Operations strategy or management is an important concept in business that revolves around the management of planning, organising and controlling the resources, both financial and human resources to maintain consistent production of good quality products and services. The main function of the operations strategy is to transform the inputs including the resources that are available and turn those into output, i.e. the finished goods and services. Not only the business operations are managed, but the Operations management also includes considering the management of financial and human resources for ensuring good production value in business (Krajewski, Ritzman and Malhotra 2013).
Competitive priority and its four categories
The competitive priority means managing the business operations and using the resources properly within the supply chain to fulfill the needs and preferences of customers at present and in the future. It sets the company apart from its competitors and allows the business to manage time, cost and flexibility. The four categories are time, cost, quality and flexibility.
Quality - Quality means not only fulfilling the demands of customers but also keeping them safe and healthy, though remaining sustainable. It is the competitive priority that focuses on meeting the preferences and needs of the clients (Reid and Sanders 2005).
Flexibility - Companies considering flexibility as competitive priority can manage production of customized products though it is a slow process when compared to competitive priority's quality. One example of flexibility could be Procter and Gamble trying to made wide variety of products available. Flexibility also allows for making necessary changes for the production process and even increase the quantity to meet the needs on rapid scale.
Time - Time is another category of competitive priority that represents the time taken for delivery considering the production of products until those are delivered to the customers.
Cost – The cost is another aspect that drives the firm’s competitiveness within the business environment through setting up of right prices for the products and services delivered. Prices are lowered to enter new markets and the customers’ buying behaviors are influenced.
Example of a company that makes quality its competitive priority
One of the companies considering quality as competitive priority is McDonalds, which focused on both high performance and designing of products. The operations should be managed in such a manner so that the products could come with better features, high performance along with best quality customer services. McDonalds is one such company that maintains consistency by making few of their products and services available any time and in any location, which also ensures maintenance of quality (Krajewski, Ritzman and Malhotra 2013).
Order qualifiers and order winners and its importance
Order qualifiers and order winners, both are competitive priorities that focus on managing business within specific market segments. The order qualifiers allow companies to gain a good market position by creating lower prices for the products whereas the order winners mean some new additions to the product category that can meet the standards of order qualifiers. These components are beneficial for managing flexibility, save cost and time as well as maintain consistency in quality (Reid and Sanders 2005).
Meaning of productivity
From the OM perspective, the management of resources and business operations, in a combined manner produces the desired output for a business and that is known as productivity. The measurement of inputs getting transformed into outputs is known as productivity and is represented by a formula below (Krajewski, Ritzman and Malhotra 2013).
Krajewski, L.J., Ritzman, L.P. and Malhotra, M.K., 2013. Operations management: processes and supply chains (Vol. 1). New York, NY: Pearson.
Reid, R.D. and Sanders, N.R., 2005. Operations management: an integrated approach. Hoboken, NJ: John Wiley.