2: OPERATION STRATEGY: Operations performance

Question 1

Why is operations performance important in any organization?

Answer 1

Influences costs, can make or break the business

Question 2

How does the operations function incorporate all stakeholders objectives?

Answer 2

They relate to the company’s responsibility to customers, suppliers, shareholders, employees, and
society in general.

Question 3

What does top management expect from the operations function?

Answer 3

Operations and processes excellence. Opportunities for process learning (future innovation). Enhanced service (secure revenue). Higher capacity utilization (lower capital requirements). Reduced errors, better resilience (lower operational risk). Process efficiency (lower costs)

Question 4

What are the performance objectives? What are the internal and external benefits which derive from excelling in each of them?

Answer 4

Quality - being right
Speed - being fast
Flexibility - being able to change
Dependability - being on time, keeping promises
Cost - being productive

Question 5

How do operations performance objectives trade off against each other?

Answer 5

The extent to which improvements in one performance objective can be achieved by
sacrificing performance in others.