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Operation Strategy Elements

In: Business and Management

Submitted By shafeeqalitk
Words 490
Pages 2
1) According to Slack and Lewis, operations strategy holds the following definition
“Operations 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 reconciliation of market requirements with operations resources”
Operations strategy is a long range business plan for the company’s and which will provide road map to the operations functions to be pursued.
Elements of operation strategy
Operations strategy comprises six components: 1) Designing of the production system 2) Facilities for production and services 3) Product or services design and development 4) Technology selection, development and process development 5) Allocation of resources 6) Focus on facilities planning

1. Designing of the production system

It involves selecting the product design, the production system and the inventory policy for the finished goods for each product line.
A). Product Focused (Customized Design): Generally employed in mass production organizations, where there are groups of machine, tools and workers arranged according to their respective tasks in order to put together a product.

B).Process Focused (Standard Design):
It is designed to support production departments that perform a single task like painting or packing. These systems are highly flexible and can easily be modified to support other product design.

2. Facilities for production and services

Certain specialization in production allows the firm to provide its customers with products of lower cost, faster delivery, on time delivery, high product quality and flexibility. Here, the overheads are less and the firm really can compete with the main players in the market.

3. Product or services design and development

The New Product Development process is often referred to as the Stage-Gate innovation process. Following are the stages of product development.
Step 1: Generating the idea
Step 2: Creating the feasibility report
Step 3: Testing the Concept
Step 4: Business Analytics
Step 5: Marketability Tests
Step 6: Technicalities and Product Development
Step 7: Commercialize
Step 8: Post Launch Review and Perfect Pricing

4. Technology selection and process development:
Every step in the process of production is planned in detail. The technology to be used in the production process is selected from range of options 5. Allocation of resources to strategic alternatives-
Production companies have to continuously deal with the problem of scarce resources like capital, machine and materials and so on. As these resource inputs are vital to production activities, their shortages can influence production performance significantly. Hence the operation manager has to plan the optimal use of resources, both in terms of minimizing wastage, and in terms of their allocation to the best strategic use.
6. Facility planning.
Setting up production facilities with adequate capacity involves massive initial investment.
Strategically right options should be carefully weighed against all available alternatives. These decisions also influence the future decisions on probable capacity expansions plans.
Operation managers also make decisions, i.e. decision on internal arrangement of workers and department within the facility…...

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