Operations and Supply Strategy

What is Operations and Supply Strategy?

Operations and supply strategy is concerned with setting broad policies and plan for using the resources of a firm to best support its long-term competitive strategy.

Competitive Dimensions

•Cost or Price

–Make the Product or Deliver the Service Cheap

•Quality

–Make a Great Product or Deliver a Great Service

•Delivery Speed

–Make the Product or Deliver the Service Quickly

•Delivery Reliability

–Deliver It When Promised

•Coping with Changes in Demand

–Change Its Volume

•Flexibility and New Product Introduction Speed

            --Change it

•Other Product-Specific Criteria

            --Support it.

Dealing with Trade-offs

For example, if we reduce costs by reducing product quality inspections, we might 

         reduce product quality.

If we improve customer service problem solving by cross-training personnel to deal  with a wider-range of problems, they may become less efficient at dealing with  commonly occurring problems. 

                                      

                       

Order Qualifiers and Winners Defined

Order qualifiers are the basic criteria that permit the firms products to be considered as candidates for purchase by customers

Order winners are the criteria that differentiates the products and services of one firm from another 

What is Productivity? Defined

Productivity is a common measure on how well resources are being used. In  the broadest sense, it can be defined as the following ratio: 

Outputs

  Inputs

Total Measure Productivity

Total Measure Productivity = Goods and services produced

                                                              All resources used

Partial measures of productivity =

Output or   Output or Output    or    Output

Labor         Capital      Materials        Energy   

  

Operation Management

1. Introduction to the Field
2. Operations and Supply Strategy
3. Project Management
4. Product Design
5. Strategic Capacity Management
6. Quality Management
7. Supply Chain Strategy

Introduction to the Field

OBJECTIVES 

•What is Operations and Supply Management?

•Why Study Operations Management?

•Transformation Processes Defined

•Differences between Services and Goods

•The Importance of Operations Management

•Historical Development of OM

•Current Issues in OM

Operations and Supply Management (OM) is defined as the design, operation, and improvement of the systems that create and deliver the firm’s primary products and  services.

A transformation process is defined as a user of resources to transform inputs into some desired outputs.

Transformations

•Physical--manufacturing

•Locational--transportation

•Exchange--retailing

•Storage--warehousing

•Physiological--health care

•Informational--telecommunications

•“If you drop it on your foot, it won’t hurt you.” (Good or service?)

•“Services never include goods and goods never include services.”  (True or false?)

•Historical Development of OM

•JIT and TQC

•Manufacturing Strategy Paradigm

•Service Quality and Productivity

•Total Quality Management and Quality Certification

Historical Development of OM (cont’d)

•Business Process Reengineering

•Six-Sigma Quality

•Supply Chain Management

•Electronic Commerce

•Service Science

Current Issues in OM

•Coordinate the relationships between mutually supportive but separate organizations.

•Optimizing global supplier, production, and distribution networks.

•Increased co-production of goods and services

Current Issues in OM (cont’d)

•Managing the customers experience during the service encounter

•Raising the awareness of operations as a significant competitive weapon