Operations Strategy 1 - Introduction

The difference between Operational Strategy and Operational management

• More long term
• Analysis at a higher level
• Data more aggregate
• Involves the whole organization
• Greater level of Abstraction and concepts and not specific solutions

NEED EXAMPLES HERE

NEED TO MAKE SURE THE STRATEGIC RECONCILATION DIAG IS IN HERE

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Market Requirements [img[2]]

Operations Resource Requirements [img[3]]

The Four Decision Categories

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Summarizing Market Based View perspective - Outside-In

• Companies make choices about what customers to attract (STP)
• Competitors partly shape the competitive environment
• Operations devotes itself to providing aspects of performance to suppor the Market Position
  • Speed, Quality, Dependability, Flexibility, Cost
• Different Customer needs mean different types of performance from operations

Summarizing Resource Based View Inside-out

• How successful a company is, is based upon the characteristics of it resources
• And how is arranges it resources
• Some resources are intangible - Reputation or Tacit knowledge - embedded learning and relationships within and out side
• Some resources are more important - ie scare, difficult to imitate, cannot be moved; no substitute - become strategic resources or Core Competences
• maintaining and exploiting core capabiliites is a key task for operations strategy through Dynamic capabilities shaped by decision making
• Decision Making can be grouped around processes, capacity, supply,

The two perspectives can be brought together through alignment

The are three levels of analysis that used to make the distinction between operational strategy and operational management by thinking how they use the input-transformation-output process by looking at the Supply Network which is the Flow between operations the Operation flow between operations and the Process the flow between resources. The 1st is strategic the 2nd is Strategic and Operational and the 3rd is operational

Order Winning and Qualifying Objectives

Of these performance objectives will be more important for some operations than others. The chapter introduces one well-known method of distinguishing between performance objectives - classifying them as order winners or qualifiers.

Order winners are performance objectives that clearly gain more business for the company as its performance in these areas improves. Qualifiers are the "givens" of doing business. No matter how well an organization performs at it qualifiers it is not going to gain great competitive benefit. However, if it fails to meet the expectations of the market in a qualifying performance objective it will suffer disadvantage in the marketplace

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Delights are qualities that were not even thought of the the customer but add to their satisfaction. This would be aline above Order Winners Over time the lines move down and to the right as they become givens and replaced with new attributes

Criticism of Order Winning/Qualifying concept

• Do all customers have the same agreement on what is wiining and qualifying
• Some customers look at the l-t realtionship and willing to ignore lapses

Operatonal Strategy Decisions

The Content of operations strategy is

Capacity

• Supply Network
• Process Technology
• Development and Organization

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Resource Based View RBV

Inside out view

• Intangible and tangible resources
• Firm specific
• Devloped over time
• Resources are co-ordinated to generate CA

Market Requirements

Outside in

• Segment, Position, Target
• Organization develops resources and capbilites based on customers needs

Bibliography

Hayes Piscano:Beyond World Class - Mfg Strategy Prahalad Hamel. The Core Competence of the Corporation Stalk Evans Shulman Competing on Capabilites Whittington: What is strategy? Porter: Competitive Advantage <comments />