Operations Management
Strategy
A Sustainable Operations and Supply Chain Strategy
Strategy should describe how a firm intends to create and sustain value for its current shareholders.
Adding Sustainability to the concept, we add the requirement to meet these current needs without compromising the ability of future generations to meet their own needs.
Shareholders are those individuals or companies that legally own one or more shares of stock in the company.
Triple Bottom Line
Social Responsibility.
This pertains to fair and beneficial business practices toward labor, the community, and the region in which a firm conducts it business.
Economic Prosperity
The firm is obligated to compensate shareholders who provide capital through stock purchase and other financial instruments via a competitive return on investments.
Environmental Stewardship
This refers to the firm’s impact on the environment. The company should protect the environment as much as possible or at least cause no harm.
What is Operations and Supply Chain Strategy?
Operations and supply chain strategy is concerned with setting broad policies and plans for using the resources of a firm and must be integrated with corporate strategy.
Operational effectiveness is reflected directly in the costs associated with doing business.
What is Operations and Supply Chain Strategy?
Operations and supply chain strategy can be viewed as part of a planning process that coordinates operational goals with those of the larger organization.
The goals of the larger organizations change �over time, the operations strategy must be �designed to anticipate the future needs.
Implementation Projects
Initiatives
Define vision, mission, and objectives
Conduct strategic analysis
Define strategic competitive priorities
Identification of major steps needed in response to new competitive priorities
Product design initiatives
Operations and supply chain initiatives
Definition of specific implementation projects
Identification of resources needed
Project funding procurement
Formulating an Operations and Supply Chain Strategy
Process
Outputs
Strategic �Analysis
Competitive Dimensions
Given the choices customers face today, how do they decide which product or service to buy?
Dimensions | Description |
Cost or price | Within every industry, there is usually a segment of the market that buys solely on the basis of low cost. |
Quality |
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Delivery Speed | In some markets, a firm’s ability to deliver more quickly than its competitors is critical. |
Delivery Reliability | Relates to the firm’s ability to supply the product or service on or before a promised delivery due date. |
Coping with Changes in Demand | A Company’s ability to respond to increases and decreases in demand is important to its ability to compete. |
Flexibility and New-Product Introduction Speed | Refers to the ability of a company to offer a wide variety of products to its customers. |
Competitive Dimensions
Other Product-Specific Criteria.
Special services are provided to augment the sales of manufactured products.
Order Winners and Order Qualifiers: The Marketing – Operations Link
A well-designed interface between marketing and operations is necessary to provide a business with an understanding of its markets from both perspective.
Order winners
One or more specific marketing-oriented dimensions that clearly differentiate a product from competing products.
Order qualifiers
Dimensions used to screen a product or service as a candidate for purchase.
The Notion of Trade-Offs
A strategic position is not sustainable unless there are compromises with other positions.
Trade-Offs occur when activities are incompatible so that more of one thing necessitates less of another.
Straddling occurs when a company seeks to match the benefits of a successful position while maintaining its existing position.
Southwest Airlines’
Activity System
Diagram that show how company’s strategy is delivered through a set of supporting activities.
Assessing the risk associated with operations and supply Chain Strategies.
Supply Chain Risk is defined as the likelihood of a disruption that would impact the ability of the Company to continuously supply products or services.
Productivity Measurement
Productivity is a common measure of how well a country, industry, or business unit is using its resources (or factors of production).
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Productivity Measurement
Productivity Measurement