Forces and Factors That Affect

¶ … forces and factors that affect a business organization's ability to maintain its profitability and set standards of performance in competitive markets. One of the frameworks that has been developed to examine some of these forces is the Four V Model (Teppides 2010). This identifies the issues of volume, variety, variation, and visibility as factors that control competitiveness and profitability in a given industry, and can be used to assess a given company's level of performance (Teppides 2010).

In this paper, the influence of variety will be assessed in both service and manufacturing operations and a comparison of the similarities and differences that exist in the level of variety and its effects in these two different sectors will be made. Variety is essentially the availability or potential in the market for slightly different products/services fulfilling the same product need to serve as competitors to a give organization's products or services (Teppides 2010).

In the service industry there is an enormous potential for variety in the provision of any service precisely because services are dependent on interpersonal interaction making service provision as variable as human beings themselves (Johnston & Clark 2008). There is thus a highly competitive factor introduced into most service industries because of this potential for variety and the abundant variety that exists in many service industries (Johnston & Clark 2008).

Other factors can limit the actual degree of competition in existence in a given market for a specific service despite the existence or potential of variety, and this tends to lead to a reduction in the quality of the service provision (Johnston & Clark 2008). It might at first appear as though there would be less potential for variety in manufacturing operations and organizations, especially in many of the more simplistic manufacturing processes and products.

This, however, is not entirely the case and in fact a great deal of process and product variety exists even in most of the niche markets in the manufacturing sector (MacDuffie et al. 1996).

This variety increases as product complexity increases which has a twofold effect on a given manufacturing organization's market position and profitability: first, productivity tends to decrease as product complexity increases, limiting profitability due to the basic rules of economies of scale; second, it increases competitiveness in most industries as it increases the number and degrees of variations possible (MacDuffie et al. 1996).

Complexity also affects the cost of manufacture and thus profitable price points for the product and thus the level of variety in most manufacturing processes and products is a major contributor to competitiveness in manufacturing industries and between manufacturing organizations. Variety is clearly as influential in manufacturing operations as it.