Operations Function in the Organization Structure

Assignment 2: Discussion—Operations Function in the Organization Structure

Operations are an important management function in an organization. The role of operations management changes as companies react to the business environment.

Using the Argosy University online library resources and valid Internet sites, search for an organizational chart of a manufacturing, service, or technology company looking specifically for one that shows a change in the operations function. Typically, such charts can be found in published annual reports of public companies.

Based on your analysis of the chart, respond to the following:

Identify the components of the operations function in the organizational structure of the company.

Review the annual reports over the past three years and see how the operations management function has changed.

Examine the financial reports to understand the competitive and market challenges the organization is facing and then analyze the importance of operations in the organization.

Explore how the organizational function has evolved to keep pace with the changing competitive and business landscape.

If possible, identify an event that caused the organization to change the role of the operations function in the organizational structure and offer an explanation of how the new operational function is better suited to compete in the current business environment.

Samsung

Samsung is an organization that has been praised for its position in the electronics and cell phone distribution industry. Samsung has been able to identify itself as an innovative leader as well quickly introducing its own array of unique products. The have a strong and efficient logistics process in place and it has played a large role in the success of the organization. They have been able to quickly provide updates of its popular products to their consumers in a timely manner (Samsung Value Chain Analysis, 2015).

Samsung has a strong focus on marketing and sales coupled with its distribution strategy. They have a strong focus on targeting consumers that buy into the high quality and cutting-edge characteristics and capabilities of their products (Samsung Value Chain Analysis, 2015).

Operational Components

Inbound logistics. The majority of Samsung suppliers are based in Asia and accordingly, 79.4% of its supply-chain expenses occur in Asia. This is followed by Americas (14.8%), Europe (4.4%) and other places.  In order to control inbound logistics aspect of the business more effectively, Samsung owns a number of logistics firms as its subsidiaries.  The most notably, Samsung Electronics Logitec, established in 1998, is an integrated enterprise logistics management agent that serves logistics needs of the company with 540 employees and 8,600 partner employees around the globe (Samsung Value Chain Analysis, 2015).

Operations. As of December 31, 2014, the company maintained 213 global operations hubs that included subsidiaries, sales subsidiaries, design centers, and research centers (Samsung Value Chain Analysis, 2015).

Financials

Samsung’s market share increased 0.6 percentage points (from 22.7 percent to 23.3 percent) as it shipped 1.2 million more smartphones to reach 79.8 million. Every quarter, Samsung owns about a fifth of the market, and that remains true for the first two quarters of 2017. IDC believes consumers are responding well to the Galaxy S8 and Galaxy S8+‘s edge-to-edge displays. And Samsung’s more affordable A Series and J Series continued to perform well in both developed and emerging markets. Now the company just needs a win with the Note8 to put its Note7 fiasco behind it (Protolinski,2017).

Event

Samsung’s success in making this shift can be traced back to a single early decision—to build design competency in-house rather than import it. As we’ll describe, Samsung chose to create a committed, resourceful corps of designers who figured out that they could manage the tensions and overcome internal resistance by deploying the same tools that they use in pursuing innovation—empathy, visualization, and experimentation in the marketplace. The corps has helped institute policies and structures that embed design thinking in all corporate functions and provide a framework for reevaluating products in the face of dramatic technological change. This operational/design adjustment was able to catapult Samsung to the status its stands at today (Yoo & Kyungmook, 2015).

References

Investor Relations. (2017). Retrieved September 2, 2017, from http://www.samsung.com/global/ir/financial-information/audited-financial-statements/

Protolinski, E. (2017, August 2). IDC: Smartphone shipments fell 1.3% in Q2 2017, but Samsung, Apple, Huawei, Oppo, and Xiaomi all gained share. Retrieved September 2, 2017, from https://venturebeat.com/2017/08/02/idc-smartphone-shipments-fell-1-3-in-q2-2017-but-samsung-apple-huawei-oppo-and-xiaomi-all-gained-share/

Samsung Value Chain Analysis. (2015, October 7). Retrieved June 22, 2017, from http://research-methodology.net/samsung-value-chain-analysis/

Yoo, Y., & Kyungmook, K. (2015, September). How Samsung Became a Design Powerhouse. Retrieved September 2, 2017, from https://hbr.org/2015/09/how-samsung-became-a-design-powerhouse