OM Global Operations Strategy HR 2011

5/27/2018 OM Global Operations Strategy HR 2011

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2008 Prentice Hall, Inc. 2 1

Operat ionsManagement

Operat ions Strategy ina Global Environment

PowerPoint p resentat ion to accompany

Heizer/Render

Princip les of Operat ions Management, 7e

Operation s Management, 9e


2/19

2008 Prentice Hall, Inc. 2 2

Precondi t ions

Streng ths and weaknesses of com pet itors andpossib le new entrants into the market

Current and p rospective environmental,technological , legal, and econom ic issues

The product l i fe cyc le

Resou rces avai lable with in th e f i rm and with inthe OM funct ion

Integration of OM strategy with companysstrategy and w ith other fun ct ion al areas

One mus t understand :


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Product L i fe Cyc le

Product designanddevelopmentcr i t ical

Frequentproduct andprocess des ignchanges

Shor t product ionruns

High product ioncosts

L imi ted models

Attent ion toqual i ty

Intro du ct ion Grow th Maturi ty Decl ine

OM

Stra

tegy

/Issu

es

Forecast ingcr i t ical

Product andprocess

rel iabi l i ty

Compet i t iveproductimprovementsand opt ions

Increase capacity

Shi f t towardproduct focus

Enhancedis t r ibut ion

Standardization

Less rapidproduct ch anges

more minor

changes

Opt imumcapaci ty

Increasingstabi l i ty ofprocess

Long product ionruns

Productimprovementand cost cut t ing

Li t t le prod uctdif ferentiat ion

Costminimizat ion

Overcapaci tyin theindust ry

Prune l ine toel iminatei tems notreturninggood marg in

Reducecapaci ty

Figure 2.5



Strategy

Analys is

SWOT Analys is

InternalStrengths

InternalWeaknesses

ExternalOpportuni t ies

ExternalThreats

Mission



Strategy Development Process

Determine Corpo rate Mission

State the reason for the firms existence and identify thevalue it wish es to create.

Form a Strategy

Bui ld a compet i t ive advantage, such as low pr ice, design, orvo lume flexibi l i ty, quali ty, quick delivery, depend abil i ty, after-

sale service, broad p rodu ct l ines.

Environmental Analys is

Identi fy th e streng ths , weakness es, oppo rtun it ies, and threats.Understand the environment, custom ers, indus try, and com pet i tors.

Figure 2.6



Strategy Development and

Implementat ion

Ident i fy c r i t ical success factors

Bui ld and staff the organizat ion

In tegrate OM w ith o ther act iv i t ies

The operations managers job is to implementan OM strategy, pro vide compet i t iveadvantage, and inc rease produc t iv i ty



Southwest A ir l ines CSF

Courteous, butLim ited Passenger

Service

StandardizedFleet of Boeing737 A irc raft

Compet it ive Advantage:Low Cost

Lean,

Product iveEmployees

Short Haul, Point-to-

Point Rou tes, Often toSecond ary Airpo rts

HighAircraf t

Uti l ization

Frequent,Reliable

Schedules

Figure 2.8



Act iv ity Mapp ing


Service



Lean,




HighAircraf t

Uti l ization

Frequent,Reliable

Schedules

Figure 2.8

Au tomated t icketing machines

No seat assignments

No baggage transfers

No meals (peanu ts)



Act iv ity Mapp ing


Service



Lean,




HighAircraf t

Uti l ization

Frequent,Reliable

Schedules

Figure 2.8

No meals (peanu ts)

Lower gate cos ts atsecondary airpo rts

High number of f lightsreduces emp loyee idle t ime

between f l ights



Act iv ity Mapp ing


Service



Lean,




HighAircraf t

Uti l ization

Frequent,Reliable

Schedules

Figure 2.8

High number of f lightsreduces employee idle t ime

between f l igh ts

Saturate a city w ith f l igh ts,lowering adm inis trat ive

costs (advertis ing , HR, etc.)per passenger for that c i ty

Pilot tra in ing requ ired on

on ly one type of aircraftReduced maintenance

inventory required becauseof only one type of aircraf t



Act iv ity Mapp ing


Service



Lean,




HighAircraf t

Uti l ization

Frequent,Reliable

Schedules

Figure 2.8

Pilot tra in ing requ ired ononly one type of aircraf t

Reduced maintenanceinventory required because

of only one type of aircraftExcel lent suppl ier relat ions

with Boeing has aidedf inancing



Act iv ity Mapp ing


Service



Lean,




HighAircraf t

Uti l ization

Frequent,Reliable

Schedules

Figure 2.8

Reduced maintenanceinventory required becauseof only one type of aircraf t

Flexible emp loyees andstandard planes aid

schedul ing

Maintenance personnel

t rained only one type ofaircraft

20-m inute gate turnarounds

Flexible union

contracts



Act iv ity Mapp ing


Service



Lean,




HighAircraf t

Uti l ization

Frequent,Reliable

Schedules

Figure 2.8

Au tomated t icketingmachines

Empowered employees

High employee

compensat ionHire for att i tude, then train

High level of stoc kownership

High number of f lightsreduces employee idle t ime

between f l ights



Reasons to Global ize

Reasons to Global isze

1. Reduce costs (labo r, taxes, tar i f fs , etc.)

2. Imp rove supp ly chain

3. Prov ide bet ter goods and serv ices

4. Understand markets

5. Learn to improve operat ions

6. At t rac t and retain g lobal talen t

Tangible

Reasons

IntangibleReasons



Match Product & Paren t

Braun HouseholdAppl iances

Firestone Tires

God iva Chocolate

Haagen -Dazs IceCream

Jaguar Au tos

MGM Mov ies Lambo rgh in i Autos

Alpo Pet foods

1. Vo lk swagen

2. B ridges tone

3. Campbell Soup4. Ford

5. Gil lette

6. Nestl

7. Pil ls bu ry

8. Sony

1. Great Br it ain

2. Germany

3. Japan

4. Un itedStates

5. Sw itzer land



Four In ternat ionalOperat ions Strateg ies

CostR

educ

tion

Cons

idera

tions

High

Low

HighLow

Local Respon siveness Considerat ions(Quick Respon se and/or Differentiation)

International Strategy

Import/export orl icense exist ing

productExamples

U.S. SteelHarley Davidson

Student led learning




CostR

educ

tion

Cons

idera

tions

High

Low

HighLow


Standardized prod uct Economies of s cale Cross-cultu ral learning

ExamplesTexas Instruments

Caterpi l larOtis Elevator

Global Strategy


Import/export orl icense exist ingproduct

ExamplesU.S. SteelHarley Davidson




CostR

educ

tion

Cons

idera

tions

High

Low

HighLow





Global Strategy




Mult idom estic Strategy

Use exist ingdomest ic mod el global ly

Franchise, joint ventures,

subsid iar ies

ExamplesHeinz The Body ShopMcDonalds Hard Rock Cafe


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CostR

educ

tion

Cons

idera

tions

High

Low

HighLow





Global Strategy Transn ational Strategy

Move m aterial, people, ideasacross nat ional bound ar ies

Economies of s cale Cross -cultural learning

Examples

Coca-ColaNestl




Mult idom estic Strategy

Use exist ingdomest ic mod el global ly

Franchise, joint ventures,

subsid iar ies

ExamplesHeinz The Body ShopMcDonalds Hard Rock Cafe

Documents

OM Global Operations Strategy HR 2011