Operations strategy can be defined as the strategic decisions and tactics which set the role, objectives and activities of a firm. It derives from the firm’s capabilities, resources and processes, seeking to deliver competitive advantage to winning customers through meeting their needs. Competitive factors that are significant in winning customers’ business are order winners. Improvements of these factors will likely result in gaining more business to the firm. In order for a firm to have a competitive advantage, it must understand and provide products and services whose factors create order winners for its customers. As a precursor, factors which customers have a certain minimum expected level from are defined as order qualifiers that firms should conform to. Therefore business decisions should be thought of in terms of order winning and order qualifying criteria, designed to win customers and drive business growth to the firm.
A firm can outperform rivals only if it can establish a difference that it can preserve. This could be delivering great value to customers or creating comparable value at a lower cost, or both. Such differentiation arises from both the choice of performance objectives activities and how they are performed, or deliberately choosing a different set of activities to deliver a unique mix of value or perform similar operational activities better than rivals.
Operations managers should decide on which of the sub-dimensions of these five performance objectives (Figure 1) they wish to excel at, and how they are going to configure the operation to do so.
Figure 1: The Multiple Dimensions of the
Five Operations Performance Objectives
The goal of this paper is to investigate and compare operations strategies of two manufacturing-based and two service-based companies. The paper takes an integrated evaluation approach of each firm’s prioritised performance objectives from a requirements and operations capability point of view, as well as focusing on line of fit strategy and tactics to achieve competitive advantage through examining their process design, capabilities management and resources management.
Table of Contents
1. Introduction
2. Chosen organisations
2.1. Primark
2.2. CenterParcs
2.3. Swatch
2.4. Toyota
3. Summary of chosen companies
4. Service Companies: Primark and CenterParcs
4.1. CenterParcs
4.2. Primark
5. Comparison of Service companies Performance Objectives:
6. Manufacturing Companies: Swatch and Toyota
6.1. Swatch
6.2. Toyota
7. Conclusion
Research Objectives and Themes
The primary objective of this assignment is to investigate and compare the operations strategies of two manufacturing companies and two service-based companies, analyzing how they prioritize performance objectives and align their tactics to achieve competitive advantage.
- Operations strategy formulation and performance objectives
- Competitive advantage through process design and resource management
- Comparison of "order winners" vs. "order qualifiers" in diverse industries
- Strategic alignment between human resources and operational processes
- Analysis of cost leadership, flexibility, and quality management
Excerpt from the Book
Toyota
Toyota has always been synonymous with efficiency due to their operations strategy that focus on process design rather than on product to achieve quality as a main order winner (Surowiecki, 2008). Through a combination of best in class operations efficiency tactics and advanced technical innovations in building quality cars for low cost, their cars are highly durable with good product features that are fully conformant with latest safety standards, providing added value for money to consumers. Toyota car quality consistently ranks near the top of customer satisfaction surveys. For example, Toyota was ranked 4th in JD Power’s 2009 Dependability study higher than its competitors and way above industry average, with 7 models ranking high among competing models (Figures 8 & 9). (autoblog, 2009)
Emulating Toyota winning quality isn’t about copying one practice or technology it’s about creating a culture. At Toyota, HR and Operations interlock in a unique way (Takeuchi et al., 2008). Toyota stands out from competitors such as GM and Honda in its unique continuous learning culture that is based on basic principles of trust, mutual prosperity, and excellence. Believing that motivated people become committed to building high-quality products, Toyota’s HRM strategy revolves around building and maintaining quality people through a four stage process in a good environment: Attract Develop, Engage and Inspire. (Liker et al., 2007)
Summary of Chapters
Introduction: Defines operations strategy as the set of strategic decisions that set the role and objectives of a firm to achieve competitive advantage through order winners.
Chosen organisations: Introduces the four companies under study (Primark, CenterParcs, Swatch, Toyota) and highlights their market positions.
Summary of chosen companies: Provides a comparative overview of the organizations across key metrics like employees, turnover, and operational priorities.
Service Companies: Primark and CenterParcs: Analyzes how these firms manage demand fluctuations and leverage infrastructure and service design as order winners.
Comparison of Service companies Performance Objectives:: Uses radar graphs to visualize and contrast the performance objective priorities between the two service companies.
Manufacturing Companies: Swatch and Toyota: Examines how these companies use innovation, radical automation, and lean production to maintain cost and quality advantages.
Conclusion: Synthesizes the findings, emphasizing that competitive advantage is sustained through the fit among interlocked activities and specific consumer needs.
Key Keywords
Operations Strategy, Order Winners, Competitive Advantage, Performance Objectives, Supply Chain, Lean Production, Process Design, Capacity Management, Cost Leadership, Quality Assurance, Service Strategy, Manufacturing Efficiency, Toyota Production System, Market Positioning, Resource Management
Frequently Asked Questions
What is the primary focus of this assignment?
The assignment explores how four specific companies—Primark, CenterParcs, Swatch, and Toyota—utilize operations strategies and tactics to maintain market leadership.
What is the difference between "order winners" and "order qualifiers"?
Order qualifiers are the minimum standards a firm must meet to participate in a market, while order winners are the factors that directly contribute to customers choosing a firm's product or service over rivals.
What is the central research question?
The paper asks how manufacturing and service companies prioritize their performance objectives and align their operational tactics to secure a competitive advantage.
Which methodology is applied to the analysis?
The author uses an integrated evaluation approach, comparing firm-specific performance objectives, process designs, and capabilities against industry standards and requirements.
What does the main body of the work cover?
The main body conducts a comparative analysis of service-based firms (Primark, CenterParcs) and manufacturing-based firms (Swatch, Toyota), utilizing data and performance radar graphs.
Which keywords characterize this research?
Key terms include Operations Strategy, Competitive Advantage, Order Winners, Lean Production, and Capacity Management.
How does Toyota maintain its competitive edge in the car market?
Toyota relies on a continuous learning culture, the Toyota Production System (TPS), and a focus on process design to achieve high quality and low costs.
What strategy does CenterParcs use to manage demand?
CenterParcs employs a "chase demand" strategy and yield management systems to optimize room occupancy and revenue during varying seasonal demand.
- Quote paper
- MBA Mo Elnadi (Author), 2009, Production and Operations Management Assignment, Munich, GRIN Verlag, https://www.grin.com/document/129763
