IMPLEMENT PLAN FOR OPERATION DEPARTMENT

 

OVERVIEW

 

The whole investment implementation plan is to achieve best customer service for Eagle’s Nest, a hotel established by Daniel Henley in 1951 from San Francisco. The main marketing is located in the USA and Europe currently. While the business of Eagle’s Nest is no good recently, a necessary investment controlled lower than $75M will be proposed to make its performance more effective. The report is aimed at the directors of Eagle’s Nest, especially the Human Resource Managers. Moreover, the proposal of establishing a leisure club mainly aims at 5-star and 4-star hotels located in USA. Therefore, leisure club mainly be established in USA market.

 

The purpose of the project is focused on improving both internal and external customer satisfaction. Internal customers can get the corresponding discounts through the use of membership cards, and it will enhance internal customers’ satisfaction, and accordingly increase their loyalty to the hotels. For external customers, the company can recommend its recreational activities and membership policy to them. While the customers check in, the general customers can be charged according to the number of use, and free use of privileges for VIP customer. When customers come in, they will get fully relaxation at the same time, which will rich their cultural life and help them enjoy a higher quality of service.

 

In this investment plan, the investment will get the profits for year of 2013 and year 2014, which are $115.7m and $118.3m respectively. The overall outcome lies in that there is now only US$75m available for the new venture instead of US$125m. At the end of year 2012, $113.1m profit will be generated, which means cost be paid back in year 2012. Therefore, as pointed in our implement plan, for Eagle’s Nest Hotel, the investment risk is small, and the company can achieve benefits in short-term.

IMPACTS ON DEPARTMENT OF OPERATION

 

Each Department has different responsibilities. While the main responsibilities and tasks of Department of Operation are responsible for purchasing raw materials, expanding the construct, finding contractors, decoration, purchasing equipment, process monitoring, evaluating results and followed-up construction and improvement of all operations, summarizing operational aspects of this investment (ELIASSON 1965). The investment will completely determine the implement of the operation. First, some activities such as purchase and negotiation with contractors will be budgeted by financial department and are limited by investment. Second, other activities such as the process monitoring will consume the investment. On the other hand, the implement of the operation will affect the investment. For example, if the operation is stuck or delayed, the process may run out the budget and will negatively impact the investment.

 

RESOURCE REQUIRMENT

 

The resource requirements have been considered in several aspects. First, they should be considered from Eagle’s Nest Hotels. i.e., the department’s responsibility and those to be provided to this department by others; second, they are from outside suppliers. The precise resources depend on the business area for which is planned. The following is not inclusive but indicates examples of some of the areas for specific departments:

  • Sales & Marketing requires:
    • Advertising media space
    • Sales and other staff
    • Web and telephony services
  • HR requires:
    • Employees for each department of different seniorities, job roles and different locations
    • Training resources (materials, trainers, training facilities)
    • Legal assistance for contracts and for any downsizing and severance needs

But the resource for Operations requires:

  • Real estate: This refers to provide the locations and space for the operation.
  • Construction and refurbishing contractors
  • Operational procedures  

In addition, all departments require:

  • Staff – of different skills and seniorities in different locations
  • Funding
  • Systems – IT and web based
  • Premises

 

LINKS TO OTHER DEPARTMENTS

The operation is a stage of turning the strategies into practice. Therefore, in the whole process of investment, operation department has strong connection with other departments including finance, marketing & sales, human resources, and engineering.

 

In the first place, the operation will apply for funding from finance department and will be audited by finance department. In the second place, operation department has to work for and with marketing & sales to make clear the objectives. Then, operation department will ask for people from human resources and even engineering department to implement the actual activities. Last, operation department may deal with other external departments for final approvals.

TIME PLAN

As mentioned previously, Department of Operation is responsible for buying raw materials and equipment, expanding the construct, finding contractors, process monitoring, evaluating results and followed-up construction and improvement of all operations, summarize operational aspects of thing. Therefore, a list will be utilized the schedule of these tasks. The whole operation can be divided into several stages as follows,

 

1 Task I: Review the construct list and the contractors’ materials.

2 Task II: Discuss/negotiate with the contractors as for cost and process of the tasks.

3 Task III: Negotiate with the finance department, engineering department, to determine the operation plan.

4 Task IV: Plan and review a purchase list.

5 Task V: Purchase raw materials and buy equipment

6 Task VI: decoration, and process monitoring

7 Task VII evaluate the results and followed-up construction

  1. Task VIII: Obtain approvals from other departments or authorities. Finish relevant paper works and certificates.

 

Noting that the total period for the whole project is about 24 weeks (six months), starting from reviewing the construct list and the contractors’ materials and ending by finishing relevant paper works and certificates, however, this process does not include the time interval for the design. The total budget is $32M, lower then total proposed budget $35M. The allocation and the progress of the investment are depicted in table 1. However, table 2 illustrates the milestone in each stage of operation.

Table 1. Time chart

 

Week 1-2

Week 3-4

Week 5-6

Week 7-8

Week 9-10

Week 11-12

Week

13-18

Week

19-22

Week 23-24

Budget

$M

Task I

                 

0.2

Task II

                 

0.4

Task III

                 

0.1

Task IV

                 

10

Task V

                 

18

Task VI

                 

2

Task VII

                 

1

Task VIII

                 

0.3

 

Table 2.  Project milestone chart

Milestone

Date

Lead responsibility

Design complete

Jul.2012

Design Team Leader

Discussion with Contractors

Sep 2012

Operation Manager

Marketing campaign commences

Jan 2013

Marketing Director

Services launched nationally

Feb 2013

Programme Manager

 

RISK PLAN

 

The risk plan covers the major risks relating to operation department’s section of the plan. In this project the risks mainly include insufficient funding, the process is delayed or the raw materials are not ready. The following will analyze the strategies for these risks.

 

To begin with, the main risk is cash flow. Since buying the materials and negotiating with the contractors will consume the cash, there mainly exist some risks of lacking the cash flow. A necessary budget control has to be carried out to prevent such circumstance.

 

At the same time, there are some decoration activities. Consequently there exists some delayed by the preparation of raw materials. Therefore, purchase should be monitored and some information should be updated in real time to the operation to prevent the delay.

 

In addition, an ISO31000:2009 Risk Management Standard (International Organization for Standardization 2009) will be implemented in this operation process. The scheme of the project management will be used to help design and manage the process of operation and measure the risk. Moreover, risk assessment methods, such as, methods to evaluate the lack of funds, fitting time delay, shortage of raw materials, etc, are considered to be applied in this project. Table 3 lists the analysis for the risks

 

Table 3 Analysis for the Risk

 

Risk Description

Priority

Pre-warning signs

Action To avoid

cash flow

high

Cannot pay salary for the employee

Financial control

Backup fund

Process is delay

media

One part of the project cannot be finished

Project Management method is applied

Cost of Raw material increases

low

Some emergency event such as Fire, war, or earthquake

Sign a contract with a fixed price

Other risks. For example,

 

low

the interest rate may vary. Or the government budget may cut off during the recession.

 

 

FINANCIAL PLAN


As pointed out previously, the budget for the operation is $35 M. However, the actually cost for the operation, according to the table.1, is only 32M. Therefore, the extra $3 million is for backup money. Among the totally $35M, the resources and the timeline for the budget are listed as below table 4.From table 4 it can be seen that around half fund for this project is from the loans of bank and half from government. Therefore, there exists some other risks. For example, the interest rate may vary and increase the cost. Or the government budget may cut off during the recession.

 

Table 4 The resources and timeline for the budgets

Task

Amount

Resource

Timeline

Task I

0.2

Loan from banks

01/2012-12/2012

Task II

0.4

Loan from banks

01/2012-12/2012

Task III

0.1

Loan from banks

01/2012-12/2012

Task IV

10

Loan from banks

01/2012-12/2012

Task V

19

Loan from government

03/2012-03/2013

Task VI

3

Loan from government

03/2012-03/2013

Task VII

1

Self-supported

01/2012-09/2012

Task VIII

0.3

Self-supported

01/2012-09/2012

 

 

REFERENCES LIST

 

International Organization for Standardization (2009), ISO 31000: ISO Press Release, 25 October 2010.

ELIASSON, G. (1965), Investment Funds in Operation. Occasional Paper 2. Stockholm: National institute of Economic Research. European Observatory for SMEs.

原文链接:Business Commercial Awareness