Some of the factors that may affect global capacity planning and control are; Political – Example are; political instability, government regulations. The tight financial control always helps the financial organisations or any organisation to monitor their current situation and always predict the future environment. For that matter, top management see the world global operation as one unit. The purpose of planning and control is to ensure that operations are working effectively and the production of products and services as required. When volume is high, there is the possibility that variety will be low and so there will be standardisation. However, global strategy has the following draw backs; In global operation content, the decision and action should be specific to achieve the objective. The companies need to practice to learn from wherever the knowledge is generated. In today’s world of economic and technological development, the organisations have changed significantly. A way of classifying the economic growth of countries is to divide them into three groups: (a) industrialized, (b) developing, and (c) less-developed nations. We're here to answer any questions you have about our services. Challenges of Globalization Managers should also be aware of the best way to approach global demographics from a business to consumer perspective, taking an international product or service and localizing it successfully. Global human resource management mainly focussed on recruiting key professional. The records should be accurate and complete and should fulfil the legal requirements. Critics also raise concerns about damage to the environment, decreased food safety, unethical labor practices in sweatshops, increased consumerism, and the weakening of traditional cultural values. Company objectives are all about maximizing value for shareholders, the providers of capital. Sometimes, FSO outsource some activities to reduce the supply network to save cost and increase speed. The next alternative is globalisation strategy which is centralised strategy for all the global operation. Successful operations managers stay abreast of these trends and implement proactive systems to take advantage of them. Most FSO fail because they fail to plan and control their resources globally. According to Yip(1995) ” global operation can be refer to, among others global sourcing, to have manufacturing or service facilities world wide or to supply drivers of globalisation including global market, each of which increase competitiveness through increase sales by expanding into new market”. The global market is more competitive than it was before the advent of globalization. It also include supplier’s suppliers and customer’s customers and so on. As a result, they adopt similar processes across the whole global organisation. For American businesses, a key challenge in global business is maintaining domestic ethical standards when companies in other countries either … The term ‘globalisation’ itself first appeared sometime in the late 1920s; a little over a decade and a half later, during and immediately after World War II, globalisation entered a new phase. Working predominantly through email makes it difficult to … Hence such a process is copied by other branches throughout the world to save money. Managers face challenges in motivating employees to share valuable knowledge. That can be termed as flexibility of resource utilisation. If these major changes have been mis-handled, then it would bring job insecurity and resulting increased pressure on work forces, which in turn can lead to higher work related stress, and a possible lack of commitment and motivation. It is therefore better for other branches in other part of the world to copy so that management time will be saved and spent on other activities. When staffing for global operation the HR management should taken consideration of the timelines of establishing the new operation, the skills and expertise required the long term and short term staff requirement, the availability of local candidate and the position which need to be filled soon. Our academic experts are ready and waiting to assist with any writing project you may have. Figure 1, below, illustrates nations and regions according to their economic growth prospects. Globalization's impact on operations and supply chain management is multifaceted. Technological developments have made doing business internationally much more convenient than in the past. (Slack, Chambers and Johnston, 2007). The implementation of a Quality Management System (QMS) does not equate to self-generated results. “Products and services are often the first thing that customers see of a company, so they should have an impact.” ” A good design is to satisfy the customer.” (Slack, Chambers and Johnston, 2007). Challenge: Disjointed conflict resolution. Example, the downturn of the housing market in U.S.A. nearly leads to the collapse of Northern Rock as a whole. Because her workers belong to diverse cultures and have different needs, she must provide as many tools as she can. The managers should know their business and need to know how well they are operating at the present. In these areas, incomes are rising. (Nigel slack, Stuart chambers, Robert Johnston). Uncertainty about the future. By establishing ethical standards and maintain these standards HR involved in the new operation, mergers and acquisition. Human resources are concerned about staffing, recruiting and retain employees, training and development, cultural compatibility, communication and technology, and policies, procedures and structure. This is to ensure efficiency and effectiveness globally. Therefore, there is standardisation. Service shops process are positioned between professional services and mass services, usually with medium levels of volume and customisation. customisation, example gocompare.com. The strong market forces within this competitive environment have developed global customers who are more aware of changes in the global market. But being global also brings strategic challenges. As a result, customers get dissatisfied and the long term effect is lost of market share. Finally, the organisation finally achieve its vision. Those in favor of globalization theorize that a wider array of products, services, technologies, medicines, and knowledge will become available, and that these developments will have the potential to reach significantly larger customer bases. This article throws light upon the ten main challenges faced by managers in an organisation. There is also a lot of management time in process design. Developing pro forma financial statements is an important part of the planning and control processes. Executive Summery. Usually, the most significant marketing opportunities exist among the industrialized nations, as they have higher levels of income, one of the necessary ingredients for the formation of markets. Disclaimer: This work has been submitted by a university student. By maintaining the operation with care will minimise the chances of failure. Therefore, planning and control is important. Economics – Recession, Exchange rate, Foreign exchange control. Registered Data Controller No: Z1821391. All of these should be properly communicated in a timely manner. To improve the operation, it should know the cause of failure of the operation. Process design will be determined by the volume and variety. This is because, an organisation depends on other organisations for survival and so there is the need to manage the supply and distribution of product and service. Company Registration No: 4964706. Normally, the design of a process for a financial services organisation within a country is based on volume-variety. Human resources have got a key role in entering in to a new market to find out the risk and opportunity of the market. Global companies stand to capture stronger growth and profitability if they can make headway into these markets. VAT Registration No: 842417633. For businesses eve- rywhere, the rate of globalization in the past few years has been nothing short of phenomenal. A global operation must be designed to enable efficiency and effectiveness. Over 90 percent of the work is repeated business from loyal clients. The globally successful companies have the ability to spread their innovation across the global market. In short, change management makes the company ready for embracing globalization. Good practices implemented by construction organizations in strategic partnerships alliances and knowledge management was identified and developed recommendations for improvements to gain competitive advantage in the construction industry. You can view samples of our professional work here. It must not happen by default. The customer satisfaction is other tool for measuring the performance. Any opinions, findings, conclusions or recommendations expressed in this material are those of the authors and do not necessarily reflect the views of UKEssays.com. This report evaluates and analyses the effects of globalization on supply chain management (SCM). Often, marketers in developing nations must be educators, using marketing techniques to education populations about unfamiliar, new products and services and the benefits they provide. Globalization. There are multiple challenges that operations managers face frequently: 1. With the introduction of modern technology and globalization, not only has the role of operations manager become more important than ever before, it … For global companies, often referred to as multinational corporations (MNCs), common benefits of expanding into developing markets include unsaturated demand for new products, lower labor costs, less expensive natural resources, and other inputs to products. This is because, it is very big, it covers wide area, time differences and it may involve a lot of resources. Watch the following short video for an overview of globalization and its impacts. Shareholders of stock listed companies want better results every quarter, leading management to take decisions that are not necessarily in the longterm interests of the company and its stakeholders. Figure 1: GDP growth rate by country: Shading indicates real rate of economic growth in 2017. Free resources to assist you with your university studies! The company strategy should achieve adequate utilisation of resource and adequate customer service. It cannot be ignored that the current process of globalization and market deregulation has often led to restructuring within organisations. As the degree of economic development increases, so does the sophistication of the marketing effort focused on a country. Total quality management is an important tool in any business to surmount future challenges within the turbulent financial service environment. Operation management is a systematic approach to address all the issues pertaining to the transformation process that convert some inputs into output that are useful and could fetch revenue for the organisation. In FSO, it cost of money to create a process. The Drawbacks of a Globalized Supply Chain Although the new opportunities associated with a global marketplace are numerous, globalization also presents a new set of challenges for supply chain management, from how to increase the scale of operations to how to manage the risks that come along with crossing borders and circumnavigating the globe. The most important challenge for the organisations is to implement such change to achieve the behavioural and cultural change that is most likely required to achieve the planned benefits. “To “design” is to conceive the looks, arrangement and workings of something before it is constructed.” (Slack, chambers and Johnston, 2007). That is, concept, package and process. This is known as level four. Globalization leads to increased competition. Change will only occur if there is leadership, clear goals and planned benefits for its stakeholders. If successful, both of these strategies lead to business growth, with stronger margins and/or larger revenues. As operations managers work in multidisciplinary environments, they must be aware of and effectively respond to the challenges presented by globalization, sustainability, ethical conduct, effective communication, and system design. In global operations design, FSO falls within the Mass Services category. It can provide tremendous opportunity for economic growth to improve the quality of life for many people. Financial service product faces unique challenges which need customers present during the production and service delivery. There are many reasons for operational failure. This also applies globally. Ethical Issues Faced by Operation Managers in Global Environment Operation management can be defined as the structure, operation, and systems improvement that establish and deliver the major products and services of an organization. That is, network of suppliers, supplier’s suppliers that provide resources to an operation. Effective operation through efficient use of resources world wide drive towards a globalize economic system. Organizational leaders must consider carefully how to balance costs and risks against the potential for gain and growth. With efficient HR management many companies recruiting people from local area and employing managers without concerned of their origin. The supply network must be designed to reduce time and cost. Because operations management plays a serious part in the general business plan of global organizations, it is vital for operations managers to consider the different trials and tribulations existing in different countries and develop strategies based on those findings. For further reading, check out this blog post: 10 Critical Decisions of Operations Management 17 July 2018 That is customers becomes satisfied, the organisation becomes flexible to meet customers needs and so productivity as whole increases. (Slack, Chambers and Johnston, 2007). The key element which underpin global environment will be internationalisation and globalisation. There is another purpose of planning which is to minimise uncertainty and risk and a clear view of future forecasting. The organisation bases their satisfaction on process time and level of waste. Darker green areas indicate where the strongest growth opportunities existed as of 2017. Most FSO now see the world as a global village. We've received widespread press coverage since 2003, Your UKEssays purchase is secure and we're rated 4.4/5 on reviews.co.uk. Globalization. The due diligence includes analysing the experience and expertise of the proposed merging management, the employment practices and the pay and benefit practices. Inventory is really important and major current asset for any business including financial services organisations. As a result, there are always policies of businesses to keep the inventory as low as possible because too much cash hold up in inventory. This shows that planning and control are very important because global operation for FSO is a very high risk. Marketing, along with other business functions, can be affected for better or for worse by the advantages and disadvantages posed by global business. Some other methods are using for improvement, such as break through improvement which is innovation based improvement, and the continuous improvement method as the name says it following the gradual improvement method. Use this quiz to check your understanding and decide whether to (1) study the previous section further or (2) move on to the next section. Slack, Chambers and Johnston, 2007; defined process design as “the overall configuration of a process that determines the sequence of activities and the flow of transformed resources between them”. As MNCs do business in new global markets, they may encounter several significant challenges: https://courses.candelalearning.com/principlesmktg1x2kscope/chapter/the-global-environment-economic-growth/, https://courses.candelalearning.com/principlesmktg1x2kscope/chapter/global-marketing-points-of-controversy/, https://courses.candelalearning.com/principlesmktg1x2kscope/chapter/the-global-marketing-environment-natural-resources-and-infrastructure/, https://commons.wikimedia.org/wiki/File:Real_GDP_growth_rate_(%25)_in_2017.png, https://commons.wikimedia.org/wiki/File:Poland_-_potholes_(Malopolska)_01a.JPG, Explain key benefits and challenges of globalization. . This can lead to companies adopting strategies that do not necessarily benefit stakeholders such as customers and staff. The most popular software for managing global projects is Groupware. They also expect high qualit… In global financial services environment business strategy is building on long-term client relationships. Globalization, technology advancements, and redefined marketplace priorities are among the many challenges at hand today. As organizations expand worldwide, human resource management has become increasingly more complex and challenging. Once the failures cause and effect understand the next step is try to prevent the failure in future. They are international strategy in which knowledge transfer from head quarters. It can also lead to challenges with the welfare of workers, economies, and the environment as businesses globalize and shift their operations between countries to take advantage of lower costs of doing business in other world regions. Social – Culture, Religion, Availability of staff. As per a March survey conducted by the Institute For Supply Chain Management, nearly 75 per cent of companies reported supply chain disruptions in one form or the other due … Recent tactics in global competition among organisations require extension of trade internationally by the pattern of foreign direct investment which has resulted emerging newly industrialising nation. Being global brings clear strategic benefits: the ability to access new customer markets, new suppliers, and new partners. The terms and condition of the employment includes payroll and compensations has to make clear before recruiting the employees. Inventory planning and control in financial services environment. Without a consistent HR strategy it is hard to recruit, retain and train employees. 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