If McDonald's customers move toward low volume, high variation, high variety, and high customer contact: The operations manager will face greater challenges in planning and controlling the operation. Resources like staff, technology, and facilities may be underutilized during periods of low demand. It will be more difficult to design flexibility into the operation to handle the variety of products and services. Personnel will need to spend more time interacting with customers.

1. KEY ENVIRONMENTAL FACTORS
AFFECTING OPERATIONS
MANAGEMENT

2.  Volume
 Variation
 Variety
 Customer Contact

3. VOLUME
Volume refers to the number of times that an
operation has to deliver a service of product.
An operation dealing with high volume should be
designed to process the demands placed upon it
more speedily than the operation meeting lower
Volume
The combination of specialization, standardization
and high volume opens up the possibility of using
technology to perform the task.

4. VARIATION
Variation describes the pattern of the volume
demands.
If there are many peaks and troughs in demand
the
situation is said to be one of high variation.
Carrying extra capacity in the times of low demand
is inherently expensive, involving under-
utilization of key resources such as staff,
technology and facilities.

5. VARIETY
Variety is the term applied to the number of
different types of service or product demand
Coping with high variety is a more challenging
managerial task than dealing with low variety
An operation facing high variety has to be designed
to provide the appropriate level of flexibility

6. CUSTOMER CONTACT
The customer contact dimension is concerned with
how much time the personnel of the operation have
to spend with their customer.
The more that customer get involved therefore, the
greater is the challenge to the planning and control
of the operation manager.

7. TASK
What are the implications for the McDonald’s
operation if its customer move towards low volume,
high variation, high variety and high customer
contact features?

8. TO REFRESH YOUR KNOWLEDGE
WHAT IS VALUE CHAIN?
 A value chain is a chain of activities.
 The goal is to analyze the activities through
which firms can create a competitive advantage,
it is useful to model the firm as a chain of value-
creating activities.

9. VALUE CHAIN ANALYSIS

10. VALUE CHAIN ANALYSIS
The operations manager have to know how the
operation’s activities fare under this calculation.
The way in which the inbound logistics effect the
value structure of operations have to be analysed.

11. VALUE CHAIN ANALYSIS
The effects of the supporting activities of the
company structure, human resource management,
technology development and purchasing have to be
assessed.
The effect of operational activities on the value
calculations of the downstream functions of
outbound logistics, marketing and sales and
customer service have to be evaluated.