Supermarket retail analysis performed by retail branch manager

This essay discusses the ways of how the branch manager of a high profile supermarket retail branch has to conduct an analysis of the retail branch operations, namely service quality in order to identify the factors that make the operations of the branch effective and efficient and to re-establish the status of the branch as an excellent in the service quality delivery. The analysis identifies and explains the following factors of branch’s effectiveness and efficiency: meeting customer requirements, sufficiency of customers serving staff, employee motivation and understanding of company’s vision, carefully managed service quality together with service standards and customization; planning and control, supply chain management and JIT practices; employee involvement, empowerment and satisfaction,

The identified areas of improvement are suggested to be addressed in terms of the process and capacity design within the framework of some other critical decisions of the operational management, namely: design of goods and services, managing quality and human resources. It is also considered in the essay how the current systems and processes can be, monitored, controlled and continuously improved in order to achieve a consistency of a high quality service delivery. That includes the PDCA cycle and service maps (service blueprints), employment of the total quality management (TQM) concepts: standards, benchmarking and Key Performance Indicators (KPIs); Just-In-Time (JIT) practices and carefully managed supply chain.

In today’s services oriented economy delivery a high quality services are the key goals for operational management in many industries. The quality of services are in a direct relationships with the customer satisfaction and loyalty, which undeniably recognized as the core factors of a successful business. Hence, providing an excellent service quality and consequently achieving a high customer satisfaction is the important issue and challenge facing every business. There is a high profile retail branch in a big city in Australia. It is one of the top five in the country and excels in excellent quality service and products. However, the branch employees seem to have taken the standard of their performance for granted. As a result, the quality of service is declining.

To re-establish the status of the branch and to ensure a maintenance of the excellent performance, the branch manager should ensure that his actions represent a system that comprises three integrated parts: firstly, an analysis of the branch operations in order to identify the factors which make branch operations effective, efficient, productive and excellent in customer service; secondly a delivery of excellent quality services, that includes the choice of the customer service strategies and their implementation and finally a branch manager should decide which practices to employ in order to monitor and a continuously improve the overall customer service staff performance.

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In the case of the given supermarket branch the branch manager is responsible for human resources management, service quality control, supply chain management and capacity optimization . Recently the manager have examined a financial data of the branch and found a significant decline in sales in comparison to previous periods. In order to find the reason for this he made a number of inspections in the store, that revealed that staff do not perform a proper job in terms of the quality of delivered services. This observation was further supported by the information obtained from the internal record system of the organization, that contains a database with customers’ complains. The data showed a warning amount of customers’ that are dissatisfied with the service in the branch.

In order to solve the problem of low quality service, the branch manager is intending to analyze the branch operations and identify the ways how to improve a service delivery quality in terms of Process and capacity design. Some other critical decisions of the operational management will be used as a frame work of the analysis, those are: Goods and service design, Managing quality and Human Resources.

Since strategic alignment is most often cited as the key to the performance dilemma, the manager firstly needs to identify the strategic aspects which may help to improve branch performance. Hill (2008) offers a focus approach to organizing resources. It is based on the achieving superior performance by concentrating its resources on accomplishing one task, rather than attempting to address an endless series of demands from internal and external sources’ (Hill 2008. p. 2). The supermarket branch strategy is a process focused strategy (Heizer & Render 2008). Operations strategy in this case involves organizing the capabilities and resources in order to optimize the process and capacity. The goals of the process focus strategy may include improving the effectiveness and efficiency of the customer service measured in terms of accuracy and timeliness, improved delivery of services through the use of new technology and reduction of costs through better and more coordinated processes. For the operations analysis and process optimization a branch manager can use a range of approaches, including information flow process charts, person flow process charts and service maps (Heizer & Render 2008). One of the most effective tools for understanding the service delivery process is service maps, also known as service blueprints. They show the movement of customers, tasks and information through the service process. It is evident that efficiently organized process of service delivery counts to the efficiency of the operations and the quality of the service delivery process (Karwan & Markland 2006) Hence, these tools can be applied by the branch manager in order to analyze and optimize the process in respect to the capacity planning and designing. The layout may be changed in such a way that will allow a logical and more efficient movement of customers within the facility, as well as more efficient use of the capacity. A manager also can consider a higher degree of the process automatization wherever it is possible. For example, it can be addition of extra checkouts, a modernisation of the checkout equipment and installation of a sufficient amount of self-checkout machines. That will allow serving customers faster and hence to reduce a waiting time. Sufficiency of the customers serving staff on the checkout, as well as inside the facility also will make a great contribution to the effectiveness and efficiency of customer service.

However, as the service in the branch started decline due to branch’s employee started take their performance for granted, it is possible to state with a high degree of confidence that employee play a crucial role in the branch’s operations improvement, including the service quality. Service delivery systems, specifically, customer services are very challenging to manage due to the direct collaboration of employees’ and customers’ psychological attributes, perceptions and expectations during the services delivery process (Oliva & Bean 2008). Delene and Lyth (1989, cited in Karwan & Markland 2006) named this as an ‘interactive service operation’. Moreover, the employees’ attitudes towards the customers and their job perceptions affect the conditions of service delivery. This argument supports the case of the given supermarket branch – the branch staff takes the standard of their personal performance for granted and the quality of service declines. The importance of the employees’ contribution to the service delivery process is acknowledged by the vast majority of scholars, who argue that combinations of customer contact personnel, customers and technologies form the basis of operations and performance of front office employees constitute the central measure of quality and success (Delene and Lyth 1989, cited in Karwan & Markland 2006). Kotler et al (1999) also state that a high quality service delivery is based on the employees’ ability to deliver services consistently and match consumers’ service quality perceptions.

Hence a service quality management is extremely important for ensuring the effectiveness of the branch’s operations. It refers to identifying and applying a system of measurement and monitoring that insure a proper branch’s performance and a consistency of quality services delivery. The challenge here is that services are customer contact based and the only criteria available to evaluate a service quality are subjective comparisons of customers’ expectations to their perception of the actual service delivered (Oliva & Bean 2008). The lack of fixed and objective service standards as well as the mutual influence between servers and consumers leads to a co-evolution of their perceptions and expectations. Oliva and Bean (2008) state that this fact is further confounded by the statement, that services are intangible, thus making it difficult to assess customer requirements and to fix an objective service standard. Therefore to ensure a delivery of a desired quality services, firstly, the standards are to be set.

Scholars claim that the setting of standards is related to planning and stating the objectives (Wright & Race 2004). Setting the standards, which can be measured and results recorded, will help to understand whether progress is being made or not and the organization’s objectives were met. In order to control of the timely overall objectives achievement, standards have to be understood by all the members of the organization starting from the high management to the staff actually providing service and the two way feedback between the senior management and the staff directly responsible for activities should be provided (Wright & Race, 2004).

However, the idea of strict following the standards is challenged by King and Grace (2005) who argue that adaptable standards should be employed that allow employees to retain the flexibility to deal with different customers in different situations. This is supported by scholars who argue that high degree of customization created by the personal interaction of customers and service providers leads to better customer satisfaction and significant productivity gains (Baumol 1967, Sasaki 2007). Without the ability to change the service delivery process to better meet the requirements of the customer the optimal customer satisfaction rating is unlikely to be achieved. Scholars name it a ‘semi-customized’ or ‘customization approach’, which means the flexibility to change according to customers’ needs (de Chernatony and Riley (1999, cited in King & Grace 2005). /LINK EVERYTHING TO THE SRTATEGIC DECISION TO BE MADE TO RE-ESTABLISH THE STATUS / QUALITY SERVICES DELIVERY/. In the given supermarket branch the system of standards should be elaborated and implemented. The task of a branch manager is to ensure that all levels employees understand and follow the standards that together with the job instructions describe precisely what they are expected to do under what circumstances and in which cases they have a flexibility to adjust their actions to the specific customer and situation.

FLOW? To improve the employees’ performance and to achieve its compliance with the branch’s standards, a branch manager should use a Total Quality Management (TQM) strategy. It refers to the manager’s task to orient the entire organization towards the continuous delivery of excellent service matching customers quality expectations (Heizer & Render). Several concepts of TQM that can be used in the given branch in order to analyse the areas of the problem for the further improvement.

Key performance indicators (KPI) are used to measure the factors that are critical to the success of the organisation. Enoma and Allen (2007) argue that the benefit lies on their measurability and the fact that performance levels are derived from specific program or project objectives. KPI is a simple method of measuring performance by benchmarking both project and performance indicators against others and use the information to set improvement targets. They also allow to track the performance trend and compare against information available from other sources. KPIs for the case of retail branch firstly can be the basic indicators such as cost, time and profitability, as such information can be easily gathered and analysed. And secondly, it could be such indicators as integrated teamwork, client satisfaction and quality. However, the concept of KPI is often challenged by practicians, who claim that it is a very broad concept and when designing KPI the organization must be careful in choosing the right indicators. It is also difficult to change the KPIs and it may be difficult to get comparisons with other KPIs from different companies (Wade & Recardo 2001). However, overall KPIs offer an excellent opportunity to target specific areas where the improvement is desired.

Another concept of TQM that can be employed by a branch manager is Benchmarking – that is a practice of comparing business practices and performances between companies. Hill (2008) states, that benchmarking is a part of a continuing need to improve operations. However, the care should be taken when using benchmarking for improvements in the sense of choosing the comparisons that is linked to the quality rather than to the quantitative parameters of other organizations, for instance the amount of staff or equipment (Grant 2001). Overall, when used carefully, benchmarking provides a powerful combination of tools that can allow any organization to identify areas where performance could be improved. It can be also used for the supermarket branch in a way of comparing the branch’s performance against the performance of the key competitors in the retail supermarkets industry.

In order to rise a service quality, the branch manager may also employ a Just-In-Time (JIT) practices, as scholars claim that JIT practices and quality are interacted (Flynn et al.1995, cited in Tan & Wisner 2003). JIT practices will improve quality performance and conversely, quality practices can improve JIT performance. In addition, Lawsirirat (2007) states, that the supply chain management system is very important for the delivery of the services, because it contains all logistics to support the service delivery. Poorly managed supply chain results in inefficient use of resources and higher costs of the service delivery. That results in low efficiency and also affects the quality of services due to the inability to meet the demand properly.

Scholars also widely cite the Employees empowerment as an important aspect of a TQM. It can be implemented via such techniques as delegation the part of the responsibility from the management to the front-line employees, building a communication networks that include employees and establishing friendly supportive supervision from the managers (Heizer & Render 2008). This concept is related to high degree of employees involvement and together with some other factors that affect branch effectiveness should be thoroughly addressed by the branch manager from the perspectives of the Human Resources management.

Vast majority of scholars concur on the role of employee involvement as one of the key factors that makes branch operations effective and excel in customer services. They state that the ability of the employee to positively or negatively impact an organization’s success is central in the process of service delivery (Harris and de Chernatony, 2001; D’Amato, 2006). When employees experience a lack of information about the customers and the way to serve them, it can lead to the discrepancy in the employees’ and consumers’ perceptions of the service quality. This can lead to the dissatisfaction with the service process for both – employee and customer and consequently to the decline of service quality. Employees involvement in the process of service delivery can be achieved through the management sharing the knowledge about customers and their needs with the employees.

Another key factor influencing the process effectiveness and efficiency is clearly stated standards and tasks that will help employees to provide customers with high quality service (Chase and Stewart 1994). This is associated with the factor of employees’ understanding of company’s vision and motivation. Hays and Hill (2006) state that to motivate employees to provide high quality service, the company must provide a vision of the importance of maintaining and improving quality. As employees understand their role in customer serving and feel that their actions are contributing to the organization’s objective they more feel confident and this linked to increase in their job satisfaction and hence better performance (Jones et al., 2003, cited in King & Grace 2005). Hence, an employee satisfaction also can be considered as an important factor influencing performance. In the case of supermarket branch, it can help to understand some of the reasons why employees’ personal performance started to decline. The front-line employee is the critical component of the service recovery procedures. Johnson and Michel (2008) argue that being between grievances customers and management or unchangeable organizational policies and procedures, front-line employees often experience stress. This together with the lack of communication or poorly established relations with the management and the lack of motivation may cause the decline in the level of their performance.

Therefore in order to improve branch’s staff performance and consequently service quality, the branch manager’s role is to state clearly standards and tasks, to ensure employees’ understanding of company’s vision and to address employees’ job satisfaction via empowerment and better involvement in the service delivery process. In addition, manager should enhance staff motivation by establishing a motivating and rewarding corporate culture, based on supportive and friendly relationships with the managers and supervisors.

After the key factors for improving branch’s performance are identified, the branch manager should ensure the implementation of the programs addressing the areas of desired improvement. Researchers concur that the ability to improve perceived service quality is based on company’s ability to carefully regular review, plan and control of performance improvement (King & Grace 2005; de Chernatony & Dall’Olmo Riley 1999). For the purpose of maintaining of the performance compliance with the set up standards a Continuous improvement program should be employed. This is a process of continuous achieving by a company a goal of perfection, that involves improvement of all aspects of the organization. As a tool can be employed a PDCA (‘plan’, ‘do’, ‘check’, ‘act’) cycle, that is used to examine systems and processes and helps in identifying opportunities for continuous improvement (Hill 2005; Heizer & Render, 2008).Wright and Race (2004) state that carefully managed improvement programs is the best way to sustain a high quality and consistency of high quality service delivery as it represents a customer service function’s philosophy of the company: when one program of improvement is done the next one is ready to be carried out. Such philosophy adopted on the all levels of the branch, undoubtly will result in the rise of staff performance and re-establish the status of the branch as an excellent in quality service delivery.

Conclusion

Tan and Wisner (2003) state that quality management efforts have resulted in improved competitiveness The quality practices are the role of top management leadership, service (product) design, the role of the quality department, training, process management, quality data and reporting, and employee relations.

The essay has provided the analysis of the supermarket retail branch operations to determine strategic decisions for re-establishing its status. It has become evident that managing a service operation represents a great challenge. As the service sector becomes more important, that the opportunities philosophy of continuous improvement has to be adopted. In particular, management need to consider ensuring the service quality delivered is aligned with the company’s values. These values are to be clearly understood by all employees of the organisation. This includes the necessity for systems and procedures to be implemented so as to provide the necessary control to ensure consistency of the quality services delivery. The delivery of the services, including customer services, is difficult to manage. High quality of services is based on the customer satisfaction where employees play the key role.

If the performance of the organisation is declining, it is also useful to analyse employees’ satisfaction. It helps to understand and eliminate reasons why employees’ personal performance started to decline.

It became evident that to re-establish the quality of services and the performance of the branch, a system of measures are to be undertaken.

To control Firstly, the standards which can be measured and results recorded, will help to understand if progress is being made or not and identify problem area. Moreover, standards have to be understood by all the members of the organization. In addition, while setting the standards, such tools as Benchmarking and Performance indicators are to be used.

Service design is another important issue that has to be taken into consideration during the analysis of branch operations. Early involvement in the design procedure and designing for operations are key factors of the corporate improvement process. In addition, it is evident that customers also can be involved in the process of the service design.

Overall, chosen appropriately design models can certainly account for a variety of objectives and they would appear to be valuable to raise performance of the organization, including operations.

Moreover, current systems and processes have to be analysed and improved. Such tools as Deming cycle, flow process charts and service maps can be used while analysing Process and capacity systems.

In terms of Managing quality it is important to use JIT practices or carefully managed supply chain as well as clearly set goals will help to improve the quality of the service. Moreover, to achieve high quality of service and to raise branch’s performance it is important to implement continuous improvement programs.

Moreover, the strategic decisions have to address how the service can be delivered better and taking into consideration all possible factors of effectiveness.it is important to take into consideration factors that make branch operation effective, including meeting customer requirements, employee motivation and understanding of company’s vision, carefully managed service quality including service standards and customization, planning and control, and employee involvement.

As a final point, to re-establish status of the branch, particularly from an operations perspective, the careful analysis of the situation, identifying problem areas is extremely important.

As a result this will increase the perceptions of the customer, improvement of all processes and quality of the service. Consequently this will improve branch’s performance and will re-establish its status as one of the best in the country.