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Mission/Strategy/Tactics Planning and Decision Making Examples of Strategies

How does mission, strategies and tactics relate  Low cost - outsourcing
to decision making and distinctive  Scale-based strategies - capital
competencies? intensive method for high volume
Strategy production
 Mission  Specialization - focus on narrow
 The reason for existence for product line for higher quality
an organization  Flexible operations - customization
 Mission Statement  High quality – focus on higher quality
 States the purpose of an than competitors
organization  Services – focus on various aspect of
 Goals Strategy Example services
 Provide detail and scope of Ratana is a high school student. She Strategy and Tactics
mission would like to have a career in business, have a  Strategy Factors
 Strategies good job, and earn enough income to live  Price – low cost
 Plans for achieving comfortably  Quality – consistent quality,
organizational goals Mission: Live a good life high quality
 Tactics  Goal: Successful career,  Time – rapid delivery, on-time
 The methods and actions good income delivery
taken to accomplish strategies  Strategy: Obtain a  Flexibility – variety, volume
college education  Service – customer services
 Tactics: Select a college and a  Location - convenience
major Distinctive Competencies- The special
 Operations: Register, buy books, attributes or abilities that give an organization
take a competitive edge.
Strategy Formulation  Strategic OM Decisions Four International Operations Strategies
 Distinctive competencies
 Environmental scanning
 SWOT
 Order qualifiers
 Order winners
 Order qualifiers
 Characteristics that customers
perceive as minimum
standards of acceptability to
be considered as a potential
purchase Quality and Time Strategies
 Order winners  Quality-based strategies
 Characteristics of an  Focuses on maintaining or Productivity
organization’s goods or improving the quality of an  Productivity
services that cause it to be organization’s products or  A measure of the effective use
perceived as better than the services of resources, usually
competition  Quality at the source expressed as the ratio of
Key External Factors  Time-based strategies output to input
 Economic conditions  Focuses on reduction of time  Productivity ratios are used for
 Political conditions needed to accomplish tasks  Planning workforce
 Legal environment Global Strategy requirements
 Technology  Strategic decisions must be made with  Scheduling equipment
 Competition respect to globalization  Financial analysis
 Markets  What works in one country may not  Partial measures
Key Internal Factors work in another  output/(single input)
 Human Resources  Strategies must be changed to account  Multi-factor measures
 Facilities and equipment for these differences  output/(multiple inputs)
 Financial resources  Other issues  Total measure
 Customers (loyalty, understanding)  Political, social, legal, cultural  output/(total inputs)
 Products and services and economic differences
PRODUCTIVITY= OUTPUTS/INPUTS Examples of Partial Productivity Measures Factors Affecting Productivity
Productivity Growth

Other Factors Affecting Productivity


Example 3  Standardization
7040 Units Produced  Quality
Cost of labor of $1,000  Use of Internet
Cost of materials: $520  Computer viruses
Cost of overhead: $2000  Searching for lost or misplaced items
What is the multifactor productivity?  Scrap rates
Measures of Productivity  New workers
 Safety
 Shortage of IT workers
 Layoffs
 Labor turnover
 Design of the workspace
 Incentive plans that reward
Process Yield
productivity
 Process yield is the ratio of output of
 Outsourcing
good product to input
 Defective product is not included in
the output
 Service example:
 Ratio of cars rented to cars
available to rent
Outsourcing
 Higher productivity in another
company is a key reason organizations
outsource work
 Improving productivity may reduce the
need for outsourcing
Improving Productivity
 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

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