Operation functions of an organization, Operation Management

Operation functions of an Organization

Case study

IKEA is the most successful furniture retailer ever. With 276 stores in 36 countries, it has managed to develop its own special way of selling furniture. The stores' layout means customers often spend two hours in the store - far longer than in rival furniture retailers. IKEA's philosophy goes back to the original business, started in the 1950s in Sweden by Ingvar Kamprad. He built a showroom on the outskirts of Stockholm where land was cheap and simply displayed suppliers' furniture as it would be in a domestic setting. Increasing sales soon allowed IKEA to start ordering its own self-designed products from local manufacturers. But it was innovation in its operations that dramatically reduced its selling costs. These included the idea of selling furniture as self-assembly flat packs (which reduced production and transport costs) and its 'showroom-warehouse' concept which required customers to pick the furniture up themselves from the warehouse (which reduced retailing costs). Both of these operating principles are still the basis of IKEA's retail operations process today. Stores are designed to facilitate the smooth flow of customers, from parking, moving through the store itself, to ordering and picking up goods. At the entrance to each store large notice- boards provide advice to shoppers. For young children, there is a supervised children's play area, a small cinema, and a parent and baby room so parents can leave their children in the supervised play area for a time. Parents are recalled via the loudspeaker system if the child has any problems. IKEA 'allow customers to make up their minds in their own time' but 'information points' have staff who can help. All furniture carries a ticket with a code number which indicates its location in the warehouse. (For larger items customers go to the information desks for assistance.) There is also an area where smaller items are displayed, and can be picked directly. Customers then pass through the warehouse where they pick up the items viewed in the showroom. Finally, customers pay at the checkouts, where a ramped conveyor belt moves purchases up to the checkout staff. The exit area has service points and a loading area that allows customers to bring their cars from the car park and load their purchases. DFS is another furniture retailer operating in the UK and Ireland. Compared to IKEA, DFS has a different business philosophy and this affects the operations that constitute the business. Questions Study the IKEA case above and any additional information you can gather from the company's web site or related web sites. Search the internet or any other sources for information that could help you to identify the characteristics of the DFS business and answer the following questions:

1. How is the IKEA superstore design different from that of DFS stores? (10%)

2. What do you think might be the major problem in running an operation like the IKEA superstore compared to DFS stores? (10%)

3. What do you identify as the main aim of the 'operations function' within the IKEA superstore? What are the two main sets of sub-operations in the superstore? Are they different from the 'sales function' in the store? Discuss in comparison to the 'operations function' within the DFS store. (10%)

4. List the main processes (and major activities if possible), for every identified sub-operation from question 3 above, and classify them according to what is being transformed in the process and what property changes (shape, location, ownership, physiological, psychological state, etc.). You can use diagrams to describe the flow of resources in both IKEA and DFS stores. (20%)

5. What is the position of the IKEA superstore operation on the four dimensions against that of the DFS (4-V analysis)? Explain. (20%)

6. Discuss the relative priority of the five operations performance objectives (quality, speed, dependability, flexibility and cost) of IKEA and DFS and which ones, in your opinion, are the most important to build into the design of the IKEA's or DFS's operations respectively. (Note: a polar graph can be used to indicate the importance of each objective for the operations at VBA). (30%)

Posted Date: 2/14/2013 7:57:56 AM | Location : United States







Related Discussions:- Operation functions of an organization, Assignment Help, Ask Question on Operation functions of an organization, Get Answer, Expert's Help, Operation functions of an organization Discussions

Write discussion on Operation functions of an organization
Your posts are moderated
Related Questions
the importance of the measurtement of market risk for financial institution

Clerks at Lotsa Data Systems key in thousands of insurance records each day for a variety of client firms.  The process is in control but CEO Donna Lotsa wants to be sure that at

A drug store has two windows available for serving customers, who arrive at a Poisson rate of 40/hr. Service time is exponentially distributed with a mean of 2 min. Only one window

Aims of Trade off in Business Strategy - Operations Focus The aim of operations focus is to ensure that, along with the other management functions, all of the operations workf

What are the main reasons businesses don't conserve natural resources or safe guard the environment?

1. Based on GM's current condition, do you think it is ethical to reduce the number of employees? Why or why not?

1. What are the causes of the quality problems on the Greasex line? Display your answer on a fishbone diagram. 2. What general steps should Hank follow in setting up a continuou

If you were the professor and you knew what was going through Vincent?s mind, what would you say to Vincent?

Material Requirements planning is more than Inventory system "discuss

(Teddy Bower Boots) To ensure a full line of outdoor clothing and accessories, the marketing department at Teddy Bower insists that they also sell waterproof hunting boots. Unfortu