Sustainable Operations Management (Essay Sample)

Running Head: SUSTAINABLE OPERATION MANAGEMENT SUSTAINABLE OPERATION MANAGEMENT: A CASE STUDY OF TESCO by Student's name Code+ course name Professor's name University name City, State Date Sustainable operation management is a management approach that involves planning, implementation and control of business operations that translate available resources into required product or service. It is the management of business practices, traditions and operations to promote highest level of efficiency, smooth workflow, and increase productivity in an organization. This management strategy ensures that available labor force and materials are changed into products or services in a cost effective way to increase the company's returns (Corbett, 2009). It also involves production waste management, food waste reduction, creating new opportunities, environment protection, and improving customer health. Sustainable operation management in retail business industry around the world has gained momentum especially in the recent years. They are particularly linked to the concepts of corporate social responsibility and global warming (Tesco, 2013). While a number of organization have not adopted sustainable operations management strategy, retail firms like Tesco, Wallmart, Mark and Spencer, have adopted this concept in their management strategies to sustain the competitive advantage. A number of firms are willing to promote sustainable operations in their markets because this strategy attracts and retains customers, nevertheless competition and operating within certain boundaries does not allow them from achieving this objective. Tesco is the largest and only retail supermarket in the UK and entire globe that makes highest profits in a given financial year that has integrated sustainable operation management in all its stores. Tesco has put in place sustainable mechanisms such as sustainable designs, processes, operations, which are guidelines and policies used by the firm to decrease the effects of its activities in the environment and the future generation. Tesco takes wastes from every stage during production process and changes them into new goods. Tesco furthermore is working to reduce food wastage from the farm to the client's fridge. Tesco has well designed policies to provide the consumer with more nutritional information on their goods to improve customer's health besides creating more employment opportunities for youths in UK and around the world. This is a significant measure to reducing the use of inadequate available natural resources and retains it for future use. Reduction of food waste According to Tesco Store Report (2012), research all over the globe has shown that a third of food is not consumed instead it is thrown away or is mismanaged and left to rot. It is critical for any firm to develop mechanisms and set clear objectives when looking for an opportunity to improve on their business operations in order to execute a sustainable program. It is much easier to be sustainable than using other management strategies. At Tesco the management pursues food waste in three spheres: management of operations, supply chain and agriculture management, and client management. Tesco has the capacity to reduce food waste by following where this wastage begins from the farm through their stores up to the client's home and all activities in between. According to Chase, Jacobs, and Aquilano (2006), 40 percent of food supply in Tesco is wasted at the value chain, of which 20 percent is in the supply chain and another 20 percent comes from clients. This is a significant waste and because of this the firm is working out to develop an advanced plan to curb the amount of food wasted in the supply chain. Tesco has rolled out schedules to visit farmers and suppliers to carry out surveys with the aim of ascertaining the extent of food waste in farms and supply chain (Constable and New, 1976). The company has also collaborated with vital local, national, international agencies, universities, nongovernmental organizations, and charitable organizations. This approach will assist Tesco to develop a better understanding of where food waste occurs and in particular where clients, suppliers, and Tesco's practices are contributing to preventable food wastes. Tesco has identified three key areas where it plans to start tackling food waste practices: its operations in stores, agriculture and supply chain, and clients. Under retail operations Tesco is developing a blueprint in the UK that will be rolled out to other distribution centers and stores around the globe. This is because in the UK food waste is low compared to other operation stores around the globe (Matos and Hall, 2007). In UK, Tesco tries to reduce any waste food by selling food that is approaching expiry date from the stores. If food is not sold after the expiry dates it's donated to charities. The bakery waste is converted into animal feeds for live stocks, expired raw meat and chicken is changed to pet food and chicken fats, cooking oils or fats are processed into biodiesel (Tesco, 2013). In supply chain and agriculture, Tesco is working with sourcing country managers who work directly with farmers to reduce waste. Moreover, the company is using technology to carry out research and start dialogue directly with farmers (Miles and Snow, 1978). To manage household wastes, Tesco is working with various research firms in UK to carry out research so they better understand major causes of wastes in household and assist clients reduce wastage. Furthermore, Tesco is setting up a food waste measure for every food frequently purchased from the stores. These measures will see Tesco prioritize its efforts and follow up progress made in reducing wastage. Customer health Human health is important to every person and everybody wants to enjoy it. But due to financial constraints, time and, motivation most people are not able to enjoy benefits brought by good health. The element of food is at the centre of all these discussion. People, societies, governments and organizations around the globe are facing rising expenses resulting from health issues due to human dynamic relationship with foods (WHO, 2012). Diseases like obesity, diabetes, high blood pressure are as a consequence of the lifestyle and foods we eat. Hence, global health management is now a world problem (Leathy, 2004). These diseases are now a threat to the world population and unless something is done urgently, the world population will be obese. For instance, in the last two to three decades the rates of overweight and diabetes cases have risen uncontrollably in all countries UK not exceptional (WHO, 2012). Tesco being one of the leading food and drink providers globally has taken the initiative to inform their customers on food choices. The company is committed to assisting their clients live a healthier live from the foods and drinks they sell. To sustain this strategy Tesco has come up with policies like formulating and labeling products clearly, creating store environment that encourages and promotes healthier options, advising customers on health lifestyles, and motivating clients to be more active. Effectiveness of Tesco's strategy Johnson (2002), explained that strategy is a mechanism or policy that an organization puts in place to enable it achieve long term goals and competitive advantage. Porter (1995) provides three general policies: cost leadership, differentiation, and market segmentation that may allow a firm to achieve its competitive advantage. He says that a thriving firm must practice and impellent at least one of the three approaches in order t gain competitive advantage. He as well proposes that firms with large market share must implement cost leadership approach in order to get more returns. Tesco's policies are not in any way affected by by Porter's model of management. Whilst the firm shares over 28 percent of UK retail business, it offers no discount shopping. Moreover, the Tesco goods are not cheap when you compare it with other major retail shops (Porter, 1992). Research shows that Tesco use low cost policy to differente it goods and subsequently turn the profits earned into an investment which in turn to decrease the costs. Tesco also work towards promoting society differentiation through building approach. Tesco clients are not differentiated because the firm offers products for all classes; both cheap and expensive. Conclusion Strategies per se don't generate competitive advantage or sustainable operations. Businesses that build sustainable operations management achieve it through development of efficient policies and activities that meet the needs of clients. Organizations that sustainably manage its operations integrate all its core functions into a one active force in the market. Tesco dynamically and steadily works in various sustainable areas of policy formulation to achieve competitive advantage, value addition, customer satisfaction, job creation, food waste management, social responsibility and climate change control. References Chase, I., Jacobs, D. and Aquilano, C., 2006. Large scale retails in United Kingdom. Journal of retail and distribution management, 22(6), pp.23-40. Corbett, H. J., 2009. Sustainability operations management and analysis. 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