Most of the slides of this part of the lecture

Transcript:Most of the slides of this part of the lecture:
Most of the slides of this part of the lecture were prepared over my teaching lifetime based on the material that I have learned & benefited from this book Ardavan Asef-Vaziri Operations Strategy There’s nothing here to take by storm; to strategy we must conform. Johann Wolfgang von Goethe (Faust,1808) Competitive Strategy Principle 1 (Value Maximization). The goal of strategy is to maximize the long run NPV of the organization. It is not a pure NPV defined for stockholders (economical sustainability), it also considers stakeholders (social sustainability), as well as environmental impact (environmental sustainability). These are the three pillars of sustainability. Competitive strategy (Business Unit strategy). Relates a company to its environment. Strengths and Weakness of the system (the company) to be related to Opportunities and Threats in the environment. Chooses an attractive competitive position  by offering a high customer value proposition (CVP). Competitive Strategy- Efficiency and Differentiation Supply Chain Strategy- Efficiency and Responsiveness – Resilience and Sustainability. Link Product attributes to process capabilities. Competitive Strategy: Environmental Scanning (Opportunities and Threats) Competitor activities. Complementor activities. Changes in consumer needs and preferences. Technological changes. Economic trends (GNP, unemployment, inflation, interests, taxes, tariffs). Legal, political, and environmental issues. Competitive Strategy: Competing Edges of the System (Strengths and Weaknesses) Human Resources (cheap labor, skilled labor, etc.) Technology, Facilities, and Equipment Financial Resources Customers Product and Services Suppliers (low material cost, reliable suppliers) Management Practices (low overhead) Competitive Strategy: Financial, Marketing, and Operations Strategy Competitive Strategy Financial Strategy Source of financial resources. Use of funds (how invested). Marketing and Sales Strategy How the market will be segmented. How the product will be positioned and promoted Operations Strategy Enabling the execution of the competitive strategy. How to best deliver the Customer Value Proposition (CVP). What Resources. What Processes What Competencies. How to Match Product Attributes (CVP) with Process Competencies Operations Strategy: Resources View Organization is a bundle of real recourses. Real Resources Tangible real resources: human resources (people) and capital resources (property, plant and equipment). Intangible resources: relationships with suppliers or customers, reputation and brands, technology and know how. To pay for the real resources, sell pieces of paper; financial resources; securities. Operations Strategy: Resources View How many resources should we invest in? The capacity, in aggregate and per main resources. When should we increase/reduce resources over time? The availability of capacity and the timing of capacity. What kinds of resources? The balance of