Hill Approach to Manufacturing Operations - Operation Management
Hill's five step approach to developing manufacturing operations illustrated in table below (Hill, 1993). A feature of this approach is the links between corporate and operations strategy.
Step 1 is concerned with the long term corporate objectives of the organisation strategy process.
Step 2 is concerned with the development of the marketing strategy. Here the marketing mix is established: price, place, product range etc.
Step 3 The marketing strategy is translated into the key factors for the operations function in terms of winning business or satisfying customer demands. Hill divides factors into order winners and order qualifiers.
Step 4 Hill refers to this as 'process choice ' and is concerned with co-ordinating the structural (process) characteristics.
Step 5 is concerned with decisions related to infrastructure (policies and systems).
The Hill operations (manufacturing) strategy approach
Corporate objectives - Growth rates, Profit, ROI, Cash flow, Financial 'gearing'
Marketing strategy - Product markets and segments, Range of products and services, Volumes/mix Standardisation versus customisation Leader versus follower alternatives.
How products win orders in the market place? - Price, Quality Delivery speed and reliability Colour range, Product range/design leadership
Operations strategy: process choice, Choice of alternative processes, Trade-offs embodied in the process choice, Role of inventory in the process configuration.
Operations strategy - infrastructure, Function support, Manufacturing systems Controls and Procedures, Work structuring, Organisational structure.