Researching Resource Requirements For Operational Planning

Undertaking Research

The operation manager should follow several procedures to determine requirements of resource in an operational plan. The first step which the operations manager should take is considering the target which the operation seeks to achieve. For example, the operation aims to enhance the safety standards of a hospital, then the succeeding steps would follow the aim. The second step would conducting a market research concern the political, economic, social and technological research of the market. The operations manager should then form strategies according to the resources available to him and in the light of the opportunities and challenges available in the external market. For example, as far as Australia is concerned, the country is technologically very strong.  Melbourne, one its top cities alone has over 8000 ICT companies which includes international players like IBM, Microsoft and Intel (invest.vic.gov.au, 2018). Thus, the operational manager can use software to control and manage the operation of their projects in the country. The manager can use technology to keep a vigil over the entire office premises to minimise risks. Operational manager can gain this information about the resources available in the market of Australia and abroad using several means. They can conduct secondary researches by consulting magazines, books, journals and official websites of different organisations like the Department of Industry, Government of New South Wales (industry.nsw.gov.au, 2018). The operation manager can take help of the marketing department which remains in direct contact with the customers and suppliers. The marketing department can provide the operation manager with substantial information about the market conditions like changing preferences of the customers or clients, the changing strategies of the suppliers and other significant changes which are capable of impacting the operation of the company. The operation manager would take these factors into account to develop strategies regarding requirement of resources for the upcoming operations and projects (Dabari & Saidin, 2014).

The project manager should follow several steps if he learns that the team he is heading will not be able to meet the targets assigned for the quarter or month. The first step which he should take would be holding a meeting with the team he is heading to gain information on the actual achieved. The meeting should also bring fourth the factors responsible for not achieving the target and also the degree to which this not achieving could have been reduced. For example, the clients which have placed orders may have cancelled or postponed their order delivery dates which resulted in the team not achieving the targets. Again, if suppliers fail to deliver certain raw materials, it may result in delay in manufacture of products and subsequent delivery to clients. The outcome of this delay would eventually the sales team not meeting the sales target. One can point out in this case that these situations which led to the non-achievement of target were not under control of the staff of the company and thus, the latter cannot be held responsible for them. The manager in this case escalate the issues to the senior management and communicate the customers and suppliers accordingly. They can then ask for the tentative date when they can either place orders or supply the materials respectively. The mangers can then communicate the feedback from these stakeholders to the apex management. If the operations manager discovers that the team will not be able to achieve the target due to deficiencies like lack of trained staff or joining of many new members who still needs time before they can deliver results, they should communicate the same to the apex management. The next step which the operations managers should arrange for training the employees and mentoring them, especially the newly hired employees. The fourth step would be holding a meeting with the team members to decide on a tentative future date when they would be able to deliver the portion of the target not achieved. The fifth step would be formation of strategies to achieve the target which should realistic as well. The sixth step would be informing the apex management about the date within which the target would be achieved.

Determining Resource Requirements

The operations manager should follow the following steps to develop a contingency plan and negotiate variations:

1. The operation managers should prepare contingency policy statement which would point out the contingency being dealt with. The statement would also enable the contingency management team to form the strategies based on the target mentioned.
2. The business impact analysis would analyse the risk factors and the influences they can have on the company and its business performance. The analysis should aligned to business needs, visions and mission of the organisational. The operational managers can prepare templates which the staff of the organisation can utilise to during implementation of the risk management.
3. The third steps requires the operational managers to identify steps which they can take to prevent the risks, if possible or at least mitigate them. They should take steps to minimise the disruption of factors which may lead to management of the risk. They should also report the variations in outcomes of the business like revenue generation which the risks can result in.
4. The operational managers should create contingency plans to deal with the contingent situation.
5. The fifth steps consist of creating a strong communication within the company to communicate the employees across departments and branches about the contingency plan. This would enable the apex management gain cooperation and support of the employees in dealing with the contingency. This would also enable the departmental heads, the apex management and the company altogether in dealing with the contingency more effectively.
6. The operation managers in presence of all the managers should test the effectiveness of the various contingency plans against the target set in the first step. They should also determine the degree at which they can accept the variance (actual performance against the target performance).For example, if the contingency plan aims to revive the brand value of the company which has suffered downfall, the contingent project manager assigned to the project should set target of the rate to which the brand value of the company can be revived say 50 percent taking into account the prevailing business environment. The manager can accept a variance within 10 percent which means an increase of minimum 40 percent in the brand value is accepted and negotiated. An increase of less than 40 percent is not accepted.
7. The contingency operations manager should train the employees to work under the newly adopted contingency plans. He should at regular intervals test the actual contingency performance achieved against the predetermined target and decide whether the variance is acceptable. If the variance is not acceptable, he should consider alternative methods of dealing with the contingency.

The following are the three mechanisms which the operational managers can employ to monitor the performance of their teams against an operational plan:

The operational manager should segregate the target among his team members and assign them specific targets. For example, if the total target assigned to the team is $ 1 million, the team leader should segregate the target among his subordinates. He must divide the target based on factors like experience and qualifications. He must take reporting of the achievement of targets assigned to weekly monthly. The team leader must compare between the target and the actual achieved performance. He should reward the high performers and mentor the low performers.

The operations manager can mandate each staff dealing with external stakeholders like suppliers and customers should be asked to obtain ratings from them which would show the stakeholder satisfaction index or SSAT. A high SSAT would show high stakeholder satisfaction which would mean that the concerned employee is a superior performer.

The operations mangers can apply inter-employee mentoring to monitor team performance against the predetermined operational plan. The employees with high SSAT consistently should be asked to mentor employees wiith poor SSAT. The improvement in the SSAT of the weak employee post-mentoring phase would enable the operations manager measure the leadership skill of the senior employee. Thus, it can inferred from this discussion that the third mechanism would not only enable the operations manager to measure the target achievement of employees quantitatively but also qualitatively.

Operations managers should measure the measure and monitor physical and human resources against operational plans using several tools and techniques. They can use budgetary control to monitor and manage the resources (Attached). The budgets would enable to capture data regarding the target usage of human and physical resources actual the actual usages. They would be able to measure the variance between the actual usage and the target usage and take appropriate measures to correct them. For example, according to the given budget, the risk management expenditure of the firm was just 2000 USD though the actual expenditure was 2100 where the variance was 5 percent. The expenditure was not able to meet the risk management requirements of the organisation and was hence increased 5000 USD. The actual expenditure to manage risks in the second year was 7000 USD which was 40 percent more than the actual estimate.

Strategies and Market Research

The second tool which the operations managers can use to control their resources, both physical and human is Gantt chart. The operations managers can show attributes like project start date, the working hours, activities and work breakdown structure. This would enable them to gain superior control over the operations of the projects, thus enabling better contingency and risk management if the situation demands.

The operations managers can use methods like critical methods to manage project risks and save resources. They can assign more manpower and resources to the crucial jobs in order to ensure better execution.

Operations managers can use methods budgeting and financial control can form the basis of operational plan, management of operations and monitoring of the same. As discussed earlier budgetary and financial charts can enable the project managers monitor the actual allocation of resources against the budgeted amounts. If the operations find excess amount of resources, they can allocate the excess resources into other projects which need them. Again, if they recognise shortage in one particular resource, they would acquire it to execute the project operations. This shows that the operations managers can use budgetary and financial control to measure the actual resource allocation and take appropriate decisions.

The operations managers can consult external specialised firms to manage operational plans based on tools like budgets. For example, in the first year, actual human resource varied by 100 percent against the budgeted human resources which led to a huge expenditure. Such an immense variance of 100 percent is not accepted and the firm in question might have consulted an human resource consultant firm and allocated excess employees to other projects, thus managing its staffs more efficiently. The stakeholders involved in the process are the consulting firm, the apex management and the employees concerned. They should be consulted in order to ensure that the risk management of the operations proceed efficiently.

The operating firms should consider the certain criteria while recruiting and inducting employees for itself and its contractors. They should ensure high degree of safety of their employees. The human resources departments should of these companies should ensure that they implement of laws pertaining to recruitment of these employees and their safety. They should also ensure that they train these employees and plan their career succession as well. The companies should abstain from resorting to any unethical and illegal policies while employing its own as well as the employees of its contractors.

Leveraging Technology

The three specialists which business organisations consult while developing operational plans are engineering consultants, risk management consultancies and financial consultants firms.

The operational managers while preparing operational plans must involve their subordinates right at the ground level of the plan. They should involve their subordinates in forming the strategies and assess their actual competencies in the light of the strategies. They should identify the gaps in the employees in the light of the plan. The managers should then train these employees so that they can understand the new operational plan and perform better.

The first step which the operational managers should take in order to ensure that workers do not use the machines in unsafe manner should provide them with train. Every employee should be provided with work, health and safety training to ensure that they are aware about the consequences of inappropriate handling of machinery both to their coworkers as well as themselves. If the employee still does not abide by instructions, the managers should take steps to ensure safety by controlling them.

Amanda would undergo an all-round training right from behavioural to product knowledge aspects.

The business organisations should treat their wastes and try to re-use them to the extent possible to reduce wastes. They can in addition to treating the wastes, acquire plants which release less wastes. However, total elimination of wastes is not feasible in reality. 

L’Oreal is the largest cosmetic company in the world and has succeeded in achieving profits and productivity in spite of the market risk it faced due to ban of the Australian government on its products containing plastic beads (abc.net.au, 2018). The company in order to retain its top position in cosmetic industry and comply with the ban imposed by the governments in the various host countries, introduced skincare products containing clay. This operational plan had several positive implications as far as achievement of target is concerned.

First, the clay based skincare products enabled L’Oreal to introduce new products in its product line and earn immense target sales of 26.02 billion EU. The French cosmetic giants holds 34 brand globally which makes it world’s largest cosmetic brand. This proves that L’Oreal is able to achieve its target profits by introducing clay based products.

Secondary Research

L’Oreal has underperformed in several products besides performing highly and failed to withdraw products containing chemicals in entirety. This failure has left the company exposed to further government actions and bans on its products containing chemicals, thus leaving scopes of further losses.

The company has a vision of achieving success in economic terms keeping in mind to achieve balance in environment as well as the health of their workers. They strive to provide quality products without ensuring any harm to environment and the health of their valued workers.

For the purpose of fulfilling the above-mentioned areas, the company regulates their suppliers to stick with current rules and regulations, which ensure the safety of environment. The suppliers are advised to adapt to the amended labour laws and avoid any negligence in order to make sure the occupational health of the workers.

Ensuring that in any way the suppliers does not violate the rules and regulations regarding the safety of environment and labourers have shown satisfactory results.

As of June 2017, the sales of L’Oreal is 13.4 billion euros. Therefore, there was 4.3% of growth in sales compared to the prior profit report.

L’Oreal’s decision to undertake The Body Shop was a huge mistake as the company is facing major backlash for falsifying claims made by the company. The underrated performance of this beauty brand has been a burden on L’Oreal since the company still holds the ownership if this Sussex based brand.

However, L’Oreal is trying to sell off the ownership of the brand to various other countries. Although the downgrading sales of the company is not attracting potential buyers. L’Oreal could take the initiative of reinventing the brand image of The Body Shop instead.

Mentoring and coaching strategies for staff to use resources economically

Investing on the development programme for employees will help the staff members to improve their skills to handle various clients and shareholders of the company. Teaching the staff members to self-direct their future development in the career will enhance the company as well as their own reputation.

The company may focus on their Public Relations team in order to promote their products on a global basis. The Public relations team should adopt various strategies that would put a positive impact about the company’s products worldwide. The social marketing team could organise contests that would ultimately impact on the sales of the company’s product. The ongoing action plan of L’Oreal to understand the purchasing pattern of the consumers by arranging coupons and distinguished number of contests on varied platforms.

Involving Marketing Department

The company organise the recruitment process in six steps where the applicants go through each step to finally select the best-suited candidate. However, after the selection procedure is completed the company should provide an initial training to the new added staffs in order to avoid future complications in their designation. Thus will help the employees to be accustomed with the company’s functioning. This will also boost the confidence and efficiency of the employees, which would be a plus point for the company in future.

The company ensured that digital training would be provided to every staff members in order to adapt with the highly digitalised technology. This has benefited both the company as well as the employees for the long run.

Appendix 1 – operational planning worksheets KRAs, Goals and Planning

In the space below you are required to outline the following: KRAs – List the main areas of accountability and responsibility your team efforts should be directed in to contribute to the broader organisational strategy. KRAs might include customer service, health and safety etc. The key here is to identify the areas of responsibility, not the tasks. Goals – Identify the goals of the operational scope. What are you trying to achieve or what targets are you hoping to meet? Performance indicators – Identify the performance indicators associated with each goal – the ‘red flags’ that will help you monitor whether goals are being achieved or not as well. These should be specific and include minimum/maximum requirements, figures and thresholds. Action plan – Outline the action items that will occur and how this will occur. This will involve identification of what is to occur, when it will occur, how it will occur, who is responsible for it and how much it will cost.

KRA 1

Social sustainability – protection of the environment Health and safety regulations for workers

Goals

The company must put effort to maintain social sustainability in order to draw in more consumers. A review from the workers in order to access the current condition of the labourers working in the company. Improve occupational health of the workers of the company. Provide quality product without causing any damage to the environment.

Key performance indicators

The company implements strict regulations on the suppliers in order to ensure no damage is caused to environment. The company adapts to the amended labour laws imposed on various countries in order to make sure the well-being of its workers.

	Quarterly	Public Relations	Social campaigns	Budget of $25000 per month

The following are the six pieces of legislations which impact L’Oreal in its global operations:

Legislation	Area
Financial regulation of EU	Financial
International Financial Reporting Standards	Accounting
Banking laws	Banking and digital payments
Environmental laws	Environment
Cosmetic safety	Production
Consumer laws	Selling of products

The government policies like ban on certain products have strong impact on the internal risk context of L’Oreal. First, the ban requires the company to withdraw those banned products form the market which causes immense financial loss. Secondly, the disposal of the products requires immense investment of from the company and also poses environmental threats. L’Oreal requires to introduce new products to replace the products withdrawn. This puts immense pressure on its staff and research partners. The company requires to inject huge amount of money and resources to produce and market the new products which catapults its expenditure. Moreover, this exposes L’Oreal before challenges from other cosmetic companies which already have clay based skincare product range. This the company is exposed to market risks due to intense competition from international skincare companies..

PEST analysis is a short form of Political, Economic, Social and Technological factors that are present in the external environment where the company is operating. The use of this analytical tool helps in determining the factors that will create an impact on the level of performance and activities of the business so that it can continue for a longer duration (Gupta, 2013).

The first part that is the political factors deals with the rules and regulations that are laid down by the government, which will help the business in assessing the external environment and the trade market that is present in the country. It also helps the business in getting a proper understanding regarding the issues such as the stability of the political party that is present, tax laws, and safety and trade regulations along with the laws of employment.  The second part deals with the economic issues that may have an impact on the company. It is inclusive mostly of the rate of interest and inflation, rate of unemployment and the economic growth that is present in the country (Kournparoulis, 2013).

Developing Strategies

The social factors provide insights regarding the socio-economic conditions that are present in the market such as the demographics of the customers, lifestyle of the people, educational level of the customers and the type of culture that is being followed within the society. The technological aspect deals with the advancements that are present in the industry so that the process of production can be increased within the organization. It also deals with the role that internet plays within the organization so that they can be aware of the latest technologies that are being launched in the market (Mahara, 2013).

The benefits of using this analytical tool with respect to risk management activities is that it is very easy and simple in nature that will provide an all-round analysis of the external environment. This will help in reducing the risks of the company, as they will have a proper information regarding the external environment in which the company will be operating. The company will also be able to reduce the potential threats that may damage the reputation of the company in the market as well (Makos, 2013). The companies will gain a deeper knowledge regarding the tax policies and the rate of inflation that is present in the country so that the products and services can be priced accordingly. This will help in avoiding the risk of facing a loss by the company in the market. The company will also be in a better position to assess the suggestions of entering the new markets so that the business can expand by assessing the level of risk that is present. This will help the company in understanding the potential risks at the primary level so that they can take proper precautions before establishing their business in the market (Iglinski et al., 2016)..

SWOT analysis is the short form of strengths, weakness, opportunity and threat. These factors help the company in understanding their position in the internal environment of the business in which they are operating. The main purpose of this analytical tool is that it will help in creating a business model that is specific to the firm so that the resources and capabilities that are present can be utilized to the full extent (Yuan, 2013).

Monitoring and Managing Resources

The strengths of the company help them in achieving the mission based on which the company is functioning. It also helps the company in assessing the traits and the qualities that are present within the work place so that the feature can help in providing consistency to the organization. It also helps the company in understanding the financial capabilities so that the goodwill of the company can be maintained in the market among the customers. The weakness factor helps the organization in understanding the shortcomings that are present, which may prevent the growth and success of the organization. The weaknesses that are present also hinders the company in meeting their service standards in the market (Xingang, Jiaoli & Bei, 2013).

The opportunities on the other hand allows the organization in taking advantage of the environment within which it is operating. It also help in executing the strategies so that the company can benefit from the environment in which it is being functioning. The threats are those that may jeopardise the position of the company in the market with respect to its profit levels. This may also result in risking the survival and stability of the company (Ng et al., 2013).

The difference between PEST and SWOT analysis is the factor of project feasibility. This is due to the fact that SWOT analysis provides an in-depth assessment of the company, which helps them in launching a new product or service in the market. PEST analysis on the other hand, focusses more on the socioeconomic nature and is wider in concept. This does not help in launching a new product or service in the market (Yuan, 2013). Another difference is assessing the expansion, as PEST analysis helps in giving an overview of the industry so that the competition that is present in the market can be understood along with the other factors. This helps the company in launching the product in the market in an effective manner. SWOT analysis provides an analysis of the internal environment, which helps in assessing the strengths and the opportunities that are present so that the weaknesses and the threats can be avoided in a proper manner (Bull et al., 2016). 

Budgeting and Financial Analysis

A stakeholder analysis refers to analysis of the impact of different categories of stakeholders on the company and taking appropriate measure to deal with them. It is important to deal strategically with stakeholders since they play significant role in risk management. For example, the customers buy products and generate revenue for the company. Thus customers enable the company to deal with financial risks by generating immense revenue for them. This shows the benefitting stakeholders like customers like superior products is significant in gaining stronger risk management..

The business organisations should maintain regular communication with stakeholder groups as they play significant roles in risk management. The business organisations need to follow five principles while serving stakeholders. They are:

1. Ethical operations.
2. Transparent communication.
3.  Long term relationship
4. Benefit by products
5. Involvement while forming strategies..

The process of consultation refers to seeking guidance from external firms to deal with risks. Business organisation seek consultation while dealing with financial risks, goodwill related risks, environmental risks, legal risks and political risks…

AS/NZS ISO 31000:2009 provides guidance to business organisations on risk management which paves ways for them to adopt risk management policies. The outcome of the AS/NZS ISO 31000:2009 is to enable organisations develop a risk management framework and align the framework with their business needs (finance.gov.au, 2018). L’Oreal while operating in its Asia-Pacific markets of Australia and New Zealand adopts ISO 31000:2009 in its operations to a greater extent compared to smaller companies. L’Oreal operates in 150 countries and owns as many as 34 global brands. The company has to invest immense capital into its business operations in order to market products. Lack of risk management and accidents of like workplace hazards and defective manufacturing techniques can cause immense loss to the company. (loreal-finance.com, 2018). It can also be pointed out that these losses would pose higher goodwill risks to L’Oreal compared to a small companies. That is why the cosmetic giant adhere to AS/NZS ISO 31000:2009 in order to manage risks (finance.gov.au, 2018)..

The risk management policies of L’Oreal is well aligned with the 11 principals of the AS/NZS ISO 31000:2009. The stringent risk management policies and implementation ensures effective risk management..

The risk management of L’Oreal is well aligned to the risk management process mentioned in the AS/NZS ISO 31000:2009. The policies of AS/NZS ISO 31000:2009 are not binding on any company but provide a framework for companies. to follow to avoid risks to the extent possible..

Consultative Process for Varying Operational Plan

L’Oreal can improve its product line to reduce further market and resultant financial risks. The cosmetic giant has not succeeded in withdrawing all products from the market in spite of warnings from governments…

The scope of the risk assessment plan of L’Oreal would involve introducing environment friendly product and withdrawal of products containing harmful chemicals. The stakeholder analysis would reveal that the company should consider its internal and external stakeholders. The company should take into consideration the findings form the PEST and SWOT analysis. L’Oreal should use appropriate channel to gain support from stakeholders and obtain support in risk management. For example, the company can inform the stakeholders like customers through advertisements. The investors can be informed through emails and meeting. The employees can be informed by official emails and meetings..

The top three internal risks which L’Oreal faces are financial risks, waste management risks and risks of losing employees to competitors. The three external risks are economic risks, political risk and technological risks.

L’Oreal can apply various tools like financial statements and risk analysis matrices to estimate the risks.

The apex management of L’Oreal hold meetings to communicate the risks to the different departments. Then they can ask for them, to participate in the process of risk management..

Risks	Outcome	Likelihood	Priority
Internal risks
Financial risks	Financial losses	High	Very high
Waste management risks	Environmental degradation and government actions	High	High
Human resource related risks	Loss of talent to competitors	low	Low
External risks
Economic risks	Loss of business opportunities and financial risks	High	High
Political risks	Loss of business partially or totally, economic risks	High	Very high
Technological risks	Wastage of investments in technology	High	High

The Gantt has been attached. The resource requirements should be linked to the budget attached.

References:

2017 Annual Report. (2018). Retrieved from https://www.loreal-finance.com/en/annual-report-2017/LOreal_2017_Annual_Report.pdf

Act on microbeads or I’ll ban them, Greg Hunt warns cosmetic companies. (2018). Retrieved from https://www.abc.net.au/news/2016-02-29/microbeads-ban-voluntary-environment-greg-hunt/7207482 

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Melbourne’s strengths in technology – Invest Victoria. (2018). Retrieved from https://www.invest.vic.gov.au/opportunities/technology/melbourne-s-strengths-in-technology

Ng, K. B., Leung, G. K., Johnston, J. M., & Cowling, B. J. (2013). Factors affecting implementation of accreditation programmes and the impact of the accreditation process on quality improvement in hospitals: a SWOT analysis. Hong Kong Medical Journal.

Risk Management – Principles and Guidelines. (2018). Retrieved from https://www.finance.gov.au/sites/default/files/COV_216905_Risk_Management_Fact_Sheet_FA3_23082010_0.pdf

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Xingang, Z., Jiaoli, K., & Bei, L. (2013). Focus on the development of shale gas in China—Based on SWOT analysis. Renewable and Sustainable Energy Reviews, 21, 603-613.

Yuan, H. (2013). A SWOT analysis of successful construction waste management. Journal of Cleaner Production, 39, 1-8.