Operations Strategy – Chapter 2 Quick Review

Operations Strategy

• Defines how operations executes corporate strategy to create a customer-driven firm
• Aligns processes & supply chains to competitive priorities

Corporate Strategy & Global Strategies

• Sets overall direction via environmental scanning & core competencies (workforce, facilities, know-how, tech)
• Core processes selected to deliver value
• Global strategy tools: strategic alliances & locating abroad

Market Analysis

• Objective: match offerings to customer wants
• Steps:
  • Market segmentation → identify distinct groups
  • Needs assessment → service/product, delivery system, volume, other needs

Competitive Priorities (9)

Cost
• Low-cost operations
Quality
• Top quality
• Consistent quality
Time
• Delivery speed
• On-time delivery
• Development speed
Flexibility
• Customization
• Variety
• Volume flexibility

• Time-based competition focuses on delivery & development speed

Order Winners vs. Qualifiers

• Order qualifiers: minimal criteria to compete
• Order winners: criteria that differentiate the firm and win business

New Product/Service Development

Development strategies: product variety, design, innovation, service
Product definition
• Service package = supporting facility, facilitating goods, explicit & implicit services
Quality Function Deployment (QFD)
• Uses “house of quality” to translate customer voice to technical specs
Development process stages

1. Design
2. Analysis
3. Development (concurrent engineering)
4. Full launch

Assessing & Managing Performance

• Competitive capability = measured ability to meet priorities
• Gap analysis compares capabilities to targets; drives improvement actions

Preference Matrix Method (brief)

1. Select criteria & assign importance weights w_i (sum =1)
2. Rate each alternative R_{ij} (scale 1–10)
3. Compute weighted score Sj = \sum wi R_{ij}
4. Highest S_j → preferred option

Key Takeaways

• Consistent decision pattern across competitive priorities builds capabilities
• QFD & concurrent engineering integrate cross-functional knowledge early
• Performance gaps reveal where operations strategy must evolve