Operations Strategy BA 341 Lean Operations Dr Bogdan Bichescu 1 Importance of Strategy Mission statements that tell Where an organization is going Purpose for being what it contributes to society Sets boundaries and provides focus Strategy Action plan to achieve mission General strategy distilled into functional strategies Strategies exploit opportunities and 2 Operations Strategy An Example Mission Manufacture and service an innovative growing and profitable worldwide microwave communications business that exceeds our customers expectations A Possible Operations Strategy To manufacture products consistent with the organization s mission as the global low cost provider of microwave communications equipment Product Design Process Design Supply chain Management Quality Management Inventory Management Facility Location Scheduling Maintenance Layout Design HR Management 3 Strategies for Competitive Advantage Competing on Differentiation Offer products that are different better or unique Can result from any aspect of the product or service that impacts customer s perception of value e g quality reliability features product variety aftersale services delivery technical support etc Special focus on experience in services e g Disney Hard Rock Cafe 4 Strategies for Competitive Advantage Competing on Cost Focus on maximizing value to customer Does not necessarily imply low quality Southwest Airlines secondary airports no frills service efficient utilization of equipment Walmart small overhead shrinkage and distribution costs Aldi no bags no bright lights no music no credit cards 5 Strategies for Competitive Advantage Competing on Response Flexibility matching market changes with design innovation and flexible volumes Reliability in meeting schedules and deadlines e g Hewlett Packard e g FedEx German machine tool industry Quickness in production and delivery Pizza Hut Motorola Amazon 6 Role of Operations Strategy 7 For next week Read class notes textbook and rework class and textbook productivity examples on your own Complete the first assignment available on MyOMLab which is due at midnight 11 59pm on 8 29 Complete the first Packback QA session which is also due at midnight on 8 29
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