Assessment Task 1: Operations Report
Many people enter the business world in the hope of gaining a profit. They can produce a good or provide a service to the many consumers around them. However, in the aim of yielding profits, operations managers understand and are very well aware that the business cannot be run from sheer blindness, but with careful planning and direction which will allow them to reach this goal. In doing so and especially as the business matures, they face many influences, like challenges, which operations managers are forced to devise strategies in order to respond and effectively manage to these influences. They can be: globalisation, technology, quality expectations, cost-based competition, government policies, legal regulations, environmental sustainability and corporate social responsibility. Cost Leadership Strategy
In response to cost-based competition, businesses have begun incorporating the cost leadership approach to their operations processes. Here, they aim to lower costs as much as possible in order to have the lowest prices while still being able to uphold profit levels. Once operations managers select a strategic choice which they believe will be the most appropriate for the cost-based competition, they implement this in their processes which will allow the business to gain that competitive advantage. Strategies to lessen costs may be: purchasing the latest manufacturing technologies, reducing the service, product research and development and sales costs, having strict control over production and constructing efficient-scale facilities. Evidence of Effectiveness of Cost Leadership used by Adidas
Adidas is an example of a transnational corporation which has taken advantage of cost leadership in response to the cost-based competition which has posed a threat to the business. In the Adidas case study, it has informed that the global business has ensured cost leadership through lessening the costs associated with production and...
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