Considering strategic choice - operation strategy, Operation Management

Considering Strategic Choice - Operation Strategy

(Strategic analysis will be covered in Strategy - Analysis and Evaluation). 

The following points are an extract from Porter (1985): 

1. Find areas of value the buyer views as important  

2. Create value and communicate this in credible ways 

3. Bear, but minimise the cost of uniqueness; find a basis of uniqueness which is difficult to emulate 

4. Manage the issue of cost and differentiation successfully 

5. Sustain differentiation by innovating new sources of buyer value. 

Finding areas 'of value' outlined by Porter (1985) is also supported by Kay (1993) who describes the rent model of the firm. He suggests that to understand why some companies are successful and others are not, it is necessary to understand the distinctive competencies of the firm.

The analogy he uses is of a farm. One farm has excellent land and therefore produces and receives a price premium. Whereas a farm with poor land cannot produce or receive the same income as the farm with the best land. Hence the difference in income, referred to as rent, is related to the land (resource). This then is the basis of differentiation. Kay argues that distinctive competence may come from reputation or organisational relationships within the value chain (he refers to this as the architecture of the firm). Reputation is usually based on an earlier competence such as quality. This relates well to operations strategy and is translated as competence or operational capability and is very much the purpose of the operations function. Operations must deliver the service or product by which the consumer will ultimately judge. It is more important to be doing the right thing, rather than things right.

Posted Date: 3/18/2013 1:53:50 AM | Location : United States







Related Discussions:- Considering strategic choice - operation strategy, Assignment Help, Ask Question on Considering strategic choice - operation strategy, Get Answer, Expert's Help, Considering strategic choice - operation strategy Discussions

Write discussion on Considering strategic choice - operation strategy
Your posts are moderated
Related Questions
Application of Transportation Models: 1. Transportation  Management  solution allow  importers exporters  and logistics providers to  manage the spiralling costs associated wi

From the e-Activity, analyze the process of statistical quality control and determine which part of the process would be most difficult for you personally as well as what steps you

Explain what the customer's expectations are concerning the salesperson's attitude toward competition

If you were the database administrator for the iTunes store, how might you use predictive analysis to determine which artists and movies will sell most next year?

Compare and contrast Scientific Management and the Human Relations Movement

Explain d ifference between Classical Theory and Neo-Classical Theory of Organisation. Difference between Classical Theory and Neo-Classical Theory of Organisation : The c

Nuvyug Industries Ltd. Has an annual requirement of 5,000 pieces of brake cylinders for its popular brand of golf carts. Each brake cylinder has a carrying cost of ` 25 per unit pe

If a company needs to maintain market position as a leader in its segment and to increase the same in future, the company is carrying out few initiatives like Innovation

IT is one of most globally integrated corporate function how is IT different from other business areas when it comes to global integration? why do you think this is the case?