AussieBum: Impact of Globalization
Susie Bum Is an Australian business that was established in 2001. The company initially manufactured men’s underwear, though has recently broadened Its product range to Include leisurewear, swimwear and sportswear. The present director of Sebaceous Sean Shabby “believed he could make more traditional bathers”. Despite the criticism off retailers and department stores Shabby proceeded with his idea and was determined to try his exclusive approach. Sebaceous is now a global success earning over $10 million a year, with 150 different products available.
Sebaceous has been significantly impacted by globalization. Globalization is the “process by which traditional barriers between countries are removed. These barriers Include language, currency, differing values, geographic, politics and laws/polices”. (Business Studies In Action Text Book). Some impacts of globalization includes: increased trade, immigration/emigration, advanced technology (airplanes/mobile phones), cultural integration and employment opportunities. In regards to business globalization can alter a lot of aspects of operations.
Some examples of operations impacts of globalization Include: purchasing materials and fabrics: this can be made cheaper ND there may be more variety of materials to choose from. Transportation of Inputs and outputs: there is faster more effective ways of transportation, there Is more options such as boats, airplanes etc. Manufacturing of products: this may become more efficient through globalization as new technology is produced. Packaging: there may be more technology available to produce different kinds of packaging.
Storage: you can store products where you would like due to globalization you can store products around the world. And customer base: this may broaden due to the new technology available to customers overseas. Slumber’s Operations Strategies: Causeless Is a small business. They now employ Just over 35 people and produce a variety of different products (150 products). Sebaceous is growing substantially with a 15-20 percent growth in sales and profit from 2001. This growth effects the volume of products operations is manufacturing. Sebaceous focus on two main operations strategies: new product design and quality management.
New product design is an operations strategy primary managed/directed by the original owner of the company Sean Shabby. It Is the process of designing new products, adjusting previous products ND enhancing future products. As customer demand is increasing it is essential for Sebaceous employees to multicast, there is now a collaborative approach to new product design strategy. “The design phase drives the management of materials” Noon Wiley). When Sebaceous is designing a product they are determined to utilize the most appropriate fabrics/material for that product.
The other operations strategy Causeless use Is quality management. Quality management Is the management of the quality of the product. The alma Is to decrease the amount of defects the product has and to do that whilst still achieving profit. The quality of these products are examined by the ability to see, feel and touch the product before it goes into the customer’s hand. These are the two components of Sublime’s operation strategy. Impact Of Globalization On Sublime’s Operation Strategies: Globalization has impacted Slumber’s operations strategies.
With globalization a Sublime’s major competitor shifted their manufacturing overseas in order to obtain optimal profit. Due to Sublime’s small quantities required manufactures overseas were unwilling to produce Sublime’s products, so they are still dedicated to manufacturing in Australia. Advantages of manufacturing in Australia include: local knowledge of suppliers and conditions, good relationship with suppliers and a positive public image. Although Sebaceous have resisted globalization by still manufacturing in Australia they embraced it in other aspects of their business.
As there were insufficient opportunities to sell Sebaceous products through the local retail outlets, they were forced to sell online. Sebaceous now utilize the growth of technology such as internet to sell their products through online shopping everywhere around the globe. The company also use social networking such as Namespace and Faceable. Through globalization Sebaceous was able to expand its customer base from Australian customers which was what Shabby originally wanted in 2001 to international customers which is what the company has now in 2013.
There has been significant demand for Sebaceous products overseas that has led to the construction of supply retail outlets in those overseas countries. This impacts different aspects of operations. For example, the wider the customer base the more variation of products you need to keep customers satisfied which is impacted the products operations is designing and manufacturing. Also the international customer base means there is a larger number of retail outlets and individual customers requesting products, which increases the volume of products operations must make.
Sebaceous is also impacted by globalization as the advancement in technology has provided the company with unique opportunities to produce products. The operations department is now manufacturing a new experienced product. Due to the advancement in technology Sebaceous can now insecure the latest fibers and polymers, such as the Micro Modal Beachwood and bamboo fiber which is used in the manufacturing of underwear. They have also begun producing an experienced banana range of underwear.
This impacts the operations function of a business as it changes the materials they will be manufacturing with and the technology they will use to manufacture the products. Through globalization the expansion of Sebaceous internationally has provided many people overseas employment. Corporate Social Responsibility: Corporate social responsibility is “the term used to describe the way a business takes into account the financial, environmental and social impacts of decisions and actions they are involved Corporate social responsibility is bout being morally right, operating in an ethical manner and acting in a socially acceptable way.
Corporate social responsibility can impact a business operations management in numerous ways. For example, employees may be more productive if they are being treated in an ethical manner by getting paid what they are entitled to, having clean and safe working conditions and having breaks when they have worked a certain number of hours. Corporate social responsibility can also impact a business’s operations function as it can increase or decrease the volume of products they need to make.
If a business is displayed on the news as being unethical, amoral and socially unacceptable they may lose sales and gain a bad reputation manufacture and vice versa. Corporate social responsibility is important to operations as ensures the business is prepared to meet customers’ social and environmental expectations. This is important as customers have an increased awareness of social and environmental issues and they tend to make decisions based on what is ethically right. Sebaceous is a “good corporate citizen” and has been since the establishment of the business in 2001.
Sebaceous is committed to making excellent quality products no matter the price. “Sebaceous uses only the best fabrics ND is prepared to pay more for these fabrics. The business is less concerned about the impact on prices then it is about providing a quality product that customers have no complaints about” Noon Wiley). This is an example of how Sebaceous is being corporately socially responsible; they are not a deceiving company that charges high prices for bad quality products. Sebaceous is determined to provide Jobs to the people of Australia.
They have resisted the temptation to change their place of manufacturing overseas where it would be cheaper, and chose to remain in Australia. This is a socially acceptable and moral way to operate the business. The operations function of the business is also being corporately socially responsible by developing echo-friendly products. They use micro modal Beachwood and bamboo fiber based fabrics, as well as banana fiber. They recycle the bark from trees that would normally be discarded when the plants are harvested, this impacts operations as it changes the materials they will be manufacturing with.
Susie Bum also coveys itself as corporately socially responsible by supporting local life- saving clubs through sponsoring boats, they are a major sponsor for the Sebaceous Queensland Cup Surf Board Competition in Moldable and they get involved with youth programs in the Blacktops area of Sydney. Sebaceous has also showed how it is a corporately socially responsible by treating its employees fairly and ethically. They have provided a room for employees to “get away from the Job”.
It is fully furnished with a lounge, foxhole, a gymnasium, barbecue on the balcony and a fully installed kitchen. This will hopefully increase operations as staff will be more productive in manufacturing. Relationship between operations and other key business functions: The key business functions of equines include, financial management, human resources, marketing and operations. They are all closely integrated and neglecting one of these key business functions can be detrimental too business.
Operations is closely linked to financial management. The more products made by operations ultimately means the more income a business is receiving. Many businesses including Sebaceous have financial management strategies. These focus on “recognizing the sensitivity of customers to changes in prices, exclusivity of brands given to retailers, the split between fixed and variable costs and the costs passed on by local suppliers and producers”. Operations can be dramatically impacted if the finances of a business are insufficient.
Sublime’s operations function made 7000 orders per week in April 2008, this would have impacted the financial function of the business as they would have to delegate money to pay the suppliers, pay for operations and pay employees. Without finances operations would not be able to operate. Operations is closely linked with marketing. The more convincing the marketing is the more customers the company will have, which then means the more products operations will need to make. Customers. Sebaceous is currently an international brand designed for today’s youth.