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Instruction: Read this and write a reflection paper Product flexibility: Offer a wide variety of goods/services, easily customized to meet specific requirements of customer. Easily drop or add products to meet customer demand. Developing an Operations Strategy o Volume flexibility: Operations strategy: Ability to rapidly increase or decrease production to match market demands. Is a plan for the design and management of operations functions? Is developed after the business strategy? Focuses on specific capabilities which give it a competitive edge-competitive priorities. BUSINESS STRATEGY Defines the long-range plans for the company The Need for Trade-offs Decisions: Designing the Operations Function OPERATIONS STRATEGY FIGURE 2.3 Operations strategy and the design of the operations function must emphasize priorities that support business strategy often require trade-offs between different priorities o must focus on order qualifiers and order winners Order Qualifiers and Winners Competitive Priorities: The Edge Four key operations priorities are: Cost Quality Time Flexibility Competing on Cost Develops a plan for the operations function focusing on specific competitive priorities in order to meet the long-range plan Competitive Cost Priorities: . Quality Time Flexibility Which priorities are "order qualifiers"? Hint: Must meet market's competitive priorities since market expects it Offer product at lower price than competition. Which priorities are "order winners"? Often limit product range with little customization. o May invest in automation to increase productivity. o Might offer extra training to employees. Focus on cutting costs and eliminating waste. Low cost does not mean low quality. Operations process that is designed to as efficient as possible. Competing on Quality DESIGN OF THE OPERATIONS FUNCTION Developed to focus on the identified competitive properties Structure: Facilities, flow of goods, technology Infrastructure: Planning & control system, workers, pay, quality Hint: Dell competes on all four priorities. o Southwest Airlines competes on cost o McDonald's competes on consistency. o FedEx competes on speed. o Pizzerias compete on homemade taste. Translating Competitive Priorities into Production Requirements Quality is often subjective and is defined differently depending on who is defining it. Structure decisions related to the production process: Two major quality dimensions include: characteristics of facilities used selection of appropriate 1. High-performance design:/ superior features, high durability, and excellent customer service technology o flow of goods and 2. Product and service consistency: meets design specifications close tolerances error-free delivery Quality must address o Product design quality product/service meets requirements o Process quality error-free products Competing on Time Time speed a top competitive priority. First to deliver often wins the race. Time-related issues involve: services Infrastructure decisions related to planning and control systems of operations: o organization of operations function o skill pay of workers o quality control approaches o Rapid and/or on-time delivery Focused on shorter time between order placement and delivering product exactly when needed every time. Competing on Flexibility Business environments can change rapidly; companies must accommodate change by being flexible. o