Operations

Stratergy
BY:
KUNWAR,SIDDHANT,GEETANSHU

The Role of Operations

Strategy

Provide a plan that makes best use

of resources which:

Specifies the policies and plans for

using organizational resources
Supports Business Strategy.

Importance of
Operations Strategy

Companies often do not understand

the differences between operational
efficiency and strategy

Operational efficiency is performing tasks

well, even better than competitors
Strategy is a plan for competing in the
marketplace

Operations strategy is to ensure all

tasks performed are the right tasks
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Developing a Business
Strategy

A business strategy is developed after

taking into many factors and following
some strategic decisions such as;

What business is the company in

(mission)
Analyzing and understanding the market
(environmental scanning)
Identifying the companies strengths (core
competencies)
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Examples from
Strategies

Mission: Dell Computer- to be the most

successful computer company in the world
Environmental Scanning: political trends,
social trends, economic trends, market
place trends, global trends
Core Competencies: strength of workers,
modern facilities, market understanding,
best technologies, financial know-how,
logistics
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Developing an
Operations Strategy

Operations Strategy is a plan for

the design and management of
operations functions
Operations Strategy focuses on
specific capabilities which give it a
competitive edge competitive
priorities

Business/Functional
Strategy
There are of three types:1) Corporate level strategy:

The highest level of strategy.

It sets the long-term direction and scope
for the whole organization.
Organizations often express their
strategy in the form of a corporate
mission or vision statement.
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2) Business level strategy:

primarily concerned with a particular business

unit should compete within its industry, and
its strategic aims and objectives.
A business units strategy may be constrained
by a lack of resources or strategic limitations
placed upon it by the centre.
It is synonymous with corporate level strategy.

3) Functional level strategy:

The bottom level of strategy is that of the

individual function (operations, marketing,
finance, etc.)
These strategies are concerned with each
function contributes to the business
strategy & strategic objectives.
Should manage their resources in pursuit
of those objectives.
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Operations Strategy
Across the Organization

Business strategy defines longterm plan

Operations strategy support the
business strategy
Marketing strategy needs to fully
understand operations capability
Financial plans in effect support
operations activities.
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Competitive PrioritiesThe Edge

Four Important Operations

Questions: Will you compete on
Cost?
Quality?
Time?
Flexibility?
All of the above? Some? Tradeoffs?
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Highlights

The operations strategy focuses on developing

specific capabilities called competitive priorities.
There are four categories of competitive priorities:
cost, quality, time, and flexibility
Technology can be sued by companies to gain a
competitive advantage and should be acquired to
support the companys chosen competitive priorities
Productivity is a measure that indicates how
efficiently an organization is using its resources
Productivity is computed as the ratio or
organizational outputs divided by inputs
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CASE STUDY
Mercedes Benz was considered to be a
byword for quality and reliability previously,
but nowadays its been noticed that BMW is
taking over Mercedes in terms of profit and
reliability.

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Review of Learning
Objectives

Define the role of Business Strategy

Explain how a Business strategy is
developed
Explain the role of Operations Strategy
in the organization
Explain the relationship between business
strategy and operations strategy
Describe how an operations strategy is
developed
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Review of Learning
Objectives

Identify competitive priorities for of

the operations function
Explain the strategic role of
technology
Define productivity and identify
productivity measures
Compute productivity measures
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Thank you
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