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Operation Management Assignment Sample

INTRODUCTION - Operation Management Sample

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Report Overview

Background of Sainsbury of the Issues of Environment

“Sainsbury’s was founded In 1869 by John James and Mary Ann Sainsbury”. It was opened in the first “small dairy short at 173 Drury Lane” in what was then one of the poorest parts of London. It rapidly became popular for offering higher quality products at lower rates. Further, “Be the user’s first option for food by delivering maximal goods and outstanding service at the lowest feasible price by operating ‘better, simpler, and together,” according to Sainsbury’s plc mission statement. This stated goal is simple and transparent. Sainsbury has more than 600 supermarkets and 800 plus convenience stores, it ranks among the 3rd most visited retail websites in the UK (Sainsburys, 2022). Sainsbury’s real-time supply chain system would enable to delivery of the store that is based on the most up-to-date stock evidence and improving the availability of the user and minimizing the waste. Customers may shop with us at any time and from any location, and we have an operating network that allows us to offer competitive in-store and online prices. The corporation plan is built to benefit our existing and future shareholders, clients, and workers.

Fig: Sainsbury Retail Store

(Source: Sainsburys, 2022)

Report Aim & Objectives

Primarily this report aims to explain the operation and quality management issues that Sainsbury’s is facing. Further, it also explains the knowledge and understanding of the understanding of operation quality management process, its tools and techniques, and suggestions for the implementation option for the issues that will be addressed.

Discussion

Identified Issues

Operational Uncertainty

Specifically operational uncertainty as a parameter might change during the operational toward the life of the system like it would have a potential impact on the needs, abilities, or the performance of the system. Further, the uncertainty impact or a manager can forecast the effect of changes within the exterior situation for the business operation which is the inability to predict the possible future state of the environment.

This food retail sector within Europe and its impact on the coronavirus pandemic has reshaped the European grocery reality landscape at an unprecedented speed and scale. Congruently, the uncertainty that would hold for the retail food industry is about the will tend to have several questions. When restaurants closed and customers stayed at home to focus and prepare, food retail sales climbed. retailer prices, on the other hand, have risen as a result of increased spending on online services and shipping, as well as supply chain risks resulting from high demand or illness at suppliers’ facilities (Dowling et al., 2019).

In the coming year, the retail business will be extremely volatile. The progression of the COVID-19 outbreak, as well as client reaction, will have a significant impact on the firm’s future and orientation. Who will be able to withstand the pandemic’s food habits? What new behaviors could arise as a result of the outbreak? Will online grocery shopping continue to grow? What are the advantages for businesses? Will food sovereignty be safeguarded, or will the focus be on pricing and trade? Will health and safety come first? What about widespread concerns regarding environmental protection? The goal of this study is to provide clarity. The uncertainty would of a supply chain change in the balance and profitability of the supply chain causes a potential and unpredictable event in the food retail industry (Dowling et al., 2019). Further, it needs to respond to re-establish the equilibrium. Next, the uncertainty as it would be the uncertainty with the means for the chances of achieving the specific goal and result or how it can be achieved with resistance to the technology would make it possible for the firm to improve significantly and also to innovate systems, processes, and skillsets.

Supply Chain Complexity

Inventory

Due to store closures, accompanying furloughs, and large quantities of perishables, humans anticipate seeing foodstuffs with expiry dates in the next 6 to 12 months find their way to defensive backs specializing in the distressed food trade.

Shipping

Although imports into the ports have declined by nearly 20%, cargo ships transport the majority of essential supplies. Items with a short shelf life are most affected by infrastructure issues (e.g., fresh products).

Labor

During planting seasons, skill shortages might put the supply chain at risk. Wheat and rice, for example, are common crops that require minimal physical labor and should provide fewer challenges. However, crops that need more physical labor (such as apples or berries) may experience difficulties (Piya, Shamsuzzoha, and Khadem, 2020). Trained labor may be difficult to get by due to transportation delays, and social distance may limit efficiency and boost costs. Due to fewer and inadequate labor, future farm care may result in losses in approaching seasons.

For the industrial estate, internationalization is both a blessing and a curse. It has benefited businesses in expanding to locations with lower production costs, more readily available raw supplies, and skilled labor. However, extending into new places has created a hitherto unheard-of issue: supply shortages.

“From point A to point B, all products, including finished goods, partially made materials, and important information should be transported”. The cost of transporting these things from their point of origin to the consumer has risen dramatically, necessitating the use of a system similar to those shown in the picture, as well as specialized abilities (Piya, Shamsuzzoha, and Khadem, 2020).

Labor challenges and rising cost- Shop floor Jobs are at risk in Sainsbury

The grocery store operator is reorganizing its operations in the United Kingdom and laying off key executives.

The number of employees affected by the transfer is “in the tens,” according to Sainsbury’s. The rival of Sainsbury Tesco, the country’s largest grocery operator, has announced 1,700 store manager layoffs. Sainsbury’s, like several other supermarkets, is attempting to save £500 million over the next three years by cutting expenses and streamlining processes. The issue is over the Sainsbury labor cost it some of Sainsbury 2000 worker might lose their jobs after the supermarket is all set to shut around the 200 of its retail stress and users across the UK Next it is yet another announcement for setting with restructuring by the retail gain to attempt for the control over rising cost (Costa Dias et al., 2020).

Noted that the retail industry’s “ongoing troubles” originated from the necessity to lower prices in the face of declining profits. “They are down because discounters drove firms to be much more price-competitive at a time when store counts are down has been defined.

It has been also said that food shop operations were being harmed by discount supermarkets like Aldi and Lidl. As a result, food stores must lower their prices, with labor being one of the most significant expenditures. “As a consequence,” “it continued, grocery employment is expected to continue to shrink.”

Fig: Labor shortage

(Source: Costa Dias et al., 2020)

Fig: Rising cost in a grocery store

(Source: Costa Dias et al., 2020)

The implication to the Sainsbury As food retail industry

“With £395 billion in retail sales in 2017 and £319,000 in private businesses in 2018”, “the retail industry is critical to the UK economy”. The supermarket retail business in the United Kingdom is diverse and wealthy, with several lucrative firm sites. “According to a UK study”, the supermarket retail industry is one of the fastest-growing and most competitive in the country, with continuing growth expected. Furthermore, discounters like “Lidl and Aldi” have increased their market share (Srivastava and Srivastava, 2021). The marketing plan and approach influenced customer purchasing behaviors in general. The rate of change in customer behavior will be one of the most important factors affecting the company. Wages, Brexit, consumer spending, internet shopping, and more competition among skilled businesses are all potential threats to the sector.

 The implication for the food retail giant in the UK where its base case assumes that the lockdown restriction was eased by the end of June, with the trade continued to be disrupted until mid-September. The implication of this sector would where Sainsbury was also hit with its profit as would be associated with the significant cost social distancing and safely with the measure that would tend to report the user and the personnel or worker in Sainsbury, weaker sales of fuel general merchandise and clothing with owing official services of the profitability.

Fig: Last Five-year trend of the retail business industry

(Source: Lea, 2020)

Challenges Faced as a Result of identified Issue

Supply chain issue- Inventory Management

Is that for Sainsbury, as a result of pandemic limits, businesses have been forced to rethink their supply chain operations and trading partner communication tactics? Trucking and transportation capacity is one of the most controversial concerns, with two-thirds of respondents saying it harms their firm.

Moreover, eateries experienced a plethora of problems due to a lack of visibility, low consumer interaction, and COVID-19. The majority of companies and their suppliers have the required tools to track inventory and demand in real-time. The restaurant owner’s connection with his or her supplier began to deteriorate as a result of poor inventory management. When a white is placed on top of it, it causes spoilage, waste, or supplier uncertainty, reducing client satisfaction and hurting the hotel’s reputation (Singh and Verma, 2018). A café with an optimized inventory system may have complete insight into overstock and be able to solve many of these issues.

COVID-19 has added new standards for restaurants, many of which are difficult to comply with. Some restaurants have permanently closed as restrictions change, while others remain open.

Further, Sainsbury’s issues over its supply chain that would mainly focus on its servers, cooks, and other restaurant employees who work fewer hours or are unemployed are among those who are affected. Only fast-food establishments saw earnings rise as more people decided to try driving. As a result of the decline in orders and increased pricing, the meat processing factory, like many other supply chain partners, loses money (Jones and Comfort, 2020). This might improve shortly, with vaccination on the way and eateries employing outside space to accommodate visitors.

Fig: Eatery hesitations distorted as COVID-19 congregated pace

(Green Line-UK)

(Source: Jones and Comfort, 2020)

The supply for the retail food industry would also have an impact when Consumer demand has evolved away from restaurants, meal service, and other types of “dinner away from home,” causing significant changes in the food supply chain. As the COVID-19 prevalent spread, food sales at motels, cafes, caterers, and cafés declined. Restaurant bookings decreased to nearly none in March as a result of the lockdowns.

Labor Issues and the rising cost

Shortage of labor has negatively impacted the grocery retailer. Throughout the epidemic, front-line employees have been hailed as heroes, but as demand increases, finding work has become increasingly difficult. Moreover, to address these issues, retailers have utilized a range of solutions, including increased remuneration and benefits, flexitime, and greater physical activity. Further, Throughout the outbreak, front-line employees have been considered heroes, but as demand increases, obtaining work has become increasingly more difficult. To address these issues, retailers have utilized a range of solutions, including increased remuneration, flexitime, and greater physical exercise (Larue, 2020).

On the other hand, the challenges those facing through the rising cost of the food retail industry are that an author has modified the shopping habits at Sainsbury’s in Whitechapel, east London, due to rising food prices. “Especially given my power bill,” he continued, “it’s absurd.” “And the expense of the most essentials appears to be rising, although it does not buy brand-name goods.” “It would have to cut back on the meat and fish diet due to financial restrictions. They’ve turned into a luxury item for me, and instead of purchasing them five times a week, It tells them to only purchase them once or twice a week.” A customer walked into a corporation’s fruit and vegetable section. What are retailers in the United Kingdom doing to combat growing living costs? Profoundly, during the unrelenting cost of the living crisis, the user must be able to easily choose the value of the bet for the product over them which might be worrying about the "shrinkflation" or whether the local store or Sainsbury stocks the budget range. The supermarket value range usually came under the spotlight early this year when some buyers were experiencing a huger priced inflation (Cranfield, 2020).

Conclusion

Hence, to conclude, Sainsbury’s first goal is to build on our great brand image, variety, and innovation by giving our customers additional services and communities while making purchasing easier. That is what it means when they say Sainsbury’s is bringing the dish back to the roots. Sainsbury’s brand awareness and competitive advantage are bolstered by the company’s extensive presence, which includes 502 supermarkets, 290 food outlets, and a rapidly expanding online home delivery service that reaches 88 percent of UK homes. Sainsbury’s, which specializes in food retailing and financial services, invests substantially in non-food goods to diversify its portfolio. Sainsbury’s is a limited corporation that is one of the leading food merchants in the United Kingdom. “The group’s strategic activity is the retail food chain”. “It employs 145,000 people, making it one of the UK’s most important socio-economic players. Sainsbury’s has an 800-store food retailing network which includes grocery shops”. Until “Tesco and Asda” come along, it was the largest supermarket chain in the UK. The UK’s second-largest superstore shackle likewise cautioned that value weights were structured as a consequence of the source encounters. Lastly, it summarises the issues and challenges over the labor, rising cost, and supply chain as the major delivery of Sainsbury operation and focuses on its quality management as their major propaganda.

Improvement options and recommendations

  • As stated directly above, Sainsbury’s has to focus on regionally customized products based on a loyal client base, while making use of their present geographic locations to increase financial stability. This would help them establish a better market position. The retailer must design truly unique in the marketplace.
  • The main goal should be to develop a strong, loyal customer base that is concerned about both price and service. The business should develop a distinct product line and pursue a larger, higher-quality approach. This would allow businesses to compete directly with the small industries and swiftly attract clientele (He et al., 2020).
  • Businesses must boost their digitization costs and focus on attracting as many clients as possible online to generate money. Sainsbury's may employ a dual-brand image to improve market share and work with tiny boutique enterprises to compete against large corporations. Businesses may also desire to merge with Asda to increase their market share and become the UK’s second-largest retailer.
  • Increase the variety and uniqueness of the purchasing experience to improve client reaction and expand your customer base. It is necessary to use both offline and online techniques. Other items, such as “special discounts, discount codes, incentives, and reimbursements”, maybe pushed by a retail store to attract clients and give them more options and alternatives (Hoyer et al., 2020). They must develop a direct link with the people to include and improve the customer's experience in the market.
  • For ring cost to keep optimal and stable Sainsbury would need to move over its online by expanding the delivery capacity by half percentage.
  • Sainsbury needs to optimize the workforce strategy and plan accordingly with succession forecasting planning to recruit the right and experienced talent also the new hires they needed to be trained with proper taring and development to achieve operational success.
  • The supply chain of Sainsbury can be improved by making an appropriate distribution network, and by building healthy relationships.

 References

Costa Dias, M., Joyce, R., Postel?Vinay, F. and Xu, X., 2020. The challenges for labor market policy during the COVID?19 pandemic. Fiscal Studies41(2), pp.371-382.

Cranfield, J.A., 2020. Framing consumer food demand responses in a viral pandemic. Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie68(2), pp.151-156.

Dowling, N.A., Smith, A.D., Smith, D.C., Parma, A.M., Dichmont, C.M., Sainsbury, K., Wilson, J.R., Dougherty, D.T. and Cope, J.M., 2019. Generic solutions for data?limited fishery assessments are not so simple. Fish and Fisheries20(1), pp.174-188.

He, J., Evans, N.M., Liu, H. and Shao, S., 2020. A review of research on plant?based meat alternatives: Driving forces, history, manufacturing, and consumer attitudes. Comprehensive Reviews in Food Science and Food Safety19(5), pp.2639-2656.

Hoyer, W.D., Kroschke, M., Schmitt, B., Kraume, K. and Shankar, V., 2020. Transforming the customer experience through new technologies. Journal of Interactive Marketing51, pp.57-71.

Jones, P. and Comfort, D., 2020. Sustainability in Retail Supply Chains. International Journal of Sales, Retailing and Marketing9(2), pp.51-60.

Larue, B., 2020. Labor issues and COVID?19. Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, 68(2), pp.231-237.

Lea, R., 2020. The coronavirus crisis: recovering retail sales and rocketing public sector borrowing. Arbuthnot Banking Group27.

Piya, S., Shamsuzzoha, A. and Khadem, M., 2020. An approach for analysing supply chain complexity drivers through interpretive structural modelling. International Journal of Logistics Research and Applications23(4), pp.311-336.

Sainsbury, 2022. [online] Available at: <https://www.sainsburys.co.uk/> [Accessed 25 May 2022].

Singh, D. and Verma, A., 2018. Inventory management in supply chain. Materials Today: Proceedings5(2), pp.3867-3872.

Srivastava, V. and Srivastava, M.K., 2021. Modelling Enablers of Customer-Centricity in Convenience Food Retail. In Innovations in Information and Communication Technologies (IICT-2020) (pp. 181-192). Springer, Cham.

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