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Operation strategy ppt

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Operation strategy ppt

  1. 1. Role and development of operation strategy<br />
  2. 2. DEVELOPMENT OF OPERATION STRATEGY<br />
  3. 3. Develop an Operations Strategy<br />-What products can be produced in which facility and how much?<br />-Which products are going to be produced internally, and which ones will be purchased?<br />-How many facilities are needed?<br />
  4. 4. Develop an Operations Strategy<br />-Where will the facilities be located, with how much capacity?<br />-What type of processes will be utilized to produce products?<br />-How much flexibility is required from each process and each product?<br />
  5. 5. Develop an Operations Strategy<br />-What level of technology (automation, etc.) will be used?<br />-Are the resources going to be owned or bought?<br />-How will the products be distributed to the end customers?<br />
  6. 6. Develop an Operations Strategy<br />-Which suppliers will provide materials, and how much?<br />-What kind of human skills are needed?<br />-And so on.<br />
  7. 7. Develop an Operations Strategy<br />Operations decisions given regarding these issues must be consistent with the firm’s corporate strategy.<br />These decisions made by operations managers are going to be viewed in detail throughout this course.<br />
  8. 8. OPERATIONS STRATEGY<br />
  9. 9. ROLE OF OPERATION STRATEGY<br />
  10. 10. Operations’ Role in Corporate Strategy<br />Operations provides support for a differentiated strategy<br />Operations serves as a firm’s distinctive competence in executing similar strategies better than competitors<br />Copyright 2006 John Wiley & Sons, Inc.<br />2-10<br />
  11. 11. Operations Strategy at Wal-Mart<br />Copyright 2006 John Wiley & Sons, Inc.<br />2-11<br />
  12. 12. Operations Strategy: Products and Services<br />Make-to-Order<br />products and services are made to customer specifications after an order has been received<br />Make-to-Stock<br />products and services are made in anticipation of demand<br />Assemble-to-Order<br />products and services add options according to customer specifications<br />Copyright 2006 John Wiley & Sons, Inc.<br />2-12<br />
  13. 13. Operations Strategy: Human Resources<br />What are the skill levels and degree of autonomy required to operate production system?<br />What are the training requirements and selection criteria?<br />What are the policies on performance evaluations, compensation, and incentives?<br />Will workers be salaried, paid an hourly rate, or paid a piece rate?<br />Will profit sharing be allowed, and if so, on what criteria?<br />Copyright 2006 John Wiley & Sons, Inc.<br />2-13<br />
  14. 14. Operations Strategy: Human Resources (cont.)<br />Will workers perform individual tasks or work in teams?<br />Will they have supervisors or work in self-managed work groups?<br />How many levels of management will be required?<br />Will extensive worker training be necessary?<br />Should workforce be cross-trained?<br />What efforts will be made in terms of retention?<br />Copyright 2006 John Wiley & Sons, Inc.<br />2-14<br />
  15. 15. Operations Strategy: Quality<br />What is the target level of quality for our products and services?<br />How will it be measured? <br />How will employees be involved with quality?<br />What will the responsibilities of the quality department be? <br />Copyright 2006 John Wiley & Sons, Inc.<br />2-15<br />
  16. 16. Operations Strategy: Quality (cont.)<br />What types of systems will be set up to ensure quality? <br />How will quality awareness be maintained?<br />How will quality efforts be evaluated?<br />How will customer perceptions of quality be determined? <br />How will decisions in other functional areas affect quality?<br />Copyright 2006 John Wiley & Sons, Inc.<br />2-16<br />
  17. 17. Operations Strategy: Sourcing<br />Vertical Integration<br />degree to which a firm produces parts that go into its products<br />Strategic Decisions<br />How much work should be done outside the firm? <br />On what basis should particular items be made in-house?<br />When should items be outsourced?<br />How should suppliers be selected?<br />Copyright 2006 John Wiley & Sons, Inc.<br />2-17<br />
  18. 18. Operations Strategy: Sourcing (cont.)<br />What type of relationship should be maintained with suppliers?<br />What is expected from suppliers?<br />How many suppliers should be used?<br />How can quality and dependability of suppliers be ensured?<br />How can suppliers be encouraged to collaborate?<br />Copyright 2006 John Wiley & Sons, Inc.<br />2-18<br />
  19. 19. THANK YOU<br />

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