regarding planning for the operational plan managers has to consider these components to make it more effective and efficient for business purpose.

The Role of Operations Management in Strategic Management of Organizations and Supply Chains

E-commerce development with the digitalization has changed the scenario of logistic services. This globalization has increased the competition in all sector including logistic transportation services. To make a logistic business successful a proper process planning for the operations is essential (Machin, &Ledin, 2017). In the process of making organization services effective and efficient product designing plays an important role. Designing of services helps the organization to identify company objectives along with the customer demands. With such details, organization can plan for some strategic implementation of these customer need in their services to make their business more sustainable and successful. Process planning must include its principles of flexibility, navigational change, limiting factor, and the principle of commitment (Newman, Zhu, Dhokia, &Shokrani, 2015). These principles are essential for decision making process for an organization. For this service, Yusen Logistics consider all these process planning principles while designing their process plan to make logistic movements from collecting their consignment to the final step of delivering the consignment. The flexibility principle will lessen the risk of losses due to unexpected events but the cost of flexibility must always be weighed against its advantages to evaluate its benefits. Yusen logistics process planning design always committed to fulfil their customer commitments. In service industry commitment is essential to make its business sustainable for a longer time period. This retail logistics service of the company continuously works on its process planning design to improve their process of transporting with strategic designs. In designing the process these principles of process planning plays a crucial role. Principle of flexibility, limiting factors and commitment are key factors to make a significant change in process planning and taking business decisions as well (Giannakis, & Papadopoulos, 2016). In logistic services, time management is a most important consideration to be made to make their process effective and time efficient as well. In the current world logistic scenario deliver on time is the best time management concern to fulfil the principle of commitment. Yusen logistics provide services with a commitment of delivering on time in every corner of the world where the company is providing its services. In globalizing world computer-aided process planning I very common to be used by the organization to make their planning more easy and effective.

Scheduling is the process that organizations or businesses follow to ensure that their resources and services are scheduled in such a way that this will make their business process more efficiently. In service industry scheduling plays an important role in making their service delivery as per the company commitment making the business efficient. Five different areas of scheduling that are to be considered in the service industry are: 1)workforce scheduling, 2) timings, reservations and appointments, 3) project scheduling, 4) transportation scheduling, and 5) scheduling in implementation. Decision support system of an organization for its services or products relays on the scheduling process. Scheduling process influences decisions to make the whole process planning for the service efficient. While scheduling for any service in the logistic industry some basic principles of scheduling like compartmentalization, interdependency, and time allocation must be considered to make the schedules more effective (Sama, D’Ariano, D’Ariano, &Pacciarelli, 2017). Decisions are made to allocate a perfect timing of different tasks. Decisions taken for time allocation and compartmentalization are critical  to make the whole operation planning efficient and time-saving.

Human Capital and Financial Requirements

Inventory management is one of the most valuable assets of an organization. Inventory management of an organization plays a crucial role for retail logistic service of the company. Inventory can be detrimental if it has a shortage at the time when it is needed most. In the service sector inventory is done to make their operations time to save by providing essentials that are required from customers to avail service on time. Decisions are to be made for selecting inventory products and timing for their inventory. Such inventory makes more business for the company. Inventory of a product may results in a loss for the company at times if the inventory products become waste due to less demand of customers. Service inventory in industries like logistics or transportation more related to the transactional confirmation. Yuken logistics can do the same by making an inventory of service availability at times. Information database is the most inventory source for an industry operating in logistics or transportation. Decisions for inventory process are very crucial as these are to be taken wisely as per the market demand for the company services and other internal and external economic environmental factors.

Organization adopts various techniques and tools to improve this service of retail logistics. In this process of enhancing the business performance, supply chain management and logistics have been regarded as most crucial factors. These two tools also help the organization to take a competitive advantage for its retail logistic service. Logistics can be defined as the management of goods’ flow from one point to another point where it is to be consumed. Similarly supply chain is also related to the movement of goods but in addition, it includes some other similar subjects like network resourcing, value chain management, and some more tasks. Both the logistics and supply chain management are comparative in academy terms but in operational planning, both the terms are related to each other. Both the systems are crucial for any organization’s operational planning. Although both the tasks are an integrated part of an operational plan, a separate operation management is required to manage their individual operation. Operation of both logistics and supply chain managements are similar but they need to be managed in such a way that their impact makes the business grow. In managing the operations of different operations of supply chain and strategic management, operational management plays a crucial role by making both of these efficient for business. Strategic managements involve planning for strategic implementation of operations and strategies of an organization. In this process of operational management manages all the operations and decisions that are taken to make company operations more strategic and effective. Operations of a supply chain system are interdependent therefore these have to be managed efficiently. Logistics or transportation business sustainability relays on strategic management and its supply chain system therefor operations of supply chain management for Yusen Logistics are important to make their business more sustainable and successful. Operation management design and implement a controlling process for different activities of an organization making their supply chain efficient and enhancing their value chain services.

Risk Management

Conclusion

Operational planning concludes the whole process of working for an organization regardless of its type. In organizations, operational planning is essential to make their business ore sustainable and successful as well. Different components of an operational plan must be considered while planning for operations important for business growth. These critical components of an operational plan are must be followed by service providing organizations as they have only little scope of invention and strategy implementation in their business. This report concludes that different components of an operational plan are crucial for decision-making process as managers’ decisions depend on these operations and their importance. Such operational plans enhance the business growth rate by making their business much effective and efficient which results in either increasing their sales and services or in increasing the values of their product or service. Operation and their management also play an important role in the strategic management of the organization as well as their supply chain system. Both the strategy management and supply chain management can change the direction of a business growth significantly. Therefore operations can be defined as the key elements of an organization’s business. These play an important role and direct the organization business in a progressive way.

Process map of Yusen logistics defines their operational activities demonstrating their order and flow in such a way that makes the whole process smooth and efficient. This map describes the operational activities in a sequence that is followed by the company. their initiation of customer contact to the final shipment of product to the end delivery to the customer through a flow channel. This flow channel used by the company is shown as a process map as it demonstrates the process of doing their business the form of this given flow map.

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