BEM2007 Operations Management - Assignment 1 – Reflection on Business
Businesses observed:
Subway, 45 Sidwell Street, Exeter
NatWest, the Forum, University of Exeter
’What implications do the differences between the organisations have for their operations
management and how might operational efficiency be improved? ’
1. Introduction
The Subway brand offers an ‘exceptional franchise opportunity’ and claims to be a ‘globally
acknowledged leader’ offering a ‘wide choice of great tasting food,’ of ‘keeping costs low’ and
providing ‘simplicity of operations.’ [1]
National Westminster Bank Plc. (NatWest) is ‘part of one of the world’s largest financial services
groups,’ the Royal Bank of Scotland group. [2] Currently, NatWest operates around 1600 branches
and over 3500 cash machines in the UK. [3][4]
2. The Transformation Model
Subway’s primary objective is to provide a quality product, made possible by a variety of
accompanying services such as a place to eat and staff adapting to customers’ needs. NatWest, on
the other hand, provide a dependable, error-free service of looking after customers’ money, whilst
also producing auxiliary products such as bank statements. The basic transformation model for each
business is highlighted in the diagrams below.
3. The 4 V’s – Characteristics of operations processes
Subway experience variation during the day and busy periods such as breakfast, lunch, dinner and
after Arena nightclub closes, are match staffing levels. High volume is matched by having allocated
production roles for each staff member. This helps reduce queuing - due to the high visibility of
production, customers are not willing to wait unnecessarily. The variety offered is created by a
standardised process enabling changes to be made along the production line.
NatWest have different customer groups (e.g. business and personal) and processes to match.
Cashiers deal with high volume, low variety, tasks such as paying in cheques, whereas meeting areas
allow managers to respond to varied, less systemised tasks. The volume varies depending on the
university schedule - it may be wise to reduce staffing levels in quiet periods such as the summer
holidays.
4. Performance Objectives
Subway’s quality is ultimately judged on the final product but will also account for factors such as
cleanliness. The speed will be judged and monitored, as the production process is extremely
transparent. The flexibility to adapt to busy periods and provide varying products is a unique selling
point and will require careful management. Measures such as self-service drinks stations seem to
improve speed and ultimately cost.
NatWest’s significant performance indicator is dependability – customers rely on the bank to look
after their money and be available to provide intelligent advice. To maintain a high level of trust,
NatWest must be flexible with regards to its range of services and have opening times to suit the
customer. Also, speed will be an important objective, as customers will often be in a rush to get back
to work/lectures.
5. Conclusion
Overall, whilst these two businesses have very different objectives, they do share some similarities.
The layouts of the two stores have clearly been designed to give customers places to queue and sit,
self-service machines are installed to improve speed and reduce costs, and information is readily
available in the queuing areas to ensure a quick and all-round service. Whilst the operations
processes of each business have clearly been monitored, there are always ways to improve the
overall product/service. Subway, need to consistently introduce new products without confusing the
current operations (one way to improve speed in busy times would be to have a computerised
ordering system which is accessible whilst queuing). NatWest require improvements in speed and
service without compromising dependability (increasing use of automated systems will be necessary,
however it must always be possible for an advisor to reassure those who are not best helped by an
automated process).
6. References
[1]
Subway ‘Franchise Opportunities’ http://www.subway.co.uk/business/franchise/default.aspx [24
Oct 2012]
[2]
NatWest ‘About Us’ http://www.natwest.com/global/about-us.ashx?channel=personal [24 Oct
2012]
[3]
NatWest ‘Branch Banking’ http://www.natwest.com/business/services/banking-your-way/branchbanking.ashx [24 Oct 2012]
[4]
Bank Reviews http://www.bank.org.uk/natwest-bank/ [24 Oct 2012]