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more important than ever and... the bar is getting higher Better quality, higher productivity, lower costs, and the ability to respond quickly to customer needs are what and what is getting higher Competitiveness: How effectively an organization meets the wants and needs of customers relative to others that offer similar goods or services through some combination of their marketing and operations functions Organizations compete how? 3 factors demonstrating marketing's influence Identifying consumer wants and/or needs Pricing Advertising and promotion Product and service design Cost Location Quality Quick response Flexibility Inventory management Supply chain management Service Managers and workers businesses compete using what 10 key operations? reasons why some organizations go splat... Neglecting operations strategy Failing to take advantage of strengths and opportunities Failing to recognize competitive threats Too much emphasis in product and service design and not enough on improvement Neglecting investments in capital and human resources Failing to establish good internal communications and cooperation Failing to consider customer wants and needs 1. mission 2. goals 3. organizational strategies 4. functional strategies 5. tactics list the 5 steps of hierarchical planning: Mission The reason for an organization's existence Mission statement States the purpose of the organization "What business are we in?" The mission statement should answer the question of what? the basis for organizational goals The mission statement serves as what? Goals Provide detail and the scope of the mission destinations Goals can be viewed as organizational what? organizational strategies Goals serve as the basis for what? Strategy A plan for achieving organizational goals strategy what serves as a roadmap for reaching the organizational destinations? Organizational strategies Functional level strategies Organizations have what 2 types of strategies? Organizational strategies -Overall strategies that relate to the entire organization -Support the achievement of organizational goals and mission Functional level strategies Strategies that relate to each of the functional areas and that support achievement of the organizational strategy Tactics The methods and actions taken to accomplish strategies The "how to" part of the process Operations The actual "doing" part of the process Core Competencies The special attributes or abilities that give an organization a competitive edge strategies To be effective core competencies and what need to be aligned? Core competencies Environmental scanning (SWOT) "Effective" strategy formulation requires taking what into account: (2) Order qualifiers Order winners "Successful" strategy formulation also requires taking what into account: (2) Order qualifiers Characteristics that customers perceive as minimum standards of acceptability to be considered as a potential purchase Order winners Characteristics of an organization's goods or services that cause it to be perceived as better than the competition Internal Factors External Factors Environmental Scanning is necessary to identify what 2 things? Hint: think SWOT analysis. Internal Factors Strengths and Weaknesses External Factors Opportunities and Threats are all key external factors Economic conditions Political conditions Legal environment Technology Competition Markets are all key internal factors Human Resources Facilities and equipment Financial resources Customers Products and services Technology Suppliers Operations strategy The approach, consistent with organization strategy, that is used to guide the operations function. Quality-based strategy Strategy that focuses on quality in all phases of an organization Trying to overcome a poor quality reputation Desire to maintain a quality image A part of a cost reduction strategy Pursuit of a quality-based strategy is rooted in a number of factors: list 3 Time-based strategies Strategies that focus on the reduction of time needed to accomplish tasks reducing time; Time-based strategies It is believed that by what, costs are lower, quality is higher, productivity is higher, time-to-market is faster, and customer service is improved --as stated by what strategy? Areas where organizations have achieved time reductions: Planning time Product/service design time Processing time Changeover time Delivery time Response time for complaints Agile operations A strategic approach for competitive advantage that emphasizes the use of flexibility to adapt and prosper in an environment of change Cost Quality Reliability Flexibility agile operations involves the blending of several core competencies: list 4 The Balanced Scorecard Approach A top-down management system that organizations can use to clarify their vision and strategy and transform them into action Develop objectives Develop metrics and targets for each objective Develop initiatives to achieve objectives Identify links among the various perspectives Monitor results according to the balanced scorecard approach, what 5 things must one do? Finance Customer Internal business processes Learning and growth Identifying links among the various perspectives involves what 4 things? Productivity A measure of the effective use of resources, usually expressed as the ratio of output to input Tracking an operating unit's performance over time Judging the performance of an entire industry or country Productivity measures are useful for what? higher standards of living (As an economy replaces manufacturing jobs with lower productivity service jobs, it is more difficult to maintain high standards of living) High productivity is linked to what competitive advantage in the marketplace Higher productivity relative to the competition leads to what? high relative productivity For an industry, what makes it less likely it will be supplanted by foreign industry? output / input how do you calculate productivity? [(current productivity - previous productivity) / previous productivity] X 100% how do you calculate productivity growth? It involves intellectual activities It has a high degree of variability Service sector productivity is difficult to measure and manage why? (2 reasons) process yield A useful measure related to productivity is: 1. methods 2. quality 3. management 4. technology 5. capital list the 5 factors affecting productivity: Develop productivity measures for all operations Determine critical (bottleneck) operations Develop methods for productivity improvements Establish reasonable goals Make it clear that management supports and encourages productivity improvement Measure and publicize improvements (FYI--Don't confuse productivity with efficiency) list the 6 steps for improving productivity bottleneck The operation with the least capacity : Improving the efficiency of any other operation in the process, other than the bottleneck, will NOT improve the efficiency of the system state the Rule of Bottlenecks: