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Operational Management - Essay Example

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Operational Management

Operation management basically deals in designing and operation of the system, with continuous improvement in the existing system. It is a department which is responsible for monitoring the process in which the company resources are converted into final products. These products can be goods or services. It is simply the core responsibility of the manager's operations to ensure that the product is produced/ delivered with minimum cost, of high quality and on time. For such a huge operation it is important for the manager to keep in touch with the entire functional department in any organization.
Since its incorporation, KFC has been developed tremendously. The organizational structure of KFC has undergone with several changes. In 1986, KFC was takeover by Pepsi Co. Pepsi Co worked drastically to change KFC in quick serve restaurant sector. The style and strategies of Pepsi were entirely different from KFC. Pepsi Co observed that the design strategy of KFC product is very much similar to soft drinks and snack foods. The difference is the division of Product as goods or service. Pepsi Co is also dealing the Pizza Hut, Bell Taco etc. Pepsi Co World wide Restaurants created an image of quality food at reasonable prices in restaurant industry.
Presently KFC has operating 4,258 restaurants in 68 countries world wide. KFC is the biggest chicken restaurant in the world. It is also the third biggest chain which serves quick to the customers in the world. International expansion of KFC is critical to increase its profitability and growth due to market saturation in United States.
At present the strategy of KFC is to provide fast and friendlier service to customers, with continued high product quality, and cleaner restaurants. The operations team focuses on improving operational efficiencies. Another feature, on which management focus is elimination of overhead costs. This in result brings high yields for the company. To gain such benefits by the company, the management has eliminated 250 management positions and gave such responsibilities to marketing and franchises.

The importance of operational management has significantly increased in the service industry. Any service providing company faces many challenges and problems which can be solved by operational management strategies. In most organizations, it comprises a drastic percentage of physical assets and human resource. The Manager operations decided what should be produced/ delivered, how to produced, when to produce. He is also responsible for all the sensitive issues like Planning for capacity, material management, purchases and logistics, scheduling and maintaining the quality. Now in this fast moving and rapidly changing business environment, the operational managers face high pressures. This is because shorter service life cycle, competition is significant, the market is full of conscious consumers. All such pressures lead to high expectation from manager ...Show more


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