Operations Strategy
An operations strategy focuses on specific capabilities of the operation that give the company a competitive edge. Factors used in developing an operations strategy includes:
Cost Competition is used when a company uses cost as a strategy by offering a product at a low price relative to the prices of competing products.
Take for example: Wal-Mart, this company is cost competitive often outsourcing their labor to impoverished countries that are willing and able to make any product for mere pennies, despite unfair working environment, health hazards, long working hours and low wages. As a result of their questionable business practices, Wal-Mart is able to offer the lowest possible prices to consumers and truly has an absolute advantage on a cost/price strategy.
Quality Strategy is a competitive priority focusing on the quality of goods and services. There are two dimensions of quality:
High-Performance Design which focuses on the aspects of quality such as superior features, close tolerances, high durability and excellent customer service.
The best example of a company who who excels in customer service is Nordstrom. Their easygoing return policy offers full refunds regardless of the item being returned and the continual commitment to customer satisfactions what earned this company the #1 ranking in customer service.
Goods and Services Consistency measures how often the goods or services meet the exact design specifications.
Starbucks is an excellent example of a company that uses the Goods and Services Consistency approach. Their Tall, Grande and Venti sizes are used as global terms to order a latte, espresso, frappuccino, etc. In addition, their staff is required to train a minimum of 40 hours in order to learn how to meet their customers exact coffee demands.
Time or Speed is a competitive strategy that focuses on speed and on-time delivery. Making time a competitive priority means competing based on all time related issues such as: rapid delivery
Cost Competition is used when a company uses cost as a strategy by offering a product at a low price relative to the prices of competing products.
Take for example: Wal-Mart, this company is cost competitive often outsourcing their labor to impoverished countries that are willing and able to make any product for mere pennies, despite unfair working environment, health hazards, long working hours and low wages. As a result of their questionable business practices, Wal-Mart is able to offer the lowest possible prices to consumers and truly has an absolute advantage on a cost/price strategy.
Quality Strategy is a competitive priority focusing on the quality of goods and services. There are two dimensions of quality:
High-Performance Design which focuses on the aspects of quality such as superior features, close tolerances, high durability and excellent customer service.
The best example of a company who who excels in customer service is Nordstrom. Their easygoing return policy offers full refunds regardless of the item being returned and the continual commitment to customer satisfactions what earned this company the #1 ranking in customer service.
Goods and Services Consistency measures how often the goods or services meet the exact design specifications.
Starbucks is an excellent example of a company that uses the Goods and Services Consistency approach. Their Tall, Grande and Venti sizes are used as global terms to order a latte, espresso, frappuccino, etc. In addition, their staff is required to train a minimum of 40 hours in order to learn how to meet their customers exact coffee demands.
Time or Speed is a competitive strategy that focuses on speed and on-time delivery. Making time a competitive priority means competing based on all time related issues such as: rapid delivery