Chapter 2: Competitiveness, strategic planning and productivity

Question 1

why go global?

Answer 1

• favourable cost
• access to international markets
• response to changes in demand
• reliable sources of supply
• latest trends and technologies

Question 2

why has globalisation increased?

Answer 2

from the internet and falling trade barriers

Question 3

competitiveness

Answer 3

how effectively an organization meets the needs of customers relative to others that offer similar goods or services

Question 4

the most common measure of competitiveness is

Answer 4

productivity

Question 5

marketing influences competitiveness in several ways:

Answer 5

• identifying customer wants and needs
• competing on price
• advertising and promotion
• product and service design

Question 6

operations has a major influences on competitiveness through:

Answer 6

• product and service design
• cost of output
• location
• competing on quality
• flexibility
• competing on time
• competing on variety
• service
• managers and workers

Question 7

product and service design:

Answer 7

should reflect joint effort of many areas of the firm to achieve a match between financial resources, operations capabilities, supply chains capabilities, and consumers buying decision

Question 8

cost of output

Answer 8

is a key variable that effects pricing decision and profits. Cost reduction efforts are generally ongoing in business organization

Question 9

location

Answer 9

can be important in terms of cost and convenience for customers. Location near inputs can result in lower input cost

Question 10

competing on quality

Answer 10

It relates to how well the product or services will serve its intended purpose (ways to please customer not only to avoid problems)

Question 11

flexiblity

Answer 11

is the ability to respond to changes. changes might relate to alterations in design features or service, or to the volume demanded

Question 12

competing on time

Answer 12

refers to how quickly a products or service is delivered to the customers. such as fedex, mcDonalds’s have have always competed on speed

Question 13

competing on variety

Answer 13

is the ability to produce a wide variety of products, to introduce new products and modify the existing one quickly and respond to customer needs

Question 14

inventory management

Answer 14

can be competitive advantage by effectively matching supplies of goods with demand

Question 15

service

Answer 15

might involve after sale activities customer perceive as added value, such as setup, warranty, courtesy, keeping the customer informed, and attention to details

Question 16

managers and workers

Answer 16

people are the heat and soul of the organization, and if they are competent and motivated, they can provide a distinct competitive advantage by their skills and the ideas they create

Question 17

business organizations compete with one another in a variety of ways

Answer 17

price 
quality
customer service 
variety
timeliness
location
differentiation

Question 18

prices

Answer 18

the amount a customer must pay for a product or service

Question 19

timeliness

Answer 19

it relates to how swell the product or service will serve its intended purpose

Question 20

customer service

Answer 20

might involve after sales activities that perceived by customers as value added

Question 21

the key to successfully competing:

Answer 21

is to determine what customers want and then direct efforts toward meeting (or exceeding) customer expectations

Question 22

in formulating a successful strategy, organizations must take into account:

Answer 22

both order qualifiers and order winners

for example, when purchasing a smartphone, customer may determine a prices range (order qualifier) and then choose the products with most features (order winner) within that price range. looking at the iphone-6 or 7. Screen Camera upgrades- resolution, and brightness

Question 23

order qualifiers

Answer 23

are the characteristics that customer perceive as minimum standard of acceptability to be considered as a potential for purchase (what qualifies an item to be considered for purchase)

Question 24

order winners

Answer 24

are the characteristics of an organization’s goods or services that cause it to be perceived as better than competition (what wins the order). (UHDTV< HDTV, SUHDTV)

Question 25

mission/vision

Answer 25

the reason for organization existence

Question 26

mission

Answer 26

is where the organization is going now, its product, and its market (defines an organization’s purpose or reason for existence)

Question 27

vision

Answer 27

is where the organization desires to be in the future

Question 28

mission/vision statement:

Answer 28

a clear statement of purpose

• should serve to guide strategy
• statement provides general direction for an organization and should lead to organizational goals or objectives

Question 29

strategy

Answer 29

a plan for achieving organization mission/goals
-a strategy is a set of coordinated broad long term policies, objectives and action programs to achieve goals

-organizations have overall strategies called organization or business strategies, which are related to the entire organization, and they have functional strategies or tactical, which related to the functional areas of the organization. then operations strategy

Question 30

organizational strategy

Answer 30

a plan for achieving organization mission/vision/goals

Question 31

tactics

Answer 31

medium-term plans, methods, and actions taken to accomplish strategies

Question 32

operation strategy

Answer 32

short-term plans, methods, and actions taken to accomplish tactical and organizational strategy

Question 33

quality based strategies

Answer 33

• maintain or improve quality

- may use initiatives such as 6-sigma or process re-engineering

Question 34

time based strategies

Answer 34

focuses on reduction of time needed to accomplish tasks

Question 35

productivity

Answer 35

a measure of the effective use of resources, usually expressed as the ratio of output to input

productivity = outputs/inputs

Question 36

productivity ratios can be computed for:

Answer 36

a worker
a department
an organization
a country

Question 37

measures of productivity

Answer 37

• partial measures (single input)
• multi-factor measures (multiple inputs)
• total measure (total inputs)

Question 38

partial productivity measures

Answer 38

• labour productivity
• machine productivity
• capital productivity
• energy productivity

Question 39

labour productivity

Answer 39

• units of output per labour hour
• units of output per shift
• value-added per labour hour

Question 40

machine productivity

Answer 40

units of output per machine hour

Question 41

capital productivity

Answer 41

• units of output per dollar input

- dollar value of output per dollar input

Question 42

energy productivity

Answer 42

• units of output per kilowatt-hour

- dollar value of output per kilowatt-hour

Question 43

productivity does not equal efficiency. It is used to

Answer 43

• track performance over time
• determine areas for improvement
• compare competitiveness

Question 44

service productivity is more difficult to measure than manufacturing productivity for two main reasons:

Answer 44

• difficult to find a measure of output (activities with a high degree of variability in both output and input for example: medical diagnosis, legal services, arts, painting)
• sometimes the measures of output result in misleading conclusions (measure the productivity of a hospital by the number of patient-days of care provided).

Question 45

factors affecting productivity

Answer 45

• methods
• management
• technology
• labour

Question 46

improving productivity

Answer 46

• develop productivity measures
• determine critical (bottleneck) operations
• develop methods for productivity improvements
• establish reasonable goals
• get management support
• measure and publicize improvements
• don’t confuse productivity with efficiency