Operations management is defined as “the activity of managing the resources which produce and deliver products and services” (Slack et al. 2010 p4). This encompasses the entire activity carried out within the organization. With increasing pressure on organizations to deliver optimally at reduced cost, the role of operations has been transformed from that of strategy implementer to one of strategy driver. Operations strategy looks at the patterns of strategic decisions and actions in a bid to set the roles, objectives and activities of the operations (Slack et al. 2010). An understanding of these strategies is important in ensuring that organizations are well aware of the requirements needed to meet the corporate objectives set about by management. The report looks at a case study of Concept design services (CDS); a product based manufacturing company looking to break into service operations. It seeks to identify current strategy types evidenced in the organization and the role operations play in the implementation of this strategies. Also considered is the relationship between the core functions highlighting possible conflicts, current practices and perceived strengths and weaknesses. Issues such as servitization and growth strategies are considered in relation to the companies push for development in line with its desire to become a service provider. An analysis of the impact it will have on the company’s manufacturing and service departments is also considered. Finally, recommendations that will ensure operations develop with the new growth plan is presented to management.
2.0 STRATEGIES IN CONCEPT DESIGN
Within CDS, there is evidence of an amalgamation of strategies. With a diversification of the company’s portfolio, the corporate strategy of the organization had to be reflecting the changing scenario of the business environment. To identify the different strategy types within CDS, there is first a need to understand what strategy is.
Strategy can be defined has “the total pattern of decisions and actions that position the organization in its environment and that are intended to achieve its long-term goals” (Slack et al. 2010 P79). Strategy has also been described as the long term direction an organization intends to go (Johnson et al. 2011). In achieving an over arching strategy, three levels of strategies have to be considered; corporate level, business level and operational level. The formulation of these strategies will determine how the different organizational strategies will interact with one another (Zanon et al. 2013) While corporate level strategy deals with the overall purpose and scope of an organization such as where to locate the business, what type of business to engage in; business level strategy is more concerned with the various ways the business can compete successfully against other competitors in its segment. Functional strategy looks at ways in which individual functions can contribute to the overall objective of the organization.
Operations strategy is concerned with the strategic decision and actions that set roles, objectives and activities of the operations (Slack et al. 2010). It focuses more on how the different parts of the organization can deliver on set strategies through the management of resources, processes and people. Operations strategy’s primary role is to implement strategy, but with continuous business growth, operations is expected to support and drive the organizations strategy. This will see it contributing to the competitive advantage of the firm (Slack et al. 2010). This is aptly captured in Hayes and wheelwrights four stage model of operations contribution.
Figure 1. Hayes and Wheelwrights four-stage model of operations contribution. Adapted from Slack et al. 2010
Slack et al. (2010), identified four different perspective to operations strategy; Top-down, bottom up, market requirement perspective and resource based...
References: BAINES, T., LIGHTFOOT, H. and SMART, P., 2011. Servitization within manufacturing. Exploring the provision of advanced services and their impact on vertical integration. Journal of Manufacturing Technology Management, 22(7), pp. 947-954
BAINES, T. and LIGHTFOOT, H.W., 2014. Servitzation of the manufacturing firm. Exploring the operations practices and technologies that deliver advanced services. International Journal of Operations & Production Management, 34(1), pp. 2-35
BARNEY, J., 1991
CALANTONE, R., DROGE, C. and VICKERY, S., 2002. Investigating the manufacturing -market interface in new product development. Journal of Operations Management, 20, pp. 273-287
CLULOW, V., BARRY, C. and GERSTMAN, J., 2007. The resource-based view and value: the customer-based view of the firm. Journal of European Industrial Training, 31(1), pp. 19-35
JOHNSTON, R., 1999. Service Operations Management: return to roots. International Journal of Operations & Production Management, 19(2), pp. 104-124
LIGHTFOOT, H., BAINES, T. and SMART, P., 2013. The servitization of manufacturing . A systematic literature review of interdependent trends. International Journal of Operations & Production Management, 33(11/12), pp. 1408-1434
LOWSON, R.H., 2002
MILLER, A. and DESS, G.G., 1993. ASSESSING PORTER 'S (1980) MODEL IN TERMS OF ITS GENERALIZABILITY, ACCURACY AND SIMPLICITY. Journal of Management Science, 30(4), pp. 553-585
PRASAD, S., BABBAR, S. and MOTWANI, J., 2001. International operations strategy: current efforts and future directions. International Journal of Operations & Production Management, 21(5/6), pp. 645-665
RAMASESHAN, B., ISHAK, A
SOUTHARD, P.B. and SWENSETH, S.R., 2003. Transitioning operations to accommodate growing pains in evolving companies: an application of product profiling to a service company. Management Decision, 41(6), pp. 578-586
Please join StudyMode to read the full document