1. OPERATIONS STRATEGY
Chapter 2
Irwin/McGraw-Hill
© The McGraw-Hill Companies, Inc. 2004
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2. Outline
1. Operations Strategy Model
2. Emphasis on Operations Objectives
3. Linking Strategies
4. Focused Operations
5. Global Scope of Operations
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3. Operations Strategy Model (Figure 2.1)
Cor por at e and
business st r at egy
I nt er nal
analysis
Oper at ions St r at egy
Mission
Dist inct ive
Compet ence
Ext er nal
analysis
Obj ect ives
(cost , qualit y, f lexibilit y, deliver y)
Funct ional st r at egies in
mar ket ing, f inance,
engineer ing, human
r esour ces, and
inf or mat ion syst ems
Policies
(pr ocess, qualit y syst ems, capacit y,
and invent or y)
Consist ent pat t er n of decisions
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Result s
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4. Operations Strategic Objectives
Quality
Flexibility
Delivery
Cost efficiency
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5. Examples of Important Policies in Operations (Table
2.2)
Pol y Type
i
c
Process
Quality S
ystems
Capacity
I
nventory
McGraw-Hill/Irwin
Pol y Ar a
i
c
e
S of process
pan
Automation
Process f
low
J specialization
ob
S
upervision
Approach
T
raining
S
uppliers
Facility size
Location
I
nvestment
Amount
Distribution
Control S
ystems
S r t g c Ch c s
ta e i oie
Make or by
Handmade or machine –made
Flexible or hard automation
Proj
ect, batch, line, or continuous
Highly decentralized or centralized
Prevention or inspection
T
echnical or managerial training
S
elected on quality or cost
One large or several small f
acilities
Near markets, low cost, or f
oreign
Permanent or temporary
High levels or low levels of
inventory
Centralized or decentralized
warehouses
Control in great detail or less
detail
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6. Types of Focus
Product focus
Process type
Technology
Volume of sales
Make-to-stock and make-to-order
New products and mature products
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7. Global Scope of Operations
“Traditional” versus “Global” company
Characteristics of “Global Corporation”
Implications of “global”corporation for
operations management
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