Operations Management: Vending Machine Business

Operations Management: Vending Machine Business

Introduction

The growth of business requires a definite plan that details the specific activities required. Several activities vary according to market and business needs. However, all the needed activities use the same principle covered under operations management. McFarlane (2015, p. 17) describe operation management as the undertakings concerned with organizing, planning, and supervising business affair for best results. As populations grow and economies change, the activities also transform. Wahab, Ismail, & Muhayiddin (2016, p. 285) confirmed that the business environment is rapidly transforming, forcing organizations to develop new abilities to handle the situation. The same effect touches on vending machines since they use a fast-evolving technology. To be able to keep up with the competition, the business must continuously improve its operation. This paper focuses on the evolution and trends in operation management, emerging obstacles in the process, and how the issue affects decision-making.

Evolution of operation management

Innovation and necessity is always the center of change in any aspect of life. In a small society, change is often gradual. However, the current business environment is complicated, and changes occur rapidly. According to Gunasekaran & Ngai (2014, p. 688), technological advancement, decentralization of operations, market globalization, and increased environmental awareness pushed firms to rethink their operation management and include techniques that enhance quality and productivity. The spread of information is liberal, allowing companies to adapt to change faster. The functioning and operation of companies have rapidly changed in the last 15 years regarding customer expectation and resource acquisition (Gunasekaran & Ngai, 2014, p. 689). The main factors that triggered the evolution of operation management are social market needs.

The social structure of a community is always in motion, changing after every generation. In the vending machine business, people are becoming busier and have little time to sit in a restaurant eating or queuing to get food. This situation created an opportunity to provide and quick means for people to get energizers. The effect of social change in market trends happened during slavery, industrialization, and capitalism. According to Gunasekaran & Ngai (2014, p. 689), the transformation of the American political landscape influenced changes in the domestic and global economy. This situation highlights the value of cultural and economic integration that forces producers to think of new ways to provide better quality goods and services. For instance, the financial crisis in 2008 affected social life that ultimately business operation. During the recession, organizations came up with policies that ensured the elimination of greed, equity valuation, ethics, controlled employment policies, and global economic integration (Gunasekaran & Ngai, 2014, p.689). Such changes reflect what happened after the fall of communism, where a change in political and social life redefined operations of a business.

Besides the historical events, the world is battling current issues that may cause more changes in the future. Challenges such as corruption, drugs, economic instability, ecological catastrophes, and the battle between the poor and the rich will continue to shape business operations (Gunasekaran & Ngai, 2015, p 670). Given the nature of these problems, governments must develop new policies for political stability, economic regulation, reduction of poverty gap, and new sustainable measures for international relations. The change will have a direct and indirect effect on operation management.

The changes in market operation also have a massive input in operation management evolution. Before the advancement of production capabilities, markets focused on meeting individual needs. The development of consumer product market companies rushed to high volume production with a focus on quality and consumer satisfaction (Gunasekaran & Ngai, 2014, p. 690). As more players came in to meet the demand, operation systems emerged. Additionally, the improvement in technology globalized the market and consequently moved production to customized products from standardized products. The market will continue changing as it is now driven by powerful forces such as IT, transfer of knowledge, cost-competitive products and customized goods (Wahab, Ismail, & Muhayiddin, 2016, p. 288). These factors change the consumer needs, and expectations and businesses must shift operations to flexible, quality, faster delivery, and cost-effective forms. From the understanding of market forces, the vending machine is a flexible idea that operates at a low cost. The labor and operation cost required is small, and that subsidizes product cost. Besides, different machines have a product tailored to the needs of a specific market, and that gives a competitive advantage.

Obstacles during operation evolution

The technical nature of operation management is the first challenge during development. The objective is always to find profitable and sustainable ways of doing business. Nonetheless, the inability to understand how the evolution function in creating value to a company’s processes for customer satisfaction is still a limiting factor (McFarlane (2015, p. 20). The complex interrelation of the elements and the technicalities creates and obstructive blanket for full implementation and realization of the new techniques. During the establishment of the vending business, the organization took time and consulted with professionals to provide the impact of each factor. The main concern the company had to sort was about the future and effectiveness of vending machines.

Besides the technical issues, another obstacle is the inability to measure the effectiveness of operation management in the service industry. The tools of operation management were developed for large manufacturing companies. Therefore it is difficult for service industries to create value from the theories, techniques, and processes (McFarlane (2015, p. 21). The inability to measure the effectiveness of the tools makes it difficult for managers to decide if the change will benefit their operations. Since services are consumed immediately, they are produced, it is not easy to quantify the effectiveness of new operation management (McFarlane (2015, p. 21). During the installation of the vending machine, the company was aware that it could not quantify people’s needs for snacks. However, the team agreed to take a risk and use one device on a pilot project. The success of the first attempt informed the need to roll out more machines.

The change in operation management philosophy

The increasing complexity in global interaction creates new ideas for practical cooperation. In operation management, the emergent of a new economy is vital in changing the narrative. According to Correa (2008, p.2), a new economy focuses on the effect of relationships, telecommunication technology, and knowledge. With the new economy, organizations need to operate in knowledge and information-intensive environment. The transfer of knowledge is becoming more rapid, and people can get expert knowledge without necessarily having to attend the institutions (Correa, 2008, p. 6). The vending machine business is more profitable because of access to information on what to procure and strategic locations. Moreover, the information assists in steering the company to the realization of its mission and vision. With the right skills, the manager can now use the operation management skills reserved for manufacturing industries to improve competition and product quality in the service industry (Correa, 2008, p.7). Leaders who understand such needs have actively supported operational evolution. Other issues that have changed the philosophy of operation management include supply chain management, production scheduling and planning, and environmentally ethical practices.

Trends in operation management

The evolution of operation management keeps introducing new ideas to improve business. The globalization of the economy increased access to quality products with the inception of theories such as just-in-time (JIT) and total quality management (TQM) (Moynihan, 2018). The development of infrastructure and communication makes it easy for the business to make orders and always meet customers’ demands. The effectiveness of operation management introduced sustainable growth by developing logistics that are environmentally friendly and sufficiently meets consumers’ requirements (Moynihan, 2018). These elements have a massive impact on decision making. The vending machine business must ensure there are enough bins for disposing of used cans and sachets. Additionally, the marketing system uses mobile technology to advertise the products and design messages that get to a target market.

Conclusion

Operation management is a principle that evolved over the last decade to improve business, but with considerable obstacles. The changes mainly originate from the transformations in social life and market forces. However, the unclear technicalities and limited use of operation management tools in the service industry do slow the evolution. As the global economy keeps creating more complex interactions, people’s perception is also shifting to accommodate the changes in operational management. The signs for the transformation include environmentally conscious policies, the use of information technology, and focus on quality.