Facebook marketing for hotels

This is a blog about operations management – not marketing.  But in services the line between these two disciplines is blurred.  This is especially so in this era of the internet, social media and disintermediation.  So I have problem sharing this infographic with you.  It explains how Facebook can be used as a major tool for the distribution of hotel space.

Posted in Chap 05 Supply chain, Sector: Hospitality & Tourism | Tagged , , | Leave a comment

Operations Insight: Bremont Watches

As explained in our book, there are many industries where craft-based production has almost disappeared, and most goods are made in high volume.  However, the watch industry is one example where some operations are still based around an extremely high degree of craftsmanship (as illustrated below).  The precision needed to produce a luxury watch requires that components are machined to within 5 microns of specification (a human hair is 50 microns).  Each watch has around 220 parts, and takes 40+ hours to assemble.  Designing and developing a new watch can take up to five years.

Most precision watch-making is centred in Switzerland, but Bremont Watches is unusual in that it is a British company with production facilities in Oxfordshire.  Although the company was founded in 2002, it was 2007 before the first watch was produced.  Originally assembly was undertaken in Switzerland, as this was where all the expertise for this kind of watch-making was based.  Subsequently this was moved the U.K., where the firm now employs around 30 people.  To find employees with the necessary fine motor skills and level of concentration required, Bremont “bench test” applicants.  Only about 1 in 50 meet their expectations.

Although some components have to be sourced from Switzerland, Bremont is trying hard to ensure it manufactures as many of its own parts as possible.  In 2014, the company opened a parts manufacturing facility near Silverstone, the motor racing circuit in Northamptonshire.  This was because Formula 1 motor racing requires precision machine and engineering skills, so this location had a workforce with the right skill base.

Bremont watches are priced at between £3,000 and £20,000.  Currently annual production around 9,000 watches.  As each watch is hand made, there is a wide range of products.  Watches are designed for different markets – military, pilot, motorsport, travel, diving, and sailing.  There is a variety of cases – stainless steel, rose gold, titanium and DLC; and five different watch sizes.  As well as their ‘standard’ ranges, they also produce a number of ‘limited edition’ watches.  For instance, the first such watch released in 2008 was engineered using material from a WWII Spitfire.

Currently Bremont operates four boutique stores to showcase the product.  These are located in Mayfair, the City of London, New York and Hong Kong.  They also have 178 authorised dealerships worldwide.

Sources:
https://www.themanufacturer.com/articles/bremont-flying-the-flag-for-british-watch-manufacturing/
https://www.bremont.com/about/values/heritage

Posted in Chap 01 Introduction, Sector: Manufacturing | Tagged , , , | Leave a comment

Death of a salesman – the spread of disintermediation?

Interesting article from Lesniak Swann discussing Hyundai’s decision to launch its ‘click to buy’ service (check it out here).  This is another example of ‘disintermediation’ whereby manufacturers sell directly to consumers and potentially eliminate their physical distribution network, or service providers see direct (as in the travel industry).

Historically intermediaries delivered services that consumers need.  In the automotive industry, car dealerships provided potential customers with product information, a range of purchase/lease payment options, and post purchase servicing of the vehicle.  In short dealers added value.

Today however, there is much less value in visiting a car showroom.  Most, if not all, of the information the customer may want is available online.  Mercedes have even stopped printing brochures.  Lesniak Swann (2017) suggest that Hyundai have the least to lose from ‘click to buy’ as they have a relatively small dealer network and share of the UK market.  Moreover the dealerships will not disappear altogether as they shift from being a place to select cars, as a place to finance car purchase and to care for the vehicle post-sale.

Posted in Chap 05 Supply chain, Sector: Manufacturing, Sector: Retail | Tagged , , | Leave a comment

Push, Pull and Ply – three alternative strategies in the grocery market

There has been a lot of discussion in the media about how Walmart will compete with Amazon now that it has acquired Whole Foods.  But what about all the other grocery retailers, how will they compete?

This article identifies that there are (at least) three alternative business models for competing in this market (and I identify the order winners that each model delivers)…

  1. The “push” model – is used by Walmart and discounters in the U.K.  This is based around competing mainly on the cost order winner, specifically low selling prices.  This is achieved by high economies of scale, shipping full lorry loads of products to individual stores, and highly effective supply chain management.
  2. The “pull” model – adopted by Amazon in the U.S.A. and Ocado in the U.K..  This ships packages of specified goods directly to customers from warehouses.  The OW in this model is reliability, especially with regards schedule adherence and delivery performance.
  3. The “ply” model – which can be adopted and adapted by local food retailers and smaller chains.  This is based around them becoming even more customer centric, especially by using digital tools.  This model’s OW is quality, notably perceived quality and value for money.

In the article, this “ply” model is explained in more detail.

Posted in Chap 14 Operations strategy, Sector: Retail | Tagged , | Leave a comment

Toru – the robot picker

Magazino have developed a robot that is designed to pick items in a warehouse.  This article tells you all about it and provides two videos of the robot in action (illustrated below).  Already operators are testing out whether or not warehouse operations can be fully automated.  For instance, Puma are running a trial at their logistics centre in Germany, as explained in this article from themanufacturer.com.

 

Posted in Chap 06 Materials and inventory, Sector: Manufacturing | Tagged , , | Leave a comment

Research Insight: How blockchain can make the Internet of Things secure

I’ve recently blogged about IoT and blockchain, so I was most interested to come across this conference paper which explains how the latter can be applied to the former.  Fremantle et al (2017) identify that IoT has a number of flaws that make it susceptible to cyber attacks and disruption.  They go on to explain blockchain and how this can be used to address most, if not all, of the issues associated with IoT.

Source: Fremantle, P., Kirkham, T. and Aziz, B. (2017) Enhancing IoT Security and Privacy with Distributed Ledgers – A Position Paper, 2nd International Conference of Internet of Things, Big Data and Security, Porto, Portugal, April

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Digital transformation in practice

I’ve blogged about i4.0 and IoT, but what does this mean in practice for manufacturers?  One recent survey by Zebra Technologies has identified what specific technologies firms are planning to invest in, in order to digitally transform their business.  They are:

  • mobile technologies
  • voice direction & recognition
  • location-tracking in real time
  • wearables.

The barriers to adopting these technologies are the complexity of the technology, budget constraints, and integration with legacy systems.

Source: https://www.themanufacturer.com/articles/manufacturers-to-substitute-pen-paper-for-wearable-tech/

Posted in Chap 10 Processes and technology, Sector: Manufacturing | Tagged , | Leave a comment

Reigniting growth in stagnant industrial companies

This article on the Bain & Co website looks at the issue of why so many industrial companies plateau, rather than continue to grow.  From talking to these companies, Bain & Co identify that it is not external factors that prohibit revenue and profit growth, but internal factors, specifically organisational and business complexity.

They identify two interlinked “vicious cycles”.  Organisational complexity derives from senior management becoming more distant from customers and the front line and ends up with a lack of innovation.  Business complexity derives from a conservative approach to target setting and budgeting so that strong products/services end up coasting and weak ones take up too much of senior management’s time.

To overcome this, Bain & Co propose what they have termed the “Founder’s mentality”.  This comprises three main elements:

  • “an insurgent mission” i.e. focus on the customer
  • “an owner’s mindset” i.e. think like an owner who typically dislikes bureaucracy and trims costs relentlessly
  • “a frontline obsession” ie support the operations, especially front of house.

They then present two case studies of how this has been put into practice.

Posted in Chap 03 Processes and life cycles, Sector: Manufacturing | Tagged , , | Leave a comment

Operations Insights from Purple Cubed

Purple Cubed are an “employee engagement” and “talent management” consulting firm, with clients operating “people centric” businesses, especially in the hospitality industry.  Their consulting services are underpinned by their ‘Talent Toolbox’ which digitises “critical people processes like talent reviews, goal management and development” and links this “to internal communications, culture and values”. They have a number of case studies on their website (here) promoting their services that suggest a strong link between employee engagement and improved business performance.

Posted in Chap 11 Jobs and people, Sector: Hospitality & Tourism | Tagged , , | Leave a comment

From shopping mall to urban social hub

Interesting article by Natasha Stokes published this week.  It looks at how shopping centres/malls are changing, especially with regards the provision of other kinds of service operations such as restaurants, hotels, and cinemas.  The old style shopping mall had a familiar footprint – lots of shops, a central food court with multiple fast food offers, and kiosks or pop-ups in the pedestrian areas.  This served consumers who basically wanted to buy and go.  Today however, we live in the so-called “experience economy” in which consumers expect to enjoy shopping by having a wider range of activities to participate in. This can be to the advantage of the retailer, because the more time shoppers spend in the mall the more they spend.

So malls have changed, and are changing, in a number of ways:

  • a wider range of food outlets are provided, not just fast food
  • these outlets cover all day parts, since malls like to be open for as long as possible in order to utilise their capacity more.  This means fast food for breakfasts, casual diners for lunch, and even upscale dining for evenings.
  • rather than clustered together in a food court this more diverse range of restaurants are located around the mall
  • the food offering should also be “on trend” i.e. reflect current eating out trends in that locale
  • consumers have other reasons to visit the mall, for instance cinemas, hotels or performance areas.

 

Posted in Chap 04 Location and design, Sector: Entertainment & Sport, Sector: Hospitality & Tourism, Sector: Retail | Tagged , , , , | Leave a comment