Operational Issues Assignment

Operational Issues Assignment Words: 1506

In this part of assignment, I will be explaining the issues a business would need to consider to go online. I have chosen a business called Hot-wishes which my colleges and I are going to do in about 5 month’s time. If this business decided to go online, it would need to consider these issues: 1. Planning issues: ?Suitability of the business for an online operation – Deciding, whether it is a good idea to operate our small business online. ‘Hot-wishes’ would decide to go for it as we could increase sales; become well known…

However, there would be also some negative points – we would need to get more people in our team to handle the online operation; there would be more work to do for all of us as well. ?Choice of domain name – Website’s domain name is normally the same as the organisational name so in this case it would be, for example, www. hot-wishes. co. uk or www. hotwishes. com. The name should be short, memorable and easy to spell. A name must be officially registered before it can be used. ?Set up – We, as owners of the business, would have to decide whether the website is going to be created ‘in-house’ or ‘outsource’.

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It means that if the website will be created in-house, it will be created by non-expert (if it is a basic website), using web authoring software, such as Microsoft FrontPage or by a specialist with more skills using Adobe’s Dreamweaver and Flash technology which producers different effects and designs. If the website will be created outsource, a professional agency will give advice on all aspects of a website, including security. In my opinion, it is worth it to pay an expert to do a website; however it could be very expensive. ?Availability of resources to cope – There are many reasons to operate business’ activities online.

Most businesses go online to increase sales. This means that the volume of business should increase and the business must be able to cope with this – businesses would need to have extra staff for checking orders, bookings, handling enquiries, replying to emails, packing and distributing goods. This means that ‘Hot-wishes’ would need to get more people to handle the online operation because there are only 5 of us in our team and we wouldn’t be able to do everything. 2. Implementation issues: ?Availability of technical and design skills – Here we would need to think about whether we have a good knowledge of construction and design features.

As ‘Hot-wishes’ is a small business, it wouldn’t need to worry about expert programming and design skills; however, large commercial websites require those things, plus good knowledge of database technology and familiarity with different web servers to plan the structure and design the site to reflect the business image and to allow for future development needs; ensure the site is accessible to disabled users; security features (encrypted pages and protection against hackers); make sure the website will be ranked highly by search engines. Customisation – This means to let visitors of the website make changes to it or personalise it (Yahoo! , Facebook, Wikipedia… ). These websites include, for example, ‘My Profile’ or allows you to edit or add entries. ‘Hot-wishes’ could allow customisation, for example, blog, where people can write whether they like our products or not, or when they have any questions about ‘Hot-wishes’. Extent of online operations – ‘Hot-wishes’ also has to think whether it is going to have only a passive presence which means that it is informational website where its other operations are unaffected by this; partial interaction where our customers can communicate online in a limited way, for example, to make a reservation; fully interactive – the whole business will be focused towards the operation of its website 24/7 (Amazon).

In my opinion, from the beginning, ‘Hot-wishes’ would go for passive presence, so our customers can find out more about activities we do; and after a while, ‘hot-wishes’ might also go for ‘partial interaction’ so customers could order goods. ?Changing user specifications – The website must be regularly reviewed to ensure it meets the needs of its users. In addition, updating the design enables the website to be improved and modernised so it will continually appeal to users. For example, if ‘Hot-wishes’ changed the prices of the products, there would be a need to update the website – change the prices on it, so customers are aware of that. Relationship with partners – When setting up a website, it is more likely that some other people (partners) are needed. Financial service providers may provide finance for website development, additional stock or expert staff. They may also be able to provide a merchant service to receive payments or advise the business on other types of payment services. Distribution and delivery services must be excellent for businesses that sell goods online. Customers expect goods to be delivered promptly and in good condition, and this may involve specialist packing and the completion of customs forms.

Many online sellers have a specialist distributor to do these tasks and some also control stock levels and warehousing as well. 3. Staffing issues ?Call centres – Computer suppliers and ISP providers (Dell, BT… ) offer call centre support where trained staff can talk customers through procedures to resolve faults or connection problems. Using call centres is a good idea because it is always better when professionals can handle all of business calls. ?Personal contact with customers – There is less personal contact with customers as using website to sell products.

If customers need to know something, they prefer to call or send an email so there isn’t personal contact. This could a disadvantage for someone who prefer personal contact. ?Unfamiliarity with technology – Staff must be trained to work effectively with new technology. When there are system or software updates, additional training is needed. ?Breakdowns in service – Service breakdowns put pressure on staff, who may be unable to do their own jobs if there is a major system problem, and may also have to deal with calls from angry customers. . Financial issues ?Initial investment costs – These costs usually include additional hardware requirements (computers, printers, servers… ); software requirements, including the operating system, application programmes (Microsoft Office), web authoring software, graphic packages… ;programme adaption such as adapting the product database to link with a web store. Other costs: registering the domain name, arranging for an ISP to host the site, paying agency to design the site, marketing and promotional costs, staffing training. Ability to cope with massively increased market interest – The site may crash or run slowly if there is a huge surge interest which the company cannot handle. Enquiries or orders cannot be dealt with if there is insufficient stock or too few staff to process them. Buying more stock or employing more staff could result in cash-flow problems. If the company gets a bad reputation online, it may lose customers rather than gain them. ?Tax liabilities for international transaction – International transactions may be subject to both customs duties and Value Added Tax – VAT, which can substantially increase the price of goods bought overseas. . Distributional issues ?Scale of the business – If ‘Hot-wishes’ was selling goods within the UK, there shouldn’t be a lot of problems with distribution, however, when selling goods on a global basis, for example, the company may have concerns including special documents to comply with customs and shipping regulations; special labelling or packaging; choosing the best method of transport – this depends on the type of goods and the destination; insurance in case something happened to goods – if they’re damaged or lost. Special types of goods – There are some types of goods that need special attention: fragile goods must be packed with bubble wrap or other protective material and they have to be clearly labelled as well; perishable goods are usually transported in special vehicles (refrigerated lorries) because they must be delivered promptly; hazardous goods must be labelled by special paperwork (Dangerous Goods Note). Ease of distribution of services – If ‘Hot-wishes’ was providing some kind of services, it would be cheaper and easier distribute it globally than distributing goods, as there is no need to physically move anything. Apart from, VAT, most costs will relate to managing and administering the service, for example, downloading software, booking flights online and reserving hotel rooms and so on. Conclusion It seems to be very easy to run business online; however, if we look at all of the issues, I was explaining above, we can see that there are lots of elements to think of before start running a business online.

I have learnt that the cost of a website can be different, depending on lots of factors – offering customisation, design, security, partners, or whether it is only informational website or customers can order goods 24/7. There are so many other factors. Every business should decide whether their business is suitable for an online operation by looking at all of those issues and risks, to make sure that they are aware of everything that could happen.

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