It is very important for an organization to have a well-defined objective. A well-defined objective facilitates the
Question:
It is very important for an organization to have a well-defined objective. A well-defined objective facilitates the development of strategies and policy thereby creating value for customers.
Operation Strategy
Operational strategy is essential to achieve operational goals set by the organization in alignment with the overall objective of the company. Operational strategy is designed to achieve business effectiveness or competitive advantage.
Operational strategy is a planning process that aligns the following
ORGANISATIONAL GOAL- BUSINESS GOAL- PRODUCT/SERVICE GOAL- SWOT ANALYSIS- OPERATIONS STRATEGY
In this global competitive age, organization goals tend to change from time to time, therefore, operations strategy as a consequence has also been dynamic in nature. A regular SWOT analysis ensures that the organization is able to maintain competitive advantage and business leadership.
Strategic Management Process for Production and Operation
For success of organisational strategic objectives, strategic planning has to trickle down to various function areas of the business. In order to build the strategic management process a sequential process as below is followed
Competition Analysis: In this step company evaluates and studies current competition in the market and practices that are followed in the industry for operations and production vis-à-vis company policies
Goal Setting: The next step involves narrowing down the objectives towards which the organization wants to move towards.
Strategy Formulation: The next step is breaking down of organizational goals into operations and production strategies.
Implementation: The final step is to convert operations and production strategies into day-to-day activities like production schedules, product design, quality management etc.
As organizations are always customer-centric, production and operation strategies for organisation are built around them
Productivity
Measurement of formulated operations and production strategy is important to maintain alignment with the organisation's objectives. In simple terms, productivity is defined as sum of total output per employee or per day. The productivity of the company is dependent on the industry and environmental conditions in which it is operating.
Two essential parts of productivity are labor and capital. In the scenario of limited resources, optimum and efficient utilisation of labour and capital will generate favorable productivity.
Productivity measurement also enables the company to identify areas that require improvement or special focus. Also, productivity provides a ready report card to measure status against the company’s production objective.
Productivity measurements can be classified in three categories based on the inputs used for calculation. Partial productivity ration of output is compared to one of resource used for example, labour productivity where output is compared to the labour wages.
The total productivity measure takes into consideration sum of all input factors which are used for the output. In the modern age technology plays an important part in productivity.
Wastivity
Another important factor is the case of production is wastivity. Not 100% of input would be converted to output, there is going to be waste during production. Wastivity is the reciprocal of productivity. Classic examples of activity are defective products and services that either has to be re-cycled or disposed of completely. Other examples are idle capacity of the material, manpower equipment etc.
Questions:
1.1 With regards to the article examine the effects of the Strategic Management Process on the operations management function.
1.2 Determine the importance of measuring productivity in operations management.
1.3 Examine the strategies for reducing waste in operations management using lean manufacturing
Principles of Information Systems
ISBN: 978-1133629665
11th edition
Authors: Ralph Stair, George Reynolds