Chapter 2. Customers, Products, and OM Strategy.ppt

MAN 3504 - Chapter 2 Chapter 2. Customers, Products, and OM: Strategy Outline Product Characteristics and the Customer Corporate and Operations Strategy Hierarchy of strategies Order Winners and Qualifiers Operations Strategy: Service vs. Manufacturing Operations Strategy: Product Life Cycle Product Design/Redesign Process/ QFD Product Characteristics and the Customer Customer are classified by their product characteristic preferences. Done through surveys and focus groups Product Characteristics: Aesthetics Cost Quality Variety/Customization Speed of Service/Delivery Warranties/Guarantees Bundled Services Corporate and Operations Strategy One product can seldom satisfy all customer types Companies recognize they must design products for a specific market segment, leading to strategies Strategy is a plan of attack (including which customers will be “attacked”) From the corporate strategy, functional strategies are derived Hierarchy of Strategies Functional Strategies drive decision making at multiple levels: Strategic DM Tactical DM Operational/Day-to-day DM Order Winners and Order Qualifiers Order Qualifier: The level of a product characteristic(s) that allow a product to be considered for selection Order Winner: The level of a product characteristic(s) that drive the customer decision to select a product Order winners/qualifiers are dynamic Changes as customer requirements change Changes as competitive products change Order Winners and Order Qualifiers Order winners become drivers for operations strategy COST Operations Efficiency QUALOITY/RELIABILITY Quality at Design/Zero Defects VARIETY/CUSTOMIZATION Recognition of customer needs SPEED OF SERVICE/DELIVERY Supply Chain Coordination Focused Operations - few order winning characteristics Operations as a driver for corporate strategy Operations Strategy: Services vs. Manufacturing Operational Strategies differ in implementation Cost Strategy: Cost may be reduced in materials or manufacturing locatio