What is operations strategy?
The content of the operations strategy
The process of the operations strategy
Substitutes for strategy
In a world, where humans do their best to survive, a never ending need for goods and services is always in people`s mind. In order to meet with these requirements, raw materials and processes should be organised and managed. In other words, `operations` is needed so that resources can be worked on to obtain products. Operations strategy has become a basic thing for organizations. In order to survive in the business world, strategies must be designed and the objectives of each operations should be indicated. Essential thing that every operations of organizations is produce either goods or services. Sometimes both goods and services should be produced in order to satisfy customers. Every organization regardless of their type has an operation function (Slack , N. and Lewis, M., 2008).
What is operations strategy?
`Operations` can be described as the act of management of inputs such as resources and transformation of these inputs into outputs such as goods and services. During these procedures a strategy should be followed. By doing these sequences of actions, inputs (resources) transforms into outputs (goods and services) and this is called the `input-transformation-output` model of operations (Slack N. and Lewis M., 2008). In figure 1.1 an illustration, which is adapted from Meredith and Shafer (2010), of production scheme of operations is shown. In this system, three stages must take place in order to obtain outputs from inputs. These stages are, as in the order of its use, strategy, inputs and transformation process. During these, environmental factors have effects on the whole process. Therefore, a control mechanism should be applied on the whole process.
Figure 1: The Production System (Meradith, Jack R. and Shafer, Scott M., 2010) As it can be seen on the figure 1.1, operations produce two types of outputs at the end of the process which are facilitating goods and services. Carmona and Sieh (2004) state that: `facilitating goods is the material bought or used by the costumer for example food items. Furthermore facilitating goods can be defined the things that provided by the costumers themselves such as medical history. ` On the other hand services considered as benefits. And these benefits may be either tangible or intangible; moreover, they can be escorted with facilitating goods (Meradith, Jack R. and Shafer, Scott M., 2010). In the figure 1.2 a visual is shown to demonstrate the differences between products and services (Meradith, Jack R. and Shafer, Scott M., 2010).
Figure 2: The relation between products and services (Meredith, J.R., 2010) Strategy
Although, strategy has a well-known meaning in the military the situation in the business world is not the same. In the business world there are, in fact, many answers to this questions since there is no an actual statement about what it really means. Out of many ideas about the meaning of strategy, Johnson et al. (2005) proposed the widely accepted definition of strategy which is ` Considering the long-term organizations, strategy is the path and choices of organization and through its pattern strategy must have the objective to help its organization to succeed in its markets. ` The path of a strategy should be planned in general. A strategy must concern about long-term aims and work on the big picture rather than details. While considering and planning the route of an organization, strategy consists of three features and these features have an interaction between them. These three elements are the organization`s objectives, its internal forces and its external forces. The interaction of these elements can be seen in figure 1.3 which is...
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