Question

Select a retail store like Walmart or Macys and identify the mission ans strategy. what are the manifestations of the 10 strategic OM decisions at the store? that is how is each of the 10 decision accomplished.

Answer 1

The retail store chosen is Walmart to detail how Walmart has accomplished the 10 Operations Management decisions. Walmart’s mission is to save money for the people to help them have a better lifestyle. Strategy too is a direct manifestation of the mission statement as it is on the basis of saving money. Hence, Walmart has the strategy “Every Day Low Price” (EDLP).

1. Design of goods and services- This is an important OM decision for Walmart as it involves the strategic differentiation of the products. This OM decision emphasizes on its efficiency and cost-effectiveness of its products and services. Since Walmart’s strategy is cost leadership, Walmart emphasizes on its store personnel’s maximum efficiency. In terms of design of goods, cost-effectiveness is obtained from reducing its production costs.
2. Quality management/standards- Walmart has three levels of quality standards as one of the OM decisions. The lower level refers to expectations of the majority of customers and this is the minimum quality. The middle level is for low-cost retailers and this level is the average quality in market standards. The upper level refers to the level that exceeds the average quality in market standards.
3. Process design- This OM decision is achieved through forecasting and continuous improvements. Behavioral analysis of the customer also forms as the basis for process and capacity design.
4. Strategic location - This is one of the important OM decision for Walmart because they focus on efficiency in the movement of goods and information across the organization. Human resources play a vital role in achieving excellence in these areas. Since Walmart aims at market reach to the maximum, the stores are located in urban areas. Strategic locations of its warehouse helps to transport goods quickly to the customers.
5. Layout design - Walmart uses consumer behavior as the basis of layout design for its stores. It also includes the company’s requirement to move the goods quickly from one location to another through its efficient supply chain operations.
6. Human Resources- Continuous recruitment is the basis of HRM for Walmart. Walmart focuses on providing adequate training so that the personnel meet the quality standards in their operations.
7. Supply Chain Management- Walmart has power over its suppliers which makes this as one of the OM decisions. Walmart uses information technology to be efficient in this OM decision. The entire SCM is integrated with the enhanced IT systems. This helps in successful collaboration with the managers and the suppliers.
8. Inventory Management- Walmart uses JIT (Just-in-Time) for order cross-docking and they also use vendor-managed inventory design to effectively manage the movement of goods and stocking them. This helps in optimum inventory so that there is neither shortage nor surplus of inventory.
9. Scheduling- Walmart’s OM decision is its flexible scheduling. It emphasizes on optimizing its internal business process schedules to reduce operational costs. This optimal schedules helps Walmart to reduce its loss which is linked with the excess capacity. However, Walmart changes its schedules accordingly to meet the changing demand.
10. Maintenance- Finally, managers maintain the resources and operations effectively through adequate training programs for efficient HRM maintenance, facility management and also for equipment maintenance to avoid any equipment breakdown or failures.

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