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Operational Approaches Essay

1517 words - 6 pages

Supply Chain Page PAGE 7 of NUMPAGES 7
Week 5 - Operational ApproachesISCOM 370 - Strategic Supply Chain ManagementOperational ApproachesOperations strategy is concerned with setting broad policies and plans for using the resources of a firm to best support its long-term competitive strategy. A firm's operations strategy is comprehensive through its integration with corporate strategy. The strategy involves a long-term process that must foster inevitable change. An operations strategy involves decisions that relate to the design of a process and the infrastructure needed to support the process. Process design includes the selection of appropriate technology, sizing the process over time, the role of inventory in the process, and locating the process. The infrastructure decisions involve the logic associated with the planning and control systems, quality assurance and control approaches, work payment structures, and organization of the operations function. Operations strategy can be viewed as part of a planning process that coordinates operational goals with those of the larger organization. Since the goals of the larger organization change over time, the operations strategy must be designed to anticipate future needs. A firm's operations capabilities can be viewed as a portfolio best suited to adapt to the changing product and or service needs of the firm's customers.In the business world, organizations have to compete with companies that produce similar goods. To be successful against the competition, an organization must have a competitive strategy. Without a competitive strategy, the company would have a difficult time in competing successfully for the duration. The strategy of an operation is based on how the competitive environment is changing and what the business needs to do in order to meet the future and current challenges. The development for a business of the operations processes and human resources has to be on a platform that would give the business a leading edge. Once the company has a clear understanding of the direction they are heading, then the company can have a more competitive organizational strategy.It is recognized the monumental advantage held by a business that can produce a product at the lowest unit cost in its industry, while at the same time, creating such differentiation that its product commands a premium price in the market. Obviously, such an organization is the envy of its competitors in terms of profitability, which is the position of manufacturers who have mastered pull production (Johnson and Bröms, 2000). Fundamentally, pull production achieves low cost by completing production at the rate of customer demand, and as a result of the discipline required for such pacing of production, commonly generates differentiation in the form of improved quality and reduced cycle times (Womack, Jones and Roos, 1999; Womack and Jones, 1999; Johnson and Bröms, 2000). Some exemplars of pull production even...

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