Operations Management and Csr Essay

Why be trading trading trading trading trading trading operations the close to undefended sector of whatever play along when mattering CSR?I. IntroductionAs globalization continues, the earths natural kneades transmogrify local problems into planetaryistic tax returns along with the phylogenesis of international commercial activities. Few communities argon being left untouched by major surroundingsal themes and lucky problems. As maven of the intimately active and authoritative elements of the homo companionship, the business creative activity has been postulate, for several(prenominal) decades, to shoulder some(prenominal) responsibility by their consumers and society in general. The concept of incarnate societal responsibility (CSR) d sensibles more than(prenominal) and more attention from every(prenominal) sectors of society, and is considered as an issue that we tush non afford to ignore.As we take into nib the increasingly sound environm ental problems and affable issues much(prenominal) as inequitable growth, somatic complaisant responsibility bathroom no longer be slangd as a slogan or a tool of self-glorification, notwithstanding rather as a pressing task for tout ensemble companies, who contribute to these problems. In a daylight and age when technology entirelyows us to be in worked in real time, strategies much(prenominal) as green-washing may besides hie the deterioration of a comp eachs image.Consequently, the CSR should be treated as an issue that stub be solved wholly by creating synergies in the midst of several spots at heart a gild. From establishing harvest concepts or operate to manufacturing, from delivering goods to recycling drive away, every single pervert of the put to work may imbibe an spacious meeting on whether a conjunction go unders to stimulate socially responsible. For this reason operations vigilance is at the core of the CSR discussion, condition that i t involves the design and control of the exertion process.though the principles of operations perplexity and that of CSR expect factors in common, much(prenominal) as reducing pay off and vigor saving, the traditional vision of slip of paper speak to as more as possible conflict with the spirit of share-out be comport with all shareholders, making operations oversight the most vulnerable ferment when considering CSR. The objective for operations managers, increasing simoleons with little resource, nominate be kinda affected by the value of embodied social responsibility.In this essay, we analyse to act the question Why are operations the most vulnerable sector of any beau monde when considering CSR? After presenting several primary(prenominal) concepts and the patronizeground of this problematic, we testament give iii reasons to answer the question above with psychoanalysis and ex angstromles. Finally, we bequeath put forward our proposals and previsions pa st come to a conclusion.II. Concepts and background1. somatic social responsibility incorporate social responsibility (CSR) is a concept foremost raised by Anpull Carnegie (1835-1919) and developed in the USA. According to him, a businessman should, freshman base of all, accumulate his groovy, and then distribute his lot to society. As he said earth who dies rich dies disgracedIf you want to be happy, set a goal that commands your thoughts, liberates your energy and inspires your hopes. (Banerjee, 2007)After this initial definition, the concept of CSR drew more attention from two faculty member circles and the business realism in the second base half of the twentieth one C. According to Howard R. Bowen, enterprises should have got and practice the policies that aim to create set desired by the society (Bowen, 1953). On the contrary, Milton Friedman insisted that the only duty of corporations is to augment the circle for their shareholders. Is his article on the New Yo rk time in 1970, he said The social responsibility of business is to take shape sugar.Since the first decade of the twenty first century Concern from governments and appeals from non-government organizations put this issue under(a) the spot light. In 2001, the European way defines the CSR as the voluntary integration of social, environmental firms in their business operations and their copulationships with all internal and external stakeholders () in crop to fully comply with applicable levelheaded requirements, invest in human capital and respect its environment (ecology and territory) (European Commission, 2001). Moreover, we poop maintain a combination of concepts from corporate social responsibility and sustainable victimization.2. trading operations managementOperations management is the activity of managing the resources which set about and deliver products and services. A close relation with products and main services makes the operations function central to all kinds of organizations. It is one of the common chord cores of business, with the marketing (including sales) function, and the product / service development.sooner than an isolated island bass down a participation, the operations function is involved in a high degree of interaction with other(a)s. For simulation, it has to oblige in touch with product development function to assure that the firm has the capabilities to build the design of a stark naked product. For the aforementioned(prenominal) reason, there is a synergy between operations function and marketing that helps dickenssome the sales power with production. (Nigel Slack et al., 2010)The vastness of this integrated way of working has been cognise for long time, but it is the development of education administration that makes it possible. Thanks to systems regulationized electronic Data Inter mixed bag (EDI) and Enterprise imaging Planning (ERP), companies can, on one hand, hush up the communication w ith their partners and providers, and promote the collaboration among functions. In order to compete in an changing global economy, enterprises make an emphasis on the efficiency and productivity of their manufacturing process, aiming to maximize advantages on charge, quality, as well as gladness of costumers. The important role of operations management in the company, and the turn it exerts to other echelons of the value set up, make it crucial for managers to consider when they take about environmental and social issues.3. terra firma evolutions on global marketDuring the defy three decades, we can observe that two elements are changing rapidly in the business world, the continuous development of international trade and production, and the wide wasting disease of the Internet. We cannot let out about CSR or operations management without considering these issues.International trade and production at a time a business reaches a sure(prenominal) sparing level, it usuall y aspires to reach an international level (Czinkota & Ronkainen, 2004). This sort of rivalry will lead to a serial of actions and turns in the strategy of the operations functions.For instance, problems in adaptation to the economic environment and coating in the target country, may fare repercussions on materials sourcing or the integration of products. nonetheless a change of format or box requires coordination between the marketing incision and the operations function. At the equivalent time, trans-national lecture demands a higher degree of reliability and efficiency from the sum chain, demanding meaning(a) improvements of operations management.On the other hand, more and more multinationals locate their facilities in third world countries, raising environmental and social problems in the host country. While they benefit form relatively low cost of raw material, energy and labor, these industrial giants leave after part high levels of pollution ad fare a scarci ty in resources (DeTienne & Lewis, 2005). Globalization has not eliminated the inequality between countries, but rather has aggravated the problem.Wider use of Internet send-off, the explosion of e-commerce has profoundly alter the way we do business. E exceptionally when we jaw about selling online, satisfaction of customers is no longer determined only by products themselves, but in like manner deeply influenced by the executing of supply chain, manifesting mainly by issues of words and after sale service (Lannoo & Ankri, 2007). Whether taking care of these tasks internally, or outsourcing to third-party companies, companies and their operations function will be faced with unprecedented challenges and risks. Second, the Internet serves as a tool for all members of the society to be informed, to say and blush proctor a company. In legion(predicate) countries like France, annual reports of listed companies are now required to include a CSR report. Along with economic p erformances of these firms, their contribution to communities and the environment is as well as be available on their official blade sites. In this effect, managers have to take more voluntary and effective actions to fulfill their promises to the public.III. major reasons for vulnerability1. Outside pressuresthither is no doubt that some of companies give anteriority to value origination for all shareholders such as the Body Shop. However, in reality, most companies make an effort to achieve their CSR goals by and large because of increasing pressures from all sectors of society. Some of these requirements are focusing on the production process and delivery of goods, and thus put ugly stress on the operations function.First of all, we could compare Traditional and Modern views of Corporate Social indebtedness applied to operational Management.Within the company, operational management full treatment as an integration of several functions such as Engineering or Manufactur ing (Inventory, Planning, somatic Flow, Quality and so on), Distribution (Suppliers, Transport), accounting etc. with interrelated operations such as Finance, Human Resources, Marketing and etc. This can be applied to any part of organization, regardless of its sector (Manufacturing, HealthCare, Wholesaling, Retail, Banking etc.)Modern CSR court creates vulnerabilities to available Management because even ostensibly insignificant change or hoo-ha in one participant (function) can influence whole loop of tack on Chain, which can therefore banly influence companys behavior in regards to Social Corporate Responsibility and even affect the goals for in effect(p) Operations Management. there are eight possible militant priorities (goals), which fall into four groupsIn the fact of such disturbance, most of companies tend to bar their tactics and strategies regarding CSR/ long-term or sustainability goals and use to short-term take downnings, no proceeds what the bell to t he environment, society, employees, consumers or stakeholders. We have concluded that most important vulnerabilities within the Organization are* New concepts and re-design (products and services)It is quite clear that creation of cutting concepts and re-design of products/services is crucial for every company. The first step or designing, creating tender or modifying product is generating ideas which furthermore fill to be properly tested, feasibility probe hireed, no matter how great the ideas expectms to be. The process is lengthy and complicated Therefore, the re-design itself can become CSR problem due to * Waste Management, additional energy consumption, recyclability * Social intrusion of the product and Customer Safety* Layoffs (employees and suppliers) in suit of restructuring or failure.For example, Michelin has failed to launch its run-flat PAX tire, which could be driven while being damaged, at highway belt alongs, for a hundred miles or more. Unfortunately, in order to use these tires, the under-body of the cars would necessitate to be redesigned, new equipment and new skills would penury to be acquired by the mechanics. As Michelin failed to crush boom consumption chain of this new concept, the production line had to be discontinued. This was not only a commercial fail, but looking from the CSR point of view, it in any case had interdict social impact such as layoffs, the time and resources used up for R&D, Marketing and other operations which could have been used for more efficient and value-added products. (Harvard Business Review 2007)* Transportation/ LogisticsThe status of the headquarters/warehouse and any other business unit has an important impact on Operations management and is one of the most vulnerable points when considering CSR. Transportation can have significant environmental impact business flights, employee commuting and the movement of goods may cause emissions and leaks, including air pollutants, greenhouse gases and water pollution. As stockpileation is un evacuateable for a manufacturing firm, operations management helps to flash back the impact, stock-taking-still due to complexity of the interrelated operations it can become vulnerable.For example, go with A is a supplier of fresh Materials Company B is a customer, which motives Raw Materials to compel goods. In the event of a raw material production stop in Company A, scheduled standard delivery might need to be re-scheduled to a special express employ delivery to the Company B because, lets say, due to this delay and ruffianly planning Company B will have a production stop. such(prenominal) delivery would be considered inefficient, as it is costly, furnish inefficient, increases pollution, pressurizes truck driver, moving from standard procedures to special procedures, additional pressure and stress for employees from both companies etc. One may argue, that the production stop would cause more oppose impact than the rushed delivery, except it is tough to weight the impact, there is the need to divvy up root causes. If the planning and security stock from both sides was well managed, the express delivery would not have been necessary.To conclude, no matter how efficient Logistics processes are created within the company, human demerit is unavoidable therefore Operations Management becomes vulnerable when considering CSR.* Waste and recycleOne of the most tragic examples of an operational failure is Chernobyl disaster in 1986, polluting and creating perniciousness and waste problems. Not only companies need to manage the basic production sentry duty and reduce accident rate, but they also need to recycle as much possible, manage day-to-day waste safely and create lean product conduct cycle. However, these processes are subject to vulnerability when considering SCR as there could be a graver damage make by conducting these operations. cycleCompanies such as HP who unionize the recycling of the old cartridges or companies such as Nespresso who collect used coffee capsules, shows a great example of how to reduce the environmental impact of its products. However as great as it might appear, legion(predicate) other aspects need to be taken into consideration, for example supply chain system unavoidably to be created to collect and transport these used items, special environmentally friendly bags or boxes for the pick-up points needs to be produced. Remembering Michelin case, where it failed to analyses its complete consumption chain, HP and Nespresso had to line up a way to encourage consumer to bring back their empty cartridges and capsules. In their cases, it is successful, however it is vulnerable and could become a failure if the company level of consumer is low.WasteMost significant waste issue is well evident in chemical assiduity or any other labor where waste is hazardous or is non-recyclable or non-reusable. The solution would be to improve the operat ion processes and to avoid unnecessary waste, however this is proven to be impossible due to human error and especially in chemical industry where chemical reactions can create useless waste. The hazardous waste management is controlled by the legislation and will be discussed subsequent on in the essay.Not only materials are considered to be waste, but also energy and labor waste companies try to be more efficient by implementing just-in-time and lean process, however there is a clear vulnerability when considering CSR at what price do companys view their just in time principles? Overcrowded and bemire roads would be most channel negative impacts, but there are also other social impacts, which will be discussed in more full stop in organization evolution section.* organisational evolutionPerformance billhook There is no doubt that Performance Measure is highly important in Operational Management as well as for any other part of the business, however measuring and setting st andards have negative social consequences, especially for the employees. Reduction of cost and prices, increasing customer experience, quality conformance, the speed of delivery, reliability of delivery could cause serious stress and working hours fluctuations for the employees.An example of the employee struggle to meet the set performance level is making entropy look better than it is by exit out certain information, some companys set high un-reasonable standards or in some quarters the performance cannot be met due to external factors cause stress.Continuous ImprovementKaizen is a Nipponese system promoting Continuous Improvement or in other worlds never remnant journey of improvements. There are many approaches such as the Deming Cycle (Plan, Do, Act, Check), tools and techniques to conduct the Continuous Improvement process. The benefits for efficiency and profit are unquestionable, however when considering CSR we can find many vulnerabilities.A good example of Continuous Improvement is Business puzzle out re-engineering (BPR) which is a way of reconfiguration of processes in an permit level to provide highest value to the customers and ameliorate critical areas. However again, at what cost when considering CSR? As BPR requires organizational change which requires changes in staff attitudes and could possibly result in loss of positions for many, reduction of responsibilities for others, the fear for occupy and Fire. Also, as tasks become more efficient, they also become more repetitive and less challenging. (T.Hill 2005)To summarize Main social considerations of operations management decisions 2. Outside PartnersAs the world continues to expand we are starting to understand the consequences that our development has not only on the environment but also on society. Due to this new consciousness we have seen the emergence of different attempts to confront these environmental and social issues. Corporate Social Responsibility or CSR is one of the mo st usually used concepts within the business world. historically CSR has been only partially integrated as a philanthropic effort. Little by little the environmental issues caused by normal operations of a company have also integrated the concept of CSR. With this change in definition, companies have actively hard to reduce their impact on the environment and society. As an essential function of a company, Operations Managements is constantly affected by these decisions. If, for example, a company decides to reduce their packaging it will be the operations section that will have to manage this change.SuppliersWhen we consider the impacts on Operations Management when compound CSR to a company, we must go farther and analyze the impact on all outside partners such as suppliers. When we decide to integrate a CSR action, especially within the manufacturing process we need our suppliers to integrate the same change on their process. As customers begin to become more conscientious about environmental and societal issues they are demanding companies to make many changes. Within the clothing industry this green movement was reflected by customers intercommunicate for organically grown cotton to be used in the manufacturing of products such as Nike. In this kind of situation we see how the responsibility immediately falls on the supplier to change their process. This sort of abrupt changes leaves the operations function of a company quite vulnerable, as they have to corporate trust that their suppliers will be able to change their process without increasing costs.When there is a synergy between a manufacture and its suppliers such changes can be made with collaborations. A great example of this is how the company Esquel managed to give their customer the organic cotton they needed by managing their whole supplier chain. Instead of just demanding their own suppliers to supply the needed product they worked with initiatory and second tier suppliers and built a sustainable procurance chain (H. Lee 2010).In the last few years we have seen how many manufacturing companies who have simply demanded certain changes to their suppliers, but do not infer about make an effort to attend to in this change, and most importantly they do not control the whole procurement chain. This was the case of Mattel who made it clear to its 1st tier suppliers that no lead blushing mushroom could be used when manufacturing its products, yet it never thought of auditing its 2nd tier suppliers or furthermore the outsourced production its main supplier had. This type of opaque supply chain makes operations very vulnerable and can cause, like in Mattels case severe financial repercussions (N. Sun 2007).The new shared-value concept developed by ostiary and Kramer has introduced the idea that by collaborating with all the actors in a value chain we can create value while still respecting CSR. A company that has been able to smoothly transition into this new shared- value concept is Toyota. The deep relation that exists between Toyota and its manufacturers has allowed them to naturally apply changes that create a win-win situation for them and its suppliers. The Toyota company culture naturally includes the idea of shared-value and has a long-term mentality (Spear Bowen 1999).