2. According to slack and lewis ‘’operation strategy is the
total pattern of decisions which shape the long term
capabilities of any type of operations and their
contribution to the overall strategy, through the
reconcilliation of market requirements with operations
resources’’
3. Building operations strategy on competitive
priorities:
Operation strategy should be linked with
business strategy. On the other hand , the business
strategy should take into account the realities of
strength and weakness of production. Likewise
operation strategy must be consistent with business
strategy and formulated to support the goals of
business organization .
4. In 1970’s and early 80’s operation strategy was
neglected. Late 80’s and early 90’s many companies
developed the strategies that have quality and time as
their major concern.
Strategy formulation: To formulate an effective
strategy the distinctive competencies are taken into
account. The factors that could have either positive or
negative effect on the firm must be critically
examined(SWOT analysis)
5. In formulating a successful strategy, a firm must take
into account both order qualifiers and order winners.
Examples of distinctive competencies;
Dimensions Competencies
Price Low cost
Quality High perfomance design, high
quality
Time Rapid delivery
Flexibility Variety, volume
Service Superior customer service
Location convenience
6. Even though firms have tended to emphasise
traditional strategies based on cost minimisation or
product differentiation, many firms are now adopting
strategies based on quality and time.
Quality based strategy
Time based strategy
7. Elements of operation strategy:
1.Positioning the production system:
The two basic types of product design are custom
and standard
2.Focus of factories & service facilities: According to
wickham skinner, “a factory that focuses on a narrow
product mix for a particular market niche will out
perform the conventional plant, which attempts a
broader mission”
8. 3.Product/service design & development:
The activities in operation, Marketing &
engineering functions related to product/service design
& development are intense as the new product/service
are developed.
4. Technology selection and Process development:
Combining high- technology equipment with
conventional equipment and devising affective overall
production schemes are indeed challenges.
9. 5. Allocation of resource to Strategic alternatives:
Cash and capital funds, capacity, works,
engineers, machines, materials, and other resources
are available in varying degrees for each firm. Because
for most companies the vast majority of the firms
resources are used in production/operations.
10. 6.Facility plans: Capacity, location and layout:
How to provide the long-range capacity to produce
the products/services for a firm is crucial part of
setting the operations strategy. Land may need to be
purchased, specialized technologies may have to be
developed, new equipment may need to be made or
purchased and installed.
