Business world is becoming more dynamic and complex with time. Due to this reason the companies operating in diverse industries needs to focus on managing the different business operations effectively. Managing the service operations is a most important task for the businesses. The companies face different issues related to service operation management. In this research paper the researcher would be discussing the service operation issue faced by the company. For this Costa coffee is measured as the case corporation. In this study the investigator would focus on explaining the issue related to product shortages faced by costa coffee due to supply chain disruptions because of the covid-19 pandemic (Hernandez et. al. 2020). The global pandemic had affected all the business practices and operations across the globe due to which the firms are facing several issues related to operational management. In this research the researcher would conduct primary research with the managers of costa coffee for understanding the issue in detail and identifying the solutions for it.
Costa coffee is one of the leading British coffee house chain which is offering high quality coffee to their customers. The company was founded in 1971 and now they are having stores in 31 different nations. Costa is the second major coffee house restraint all over the world and main in UK. The company focuses on using effective strategies for managing the business operations effectively for delivering high quality service to their customers across the world.
Due to the supply chain disruptions because of the pandemic costa coffee is facing issues related to lack of proper supply of products. This is affecting their service operation management and creating issues for the company in meeting the customer demands. The pandemic had affected all the firms and had changed the business world to a greater extent. Costa coffee needs to focus on process improvement which can help them in solving this problem. For addressing the issue it is important to investigate the issue in detail so that the company can take effective action towards it and can statement the problem.
Aim & Objectives
The aim of this study is to examine the product shortage issues faced by Costa Coffee and need for process improvement for solving the service operational issue.
To investigate the product shortage issue faced by costa coffee.
To understand the impact on product shortage on service operation management.
To analyse that how process improvement can help the company in addressing this service operation issue.
Plan of products and Services
Management of Quality
Process and Design of Capacity
Supply Chain management
Job Design & Human Resources
REVIEW OF LITERATURE
Impact of Covid-19 on businesses
Covid-19 had affected the businesses at large and had transformed the way in which they are operating. The businesses across the world had faced a lot of issues in handling their operations in an actual manner due to the epidemic. Meyer et. al. (2021) had directed an researcher research for explanation the effect of covid-19 pandemic on the businesses. In this research the researcher had clarified that the companies had faced main matters due to the disruptions in the global supply chain. In the present global world the businesses are operating at international level and are highly depended on the global supply chains. Due to the travel and trade restrictions as an precaution measures for covid-19 the companies had faced a lot of issues regarding operational issues.
The statistics mentioned by World Coffee portal, (2021) shows the negative impact on the pandemic and travel restriction on the declining sales of coffee market. The decline in the sales had affected all the major coffee brands to a greater extent. The companies are experiencing reduction in the daily consumption of coffee which is affecting the entire market negatively.
The article mentioned by Lepitak (2021) explained that the pandemic had made major changes in the demand of coffee and sales of the company. But on the other hand costa coffee is looking forward for the global growth in the international market. The customer behaviour towards coffee had changed and not the company can focus on entering into new markets. Costa coffee is focusing on opening new stores into new markets for enhancing the sales and profitability of the firm.
Service operation issues faced by Costa Coffee due to pandemic
The research by Widman (2021) had explained the influence of covid-19 on the worldwide coffee market. In this study it was explained that that all the different consequences occurred due to the pandemic had affected the businesses operations differently. The study had stated that due to the pandemic the decline in the sales of coffee is being experienced and this is affecting all the global coffee firms. The lockdown and the social distancing measures had affected the hospitality industry significant and had declined their sales. The negative effect of the global supply chains and value chains is also an significant factor which had affected the global firms operating in the global coffee sector.
Costa coffee is an international brand and due to this reason they are highly depended on the global suppliers and global supply chain. Macckenzie (2021) had stated in their report that Costa coffee warns their customers that they are facing several supply chain issues which are leading to supply delays. The delay in the supply of the raw materials is due to the situation of lockdown and trade restrictions due to which the suppliers are not able to fulfil the order on time. As a result of delay in the raw materials the company is facing several issues in meeting the customer demands. Similar to all the other global food firms Costa coffee is also having all such issues due to the pandemic and the supply chain disruptions. Costa coffee is focusing on addressing the issues related to the supply side problems and managing proper demand and supply.
International Comunicaffe, (2021) had mentioned a report regarding the supply side issues which are faced by costa coffee. In this report it was mentioned that the company is facing issues due to logistic issues and supply chain disruptions which are resulted due to the restrictions due to the pandemic. The company is facing sharp rise in the prices of raw materials and this is increasing additional cost for the company. The logistic issues is affecting the firms significantly and due to this reason the company is going out of stock.
Strategies for solving the issue of product shortage and service operation issues
Gursoy and Chi (2020) had stated in their study that when the organisation is facing any issue then it is crucial for them to emphasis on emerging better plans that can enable them in addressing the issue. Service operation issues are generally being faced by the businesses but the company should focus on understanding the issue in detail and then applying effective models and processes for solving the issues. Along with this the organisation needs to focus on identifying all the factors which are contributing to the issue then only they can solve the issue in an appropriate manner.
Bhandari et. al. (2021) stated that the industries need to use active policies and methods for solving the issues faced by them due to the pandemic. The article explained that six sigma is one of the effective tool or the model which can be used by the businesses for accepting the new changes and managing the different issues faced by them due to supply chain disruption and other factors. The companies can focus on process improvement that can help them managing the pandemic in an efficient manner. Six sigma is an effective tool that can help the companies in improving their operational efficiency and capabilities of the business processes. This model focuses on five different factors or elements which are define, measure, analyse, improve and control. Businesses operating in different industries are making use of this model. The companies are using this model and focusing on technology and intelligent automation which can help them in addressing these issues and improving their working processes.
IQPC, (2021) had mentioned in their article that Costa Coffee is focusing on making changes in their organization so that they can manage the pandemic effectively. The company is focusing on following all the rules made by the government and while operating they would be focusing on all the safety measures properly. Costa coffee had invested higher capital for enhancing the safety measures while offering the services to their customers. The company is concerned for the health and safety of their employees as well as the customers. The CEO of Costa Coffee had mentioned that the company would be using different safety measures in different nations as per the spread of the disease. Also they would ensure that their employees should follow all the safety measures while offering in store services to their customers and managing the service operations as well.
In an report by Fineextra, (2020) it is stated that the costa coffee is focusing on going cashless during the pandemic. The company had started using online payment methods and going complete cashless. The coffee house is making significant changes in their working process by changing in store environment in respond to the pandemic. From this it can be said that the company is concerned for the safety and well being of their customers and trying to offer them better service.
Forsdick (2020) had mentioned that Costa coffee is focusing on making better use of technology for solving the operational issues. The global pandemic is having both short term and long term effect on the day to day business operations. Costa coffee is focusing on going cashless which is helping them in being more effective at managing the risk. Due to this reason it is significant for the firms to focus on process improvement and increasing efficiency. Costa coffee would be using different strategies for focusing on people and productivity in an efficient way. The human resource is having an important role to play in the service processes due to which the company would be focusing more on them. Whenever the company faces issues related to service operations then it is having a major influence on the customers.
Methodology is defined as the changed procedures and models which can be used by the investigators for directing the study (Snyder, 2019). In this study the investigator would be focus on leading a detailed research with the help of effective tools and techniques.
Data collection is defined as the procedure of data collection with many methods in the research. In this study the investigator would be focusing on collecting reliable data related to the study for these both primary & secondary data collection methods. For understanding the service operation issue the researcher would be gathering information from the different literature sources for collecting the secondary data connected to the study topic. On the other hand the researcher would also conduct the field research for collecting the actual and more accurate data regarding the research topic (Samuels, 2020). For this the investigator would be directing survey survey with the manager of the case corporation. This would help them in understanding the problem which is being faced by Costa coffee and how they are managing the issues. Using the mixed data collection method will help the researcher in understanding the issue and studying its consequences in an appropriate manner.
Sampling is the method which is being used by the researchers for selecting the candidates for the research topic. There are different types of sampling methods, but in the current research simple random sampling method would be used. In this technique all the managers are having an equivalent chance to get selected for this particular study. For this research the researcher would be selecting 5 managers working in different outlets of Costa Coffee in Malta. Conducting questionnaire survey would help the researcher in analysing that how the company is managing the issues faced by them related to service operation management.
Analysing the data is the most important task. Several methods which can be used by the researcher to analyse the data. In the current research the investigator would be using thematic analysis for analysing the results of the research study. This will enable the investigator in analysing the data appropriately and connecting it well with the literature as well (Terry et. al. 2017). In this analysis method different themes would be developed which would help the researcher in representing the findings in an appropriate manner.
RESULTS AND ANALYSIS
Question 1: Do you think that covid-19 had created operational issues for Costa Coffee?
Answer: (1) Yes (2) No (3) May be
Replies: 4 defendants said yes and 1 believed may be.
Question 2: Do you think that process improvement is required for addressing the problems and experiments faced by the company due to the epidemic?
Answer: (1) Yes (2) No (3) May be
Replies: 4 said yes and 1 said may be.
Question 3: Is your store also facing supply shortage issues?
Answer: (a) Yes (b) No (c) May be
Replies: 3 respondents answered yes, 1 said may be and 1 said no.
Question 4: Do you think the supply shortage issue is affecting the customer experience negatively.
Answer: (1) Yes (2) No (3) May be
Replies: 3 respondents have answered yes and 2 said no.
Question 5: Do you think that customer demands had affected due to the pandemic?
Response: (1) Yes (2) No (3) May be
Responses: 2 said yes, 2 said may be and 1 said no.
Question 6: Is Costa Coffee focusing on using technology for making their working process advance?
Answer: (1) Yes (2) No (3) May be
Replies: 4 respondents have answered yes and 1 said no.
Question 7: Is the company looking forward to focus more on quality management and improving service quality?
Answer: (1) Yes (2) No (3) May be
Replies: all the plaintiffs said yes.
Question 8: Is the company focusing on tying up with the local suppliers for addressing the issue of product shortage?
Answer: (1) Yes (2) No (3) May be
Replies: 4 said yes and 1 said no.
Question 9: Do you think lean six sigma method can help the company in improving the service operation and process improvement?
Answer: (1) Yes (2) No (3) May be
Replies: 3 said yes, 1 said may be and 1 said no.
Question 10: Do you think operation decisions and strategies would help the company in solving the service operational issues faced by Costa Coffee?
Answer: (1) Yes (2) No (3) May be
Replies: 3 respondents said yes, 1 said no and 1 said may be.
Impact of Covid-19 on Costa Coffee
From the results obtained through the field research it can be said that the costa coffee is facing major issues due related to product shortage and service operation management. The company is facing wide range of issues due to shortage issues as it is affecting all the service operations. Costa Coffee is focusing on reducing their menu for some times till the things get back to normal and they get proper supply of raw material (Lakshmi and Shareena, 2020). All the stores of Costa Coffee are facing adverse of pandemic as it is affecting their working process and now the company have to focus on process improvement for talking the different issues which are facing by them due to epidemic. These issues are having an significant impact on customer satisfaction and experience due to this reason it is very crucial for the firm to address this issue.
Shortage issues and service operation issues faced by Costa Coffee
The results had shown that the customer demand had also affected during the pandemic. The lockdown across the different nations had affected the sales because the customers are not allowed to go out. Also the demands of the customer had changed which had made it difficult for the company to manage the supply and meeting the customers demand. Apart from this due to the increased risk of covid-19 quality management had become more important for the businesses and especially for the food service providing firms. In relation to this Costa Coffee is focusing on ensuring that they would deliver high quality and hygienic services to their customers which can help them in offering better services to their customers. From this it can be said that the company needs to make changes in their working pattern and improving their processes for addressing these issues in an efficient manner (Ahmed et. al. 2021).
Strategies lined up by Costa Coffee for solving these issues
While looking into the solutions to these issues the company is focusing on making effective use of technologies that can help them in addressing these issues. Along with this the company is also using the technologies related to safety and hygiene for the employees and customers visiting the stores. The managers had explained that lean six Sigma method is also being used by the company for addressing the issues related to the supply shortage and as service operations. the company is looking forward to make effective strategies and taking immediate action towards this so that it can help the company in solving the service operation issues. Based on this it can be said that the organization requirements to focus on overall process improvement that can enable them in lecturing these problems and enhancing efficiency as well. Due to the adverse effect of the pandemic the company had shut several stores and is looking forward to recover soon and then resume their in-store services. Also Costa coffee had also announced that they would be cutting around 1600 jobs for recovering the financial loss and reducing the company expenses (Butler and Partington, 2020).
In the article it was also found that the company is concerned for both the employees and customers. Due to this they are focusing on following all the precautions and safety measures while offering on store services to their customers. For this different changes have been implemented by the company related to proper social distancing, sanitizing and other safety measures in concern of the novel corona virus disease. It can be said that the businesses needs to focus on multiple factors that can help them in addressing the issues properly and improving their business performance as well.
The pandemic had affected the way the businesses are operating and managing their service operations. The firms operating in the service sector are highly affected. Costa Coffee is one of the top international firm offering coffee to their customers across the globe. Due to high reliance on global supply chain the company is facing shortage of supply which is affecting their overall efficiency. The trade restrictions had made it difficult for the companies to have proper flow of supply and due to this reason the company is facing product shortage. Along with this the company is also facing several issues related to the service operations management which were being changed due to the pandemic (Rojas, 2020). In the present scenario the businesses across the globe are facing different issues and are focusing on using multiple strategies. As per the manager of Costa coffee, Six Sigma is an efficient manner that can help them in addressing the issues faced by the firm.
Implementation of Six Sigma
When the company is focusing on using the six sigma then it is crucial for the organization to emphasis on all the different parts or the elements of the model in an effective and systematic manner. If costa coffee is focusing on using this model then they need to focus on all the stages which are describe, measure, examine, and advance and controller.
Starting from the first stage the company requirements to emphasize on defining the problem in an actual manner. Also the company need to focus on Identifying the major reasons behind all these issues then only they would be able to solve these problems. The company needs to develop the create goals of improvement then only they would be able to bring successful improvements in their service operations.
In the second stage the company have to focus on analysing the current performance of the company. Also they need to focus on measuring the performance of the company at the time of pandemic and the influence of the shortage issues on the overall performance and service operations. Along with this the costa coffee should also focus on calculating the short term and long term process capabilities of the firms. All the different factors which are being affected due to the pandemic are required to be identified so that further actions can be taken.
Analysing the problem is a crucial part for the organization when the company is focusing on addressing the issue. In this stage the company needs to identifying that how the issues related to service operations are affecting the customers. This will help the company in identifying that how the customers are affected and how customer satisfaction and expectations are changed due to the pandemic. The root cause of the issues faced by the company are required to be analysed so that the company can take effective action towards it. Also the company should focus on analysing that how the existing process can be improved with the help of collaborative efforts of all the employees of the company.
In the improve stage the company needs to focus on identifying the solutions and addressing the issues. The major issue faced due to the shortage of products and supply chain disruptions can be addressed by switching to the local suppliers. The company can focus on making use of effective technologies that can help them in managing proper flow of goods. All the firms are facing the issues related to supply chain disruptions and for addressing this it is significant to focus on using the modern technologies such cloud, digital and data analysis those can help them in improving their overall supply chain performance. Making use of advance technologies would help the company in addressing the existing issues of supply shortage and will improve the overall process as well (Goel, 2021).
The company is also facing several other issues related to service operations especially related to in-store services as they are highly changed due to the pandemic. The customers preferences are changed due to the pandemic as now the customers are focusing on online shopping more as compared to having in store coffee. Due to this the case company had to focus on making use of different safety measures for ensuring the health and safety of their staffs and the clients as well. For this the company have to emphasis on contribution better training to their staffs related to the covid-19 precautions. This would help the entire organisation in accepting the changes effectively and working accordingly.
Quality had also gained a lot of importance especially due to the pandemic. Due to the increasing risk of the disease the customers are focusing more on healthcare. The costa coffee is focusing on ensuring that all the safety measures should be taken in concern while preparing coffee and serving them to their customers. Costa coffee should focus on having regular audits and ensuring that all the safety measures are followed properly. Moreover it can be said that the business requirements to emphasis on quality of the products and quality management in an efficient manner through the epidemic and even in the post pandemic era as well.
It is the last stage of process improvement and problem solving. In this stage the company need to focus and ensure that all the employees of the company should work according to the changes which are required to be implemented. In this phase the company should focus on implementing the changes in an effective manner so that the company can address all those issues effectively and can bring positive outcomes for the company.
Impact on Customer
The customers who are loyal to the organisation would have to try a different coffee product in order to satisfy their needs. Due to the shortage in supply, it would seem that only a limited number of customers can be targeted and it is not sure on whether they would also stay with the product or not. Another major impact upon the customers is there has been panic buying which is done during the COVID 19 and if Costa Coffee is not able to manage its service operations, then it would not be able to make any profits during the pandemic.
Demand And Supply
Variation in Demand
The variation in demand has changed for the coffee industry altogether as COVID 19 has changed the way not only people but how businesses perceive products. Costa Coffee is mostly known for its outlets and less of the products it makes and it is due to COVID 19 that people prefer to stay indoors and even the government has imposed lockdown to be put into effect. This has caused less demand to be perceived by people. On the other hand, the hospitality industry has also faced major set-back because of which buying coffee related products would be of cheap ones rather than expensive. This limits the amount of demand from organisations.
On the other hand, panic buying has made people to buy more products and the loyal customers would be buying products of Costa Coffee in large amounts. This needs to be taken care of as the demand has risen while and the services need to be managed in that order.
The level of forecasting has dropped during the pandemic as the customer behaviour cannot be understood as they have a large number of changes that can occur. Also, it can be understood that the rise and fall of COVID 19 patients has put organisations in a dilemma whether they should or not open up. The new variants that are rising within the COVID 19 has even got the government thinking when they should and should not impose the lockdown hence thinking for a long-term cannot be done (Nikolopoulo et al. 20201).
Supply side problems
The problems in supply have also affected they way coffee is being distributed around the world. Main coffee manufacturers are present around the world and it seems that due to the lockdown they have not been able to supply coffee. Countries like Vietnam whose one highest export is coffee has not been able to do so hence causing supply side issues to arise (Perez et al., 2021).
In the above mentioned report the researcher had conducted an detailed study on the service operation issues which are being faced by the company. The researcher had explained that the Costa Coffee had faced supply shortage issues and issues related to the changes in service operations. Different solutions and alternatives were being discussed in the study which can help the case company in addressing the issue. Whenever the organisation face any of the issues then it is important that they should make effective strategies and use better tools and techniques which can help them in solving the problem