Read the case study provided and answer the following questions.

ENHANCING OPERATIONAL PERFOMANCE

In most industries, regardless of whether the average profitability of the industry is high or low, some firms are more profitable than others. The superiorperformershavesomethingspecialanddifficulttoimitatethatallowsthemtodobetter thantheirrivals.Instrategy,theseuniqueskillsand resources are mentioned as sources of competitive advantage. Bharadwaj,Varadarajan and Fahy $(2008)$ classify two broad sources of competitive advantage:$-$ unique resources $($assets$)$ and distinctive skills $($capabilities$).$ Day and Wensley, $(2016)$ characterize superior skills as the distinctive capabilitiesofa firm'spersonnelthatsetthemapartfromthepersonnelofcompetingfirmsandsuperiorresourcesasmoretangiblerequirements for advantage that enable a firm to exercise its capabilities. These two sets of sources allow a business to perform the various primary and secondary value activities that compose its value chain at a lower cost or lead to differentiation. They create competitive positional advantages in the form of superior customer value by differentiated goods$/$services$,$ and$/$or lower relative costs through cost leadership. Firm$-$specific skills and resources are also referred to as the "drivers" of cost and$/$or differentiation advantages.

There are varieties of drivers in the literature; these include resource$-$based drivers such as economies of scale and scope, brand equity, and reputation, and skills$-$based drivers such as the skills underlying the innovativeness and superior quality of a business's offerings. Superior skills and resources do not give a business a competitive advantage. They only offer the business an opportunity to use its skills and resources to achieve competitive cost and$/$or differentiation advantages. Thus, one must identify the skills and resources that have the greatest potential to endow the firm with enduring competitive advantages. Aaker, $(2010)$ stated that multiple sources of competitive advantage are necessary for a business to compete successfully. Logistics management has always been concerned with lead$-$times. In particular, the order$-$to$-$delivery cycle has been seen as a major element in the customer service process. However, companies are now increasingly coming to recognise that the way in which $$time$$ is managed throughout the logistics system $-$ from procurement of materials through to the receipt of payment for goods sold $-$ is a key determinant of competitive advantage.

Not only is work$-$in$-$progress and inventory reduced through a shortening of total logistics lead$-$time, but responsiveness and flexibility to marketplace requirements is dramatically enhanced. One of the goals of any company selling a product or service is differentiation. A company pitches its unique selling proposition that is going to be most advantageous for it$.$ Successful differentiation requires a good product or service and customer insight $($customers$$ perception of a company$$s product and those of competitors$).$ Setting its products or service apart from its competitors is necessary to create preference and loyalty. Here are a few examples on how companies have maintained competitive advantage.

Case derived from: Heizer and Render $(2018)$

QUESTION $1[30$ MARKS$]$

Nike in one of its operations has recently noted increases in costs and therefore has been aiming towards improving efficiency. The operations manager Cedric Masuku is interested in determining the productivity of his organisation and would like to know if his organisation is maintaining the manufacturing average of $3\%$ increase in single and multi$-$factor productivity. Compile a report highlighting if this is being achieved, provide relevant calculations in compiling this report. $(15)$

He has the following data representing a month from last year and an equivalent month this year:

Units produced

Labour $($hours$)$

Resin $($Kilograms$)$ Capital invested $($rands$)$ Energy $($watts$)$

Last Year Now

$200020003002755045$

R$10000$

$30002850$

R$10000$

The costs have been determined to be as follows. Labour R$10$ per hour,

Resin R$5$ per kilogram

Capital $1\%$ per month of investment. Energy R$0\mathrm{.}50$ per watt

$1\mathrm{.}2$ In the context of operations management, analyze the concept of competing on cost for an operations manager. Utilize relevant examples

to illustrate the range of decisions that must be applied within this scope. $(15)$