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Operation Managements in Nokia Company Report

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Updated: Jul 21st, 2021

Introduction

Operation management refers to a field of management that oversees, designs and redesigns organizational operations in productions of goods and/services (Bicheno & Elliot 1997). The field has the responsibilities of ensuring that organization operations are efficient in reference to the resources needed to meet customers’ requirements (Matthew & Tan 2009).

It is concerned with management of the processes that transform or converts the inputs to outputs such as the conversion of raw materials, labor, and energy to goods and services (Bicheno & Elliot 2009). The field ensures that an organization maximizes its profits while undergoing the minimum cost of production possible (Bicheno & Elliot 2009).

In operation management, both long and short-term business strategies begin with high-level departments. They “are based on careful and sound projection of demand for the product or service (Shim & Siegel 1999 p2).” Operating strategies and plans start with derivation of short-term and long-term procedures in production that transform later into purchasing plans (Shim & Siegel 1999).

All this plans and strategies should focus on maximizing the profits and minimizing the cost of production. During formulation of the plans and strategies, the decision-makers should concentrate on the issues that focus on competitive advantage, as this will give the organization the advantage to maximizing its profits (Sheik 2003).

An organization thus focuses on its strengths, weaknesses, opportunities, the threats associated with its production, markets, and the finances generated (Sheik 2003). An organization must therefore focus and evaluate its decision-making tools and methodologies in order to generate plans and strategies that will enhance its achievement of the goals (Garg & Venkitakrishnan 2003).

In operation management, the decisions made on the order winners and qualifiers affect an organization. This paper focuses on the order winners and qualifiers of Nokia Company, evaluation of means of delivery, improvement and the potential implications of the improved orders and qualifiers.

Orders Winners and Qualifiers

Nokia Company deals with the production of mobile phones and their parts. In the recent years, the industry of mobile phone and their parts production has relatively grown thus increasing the competition in the market. The company has therefore focused on evaluating its order winners and qualifiers.

The company gears towards achieving a competitive advantage over its competitors while minimizing its cost, maximizing its flexibility and maximizing the profits (Slack 1999). Order winners refer to those characteristics that give Nokia products a competitive advantage over its competitors’ products.

Order winners refer to the characteristics that persuade a customer to buy Nokia phones or parts over those of other mobile phone production companies. The order winners focus on the price or cost, quality, flexibility, product design, image, delivery reliability and speed, and after-service market (Barney 1991).

On the other hand, order qualifiers refer to the aspects of competitiveness that Nokia operations management has over a particular level that customers consider (Barney 1986). Qualifiers thus give Nokia Company a name depending with the level of their performance over what the costumers consider. Similarly, Nokia Company order winning factors implicitly define its operations contributions (Barney 1991).

Increase in the performance of the order winning factors increases the chances for more business while the converse results to reduced amount of business (Khanna 2007). The paper will focus on five order winners and qualifiers used by Nokia Company.

Customer service: Nokia Company customer service provides a real time services to its customers. They handle all the customers’ queries and needs with immediate response. The company customer service gives the customers the first priority. They emphasize on treating their customers fairly as the customers are their main concern (Ake & Hakan 1997).

They fully understand that customers are of great importance to their company and without them, they cannot operate. The company emphasizes on honesty and treats the customers’ information with confidentiality (Ake & Hakan1997).

They further have a well-established database system that helps them to store their customers’ data that help them to revisit the customers’ information to clarify whether the answer they responded to the customers was right.

The company customer service further believes on the minimizing the cost of their operation by ensuring that complains and queries from their customers are minimal by offering high quality services and easily understood instructions (Ake & Hakan 1997).

Quality: For Nokia Company to ensure it has a competitive advantage; it concentrates on the production of high quality products (Hill 2000). Nokia Company products are competitive in the market due to their high quality. They give a wide range of products that are of high quality that persuade many customers to purchase them.

Further, most of their products have the qualities that the customers seek when purchasing their mobile phones. The Nokia Company also concentrates on the quality of these features to ensure that they have a competitive advantage over the competitors’ features.

For instance, regarding their mobile phones with a camera and an internet connection, the Nokia Company concentrates on improving the quality of the camera and the speed of internet connections. In addition, in terms of durability, Nokia products last longer than their competitors’ products.

They produce mobile phones and parts that give their customers’ service for a long time. Further, their products are mainly default free and give a 100% tolerance to faults.

Delivery speed: This refers to the time taken for the Nokia Company to respond and deliver the orders once placed (Hill 2000). Since Nokia Company uses the made-to-stock products operations strategy that allows them to produce their products in bulk through maintenance of an inventory record of the finished products, they are able to give response to orders in the right time (Khanna 2007).

However, even though the company has the products ready, they give respect to the customers’ orders and they cannot deliver them so earlier than the customer expects (Khanna 2007). Ability of the company to make deliveries at the right time gives the company a competitive advantage over their competitors.

Furthermore, due to their effective customer care service, the company is able to receive the order placements in the shortest time possible. The company through their technologically improved operations allows the customers to place orders online that ensures that orders are received as soon as possible.

They further encourage communication on the issues related to orders to ensure that they are meeting the customers’ needs. The company also ensures that their delivery is reliable. The company does this by ensuring that it has the maximum number of days that the delivery should take.

Further, they ensure that the means of delivery that they use are reliable and cannot cause delay in the delivery of the products to the customers (Hill 2005). This gives the customers the confidence with the company that result in more business opportunities.

Flexibility: Flexibility refers to the ability of the company to change easily from the production of one item to a substitution product, easily customize an output to meet a certain customer specification or requirements and the ability of the company to change its production to meet the customer demands (Hill 2005). In substitution production, Nokia Company ensures that they produce a variety of products that can substitute each other.

They ensure that every product they introduce to the market has its substitution. This helps the company to have a competitive advantage as their customers always have a substitution from the company rather than purchasing substitute products from other companies.

In terms of customizing the output to meet the customers’ requirement, Nokia Company similarly ensures it has a vast range of products that the customers can choose. They ensure that they have more than five products that have almost the same features but different shapes, image, color and model.

This gives the customers the right to choose their favorite depending on their taste. In reference to meeting the market demand, Nokia Company has been and is able to respond to the market changes. The company is able to produce in bulk during high demand and in less bulk during low demands.

Price and cost: Nokia Company concentrates on reduction of cost of production. The company ensures that there is elimination of waste materials, labor, and facilities (Barney 1986). The reduction of production cost helps the company to offer better prices for their products.

However, Nokia products are more expensive than most of its competitor’s products but the customers consider them genuine when they consider the quality of the products. In addition, the company produces in bulk that gives the company the advantage of economy of scales (Garg & Venkitakrishnan 2003). This further helps the company in offering better prices to its customers.

Improvement of the Order Winners and Qualifiers

As mentioned earlier, the order winners and qualifiers highly predict the business of an organization. Similarly, in Nokia Company the order winners and qualifiers predict the market and the business. The company has therefore embarked on the improvement of its order winners and qualifiers in order to have a better competitive advantage and withstand the rising competition from other upcoming competitors.

In customer service, the company has started on projects to improve their customer management. The company in their research has realized that their customer service turn-around time is not as minimal as the company may opt to achieve (Barney 1991).

To solve this problem, the company is working on improvement of the customers’ service by updating their database capacity, increasing the number of customer service agents and use of reliable means of communication. On the quality of the products, the company has focused on improvement of the features of the products and durability.

The company looks forward to production that will meet all the customers’ needs through update of the features. The company focuses on the production of mobile phones that will give its customers the ability to perform all the tasks that a computer can perform. In addition, the company seeks to ensure that durability of these products is high to win confidence of the customers.

The company further concentrates on simplifying its products usability to ensure that they match all market needs (Hill 2000). This is through making their products instructions precise and easy to understand that will assist all their products users. In delivery time, the company objective is to make the customers more satisfied with the company deliveries.

The company has stressed on its operation strategy and is keen in the production in bulky prior to the placement of the orders to ensure they respond to the orders immediately. The company has recommended improvement of the inventory technology that will help it in bulky production. In addition, the company seeks to ensure in future that there is no even a single delay in the delivery of the products to customers.

The effort of the company is to ensure that customers are satisfied with the delivery of the products to the market (Slack 1999). This also involves the reliability of the channels used in the delivery of the products to customers.

In flexibility, though the company has been able to adapt to the changes in the market, the company objective is to produce more substitute products and introduce them to the market. This will give the customers a variety to choose from that will ensure the company ability to sustain its customers.

This will further ensure that Nokia Company is able to compete with other mobile phone production companies that produce products that would substitute their products. In addition, the company is looking forward to the improvement of the methods used to collect customer requirements rather than only depending on their customer service.

This aims at achieving a more elaborate customer requirement through market researches that will help them to focus on the customer needs (Barney 1986). This will strengthen the company and customer relationship as the customers will have a feeling of a company that cares for their needs. After the collection of this data, the company will concentrate on transforming the customers’ requirements into products.

In pricing, the company’s objective is to offer prices that match the customer ability. To respond to their normally more expensive prices, the company has concentrated on reduction of production cost and production in bulk.

The reduction on production cost will consequently lower the products price in the market (Barney 1991). In addition, the company has focused on introduction of more products with different pricing in the market. The price differences will help customers to purchase the products that best suit their ability.

Potential Implications of Improved Order Winner/Qualifiers

Order winners and qualifiers affect the performance of the business. An improvement in the order winners and qualifiers will have an improvement in the business performance. The improvement of Nokia order winners and qualifiers similarly will have an impact on the organization supply chains. Supply chain refers to the channels and processes used in transferring products from the producer to the customers (Rangaraj 2009).

This may include the people, activities, organization, resources, and activities involved in transferring the products from the producer to customers (Rangaraj 2009). An improvement in the order winners and qualifiers results to an increase in the number of customers, which consequently affects the chain supply.

The increase in customers means that the supply chains must be able to meet the customer demand (Seuring 2003). This causes an increase in the supply chains, the level of their profit margins increases and their management becomes more complicated as they work towards meeting the customer demands.

They therefore work on sustaining the delivery of products in the market through improvement in the management and operations. The improvement in order winner and qualifiers further affects the supply chains in the sense that the supply chain has to improve to meet the needs of the market.

The improvements in supply chain must address the strategic supply chain, supply chain planning, logistics, management of product lifecycle, applications of enterprise chain supply, procurement and asset management meant to match the changes in order winners and qualifiers (Seuring 2003).

The failure to have a well-planned improvement in the supply chains management will consequently affect the delivery of products to the customers.

Conversely, lack of improvement in order winners and qualifiers has impacts on supply chains. Lack of improvement in order winners and qualifiers means less business for the Nokia company products. It consequently affects the supply chains, as the market opportunities are few.

This causes collapse of some of the chains, failure in management due to lack of resources, shift of the market to the competitors and poor profits margins due to lack of market for the Nokia company products (Rangaraj 2009).

Conclusion

In any organization, operation management is very crucial. The decisions made by the managers and the people in this field or department might affect the operations of a whole organization positively or negatively.

The department is concerned with the production, the conversion of the labor, materials, and energy into finished products. In addition, the department is concerned with the minimization of production cost and the maximization of profits and flexibility. The department focuses on decisions for improving the order winners and qualifiers that really affect the performance of the business.

The failure of the decision, plans, and strategies made by this department means the failure of an organization. It is therefore important for every organization to hire competent personnel to run the department. Evaluation and validation of decision-making tools related to this department is of great important before the application.

References

Ake, H & Hakan, Y 1997, The firm’s and its customers’ views on order-winning criteria, International Journal of Operations and Production Management vol. 17, no. 10, pp. 1006–1019.

Barney, J 1986, Organizational culture: Can it be a source of sustained competitive advantage? Academy of Management Review 11: pp. 656–65.

Barney, J 1991, Firm Resources and Sustained Competitive Advantage. Journal of Management 17: 99–120.

Bicheno, J. & Elliot, B 1997, Operations management: An active learning approach. Blackwell Publishers Inc, Malden, USA.

Garg, V & Venkitakrishnan, N 2003, Enterprise resource planning: Concepts and practice, Prentice-Hall of India Private limited, New Delhi.

Hill, T 2000, Manufacturing strategy: Text and cases. 3rd ed, Irwin McGraw-Hill, Boston.

Hill, T 2005, Operations management strategic context and managerial analysis, Second Edition, Palgrav, USA.

Khanna, R 2007, Production and operation management, PHI Learning Private Limited, New Delhi.

Matthew, R & Tan, K 2009, Operations strategy in action: A guide to the theory and practice of implementation, Edward Elgar, Cheltenham.

Rangaraj, N 2009, Supply chain management for competitive advantage, McGraw-Hill Companies Inc, New York.

Seuring, S 2003, Strategy and organization in supply chains, Physica-Verlag Heidelberg, New York.

Sheik, K, 2003, Manufacturing resource planning (MRP II): With introduction to ERP, SCM, and CRM, McGraw-Hill companies Inc, New York.

Shim, J & Siegel, J 1999, Operations management, Barron’s Educational Series, Inc, New York.

Slack, N 1999, The Blackwell encyclopedic dictionary of operations management, Blackwell publishing Inc, Malden.

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