Operation Strategy chapter

Question 1

What is the operation strategy concerned with?

Answer 1

Operation strategy is concerned with the reconciliation of market requirements (customer needs, market positioning, competitors’ actions) and operation resources (tangible and intangible resources; operation processes, operation capabilitites)

Question 2

What is the content of operation strategy?

Answer 2

It is the interaction between performance objectives and decisions related to resource deployment. Hence we have two perspectives on operations that would be aligned by the operation strategy in order to be executed efficiently.

Question 3

How can companies articulate their wished market position?

Answer 3

• Compare it to competitor “We want to be as company X and provide those products”
• Associate it with a specific customer group “We wish to provide service level to attract business people at our hotel”

Question 4

How can a market position be defined by a company?

Answer 4

Eg. price, range, quality. The factors on which a firm wants to compete is called competitive factors. Common for those factors are that they are visible for customers.

Question 5

This clusters the competitive factors into operations generic performance objectives. Which are they?

Answer 5

The importance of each performance obejective varies among companies and industries, and are prioritized differently. In additions, they can be bundled and combined.

• Quality
• Speed
• Flexibility
• Dependability
• Costs

Question 6

The set of decision areas are needed to manage the resources and operations, often refered to “Operation strategy decisions”. Which are they?

Answer 6

• Capacity strategy - how capacity and facilities should be configurated. Eg. location of plants, size, what is the overall capacity?
• Supply network strategy, including purchasing and logistics - how operations relate to interconnected network. Firm must consider its position in this network. Deals with fluctuations in the network, how much of the network they control, relationship management, how many suppliers they have,
• Process technology strategy - the choice and development of systems, machines and processes that directly or indirectly transform resources into products or services.
• Development and organization - short and long term decisions regarding how the organization is run. “How should resources be clustered in the organization (configuration mode), how is the organization going to be developed, organization of new product and services development)

Question 7

The distinction between structural and infrastructural strategic operational decisions:

Answer 7

Structural decisions (Capacity and supply network) are concerned with configuration of physical resources (like a hardware; determines the limits of operations), and infrastructure decisions (process tech and development and organization) are concerned with how the operations are conducted at a daily basis, eg. activities etc (the software; it must be able to exploit the potential embedded in the hardware).

Question 8

What is operations?

Answer 8

Operations is the activity of managing the resources and processes that produce and deliver goods and services. It’s a transformative process.

Question 9

On what levels can operations be analyzed?

Answer 9

• The business itself
• as a part of a greater network
• at the level of individual processes within the operation (subprocesses)

Question 10

WHat is operations strategy?

Answer 10

Operations strategy is the total pattern of decisions that shape the long-term capabilities of any kind of operation and their contribution to the overall strategy.

Question 11

What are emergent strategies?

Answer 11

The idea of strategy being shaped and directed by experience over time. “Bottom up” approach.