1. Operations Strategy in a Global Environment2
PowerPoint presentation to accompany
Heizer and Render
Operations Management, 10e
Principles of Operations Management, 8e
PowerPoint slides by Jeff Heyl
© 2011 Pearson Education, Inc. publishing as Prentice Hall

2. Reasons to Globalize Reasons to Globalize Tangible Reasons
Reduce costs (labor, taxes, tariffs, etc.)
Improve supply chain
Provide better goods and services
Understand markets
Learn to improve operations
Attract and retain global talent
Tangible Reasons
Intangible Reasons
© 2011 Pearson Education, Inc. publishing as Prentice Hall

3. Improve the Supply Chain
Reduce Costs
Foreign locations with lower wage rates can lower direct and indirect costs
Improve the Supply Chain
Locating facilities closer to unique resources
Auto design to California
Athletic shoe production to China
Perfume manufacturing in France
© 2011 Pearson Education, Inc. publishing as Prentice Hall

4. Provide Better Goods and Services
Objective and subjective characteristics of goods and services
On-time deliveries
Cultural variables
Improved customer service
© 2011 Pearson Education, Inc. publishing as Prentice Hall

5. Learn to Improve Operations
Understand Markets
Interacting with foreign customers and suppliers can lead to new opportunities
Learn to Improve Operations
Remain open to the free flow of ideas
General Motors partnered with a Japanese auto manufacturer to learn new approaches to production and inventory control
© 2011 Pearson Education, Inc. publishing as Prentice Hall

6. Attract and Retain Global Talent
Offer better employment opportunities
Better growth opportunities and insulation against unemployment
Relocate unneeded personnel to more prosperous locations
دكتورة منى الشريف وقفت هنا
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7. Cultural and Ethical Issues
Cultures can be quite different
Attitudes can be quite different towards
Punctuality
Lunch breaks
Environment
Intellectual property
Thievery
Bribery
Child labor
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8. Developing Missions and Strategies
Mission statements tell an organization where it is going
The Strategy tells the organization how to get there
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9. Mission Mission - where are you going?
Organization’s purpose for being
Answers ‘What do we provide society?’
Provides boundaries and focus
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10. Factors Affecting Mission
Philosophy and Values
Profitability and Growth
Environment
Customers
Public Image
Mission
Benefit to Society
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11. Organization’s Mission
Strategic Process
Organization’s Mission
Functional Area Missions
Marketing
Operations
Finance/ Accounting
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12. Strategies for Competitive Advantage
Strategy
Action plan to achieve mission
Functional areas have strategies
Strategies exploit opportunities and strengths, neutralize threats, and avoid weaknesses(SWOT analysis)
Strategies for Competitive Advantage
Differentiation – better, or at least different
Cost leadership – cheaper
Response – rapid response
© 2011 Pearson Education, Inc. publishing as Prentice Hall

13. Competing on Differentiation
Individuality can go beyond both the physical characteristics and service attributes to encompass everything that impacts customer’s perception of value
Competing on Cost
Provide the maximum value as perceived by customer. Does not mean low quality.
© 2011 Pearson Education, Inc. publishing as Prentice Hall

14. Competing on Response
Flexibility is matching market changes in design innovation and volumes
Reliability is meeting schedules
Timeliness is quickness in design, production, and delivery
© 2011 Pearson Education, Inc. publishing as Prentice Hall

15. Managing Global Service Operations
Requires a different perspective on:
Capacity planning
Location planning
Facilities design and layout
Scheduling
© 2011 Pearson Education, Inc. publishing as Prentice Hall