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- 1. THE HOUSING MARKET Great Recession Mortgage collapse High interest rates Restricted supply of new homes https://roselawgroupreporter.com/2015/05/freddie-mac-housing- markets-continue-to-get-better-ariz-among-most-improved/ In the course of the most recent decade, no occasion has impacted the housing market more than the worldwide financial downturn that started in December 2007. Amid this seismic financial move, alluded to as the Great Recession, many, if not the vast majority, confronted a bunch of uncommon challenges. The subprime contract crumple prompted numerous individuals losing their homes and monetary stagnation. Americans confronted money related debacle as the estimation of their homes dropped well underneath the sum they had obtained and subprime loan fees spiked. Month to month contract installments relatively multiplied in a few sections of the nation. Much of the time, borrowers were in reality better defaulting on their home loan advances instead of paying more for a home that had dropped sharply in esteem. Thus, home building saw a huge decrease, bringing about a confined supply of new homes for a consistently developing populace. The absence of supply and the expanded request saw the land
- 2. condition transform into a vender's market. More individuals were currently pursuing less homes, which expanded home costs. 1 HOUSING PRICE INDEX HOUSING PRICE INDEX 2011 THE AVERAGE PRICE WAS DOWN TO JUST 300K US DOLLARS American housing market reform Today’s average housing price index The housing price index averaged around 378k us dollars in 2007, by 2011 the average price was down to just 300k us dollars. During 2011, under the Obama administration, the American housing market reform was created. The housing market reform was created to increase the number of jobs for US citizens and help restore the housing market. Today, the average housing price index is back up to just over 400k. 2 Household income 2007 average household income decrease in average household income By 2011 the average household income dropped down to a little over 53k year 2016 average household income The average household income for families were up before the market crashed. The decrease in average household income played it’s part in the housing market crash. The average
- 3. household income in the US was around 58k per year in 2007, by 2011 the average household income dropped down to a little over 53k per year. In just two years (2013) the average household income was up to 55k a year and today the average household income is up to 59k per year. 3 Household income Here is a depiction of the Household Income from 2007 to current. 4 39083394483981440179405444090941275416404200542370581 49560765568354245534015333155214543985723059039 Year Income unemployment Unemployment rate Affects of unemployment to housing market Current unemployment rate In 2007 the unemployment rate was over 4 percent but due to the affects of the market crashing and the loss of jobs, the unemployment rate doubled by 2009. The fall of the housing market caused a loss of jobs in many industries which affected many peoples household income and their ability to afford a house. This would all change over the next coming years as the
- 4. unemployment rate would be cut by more than half by May of 2018. 5 unemployment Here is a depiction of the Unemployment from 2007 to current. 6 39083391143914239173392033923439264392953932639356393 87394173944839479395083953939569396003963039661396923 97223975339783398143984539873399043993439965399954002 64005740087401184014840179402104023840269402994033040 36040391404224045240483405134054440575406034063440664 40695407254075640787408174084840878409094094040969410 00410304106141091411224115341183412144124441275413064 13344136541395414264145641487415184154841579416094164 04167141699417304176041791418214185241883419134194441 97442005420364206442095421254215642186422174224842278 42309423394237042401424304246142491425224255242583426 14426444267542705427364276742795428264285642887429174 29484297943009430404307043101431324316043191432214.66 684661074413044.60730724830621964.44639041633019974.56 5612608124384.49732140749364984.61119882247426024.6925 4556782863034.66754747901093044.78177467913195024.7594 6313355176994.76742024918779975.04960489379983014.9908 4149858632034.92507618562845025.10930679739604985.0592 8984729110015.53294942682371985.63326587181701035.8805 5321046133016.15755959958123986.27593993403312036.5938 8867983796976.90515915074145967.46599880153437037.9160 59463104788.40424291181225068.840569526977479.13860837 906350029.50455095965227069.51881930194313959.51155089 414888989.71447142136037029.978334063199330510.1650103 6624980110.01113432407350110.08379082581229.8883679106 4393069.910327152833639610.03225691947780110.132545459
- 6. Production and business activity 2007 Housing sales Decrease in housing sales Current housing sales In 2007 the price to purchase a home on average was less than it was now due to the crash of the housing market. However, even though there were less home buyers, the price of homes did not decrease as you thought it would. The cost of living dropped for a short time, but by 2009 the market was already starting to see a balance in cost of living. By 2011 due to the Housing Reform, the market price was climbing back to what most people expected them to be. 7 Housing bubble Supply Demand A housing bubble is a run-up in housing prices fueled by demand, speculation and exuberance. Housing bubbles usually start with an increase in demand, in the face of limited supply, which takes a relatively extended period to replenish and increase. Speculators enter the market, further driving up demand. At some point, demand decreases or stagnates at the same time supply increases, resulting in a sharp drop in prices — and the bubble bursts. 8
- 7. Housing market crash Loss of jobs Supply Increase of Demand The crash of the housing market was caused by the loss of almost 1 million jobs to various professional industries causing the loss of many homes thus driving the housing market into a downward spiral. The rise of the housing marking (bubble) began in 2011 with the Housing Market reform under the Obama administration. The reform was created to help bring jobs back to America helping lower the unemployment rate and allow the demand for housing to increase. The increase in demand would create jobs for the construction industry and real estate industry while driving the market back up to a healthy state. 9 Prior government policies and legislation Community reinvestment act (cra) Fannie mae Freddie mac The Community Reinvestment Act (CRA), Fannie Mae and Freddie Mac, punishment free renegotiating of home credits, assess inclinations allowed to home value acquiring, and lessened capital necessities for banks that hold home loans and home loan supported securities (MBS) have all debilitated the benchmarks for giving home loans and the lodging money framework itself. Faulting ravenous brokers, bumbling rating organizations, or different performers in this uncommon show misses the point, maybe intentionally, that administration approaches made the motivating forces for both a lodging
- 8. bubble and a diminishment in the bank capital and home value that could have alleviated its belongings. To keep a repeat of this fiasco, it would be far superior to change the ruinous government lodging approaches that conveyed us to this point than to sanction another administrative administration that will frustrate a brisk recuperation and impede future monetary development. 10 Fiscal and monetary policy Federal government (fiscal policy) Federal reserve (monetary policy) Economic growth Policy influences Monetary policy is principally worried about the administration of loan fees and the aggregate supply of cash available for use and is by and large completed by national banks, for example, the U.S. Central bank. Fiscal policy is the aggregate term for the exhausting and spending activities of governments. Fiscal policy influences total request through changes in government spending and tax collection. Government spending and tax assessment impact business and family unit wage, which direct customer spending and speculation. Fiscal approach impacts the cash supply in an economy, which impacts financing costs and the swelling rate, the fiscal policy put in place make an impact on economic growth. Additionally, money related arrangement impacts business extension, net fares, work, the cost of obligation and the relative cost of utilization as opposed to sparing. 11
- 9. https://fr.dreamstime.com/photo-stock-op%C3%A9rations- consultant-le-concept-trains-d-de-dent-d-image78363636 OVERVIEW Evaluate Operations Consulting Tool Kit Determine Resources and data Develop Business case Engagement Proposal Operations Consulting A business in the media having difficulties with its operating model or one which is struggling in the community will be chosen. How all or some of the items from the Operations Consulting Tool Kit in Operations and Supply Chain Management that could help this business get back on track will be evaluated. Resources and data needed to deploy an operations consulting engagement with this business will be determined. Develop A business case including financial benefits on how operations consulting can have a positive impact on the business will be developed. 1 Operations Consulting Problem Definition
- 10. Data Gathering Data Analysis and Solution Development Cost Impact and Payoff Analysis Implementation Introduction https://www.kisspng.com/png-restorative-practices-school- restorative-justice-e-683695/ When organizations leverage to the full potential of being transparent in their process as well as ensure the free flow of information, most of the organization efficiencies can be eliminated or reduced. Operations Consulting a research work that leverages data and analysis to provide organization operations produce the optimal capabilities. Most of the business is tied down to complex business processes, and Operation consulting can reduce such inefficiencies by looking through the data and identifying issues and creating strategies
- 11. to resolve them effectively. Operations of aiding clienteles in emerging activities stratagems and advancing production methods. In strategy advancement, attention is on exploring the proficiencies of services considering the organization's tactics (Jacobs, 2013). 2 Benefits of Operations Consulting Strategic Flexibility Faster responsiveness Continuous cost reductions Shorter times to market Leadership practices to sustain gains Alignment between improvement priorities and business strategy http://www.schneidermanconsulting.com/index_htm_files/[emai l protected] Experienced and effective operations consultants will help your
- 12. organization meet its operational goals much faster and more thoroughly than it would without support. Once a consultant of operations determines the way procedures are accomplished, together with the reasoning of the organizational configurations and processes, the consultant will then offer advice regarding improving different operational functions. Operational functions mean accenting current strategies and methods which benefit the organization, and at the same time indicating areas in need of improvement (Joost, 2016). Organizations recognize substantial savings via program and vendor management, vendor agreements, self-service resolutions, and decreased technology customizations. Rewards service distribution models are constant change. Organizations and regulatory changes drive the need for administrative changes, and program design must respond to current needs and anticipate new ones. In today's continually changing regulatory environment, it's crucial to create controls as well as operation metrics to evaluate compliance risk, detect opportunities for enhancement and act on them (Joost, 2016). 3
- 13. Business Identification https://tribecacitizen.com/2018/07/27/seen-heard-is-barnes- noble-closing-at-year-end Drop in in-store traffic Drop in on-line sales Store closings Employee lay-offs Meyersohn (2018), "Barnes & Noble (B&N), already reeling from the messy departure of its chief executive, said on Thursday that same-store sales fell 6.1% last quarter compared with a year ago. The company attributed the decline to a drop in in-store traffic. Online sales also dropped 14.3% because of fewer promotions, including in Barnes & Noble's Nook tablet business. Barnes & Noble's overall losses widened to $17 million. The combination led to a sell-off in Barnes & Noble (BKS) stock. The weak quarter came as other retailers were capitalizing on a healthy consumer economy, and it was another sign of a company in serious trouble. Barnes & Noble which has more than 600 stores in the United States and 23,000 employees, has been trying to trim expenses and grow revenue. But it may not be able to turn the business around" (para. 1). Digital online marketplace has taken over every single
- 14. retail store by storm. Digital stores provide the convivence of purchasing goods at the best price from different vendors. Local bookstores which were a marvel in the past is now vastly impacted by online book retailers like Amazon and Apple. Barnes & Noble, once a leading bookstore, has been severely affected by online retailers, causing their sales to go down every year for the last four years. The stock price has been dipping as well as several stores are getting closed, causing layoffs of employees (Wahba, 2017). According to Wahba (2017), "It has closed about 20 a year in recent years" (para. 4). 4 barnes-noble-is-entertaining-the-possibility-of-selling-itself http://fortune.com/2017/11/30/barnes- nhttp://fortune.com/2017/11/30/barnes-noble-sales/oble-sales/ Decline of Barnes & Noble According to Ilwareed (2018), "As a bookseller, B&N has struggled on the one hand to keep up with the speed and
- 15. ubiquity of Amazon, and on the other, to attract people to stores the way small, local indies have. It's also suffered from the decline of US shopping malls. In the last earnings call, Riggio, the B&N founder, and the chair said the company still needs to figure out new store sizes and layouts, and that its recent venture into restaurants was not successful" (para. 2). 5 Barnes & Noble Operations Efficiencies Plant Processes Planning & Control systems https://s3.amazonaws.com/vetter-prod-vetter-public- files/photos/165/Efficiency_Defined.png Some of the core inefficiencies can be co-related to the Operations Consulting 5P's. Plant, People, Parts, Processes, and Planning, each of which contribute to the operational efficiencies. Some of the Barnes and Nobel operational
- 16. inefficiencies are with the plant, process, and planning. Plant efficiencies relate to the Nook tablet brand, which as the worst failure when compared to larger brands. Also, Barnes and Nobel were late in the game going digital and let the competition take over the marketplace. According to Lutz (2014), "The company blamed its poor sales on competition from Apple's iPad and its failure to release a new tablet." (Para, 2). 6 Problem Definition Data Gathering Data Analysis and