Operation Strategy and the Factors Affecting Operation Strategy - Essay Example

Full topic and Section # of Operation Strategy and the Factors EffectingOperation Strategy: Operation strategy is the collection of concrete actions that are choosing keeping in mind the corporate strategy that a firm or an organization is following. They involve basically the operation aspects of the strategy which are chosen or mandated keeping in mind the overall position the business wants to be in. operations strategy is concerned with developing the operations of a particular organization in such a way that they are in line with the conditions of the market that are needed to be fulfilled in order to run a successful and profitable business. There is a proper SWOT analysis done: the products and the customers in need of those products are studied, their competitors, their strengths and weaknesses are monitored and opportunities and threats are embarked upon, resources are numbered and efficiently utilized in order to fulfill the vision of the company. Each function of the company then derives their separate strategy to support the firm's values and vision and the operations that are needed to support that strategy help develop the operational strategy. Making it easy, the operations strategy helps to specify how a particular firm will employ its operational activities to support the business strategy. Various factors contribute to the kind of operation strategy a company wishes to employ to gain maximum profits. a) Customer's Point of View: Customers are the most valuable aspect in the supply chain. They are the one through which we are able to generate revenues from. They are the one who are needed to be pleased by the products and services that companies put forward in order for those companies to prosper in the long run. Therefore, it is one of the core values to satisfy the needs and wants of the customers in order to fulfill the main purpose of the organization. If a customer views your product being one of those on which he or she does not have to spend much money or there is a substitute present in the market, it becomes necessary for the organization to improve on cost-effectiveness and reduce the price of the product in order to lure in the customer to your product. Price/cost strategy is usually used in this case however; this strategy can only be employed if the firm is able to mass produce or is ready to accept a lower profit margin in order to grasp the market share. In the operations strategy framework, fulfillment of customer needs top the chart. All the new and existing products are manufactured keeping in mind the needs of the customers. One tremendous example is of Wal-Mart. Wal-Mart has a reputation in the eyes of the customer as being the best retailer chain as they are able to supply the products with the lowest prices by accepting a smaller profit margin. Their tremendous volume helps them make up even more than before. Another very important factor that plays an important role is the competitiveness of a firm. They are based on the elements of the operations on which they need to excel in order to gain competitiveness in the environment over a certain aspect. b) Competitors: Competitors are a part of the general macro environment for any firm and their decisions and strategies have a major impact on the different strategies that are being followed in the particular firm. Competitors are one of the major threats to a business and by knowing valuable information about how your competitors are functioning in the market, you might be able to compete with them on fair basis. in order to provide your product or service at a much better price, one needs to examine how the competitors are working, focus on their positives and try not to copy their negatives and develop a strategy in such a way that is counteracts their competitors strategy and helps you to achieve competitiveness. When it comes to developing an operational strategy, price or cost effectiveness comes into place. A firm can maneuver its operation strategy according to the needs at that time. c) Product life cycle: The product life cycle is the cycle of different stages through which a product goes through in its life. From the introduction of a particular product or service, to its extinction, there are various stages in which different kinds of strategies are used by organization in order to support that product through that particular stage. For example, at the start of the maturity stage of a particular product, companies producing the product try to introduce other variants or SKUs of that product to so that they increase the overall maturity of the product and it does not enter the decline stage. Therefore, there are certain operational strategies implemented in different stages of the product life cycle. At the introduction stage, the operation strategy might include no compromise on quality and less emphasis on production. At the growth stage, the company focuses on achieving cost effectiveness as more competitors enter in to market so that at the maturity stage, they are able to compete with their rivals on the cost basis. All the factors are interrelated with each other and work simultaneously and affect the operational strategy. However, in order to achieve competitiveness, all these factors and others should be kept in mind and strategies should be devised accordingly keeping in mind the current situation and environment. 2. Project Planning: Project planning is an integral part of project management. it involves the use of Gantt charts and schedules and other projecting tools so that they are able to plan and successfully report progress within the project management. The first and foremost step that is needed is to prioritize which tasks are to be accomplished first and appropriate methods are chosen to accomplish those tasks. The duration dedicated to each task is then appropriately decided so that the project is completed in due course of time and ample and adequate time is allocated for each task for it to complete in an excellent manner. The slack time which is usually present in between different tasks is also calculated usually with the help of some project management software. Using the same kind of software, the various costs are then calculated and allocated and estimated so that a baseline can be formed. The progress of the particular project is then evaluated throughout the life of the project. Importance: The most important aspect that one has to keep in mind is that the success of a particular project depends solely upon the dedication, effort and care you apply in the initial planning because if the initial step goes wrong, then whole process can go down the drain. This is true for any kind and any size of project that is to be undertaken. Therefore, the initial steps are really important and must be handled with care. Project planning is important because as manager, you need to have a clear and focused vision of how you want your task accomplished. As a manager, you are also held accountable for the timely submission of a project and therefore, you need to generate timely progress reports in order to keep yourself and your upper management about how things are shaping up. Project Planning and Control Technique A project planning and control technique is nothing but the procedures that are needed to follow. These procedures are in a linked structure that means that they are to be followed in the specified path. Once there is a complete understanding of the products, you design a set of simple activities. The reason for this is that the processing capacity of our human brain is limited. Therefore, one needs to think about it in bits and pieces to get the real grasp of the picture. Thus each level of the project can be understood as the amalgamation of few simply described smaller units. This is called the work break down structure; manage a complicated item by dividing it into smaller simpler parts, to make it sound more impressive. The next stage is task allocation. This is not as easy as it sounds. You just don't need to find the right kind of people to do your task. Your major objective is that your team gains something and learns something from that project. Therefore, the procedures and tasks should be molded according to the people you have in your task force so that they are able to gain the most from this project. For example, if one of your colleagues lack confidence, his or her tasks should be divided into smaller bits and pieces so that he or she be able to accomplish that task as a whole. The next step is of establishing controls. When the planning phase is done with, the part where the real action starts come into focus. The two most important aspects of this part of project planning are establishing milestones and means of communication. Milestones are short term goals that are set throughout the project lifecycle as targets. These goals are far more tangible than the actual project itself than the entire project seems in totality. Communication is important in every walk of life. As a manager, you need to be informed timely about the problems and dangers and loop holes in the project completion so that you are able to counteract them with various methods. For this one needs to teach their team the exact method and the kind of information that is needed to be communicated so that they are able to communicate that kind of information to us whenever it needed. No plan is complete without adequate quality test. This should be one for each part, each bifurcation of the whole project to ensure quality standards is maintained throughout. A manager should also be ready for different kinds of problems that usually occur in projects like these. Any errors should be counteracted with procedures planned beforehand. With proper prior planning, projects can be run on time and help to interact positively with the customers and the employees, whichever applicable. The bottom line is that if you want your project to be efficient in quality and quantity, planning that project is really important. 3. Managing Quality Managing quality is one of the most important aspects a manager has to take care of. He or she has to ensure that there is no compromise on quality of a certain product or service so that the customer's needs and wants are fully satisfied and they buy you product again and again. Therefore, it is an important feature of today's business environment. a) Managing quality is a tedious job. it is the methods and means through which a manager ensures that all the activities that are necessary to design, develop and implement quality standards in a product or a service and effectively and efficiently done, keeping in mind the whole system and its performance. The three major aspects of quality management are quality control, quality assurance and quality improvement. In the future, companies will be using systems that will help them ensure that there is no compromise on quality standards that are being followed in organizations. The reason that quality is becoming such a live issue today is that the people around are informed people and they know whatever is going on in this world. Suppliers recognize that quality is one aspect through which they can differentiate their own products from those of the competitors. The quality difference between the products of the two companies is called the quality gap. This quality gap has been greatly reduced in the last two decades. The reason being that the market out there has become more informed and sophisticated. They are demanding for better quality products at low cost because they know some firms out there are coming up with those products. Therefore, any firm who compromises on quality loses on the market share making quality management as one of the fundamentals of profitable business. b) There are many ways through which organizations can achieve quality in its products and services. Introduction of the importance of knowledge management techniques in organizations are very fruitful these days. Letting your employees know how important knowledge is in the long run for the profitability of an organization can urge them to maintain an efficient knowledge base for the organization that will greatly help in maintaining the quality of the workforce that is employed at your organization. Leadership plays an important role in motivating your employees to maintain quality standards at the workplace which in turn is visible in the kind of product and services you put forward for your customers. A good leader will be able to communicate the idea of quality management across in more effective terms than anybody else, and people will be willing to work for the cause. Another phenomenon called the quality culture emphasizes on the importance of inculcating quality rich values in their employees by giving them an environment fostering quality maintenance and improvement. c) There are many methods of quality improvement present in today's world. Various steps have been taken to establish basic grounds of quality. These include product or service improvement, people based improvement etc. a great example would be of the ISO awards that are quality award status given to organization who follow their basic quality standards when it comes to labor, environment, raw material etc. They offer a guarantee to the normal individual that companies which are ISO certified will be following the minimal standards of quality that are needed and wanted by the customers. These standards are certified by the quality management system which is also developed by ISO. They certify the processes of the system and not the product itself. Another way to improve or initiate quality management is to introduce quality circles. This is a people oriented approach towards improvement. Works Cited 1. Heizer, Jay and Render, Barry (). Operations Management. Seventh Edition. 2. Fleming, Quentin (2005). Earned Value Project Management. Wiley IEEE Computer Society Press. 3. N Slack, S Chambers and R Johnston (2007). Operations Management. Prentice Hall. Read More