Discuss possible root causes for each of these issues

Assignment Help Operation Management
Reference no: EM131146817

Discussino Question

Read the scenario regarding John Smith's Business profile. (See Scenario)

Using the Library, Internet, or any other available resources, discuss specific service issues Smith's organization is realizing. At a minimum, efficiency, responsiveness, quality, and costs should be discussed. Customers have provided some input regarding a number of issues that have been surfacing more frequently than in the past. Discuss possible root causes for each of these issues and their impact on both the business and the customer.

750 - 1000 words, APA, 3 references

Five years ago, John L. Smith decided he wanted to start his own technology service business. He rented some office space, purchased some computer and network equipment, and installed a telecommunications circuit to the Internet. Almost immediately, he started to acquire customers who wanted him to host their business applications and for him to be responsible for the operational availability of the applications. In other words, John would provide the space, servers and local area network equipment, connectivity to the Internet, and an around-the-clock operational support staff. His customers would provide the business application software, and they would manage it remotely.

During the first 5 years, John's business grew substantially. He had to relocate his offices three times, add computer and network equipment, increase the bandwidth and connectivity to the Internet, and hire numerous administrative and technical support staff.

As John needed to add computer hardware, he would negotiate with local retail stores and purchase the lowest cost equipment. If he needed additional communication services, he would go to the local telephone company to add the bandwidth and connectivity he believed he needed.

Starting his sixth year in business, John has over 30 major long-term contracts, a 20,000 square foot data center, over 400 servers; and 100 full-time employees. Additionally, he hosts 50 major business applications for his customers.

The organization configuration is fairly simple. John has set up an extremely flat organization in which the majority (approximately 80%) of the staff are technical or operations support (network, server, applications, operating systems, and database). Additionally, there is one contract, five helpdesk, one project manager, and five administrative support staff. John does all of the marketing and sales and personally negotiates each contract.

The cost structure is set up as follows:

• Floor space (includes utilities, rent, water, and so forth): $100/square foot (John pays $25/square foot)

• Hardware (servers): Actual cost of each server as well as the number of servers required (customers reimburse John for parts)

• Labor: $25/hour as required for break/fix, updates, and so forth

• Internet connectivity: Cost per month spread across all contracts

Each month, hours are tabulated and additional costs are billed to each customer.

Over the past several years, John has been one of the few providers in this hosting business; however, competition is now starting to challenge his company from a cost, efficiency, quality, and the kinds of services provided. Additionally, existing customers are starting to complain about slow response times, degradation of services, poor quality, lack of communication, and rising costs. In the past, when a customer made a request, the organization has accommodated for that request. As of recently, John is taking responsibility for nearly half of the customer applications to include updates and changes.

A number of the customers have told John that they will have to reduce their effort with him if the service-related issues are not corrected. A couple of them have sent correspondence to John stating the following:

• Response times: When they provide updates and changes, the support staff is taking longer and longer to implement the changes.

• Service degradation: The availability of the hardware platforms is trending downward. Where the platforms were available around the clock, they are now suffering from some frequent and long outage periods.

• Quality: When updates and changes are implemented, they are often not installed correctly and have to be reinstalled.

• Communication: Whether changes to the platforms or coordinating outages, the support team does not notify the customers and the issues are beginning to impact their revenue stream.

• Costs: In the past, when additional equipment was needed, John purchased, installed it, and billed it back to the customer each month. Also, the cost of support over the past few years has been steadily increasing.

John is now beginning to wonder whether he should outsource or even offshore some of the functions and services he is offering to an organization that specializes more in a specific area. He has contacted a number of outsourcing organizations as well as an organization in India that might be able to run his service center help desk. The cost seems to be less expensive than what he is able to provide to his customers. Also, he thought it might be a good idea because he is starting to expand his company to global customers. He now has two smaller contracts with European customers, and this appears to be an area that is going to grow.

Reference no: EM131146817

Questions Cloud

How do you fit systems requirements specification : How do you fit Systems Requirements Specification (SRS) documentation into an agile framework - Is it possible to use agile methodologies when the customer is not on site? If so how?
Why cash flow is more important than sales in a business : Describe why a manager needs to understand the characteristics and importance of financial markets including risk and efficiency. Describe why cash flow is more important than sales in a business.
Analyse the discussion between packard and edgerton : Ronald Edgerton, head of Royal Machine Works Ltd.'s valve division, tore open the confidential memorandum. How would you characterise/analyse the discussion between Packard and Edgerton
Find an optimal parenthesization of a matrix-chain product : Find an optimal parenthesization of a matrix-chain product whose sequence of dimensions - show the dynamic programming tables at the end of the computation.
Discuss possible root causes for each of these issues : Additionally, existing customers are starting to complain about slow response times, degradation of services, poor quality, lack of communication, and rising costs. In the past, when a customer made a request, the organization has accommodated for..
How would the following ratios be affected by the accounting : In a period of rising prices, how would the following ratios be affected by the accounting decision to select LIFO, rather than FIFO, for inventory valuation? * Gross Margin * Current Ratio * Asset Turnover * Debt-to-equity ratio * Average tax rate
What is the estimated error in the observed distances : The estimated error for both instrument and target miscentering errors is 3 mm. For the EDM in Problem 6.37, what is the estimated error in the observed distances?
Explain how lifo can result in a higher cost of goods sold : Explain how LIFO can result in a higher cost of goods sold. Would you expect LIFO to result in a greater or lesser valuation of the company's ending inventories? Defend your answer.
Determine the most probable length of a line ab : Determine the most probable length of a line AB, the standard deviation, and the 95% error of the measurement for the following series of taped observations made under the same conditions: 632.088, 632.087, 632.089, 632.083, 632.093, 632.088, 632...

Reviews

Write a Review

 

Operation Management Questions & Answers

  Describe the offensive strategies for blockbuster

Will new competition for Redbox and digital content providers force blockbuster to alter its strategy? If yes, what are the offensive strategies for blockbuster?

  Determine how the same focus on quality demonstrated

From the video "Barcelona Restaurant Group", determine how the same focus on quality demonstrated by the Barcelona Restaurant Group could benefit manufacturing operations. Provide specific examples to support your response.

  Explain how does an organization mission-vision

Explain how does an organization's mission, vision, goals, philosophy, managerial roles also leadership impact the design, development also implementation of an organizational security plan.

  Which one is the th, and which one is the ct

Which one is the WIP, which one is the TH, and which one is the CT?

  Develop essay that explores at least two different approach

Discuss the differences of the two approaches. Finally, discuss the conditions or contexts of when it would be appropriate to use each approach.

  Write a linear program that minimizes cost

M&D wants to sell the remaining pounds of the catalytic agent at a price of $100. How much money will be generated from the sell?

  Obtain the correlation matrix for all six variables

Construct scatter plots of Demand vs DIFF and Demand vs. ADV, Demand vs. AIP, and Demand vs. Price. Observe the graphs and provide interpretation.

  How it can improve service delivery to its citizens

Select one best practice from an organization or industry which you are familiar with also then whether which best practice can be implemented into the culture of a governmental entity also describe how it can improve service delivery to its citiz..

  Manufactures two electrical products

The CoolerQ Corporation manufactures two electrical products: air conditioners and large fans. The assembly process for each is similar in that both require a certain amount of wiring and drilling. Each air conditioner takes 2.5 hours of wiring and 2..

  Stock price and total market capitalization

Compare pfizer today, with Pfizer at the time of the case, showing a compilation of some of the key financial information. Include information on stock price and total market capitalization in this summary. Based on this review, do you think this was..

  What are the primary reasons for holding inventory

What are the primary reasons for holding inventory?

  Private firm considering becoming a public firm

Explain the important issues involved in deciding whether to go public, i.e., a private firm considering becoming a public firm. include cost estimates, advantages and disadvantages.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd