Evaluation of the existing operations Essay Example

competitive pricing. With estimated revenues exceeding INR 20 million, TBS is headquartered in Calicut with branches located across Kannur, Kottayam Trivandrum, and Trichur in northern Kerala. They also have an extensive network of agents throughout Kerala who assist with product distribution.

In addition to their core offerings of books and educational services, TBS provides office letter paper, lab equipment including chemicals and surgical items for labs setups. They also offer various products such as equipment for small industries, computer components IT components , sports goods.The main focus of this text is on the books business at the main bookstore in Calicut, which accounts for 80% of TBS's gross and 85% of its profits. Total Quality Management (TQM) plays a crucial role in delivering high-quality standards and improving operational efficiency. TQM includes various schemes, programs, and strategies like Quality Assurance, Reliability Analysis, Statistical Quality Control, Random Sampling Inspection to ensure practical quality control methods are incorporated. It also emphasizes continuous improvement in quality through organizational mechanisms. Instead of focusing solely on individual parts, TQM takes a holistic approach by considering the entire system. Failure can be attributed to factors such as cultural clashes/shortfalls, teamwork issues, leadership problems, management problems, HR issues, individual motivation issues, employee commitment issues along with skills and equipment deficiencies. Under the TQM philosophy, customer satisfaction is prioritized and every aspect of improvement is considered from their perspective. The organization as a whole adopts a holistic approach with customers at the center while involving all stakeholders. Therefore, empowering employees and promoting teamwork are crucial for success.According to David Garvin, there are eight features that interest customers. These parameters were evaluated through a customer satisfaction

survey with 250 participants completing a questionnaire to determine their preferences. The results of the survey indicated that Features and Performance were areas in need of improvement. The chart below displays the customer satisfaction index, with blue representing current scores and red highlighting areas for potential improvement.

TBS's operations were analyzed using Total Quality Management (TQM) principles. TBS is categorized as a "mass service" business with significant capital investment and high volumes of services offered in a medium range with low customization for customers. TBS primarily focuses on providing quality books and other services from publishers to end customers. Both the transformation of place and ownership operations raise concerns for TBS.

The text emphasizes the importance of clients in TBS's business, particularly in the highly competitive educational services market in Kerala. In this market where there are numerous small bookstores and competition from pirated books, clients play a major role. Most leading bookstores offer similar products and services due to the absence of intellectual property rights or exclusivity agreements. However, TBS has managed to maintain a competitive position by developing a loyal customer base.TBS creates value for its clients by providing an easy and efficient method for end customers to purchase educational items such as magazines, lab equipment, CDs, and books. Utilizing Total Quality Management (TQM) principles ensures that TBS maintains a loyal customer base in this highly competitive market. The text emphasizes the importance of using TQM principles for long-term success, offering mutual benefits for both TBS and its clients. This concept is illustrated in Figure 2, which depicts Normann's service management system-based value generating model.

Additionally, the text highlights the need for perfect harmony among People,

Systems, and Procedures within an organization. It also stresses the importance of fostering a conducive culture, effective communication, and commitment from all stakeholders. Market segmentation analysis reveals that TBS attracts a diverse range of customers in terms of businesses, genders, ages, and financial conditions; all seeking TBS' educational products.

The following pages demonstrate the purchasing flow of various customer segments at TBS using the service blueprinting technique of Zeithaml & Bitner (2003). The different types of client sections found include Focused Customers,
Topical Customers,
and Unfocused Customers.
These are explained in detail on subsequent pages.

1. Focused Customers - These customers know exactly what product they want to buy. They seek advice from customer service on its price and availability, then make a purchase decision. They typically only buy the specific product they came for and spend very little time in the store. The frequency of their purchases is high compared to the other two segments.
2. Topical Customers - These customers are interested in specific subjects but may not have a particular title or product in mind. They go directly to the relevant section of the store, browse various titles under that subject, explore offers, and eventually decide on what to purchase. The purchasing frequency of this group is lower than Focused Customers but significantly higher than Unfocused customers.
3. Unfocused Customers - These individuals visit the store without any specific plan or intention to buy a particular type of product. They tend to explore different sections of the shop and make spontaneous buying decisions. The frequency of their purchases is noticeably lower compared to the other two customer segments.

TBS' service concept can be classified into two categories, Core services and Peripheral

services, following the principles of Total Quality Management (TQM). Core services encompass vital elements such as location, which is crucial for any book shop. TBS in Calicut benefits from its convenient proximity to a busy bus terminal and popular supermarket, making it easily accessible for customers. The information counter/desk also plays a significant role in assisting TBS' customers in making informed purchasing decisions. Its placement within the store and inventory status greatly contribute to customer satisfaction.

The TBS stores offer a wide range of books and services to cater to customers' preferences. Customer attention and superior client care are prioritized by TBS through the implementation of various strategies. The well-designed store layout ensures ease of reading and browsing, facilitating efficient searching for specific items. Visibility is enhanced through posters, newsletters, and other forms of communication that provide helpful information.

Furthermore, sofas are provided within the shop to encourage customers to spend more time browsing since it has been observed that longer stays often lead to increased purchases. Additionally, wireless internet connectivity is available inside the shops with the aim of attracting new customers, particularly travelers who require internet access.Furthermore, TBS has implemented a delivery system based on TQM principles. This system, as shown in Figure 4, consists of several components. Firstly, to meet the constantly changing needs of customers, TBS maintains multiple layers of inventory. Each store has its own back-office inventory to ensure that highly demanded books are always available and potential sales are not missed. Additionally, local warehouses are maintained to guarantee that fast-selling books can be delivered within two days. Furthermore, there is a central warehouse specifically for specialized books that typically have a

maximum wait time of five days for end-customers.

TBS views inventory as both an asset and insurance against fluctuations in demand in this volatile market. However, having a large amount of inventory in their supply chain results in significant costs for TBS which include physical/geographic location considerations. It is crucial for TBS to have customers visit their stores as this increases the chance of higher gross sales. Moreover, TBS has developed a unique shop plan/layout system where titles are grouped by subject, class, and genre. They also have separate sections dedicated to promotions such as new arrivals and sales. In addition to these amenities, TBS provides sofas and a coffee shop for customers' comfort along with clean premises equipped with rider lifts and lavatories.TBS focuses on creating a welcoming atmosphere, spacious aisles, and well-organized books. They also prioritize maintaining strong relationships with sellers, suppliers, and publishers. These efforts result in benefits for customers such as author visits, timely availability of new releases, and competitive pricing.

To thoroughly evaluate TBS' operating and service system, it is important to assess it at various levels. This can involve personal observations of the bookshop itself and gathering feedback from different types of clients.

One key aspect to consider is the assortment offered by TBS. Their customers have diverse needs that encompass books, CDs, and magazines. It is crucial for TBS to have an appropriate mix of volume and variety within each category. However, improvement is needed in implementing a demand forecasting system to accurately predict future demand.

Product availability is another crucial factor that heavily influences customer purchasing decisions. If a desired product is not available at TBS, customers may opt to buy

it from competitors instead. This emphasizes the importance of customer retention and loyalty for TBS.

Overall, providing a pleasant shopping experience remains significant for TBS in order to satisfy customers' expectations.TBS ensures the availability of customer-care service staff with specialist knowledge, offering different ranks. Each staff member serves about 6-7 customers per hour, and each customer typically spends 6-10 minutes at the customer-care counter. TBS also provides additional facilities such as a coffee shop, couches, clean washrooms, baby feeding rooms, and toilets. It was observed that approximately 30% of customers visit the coffee shop while shopping at TBS.

In-store promotions include various offers like "buy 1 get 1 free," festival celebrations, discounts, celebrity visits, and authors' book signing events. During a two-hour observation on a Saturday from 2pm to 4pm, out of the total of 92 customers, 25 opted for books under the promotions section. Around 35% of customers purchased at least one magazine/CD/book.

Figure 6 depicts a matrix that categorizes different types of customers based on their time spent in the shop and number of purchases made. This matrix helps TBS effectively position both high-value clients and unprofitable clients. The efficiency of the system plays a crucial role in the long-term success of businesses like TBS. Evaluating and measuring this efficiency can be done through various methods; one important aspect is monitoring inventory flow. For fast-moving businesses like educational books, this aspect becomes particularly relevant.The success of a bookstore is not solely determined by the quantity of books stocked, but also by the speed at which products are transferred from suppliers to customers. It is not enough to know the total number of books in stock; it

is important to address any constraints within the operations system as well. TBS, for example, has identified certain key constraints. One particular constraint lies in bottlenecks during the Supplier phase. Acquiring sufficient quantities of highly sought-after books, especially those generating hype before their launch, can be challenging and may result in missed sales opportunities - particularly during initial book launches such as Harry Potter books.
Additionally, this paragraph discusses three issues within a bookstore: an efficient line-up system, customer service at checkout desks, and inventory forecasting. Customers expect a strong line-up system due to their fast-paced lifestyles and availability of online bookstores. On average, customers wait 1.5 minutes with queueing times ranging from 6-8 minutes. Customer satisfaction is crucial in competitive businesses like bookstores because any lack of customer service or quality can lead to lost sales. However, during busy periods there may be limited customer service personnel available, resulting in customers waiting for at least 3 minutes before receiving assistance.To effectively manage inventory in both the store and warehouses, accurate demand forecasting is essential. This involves predicting sales peaks ahead of time, such as during the Christmas season for cake cooking books or major sports events for sports magazines. Terbium addresses this challenge by utilizing a multi-stage stock list and offering promotional free places during peak periods.

In the educational book industry, both suppliers and purchasers hold significant power. Therefore, companies like TBS that sell books must establish long-term agreements with various stakeholders, including publishing houses. These negotiations focus on important business factors such as employee wages, shop maintenance costs, and annual rents.

The success of TBS heavily relies on the dedication and performance of its in-store

and warehouse employees. A large bookstore like TBS requires different types of staff for various sections such as administration, billing, sales, marketing, human resources, and inventory management. Currently employing 13-17 workers who work in shifts, but during peak hours this number can increase to up to 20 employees.

Employee training is an essential but costly process for TBS as it ensures that employees are prepared and meet the high standards required. To monitor staff efficiency at TBS involves measuring parameters such as average time per customer, average transaction completion time, and positive customer feedback.The "unfocused purchasers" are a significant source of profit for TBS. It is important to attract more customers from this group and encourage them to spend more time in-store, as research shows that the amount of time spent in-store relates strongly to purchasing decisions. To achieve continuous quality improvement with a customer-focused approach, I recommend the following changes:

1.

Implementing an Enterprise Resource Planning (ERP) solution

To effectively apply Total Quality Management principles, it is suggested to implement a companywide Enterprise Resource Planning (ERP) solution, such as SAP or PeopleSoft. This system will integrate all subsystems of TBS, including Inventory Management, Inventory Forecasting, Billing, Logistics, Human Resources Management, Marketing, Customer Service, and Information Management. For example, within the inventory management module of the ERP solution, when inventory levels drop below specified thresholds, the system will automatically generate orders for additional stock from publishers/suppliers.

2. Additionally, suppliers could be given access to view each store's stock levels or receive notifications when customers place new orders for their specific products. Implementing this system would enable Just-In-Time (JIT) inventory management principle as well.
The adoption of this system in-store can

greatly reduce waiting time, leading to improved customer satisfaction. Additionally, TQM allows customers to place orders and obtain information from any location, including remote areas where products can be ordered online and sent to friends in Calicut. The implementation of an ERP system is expected to enhance the delivery system and improve demand prediction. One specific improvement is the enhancement of the online/web presence. Currently, limitations are experienced at the physical TBS shop due to a crowded charge counter and client attention desk, resulting in customer dissatisfaction. To address this issue, it is recommended to establish a comprehensive website where clients can view books, preview pages, place orders using debit or credit cards, and have books delivered at home. Delivery and payment options could also be flexible with choices like "modesty and pick-in-store" or "cash-on-delivery". By effectively implementing Total Quality Management (TQM) principles, customer satisfaction can be enhanced. Another suggestion for TBS is to introduce loyalty programs such as reward/discount cards for repeat/high-value customers.In order to improve client satisfaction and meet customer demands, it would be beneficial for the store to start a DVD/CD/Blu-ray rental section. The implementation of an ERP solution and online presence should be linked to offer all necessary products in one place. This will result in clients returning to lease products, potentially leading to future gross revenues. It is crucial for accomplishing the main objective of Total Quality Management (TQM) to ensure customer satisfaction and prevent dissatisfaction and loss of loyalty. Increasing the number of customer service personnel and reducing waiting times can help with this. Additionally, implementing modern charge self-desks can enhance customer experience as clients become more comfortable with

technology. Having well qualified and personable support forces who understand procedures and are passionate about the products they work with is essential. Furthermore, these staff members must also be highly patient, hospitable, well-dressed, and maintain good hygiene as this directly impacts the customer experience negatively if not upheld. To provide great value and enhance customer satisfaction, we can apply the principles of Total Quality Management (TQM) and Quality Function Deployment (QFD).In order to enhance our service delivery system, it is recommended that we implement an Enterprise Resource Planning (ERP) solution. Our main priority should always be our customers, with a focus on doing things correctly the first time rather than fixing issues later. By following these recommendations, we foresee an improvement in the company's operational profitability.