Business Structure and Business Chapter

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Operations Strategy

John is a man that has started a small technology service business. He has to relocate his business several times due to growth but he is now experiencing some growing pains and some customer pushback due to delegation issues relating to service time, communication quality and the hierarchal structure of his business. There are some open questions about how he should structure and operate the business going forward including whether to outsource more, whether to go more global in his business contracts as that seems to be an opportunity for him and so forth. This brief report will deign to answer those questions and beyond. While John presumably wants to grow his business more and more, he will have some important decisions to make before he can do this and do it well.

Analysis

What is obvious about the current hierarchy and business structure of the firm is that John is taking on too much of the responsibility for customer or technical support. As such, response times are starting to suffer and customers are taking note. As such, John either needs to pick the right outsourcing provider to fill the gap or he needs to hire more of his own staff and de-flatten his organization. His choice to keep the hierarchy flat and the business simple worked at first because the amount of business volume allowed for it. However, there is only so much that John can do on his own. As such, he needs to have a person (or people) or a firm do some of the work or he will need to scale back the size of his business.

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The current way of doing things from a cost and procedural standpoint is not going to work given the amount of customers he has grown to have.

A related yet different issue is the prospect of taking on foreign clients. There are a couple of layers and issues that must be addressed when it comes to that. The narrative notes that the clients are in Europe. Many Europeans speak English but many do not. Indeed, many countries in the European Union and beyond along that continent have a primary or official language that is nto English. As such, John should be careful about what he commits to because he cannot always control who will be picking up the phone or emailing him. Another issue is that while diversifying his business is a good thing in some ways, it makes the business more complex and arduous in many other ways and thus John should think twice about engaging in that expansion. Indeed, he is already having service quality and response issues. This leads to the last point and that is the idea that relates to the one posed earlier. Expanding the business may very well be lucrative but John needs to make sure that the proper support and technological solutions are there so that the new and existing customers are both support to a degree that is sufficient for what they expect and desire.

Based on the above, John needs to do a few things. First, he needs to add some levels to his hierarchy. Whether he chooses an outsourcing provider or whether he….....

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