CHAPTER 2 OPERATIONS STRATEGY

Corporate strategy : goals core competencies environment responses new products/services global strategies Functional-area strategies : finance, marketing, operations, others Market analysis : segmentation, needs assessment Competitive Priorities : cost, quality, time/speed, flexibility Capabilities : current needed planned

CORPORATE STRATEGY Determining the business(es) that the company will pursue Coordinating the firm’s overall goals with its core competencies  customers to serve, products or services to produce, responses to take, strategy to employ in global markets Providing an overall directions that serves as the framework for carrying out all the organization’s function

CORPORATE STRATEGY (continued) Three considerations to develop corporate strategy : responding to pressure for flexibility  developing capability for change monitoring and adjusting to changes in the business environment  environmental scanning : trends in socioeconomic environment identifying and developing the company’s core competencies  unique resources and strengths : workforce, facilities, market & financial know- how, system & technology

Global Strategies : Strategic Alliances : collaborative effort, joint venture, technology licensing Locating Abroad

MARKET ANALYSIS To understand what customers want and how to provide it better than the competitors do Market Segmentation  the process of identifying groups of customers with enough in common to warrant the design and provision of products or services that the larger group wants and needs Needs Assessment  identifying the needs of each segment and assesses how well competitors addressing those needs

COMPETITIVE PRIORITIES Operating/Competitive Advantages for processes that related to the products or services, to its delivery system and to related volume factor The key capabilities area that operations must develop by utilizing its core competencies to compete successfully in a certain market segment or to achieve competitive priorities : cost, quality, time and flexibility

SERVICE STRATEGIES Standardized-service strategy  little variety in high volume : consistent quality, on time delivery and low cost Assemble-to-order strategy  a set of standardized services and processes devoted to assembling standardized offerings for a specific customer’s needs : customization, fast delivery time Customized-service strategy  individualized service : high performance design, customization, low volume

MANUFACTURING STRATEGIES Differ from service strategies primarily because of the ability to use inventories. Make-to-stock strategy/mass production  minimizing customer delivery time, high volume which needed accurate forecasts, consistent quality, low cost Assemble-to-order strategy  customized product from relatively few assemblies and components : customized, fast delivery time, low cost (fabrication), flexible (assembly processes)

Make-to-order strategy  a set of processes that can be used in many different ways to meet the unique needs of customers : flexible, low volume, high variety

MASS CUSTOMIZATION Flexible processes generate customized products or services in high volume at reasonable low costs Postponing the task of differentiating a product or service for a specific customer until the latest possible moment Consists of independent modules that can be assembled into different form easily and inexpensively Provide customization at the latest possible moment Internet use