Functional Strategy - A Game Plan to Enhance Organizational Efficiency and Effectiveness

Functional Strategy
Functional strategy refers to the approaches employed within a specific functional area to address the fundamental question of how that area contributes to the overall business strategy - corporate and business-unit level strategies. The focus is on aligning the activities and capabilities of a particular business function (such as marketing, operations, or human resources) with the broader strategic goals of the organization. Strategic management decisions often guide the overarching strategies within functional areas, ensuring they align with the broader business strategy. Think of these as the high-level directives that shape how each function operates in support of the organization's goals. ​

Functional Area Strategies
Functional level strategies are the specific actions taken by individual departments to support the overall business strategy. In the context of marketing, these decisions are crucial for achieving organizational goals. They are the bridge between strategic goals and tactical execution. Functional strategy sets the overall goals and objectives for each department. The purpose of functional strategy is to enhance the effectiveness and efficiency of an organization. By developing effective functional strategies, companies can enhance their competitive advantage and achieve their desired outcomes.
 

• Marketing
  • Strategic Management Decision: Define target markets and positioning.
  • Functional Management Decision: Develop campaigns, choose marketing channels.
  • Relationship: Marketing decisions execute the strategic vision by reaching the defined audience effectively.
• Sales
  • Strategic Management Decision: Establish sales targets and growth plans.
  • Functional Management Decision: Set sales quotas, develop sales training.
  • Relationship: Sales tactics are designed to achieve the strategic revenue goals set by the organization.
• Finance
  • Strategic Management Decision: Allocate resources, decide on investments.
  • Functional Management Decision: Create budgets, manage cash flow.
  • Relationship: Financial operations ensure funds are available to support strategic initiatives.
• HR
  • Strategic Management Decision: Define talent acquisition and development goals.
  • Functional Management Decision: Recruit staff, implement training programs.
  • Relationship: HR activities build the workforce needed to execute the business strategy.
• Operations
  • Strategic Management Decision: Set efficiency and quality benchmarks.
  • Functional Management Decision: Streamline processes, improve production.
  • Relationship: Operational adjustments are made to meet strategic efficiency and quality targets.
• IT and Technology
  • Strategic Management Decision: Determine tech investments and innovations.
  • Functional Management Decision: Implement IT projects, manage infrastructure.
  • Relationship: IT decisions ensure technological support for strategic goals.
• Product Development
  • Strategic Management Decision: Identify key areas for innovation.
  • Functional Management Decision: Manage product lifecycles, conduct R&D.
  • Relationship: Product decisions turn strategic innovation priorities into tangible offerings.
• Customer Service
  • Strategic Management Decision: Define service standards and customer experience goals.
  • Functional Management Decision: Implement support systems, manage feedback.
  • Relationship: Customer service actions enhance the experience in line with strategic goals.

Strategic management decisions set the stage and define the direction for functional area strategies. Each functional area then makes more detailed, tactical decisions to implement these strategies, ensuring cohesive progress towards the business's overarching objectives. This symbiotic relationship helps the organization maintain alignment between daily operations and long-term goals.

Functional Areas Management
Functional area management is tactical in nature. It is the process of implementing strategic plans through operational activities. It involves the coordination of resources and personnel to achieve short-term objectives that align with the overall organizational goals Essentially, tactical management is about "making things happen." It bridges the gap between strategic planning and operational execution. Tactical managers translate these functional strategies into actionable plans and tasks. 

Tactical Management: Key Responsibilities:

• Resource allocation: Determining how to best utilize available resources (human, financial, technological) to achieve short-term goals. 
• Operational planning: Developing detailed plans and schedules for daily operations. 
• Problem-solving: Identifying and resolving issues that arise during operations.
• Coordination and communication: Ensuring effective communication and collaboration among teams. 
• Performance monitoring: Tracking progress towards short-term objectives and making necessary adjustments.  

​In essence, tactical managers are the "doers" who translate the strategic vision into actionable steps. They focus on efficiency, productivity, and quality while ensuring alignment with the organization's broader objectives.

• Marketing
• HR
• Finance
• Operations

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Management Decisions: Marketing Strategy and Tactics
Management in marketing indeed involves a significant amount of decision-making.  It encompasses the management of a firm’s marketing resources and activities, aiming to create a strong market presence and achieve business goals. Marketing techniques and methods focus on creating opportunities to boost sales. These include strategies for targeting high-potential markets, building brand recognition, and generating and nurturing leads to achieve faster growth and increased profits.

Marketing Management: Management Functions
Marketing management plays a crucial role in an organization’s success by aligning marketing efforts with strategic goals. Marketing management involves planning, organizing, coordinating and executing procedures designed to increase customer engagement, drive sales, and create product/service awareness. ​Marketing management decision-making relates to the four key managerial functions:

• Planning:
  1. Marketing Planning: Marketing managers engage in strategic planning to define marketing objectives, target markets, and positioning strategies.
  2. Market Research: They analyze market trends, consumer behavior, and competitive landscapes to inform planning decisions.
  3. Budget Allocation: Planning involves allocating resources (financial, human, and technological) to various marketing activities.
• Organizing:
  1. Campaign Execution: Marketing managers organize teams, assign responsibilities, and coordinate efforts to execute marketing campaigns.
  2. Resource Allocation: They ensure that the right people and resources are in place to achieve marketing goals.
  3. Cross-Functional Collaboration: Organizing involves collaborating with other departments (sales, product development, etc.) to align marketing efforts with overall organizational objectives.
• Leading:
  1. Motivating Teams: Marketing managers lead teams by inspiring creativity, setting clear expectations, and fostering a collaborative environment.
  2. Decision-Making: Effective leadership involves making timely decisions related to promotions, pricing, product launches, and communication strategies.
  3. Adaptability: Leaders must adapt to changes in consumer preferences, market dynamics, and technological advancements.
• Controlling:
  1. Performance Measurement: Marketing managers use key performance indicators (KPIs) to assess the effectiveness of marketing efforts.
  2. Feedback Loops: Controlling involves monitoring results, comparing them to targets, and adjusting strategies as needed.
  3. Quality Assurance: Ensuring that marketing activities align with brand guidelines and organizational values.

Marketing management decision-making is intertwined with planning, organizing, leading, and controlling. By effectively managing these functions, marketing managers drive revenue, enhance brand reputation, and create meaningful customer interactions. 

Marketing Strategy Formulation: Management Decisions
Formulating an effective marketing strategy requires a series of well-informed management decisions. The key steps and considerations include:
1. Market Research and Analysis

• Purpose: Understand the market dynamics, customer needs, and competitive landscape.
• Decisions:
  • Target Market Selection: Identify the most attractive segments to focus on.
  • Customer Insights: Gather and analyze data on customer preferences and behavior.
  • Competitive Analysis: Assess the strengths and weaknesses of competitors.

2. Marketing Objectives

• Purpose: Establish clear, measurable goals that align with the overall business objectives.
• Decisions:
  • Sales Targets: Set revenue and sales volume goals.
  • Brand Awareness: Define goals for increasing brand recognition.
  • Market Share: Determine desired market share within the target segments.

3. Marketing Mix (7 Ps)

• Purpose: Develop a cohesive strategy that addresses product, price, place, and promotion.
• Decisions:
  • Product: Decide on product features, quality, design, and packaging.
  • Price: Set pricing strategy considering costs, competition, and customer perceived value.
  • Place: Choose distribution channels and logistics to ensure product availability.
  • Promotion: Plan and execute promotional activities, including advertising, sales promotions, and public relations.
  • People: the individuals who deliver the service, such as employees, customer service representatives, and frontline staff. Their skills, attitude, and behavior significantly impact the customer experience.
  • Process: The systems and procedures used to deliver the service are crucial. A well-designed process can enhance efficiency, reduce errors, and improve customer satisfaction.
  • ​Physical Evidence: This includes the tangible aspects of the service, such as the physical environment, signage, and any physical materials used in the service delivery.

4. Positioning and Branding

• Purpose: Establish a unique position in the market and create a strong brand identity.
• Decisions:
  • Value Proposition: Define what makes the product or service unique and valuable to the target market.
  • Brand Image: Develop branding elements such as logo, slogan, and brand voice.
  • Customer Experience: Ensure a consistent and positive experience across all touchpoints.

5. Budgeting and Resource Allocation

• Purpose: Allocate resources efficiently to maximize the impact of marketing efforts.
• Decisions:
  • Budget Allocation: Determine the budget for each marketing activity and channel.
  • Resource Management: Assign responsibilities and resources to the marketing team.

6. Implementation and Execution

• Purpose: Execute the marketing plan effectively and ensure alignment with strategic goals.
• Decisions:
  • Campaign Planning: Develop detailed plans for marketing campaigns.
  • Timeline Management: Set timelines for various activities and ensure timely execution.
  • Collaboration: Coordinate with other departments to align marketing efforts.

7. Monitoring and Evaluation

• Purpose: Track performance and make data-driven adjustments to improve outcomes.
• Decisions:
  • Performance Metrics: Identify key performance indicators (KPIs) to monitor progress.
  • Feedback Loop: Collect and analyze feedback from customers and stakeholders.
  • Continuous Improvement: Adjust strategies based on performance data and market changes.

Strategy formulation documents the series of decisions regarding target audience, value proposition, and the configuration of marketing mix variables/parameters that the business will use to reach its target audience, as well as brand messaging. A well crafted/formulated marketing strategy can help you make sense of your situation and cut through all the noise and be your vehicle to guide successful marketing and sales decisions. The marketing strategy to be successful has to be implemented by developing a marketing plan. ​By making informed decisions at each step, marketing management can develop a comprehensive and effective marketing strategy that drives business growth and achieves organizational objectives.

Marketing Strategy: Strategic Marketing Decision Choices
Strategic marketing decisions are crucial for setting the direction and goals of an organization's marketing efforts. These decisions shape how the company interacts with its target market and can have a significant impact on its success. Here are the primary types of strategic marketing decisions guided by marketing strategy:

1. Market Segmentation: Identifying specific segments of the market to target based on factors like demographics, psychographics, and behavior.
2. Target Market Selection: Choosing the most lucrative or strategically valuable segments to focus marketing efforts on.
3. Positioning: Establishing a distinct place in the market for the brand or product, ensuring it stands out from competitors.
4. Product Strategy: Deciding on the range of products to offer, including product features, design, quality, and the development of new products.
5. Pricing Strategy: Setting the right price points to balance profitability with customer satisfaction and competitiveness in the market.
6. Distribution Strategy: Determining how products will be delivered to customers, including the choice of distribution channels and logistics management.
7. Promotional Strategy: Planning and implementing marketing communications to promote the product or brand, including advertising, sales promotions, public relations, and digital marketing.
8. Brand Strategy: Managing the brand’s identity, values, and reputation to create a strong and positive perception in the market.
9. Customer Relationship Management (CRM): Developing strategies to maintain and enhance relationships with customers, aiming for long-term loyalty and satisfaction.
10. Market Entry and Expansion: Deciding how to enter new markets or expand in existing ones, which could involve geographical expansion, new customer segments, or new product lines.
11. Innovation Strategy: Focusing on innovation to stay competitive, which includes adopting new technologies, processes, or business models.
12. Competitive Strategy: Analyzing competitors and devising strategies to outperform them, whether through better products, superior customer service, or more effective marketing.

​These strategic decisions collectively drive a company’s approach to the market and are crucial for achieving long-term goals and sustainable growth.
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Marketing Strategy: Strategic Decision Choices
Strategic marketing decisions are high-level decisions that shape the overall direction of the marketing function. They are closely linked to the development and implementation of a marketing strategy. These include:

1. Product Strategy

• Product Development: Deciding on new product development, product line extensions, or product elimination.  
• Product Positioning: Determining the product's position in the market relative to competitors.  
• Product Lifecycle Management: Managing the product lifecycle from introduction to decline.  
• Branding: Developing and managing a strong brand identity.

2. Pricing Strategy

• Pricing Objectives: Setting pricing objectives, such as profit maximization, market penetration, or market skimming.  
• Pricing Methods: Choosing appropriate pricing methods, such as cost-based, value-based, or competitive pricing.
• Price Discrimination: Implementing price discrimination strategies to target different customer segments.  
• Price Adjustments: Making adjustments to prices over time, such as discounts, allowances, or price increases.  

3. Distribution Strategy

• Channel Selection: Choosing the most effective channels to reach the target market, such as direct sales, retail, or e-commerce.  
• Channel Management: Managing relationships with channel partners and ensuring efficient distribution.  
• Logistics and Supply Chain Management: Optimizing the flow of goods from suppliers to customers.  

4. Promotion Strategy

• Advertising: Developing effective advertising campaigns to reach the target audience.  
• Sales Promotion: Using short-term incentives to stimulate demand, such as discounts, coupons, or contests.  
• Public Relations: Building and maintaining positive relationships with the public and media.  
• Direct Marketing: Targeting specific customers through direct mail, email, or telemarketing.  
• Digital Marketing: Leveraging digital channels to reach customers, such as social media, search engine optimization, and content marketing.

By making informed decisions in these areas, marketing teams can contribute significantly to the overall success of the organization. It's important to align these functional-level strategies with the broader business strategy to ensure consistency and coherence.

Tactical Marketing Decisions:
Tactical marketing decisions are the day-to-day actions and implementations that support the broader strategic marketing plan. These decisions often involve the practical details of executing the marketing strategy. Here are the key types of tactical marketing decisions guided by marketing strategy:

1. Advertising Campaigns: Planning and executing specific advertising efforts, including selecting media channels (TV, radio, online, etc.), creating ad content, and scheduling ad runs.
2. Sales Promotions: Developing and running short-term incentives such as discounts, coupons, contests, and loyalty programs to boost sales and customer engagement.
3. Content Marketing: Creating and distributing valuable, relevant content to attract and engage a target audience. This includes blog posts, videos, social media updates, and email newsletters.
4. Social Media Marketing: Managing social media profiles, posting updates, engaging with followers, and running social media ad campaigns.
5. Email Marketing: Designing and sending email campaigns, newsletters, and personalized email communications to nurture leads and retain customers.
6. Public Relations: Crafting press releases, organizing events, and managing media relations to build and maintain a positive public image.
7. SEO and SEM: Implementing search engine optimization (SEO) and search engine marketing (SEM) strategies to improve website visibility and attract organic and paid traffic.
8. Pricing Adjustments: Making temporary or seasonal pricing changes, such as discounts or special offers, to stimulate demand and sales.
9. Retail Displays: Designing in-store displays, signage, and merchandising to enhance the shopping experience and drive impulse purchases.
10. Partnerships and Sponsorships: Collaborating with other brands or sponsoring events to increase brand exposure and reach new audiences.
11. Customer Service Initiatives: Improving customer service practices and training to enhance customer satisfaction and loyalty.
12. Market Research Activities: Conducting surveys, focus groups, and other research activities to gather customer feedback and market insights.

These tactical decisions are crucial for the effective implementation of the marketing strategy and ensure that every action taken aligns with the organization's goals and objectives.

Marketing Channels
Marketing channels are the pathways through which goods, services, and communications travel from producers to consumers. They play a crucial role in reaching the target audience and delivering the product or message effectively. Here are the main types of marketing channels:

1. Direct Channels:
   • Direct Selling: Involves selling directly to the consumer without intermediaries, such as through company-owned stores, online platforms, or direct mail.
   • Telemarketing: Reaching potential customers via telephone calls to sell products or services directly.
   • Online Channels: Websites, e-commerce platforms, and social media where companies can sell directly to consumers.
2. Indirect Channels:
   • Retailers: Selling products through retail stores like supermarkets, department stores, and specialty stores.
   • Wholesalers: Large-scale buyers who purchase in bulk from producers and sell to retailers or other intermediaries.
   • Distributors: Entities that help move products from manufacturers to retailers or wholesalers.
3. Hybrid Channels:
   • Franchising: Using a hybrid approach where franchisors grant licenses to franchisees to operate under their brand, combining elements of direct and indirect channels.
   • Agent/Broker Channels: Using agents or brokers who act as intermediaries to sell products on behalf of the company to various buyers.
4. Digital Channels:
   • Social Media: Platforms like Facebook, Instagram, and Twitter where businesses can market their products and engage with customers.
   • Email Marketing: Sending targeted emails to potential and existing customers to promote products, services, and offers.
   • Search Engine Marketing (SEM): Using paid advertisements on search engines to drive traffic to a website.
   • Content Marketing: Creating and sharing valuable content to attract and retain customers, such as blogs, videos, and infographics.
5. Traditional Channels:
   • Television and Radio: Advertising through TV and radio commercials.
   • Print Media: Using newspapers, magazines, and brochures to reach consumers.
   • Outdoor Advertising: Billboards, transit ads, and signage in public places.

These marketing channels can be used individually or in combination, depending on the target audience, product type, and marketing strategy. Each channel offers unique advantages and can be tailored to meet specific marketing objectives.

Marketing Activities
Marketing activities encompass a wide range of actions and strategies designed to promote products, engage customers, and achieve business goals. These activities can be broadly categorized as follows:
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1. Advertising: Creating and placing ads in various media (TV, radio, online, print) to promote products or services.
2. Sales Promotion: Short-term incentives like discounts, coupons, contests, and samples aimed at boosting immediate sales.
3. Public Relations (PR): Managing the public image and media relations of a company, including press releases, events, and crisis management.
4. Direct Marketing: Communicating directly with targeted customers through channels like mail, email, telemarketing, and mobile messaging.
5. Social Media Marketing: Using social media platforms to engage with customers, build brand awareness, and promote products or services.
6. Content Marketing: Creating and distributing valuable content (blogs, videos, infographics) to attract and retain a target audience.
7. Search Engine Optimization (SEO): Improving the visibility of a website in search engine results through on-page and off-page optimization techniques.
8. Search Engine Marketing (SEM): Using paid advertising on search engines to drive traffic to a website.
9. Email Marketing: Sending targeted email campaigns to nurture leads, promote products, and maintain customer relationships.
10. Influencer Marketing: Partnering with influencers to promote products or services to their followers.
11. Event Marketing: Organizing or sponsoring events to promote a brand, product, or service.
12. Affiliate Marketing: Partnering with affiliates who promote products and earn a commission for sales generated through their efforts.
13. Market Research: Collecting and analyzing data to understand market trends, customer preferences, and competitive activities.
14. Brand Management: Developing and maintaining a strong brand identity and reputation through consistent messaging and customer experiences.
15. Customer Relationship Management (CRM): Managing interactions with current and potential customers to improve satisfaction and loyalty.
16. Product Development: Creating new products or improving existing ones to meet customer needs and market demands.

These marketing activities are essential for reaching potential customers, building brand loyalty, and driving business growth. They can be tailored to fit the specific needs and goals of an organization, ensuring a cohesive and effective marketing strategy.

​​Marketing Plan
​​​​​A marketing plan is a document that outlines a business's strategies for a certain campaign, providing an overall high-level strategy based on the brand's objectives over a specific period, such as a quarter or fiscal year. The marketing plan clearly states the strategies and actions to be implemented, laying out the marketing approach for the business, products, and services. It includes information about the target market and detailed step-by-step processes for developing various marketing systems and strategies. The purpose is to describe who your clients are, where they are, and how you can reach them.

Elements of a Marketing Plan
A marketing plan encompasses all your marketing initiatives, including all campaigns you intend to run over a set period, your goals, ambitions, and supporting research. Marketing plans detail specific strategies to reach the company's goals and include timetables for when these strategies will be executed. They also outline the logistics of marketing campaigns, such as budgets, detailed timelines, responsibilities within the organization, and the costs associated with various distribution channels.

• Organization Mission: This defines the organization's purpose and reason for existing.
• Objectives: These represent the expected outcomes of the marketing efforts.
• Marketing Strategy: This identifies the most effective actions to fulfill the objectives, including determining target markets, setting competitor targets, and creating a competitive advantage. Examples of marketing strategies include online advertising, email marketing, content marketing, social media management, and events.
• Tactics: These detail the actions to be taken, explained through the 4Ps (or 7Ps for service marketing) and the responsibilities of individuals implementing the plan. Tactics involve the major marketing decision areas and set the stage for specific actions.
• Implementation Activities: A list of tasks required to implement each marketing strategy.
• Marketing Budget: This section details the financial resources allocated to each marketing activity.
• Controls: These are systems to appraise the results of the marketing plan, allowing for corrective actions if performance does not meet objectives.

A marketing plan typically outlines marketing activities on a monthly, quarterly, or annual basis. It serves as the framework for all marketing strategies, detailing specific types of marketing activities and containing timetables for rolling out initiatives. The plan helps connect each strategy to the larger marketing operation and business goals. It needs to be updated frequently to accommodate changes in costs, market conditions, and other factors.

Marketing Campaigns
A marketing campaign is a focused tactical initiative aimed at achieving a specific goal. A campaign plan coordinates many activities and resources, often involving multiple organizations, and is typically broken down by phases. Campaigns are centered on events or specific assets and help organize thoughts, identify target markets, and craft effective messages. They may focus on customer acquisition, conversion, retention, brand awareness, or advertisements. The choice of marketing media strategy, combined with appropriate messaging and creative elements, can resonate with ideal customers and encourage engagement.

Marketing Programs
A marketing program includes all the people, processes, technologies, and activities involved in making connections and building relationships to achieve a goal. In both B2B and B2C markets, the goal is to engage potential customers and improve sales. Programs focus on engaging, nurturing, and converting buyers with relevant content that aligns with their needs and buying processes. Unlike campaigns, programs are perpetual and continuously optimized by analyzing key performance indicators (KPIs). They include brand awareness, lead generation, customer acquisition, retention, and past customer reactivation. Programs are often managed as a group and adjusted based on business intelligence to improve overall performance.

Marketing Projects
A marketing project is a series of related action plans that further the implementation of marketing strategies. Projects have a clear beginning and end. For example, developing ads for a specific period is a marketing project. Key steps in any marketing project include determining the budget, identifying effective media outlets, crafting the ad message and design, and developing procedures to analyze ad effectiveness.

A marketing plan is a comprehensive document outlining a company's marketing strategies, campaigns, programs, and projects. It connects each strategy to the larger business goals, ensuring a cohesive and effective approach to achieving marketing objectives. The plan must be dynamic and adaptable to changes in the market and economic conditions.
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Human Resource Management and Strategy
Human Resource Management (HRM) is defined in terms of the set of functions, and activities designed and performed in order to maximize both employee as well as organizational effectiveness. It is a management function that helps organization in recruiting, selecting, training, developing and managing its members. Human Resource Management functions include planning, organizing, leaning and controlling company's activities in recruiting, staffing, and effective utilizing of the organization's workforce. The scope of HRM include workforce planning, recruiting and hiring, performance management, and learning and development.

Human Resource Function
Human Resource is the function within an organization that focuses on developing the capability for planning, recruitment, management, and providing direction for the people who work in the organization. Human Resource function area business capabilities include:

• HR Strategy and planning,
• Workforce management,
• Talent management,
• Learning and Development,
• Compensation and Benefits management,
• People Relationship Management,
• Recruitment and Hiring
• HR Analytics and Reports

A business capability is what a company needs to be able to do to execute its business strategy. Another way to think about capabilities is as a collection of people, process, and technology gathered for a specific purpose.

HR Management Goals and Objectives
The primary objective of resource management is to ensure seamless experience for the staff and other people associated to management and organizational goals. HRM objectives are basically influenced by organizational goals. ​Some of the main objectives of HR are:
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1. Achieve Organizational goals - To help the organization reach its goals. Fulfil organizational goals by utilizing human resources to achieve business goals. Organizational objectives include: workforce handling, staff requirements like hiring and onboarding, payroll management and retirement.
2. Work Culture - Foster better work culture through automation of activities like leave approvals, reimbursement request acknowledgement to help create positive vibes in the work place.  Developing good team culture through developing and maintaining healthy and transparent relations among team members and teams.
3. Team integration - Ensuring teams coordinate efficiently through better communication.
4. Training and development - To provide the organization with well-trained and well-motivated employees. Ensure effective utilization and maximum development of human resource. Enhance employee’s capabilities to perform the present job.
5. Employee Motivation - To increase to the fullest the employee’s job satisfaction and self- actualization. ​Attend to employee needs to keep them motivated ; keep them on the right path and keep distractions and negative vibes away.
6. Workforce Empowerment - Empowering the workforce improves employee morale, motivation and ensures workforce engagement.
7. Retention - To achieve and maintain high moral among employees.
8. Data and Compliance - Managing company and employee data, and managing compliance. Managing payroll compliance and keeping the company out of any penalties or fines.

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HRM objectives are basically influenced by organizational goals, and encompass ensuring availability of resources, easy access to data, on-time payroll, ensuring compliance, on-time payroll, ensuring compliances, etc. And ensuring a stable work environment with data at one place and efficient operations.

HR Strategy
HR strategies are internally consistent bundles of human resource practices. HR strategies set out what the organization intends to do about the different aspects of its human resource management policies and practices. The purpose of HR strategies is to guide HRM development and implementation of programs. They provide a means of communicating to all concerned, the intentions of the organization about how its human resources will be managed. They provide the basis for strategic plans and enable the organization to measure progress and evaluate outcomes against objectives.

HR strategies provides a vision for the future, but are also vehicles that define the actions required  and how the vision should be realized. Because all organizations are different, all HR strategies are are different. HR strategies however, can be categorized into two (2) types; overarching strategies and specific strategies.

Overarching Strategies Examples 
These describe the general intentions of the organization about:

1. How people should be managed and developed,
2. What steps should be taken to ensure that HRM processes of the organization can attract and retain the people it needs, and ensure as far as possible that,
3. Employees are committed, motivated and engaged.

These strategies are likely to be expressed in broad statements of aims and purpose that set the scene for more specific strategies. 
​
Specific Strategies  
These relate to the different aspects of human resource management. They set our what the organization intends to do in decision areas such as:
​

1. ​Talent Management - How the organization intends to win the war for talent,
2. Continuous Improvement - Providing for focused and continuous incremental innovation sustained over a period of time,​
3. Knowledge Management - Creating, acquiring, capturing, sharing and using knowledge to enhance learning and performance,
4. Resourcing - Attracting and retaining high quality people,
5. Learning and Development - Providing an environment in which employees are encouraged to learn and develop,
6. Reward - Defining what the organization wants to do in the longer term to develop and implement reward policies, practices and processes that will further the achievement of its business goals and meet the needs of its stakeholders,
7. Employee Relations - Defining the intentions of the organization about what needs to be done and what needs to be changed in the ways in which the organization manages its relationships with employees and their trade unions.

They are concerned with the overall organizational effectiveness. - achieving human resource advantage by employing 'better people in the organization with better processes', developing high performance systems and generally, creating a great place to work. ​

Finance Management and Strategy
​S.C. Kushal defines financial management as: “Financial Management deals with procurement of funds and their effective utilization in the business”. Financial management is an area in financial decision-making, harmonizing individual motives, and enterprise goals. ​Financial Management is the activity concerned with the control and planning of financial resources. Financial management entails the process of planning, organizing, monitoring, and also controlling the financial resources of an organization. It controls every single thing regarding the company’s financial activities which includes the procurement of funds, use of funds, payments, accounting, risk assessment, and other things that are related to finances.

Financial Management functions include:

• Financial Planning and Forecasting
• Determination of capital composition - Decide the capital structure after planning and forecast has been made.
• Fund investment - Ensure funds made available to the business are used adequately to grow the business.
• Maintain proper liquidity - Cash is the best source for maintaining liquidity.
• Disposal of surplus - Increase the ROCE.
• Financial Controls - This is the analysis of a company's actual results, compared to its short, medium, and long-term objectives and business plans.

Successful financial management contributes to and supports the reason for establishing a company, i.e., make a profit and thrive (run for many years).

Finance Function
The Finance Function is a part of financial management. In a business, the finance function involves the accounting and utilization of funds necessary for efficient operations. The financial function is concerned with two sets of activities;
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• Strategic management - Acquiring funds to meet the organization's current and future financial needs, and
• Operations management - recording, monitoring, and controlling the financial results of the organization's operations.

The accounting aspects of finance function brings business to life, and passes through every part of the firm's operations. It is the operational activities of business that is responsible for obtaining and effectively utilizing the funds necessary for efficient operations.

Finance function can be classified into the following categories:

• Long-Term Finance - Acquiring funds to meet the organization's current and future financial needs, Sources may include owner capital, share capital, etc.
• Medium-Term Finance - Acquiring funds to meet the organization's current and medium term needs. Sources may be bank loans and institutions.
• Short Term Finance - Finance needed with a year; sources may be bank overdrafts, commercial paper, trade credit, etc.

​The finance function is important in helping establish the business and run the business.

The objectives of the finance function are:

• Investment Decisions - Decisions on where to put the company's funds. These decisions relate to the management of working capital, capital budgeting decisions, management of mergers, buying or leasing assets, etc. Investment decisions should create revenue, profits, and save costs. 
• Financing Decisions - Where to raise funds from.
• Dividends Decisions - Decisions on how much, how frequently, and in what form to return cash to owners.
• Liquidity Decisions - Liquidity means that a firm has enough money to pay its bills when they are due and have sufficient cash reserves to meet unforeseen emergencies. This decision involves the management of the current assets so you don’t become insolvent or fail to make payments.

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​Financial Management Goals and Objectives
The main focus of financial management must be set up to follow the best practices, use the required financial management tools, and also deploy the right strategies to minimize cost, and ensure production or business activities function smoothly.

Financial Management Goals
The goals of the financial function includes:
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1. Strategic Budgeting - The goal is to create and monitor the overall company budget, and the variety of functional departments' budgets. Budgeting requires research to estimate revenue levels based on demand forecasting. Using annual budget projections, the accounting staff can help you set targets for profit goals and for overhead and production spending levels. Overhead includes costs such as phones, rent, and marketing; while production costs are those related to making your product. Create monthly or quarterly budget variance analyses to see if you are on track with your revenues and spending or if you need to make changes before expenses get out of hand. ​
2. Cost Containment - To ensure you get the best quality at the lowest price for materials, supplies, and services, make purchasing management one of the duties of the finance department. Require that employees get multiple bids or present some justification for large purchases; and have vendors, suppliers and contractors rebid their contracts every year. Look for trends in spending lvels to determine where you can cut costs without sacrificing quality.
3. Cash Flow Management - Cash flow management is about knowing when your bills are due and when you can expect payment from your customers, or other sales revenues; and its critical to your financial health. Its not enough to show a profit on paper, the financial function to should help you manage your working capital and credit to ensure you have enough to pay your bills at all times. Make receivables management a key role of the financial department.
4. Debt Service​ - Keep an eye on credit use, including interest amounts you are generating, the scheduling of your payments and the status of credit report and scores.
5. Tax Planning - Use proactive strategies to lower your tax burden, such as deprecisting assets, and offering voluntary benefits to employees that help you lower payroll taxes.
6. Accurate Record Keeping  - The most important objective of any finance department is to keep accurate financial records. This includes you meet your legal requirements and ensuring you don't spend more than you have by accident. Consider audits to prevent fraud and institute policies and procedures for controlling contacts and payments.

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Financial Management Objectives
There are objectives or reasons firms implement these management strategies to grow their business.

1. Profit Maximization - Maximize profit while managing the finances of the company. Ensure the company is making sufficient profit to survive and grow.
2. Proper Mobilization of Finance - Collection of funds to run the business. Securing the required amount of funds needed/estimated for the business process.
3. The Company's Survival - Make adequate financial decisions to ensure the company is successful.
4. Proper Coordination - Proper understanding and cooperation among various departments.
5. Lowers cost of Capital -  Reduce the cost of capital; ensure money borrowed attracts little interest rates so the company can maximize profits.

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​Financial Strategy
Financial strategy is concerned with the choices and commitments regarding acquisition of financial resources, analyzing cost structure, estimating profit potential, allocation of financial capital, dividend policy, or accounting functions in managing investment/working capital/cash flow. Most businesses require substantial amount of capital to both develop and operate; and therefore, cost and availability of capital have an enormous impact on the business.  When demand is high, large amounts of cash is generated, and when demands drops cash gets used up very quickly. Financial strategies concern objectives in key results areas such as: profitability, liquidity and cash management, leverage and capital management, asset management, investment ratios, and financial planning and control.

​Businesses respond to and operate under a variety of financial strategy options. Strategy selection is influenced by the company's overall goals, objectives, and mission statement. 

Finance and accounting operations implement strategies to reduce functional and operational complexity, streamline processes, optimize the use of technology, and efficiently use resources to deliver cost effective, high quality services. ​

Return on On Investment Capital
The following financial strategy options can b mixed to achieve various business objectives such as accelerate growth, minimize investment, and improve returns and  the timeliness of those returns. For example, for business objective such as Return on Investment, the mix of financial strategy options include:
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1. Manage Contracts
2. Rollover Asset
3. Additional Capacity
4. Franchises
5. Management contract with limited equity investment
6. Buy out of negative leases
7. Acquisitions
8. Joint Ventures
9. Management contract with major equity investment
10. Ownership (Construction)

Improve Return on Investment Capital (ROIC) involves the following financial strategy options:

1. Rollover Asset (sale)
2. Manage Contracts
3. Additional Capacity (assumes demand is high)
4. Buy out of negative leases
5. Buy in to joint ventures with management contracts.

​Cash Generation
Understanding how to generate cash in relationship to your business' time horizon is essential to survival. The fastest way to generate cash is to rollover an asset. The longest time to generate cash is to develop a concept - opening an operating business model that is successful and worthy of franchise investment - and then providing for the marketing of the franchise.

1. Rollover of an Asset
2. Ownership
3. Acquisitions
4. Manage Contract
5. Franchise

Operations Management and Strategy
​Operations is a term used to refer to the steps/tasks an organization performs in the process of producing and delivering value to customers. Operations constitute many processes, such as material acquisition, manufacturing, inventory management, delivery, etc. An organization may consider each step they take toward producing/delivering a product, an operation, and all decisions regarding these various operations are the Operations Strategy. 

Operations management 
​Operations management is a broader term that encompasses the planning, organizing, and supervising of production, manufacturing, or the provision of services. It focuses on the entire process of transforming inputs (such as raw materials, labor, and energy) into outputs (goods and services) that add value to the customer2. Operations management is concerned with the design, implementation and improvement of operations infrastructure - the systems that create the organization's goods and services. Operations management is important in a business organization because it helps effectively manage, control and supervise goods, services and people.

​Operations Management Decisions
Operations management involves making a wide range of decisions that are crucial for the efficient and effective functioning of an organization’s production and service processes. Here are some key areas where operations management decisions are made:

1. Process Design: Decisions about how to design the production process to ensure efficiency and quality. This includes choosing the right technology, workflow, and layout.
2. Capacity Planning: Determining the amount of production capacity needed to meet demand. This involves decisions about scaling up or down, adding new facilities, or optimizing existing ones.
3. Supply Chain Management: Managing the flow of materials and information from suppliers to customers. This includes decisions about sourcing, procurement, logistics, and inventory management.
4. Quality Management: Ensuring that products and services meet customer expectations and regulatory standards. This involves decisions about quality control processes, standards, and continuous improvement initiatives.
5. Inventory Management: Deciding how much inventory to keep on hand to balance the costs of holding inventory with the need to meet customer demand promptly.
6. Scheduling: Planning and controlling the timing of production activities. This includes decisions about workforce scheduling, machine utilization, and project timelines.
7. Maintenance: Ensuring that equipment and facilities are kept in good working condition to avoid disruptions in production. This involves decisions about preventive maintenance, repairs, and upgrades.
8. Human Resources: Managing the workforce involved in production and service delivery. This includes decisions about hiring, training, and workforce planning.
9. Innovation and Improvement: Continuously seeking ways to improve processes, products, and services. This involves decisions about adopting new technologies, implementing lean practices, and fostering a culture of innovation.
10. Sustainability: Making decisions that ensure the operations are environmentally sustainable and socially responsible. This includes decisions about waste management, energy use, and ethical sourcing.

By focusing on these areas, operations management aims to optimize the efficiency and effectiveness of the production process, ensuring that the organization can meet its strategic goals and deliver value to its customers.

Operations Management Decisions Alignment with Management Functions
​Operations management decisions align closely with the four fundamental management functions: planning, organizing, leading, and controlling. Here’s how each area of operations management fits into these functions:

1. Planning: Planning involves setting objectives and determining the best course of action to achieve them. In operations management, this includes:

• Process Design: Planning the layout and workflow to ensure efficiency and quality.
• Capacity Planning: Forecasting demand and planning capacity to meet future needs.
• Supply Chain Management: Developing strategies for sourcing, procurement, and logistics.
• Quality Management: Setting quality standards and planning quality control processes.
• Inventory Management: Planning inventory levels to balance costs and meet demand.
• Scheduling: Planning production schedules to optimize resource use.
• Innovation and Improvement: Planning for continuous improvement and innovation initiatives.
• Sustainability: Setting sustainability goals and planning initiatives to achieve them.

2. Organizing: Organizing involves arranging resources and tasks to achieve the plan. In operations management, this includes:

• Process Design: Organizing the production process, including technology and layout.
• Capacity Planning: Organizing resources to scale up or down as needed.
• Supply Chain Management: Organizing the flow of materials and information.
• Quality Management: Organizing quality control teams and processes.
• Inventory Management: Organizing inventory storage and handling.
• Scheduling: Organizing workforce and machine schedules.
• Maintenance: Organizing maintenance schedules and teams.
• Human Resources: Organizing hiring, training, and workforce planning.
• Innovation and Improvement: Organizing teams and resources for innovation projects.
• Sustainability: Organizing resources and processes to achieve sustainability goals.

3. Leading: Leading involves motivating and directing people to achieve organizational goals. In operations management, this includes:

• Process Design: Leading teams to adopt new processes and technologies.
• Capacity Planning: Leading efforts to expand or optimize capacity.
• Supply Chain Management: Leading supplier relationships and logistics teams.
• Quality Management: Leading quality improvement initiatives.
• Inventory Management: Leading inventory management teams.
• Scheduling: Leading workforce and production scheduling efforts.
• Maintenance: Leading maintenance teams to ensure reliability.
• Human Resources: Leading and motivating the workforce.
• Innovation and Improvement: Leading innovation and continuous improvement efforts.
• Sustainability: Leading sustainability initiatives and fostering a culture of responsibility.

4. Controlling: Controlling involves monitoring performance and making adjustments to stay on track. In operations management, this includes:

• Process Design: Monitoring process performance and making adjustments.
• Capacity Planning: Monitoring capacity utilization and making adjustments.
• Supply Chain Management: Monitoring supply chain performance and making adjustments.
• Quality Management: Monitoring quality and implementing corrective actions.
• Inventory Management: Monitoring inventory levels and making adjustments.
• Scheduling: Monitoring schedules and making adjustments to meet deadlines.
• Maintenance: Monitoring equipment performance and scheduling maintenance.
• Human Resources: Monitoring workforce performance and making adjustments.
• Innovation and Improvement: Monitoring innovation projects and making adjustments.
• Sustainability: Monitoring sustainability performance and making adjustments.

By aligning operations management decisions with these management functions, organizations can ensure that their operations are well-planned, organized, led, and controlled, ultimately supporting their strategic goals and achieving long-term success.

Operations Strategy Formulation
Operations strategy formulation involves selecting the most appropriate and efficient methods to realize the organization’s vision and achieve its goals and objectives. This complex and dynamic process requires careful planning and analysis. Key factors to consider include:

• Product and Service Offerings:
  1. The type and scope of products and services the organization offers.
  2. How these products and services are designed, manufactured, and delivered to customers.
• Demand and Supply Management:
  1. Forecasting demand and managing the supply of products or services.
  2. Scheduling and managing inventory and capacity to meet demand efficiently.
• Quality and Performance Standards:
  1. Setting quality and performance standards for products and services.
  2. Ensuring and measuring customer satisfaction and loyalty.
• Resource and Capability Management:
  1. Assessing the resources and capabilities the organization has or needs to acquire, including human, financial, physical, technological, and informational assets.
  2. Allocating and optimizing these resources across operations.
• Competitive Environment and Market Conditions:
  1. Analyzing the competitive environment and market conditions the organization faces.
  2. Differentiating the organization from its rivals and creating value for stakeholders.

The result of operations strategy formulation is a comprehensive plan that aligns the organization’s operations with its overall strategic goals and objectives. This plan provides a clear roadmap for how the organization will manage its resources, processes, and capabilities to achieve competitive advantage and deliver value to its customers.

Operations Strategy: Strategic Decision Areas
Operations strategy is more about the big picture. It involves setting the long-term direction for how the organization’s operations will support its overall business strategy. This includes making decisions about the design of the operations system, the technology to be used, and the capabilities that need to be developed to achieve competitive advantage2. Operations Strategy time horizon is long-term, focusing on aligning operations with the overall business strategy. Operations Strategy scope is broad, encompassing the entire operations system and its alignment with business goals. 

An operations strategy is a set of decisions an organization makes regarding the production of its products/goods and provisioning of its services. An organization may consider each step they take toward, for example, manufacturing or delivery of a product, or provisioning of a service an operation, and all these decisions regarding these various operations are the operations strategy.  Operations strategy decisions can be broadly categorized into several key areas.

1. Design of Goods and Services:
   • This involves decisions about product specifications, quality standards, and resource requirements. It ensures that the products or services meet customer needs and align with the company’s strategic objectives1.
2. Quality Management:
   • Focuses on maintaining and improving the quality of products or services. This includes implementing quality control processes and continuous improvement initiatives1.
3. Process and Capacity Design:
   • Involves planning and designing the processes needed to produce goods or services. It also includes decisions about the capacity required to meet demand efficiently2.
4. Location Strategy:
   • Decisions about where to locate production facilities, warehouses, and other operations. This affects costs, delivery times, and the ability to serve customers effectively2.
5. Layout Design and Strategy:
   • Concerns the physical arrangement of resources in production facilities. Effective layout design can improve efficiency and reduce production time2.
6. Human Resources and Job Design:
   • Involves planning for the workforce needed to execute the operational strategy. This includes recruiting, training, and designing jobs to maximize productivity and employee satisfaction2.
7. Supply Chain Management:
   • Focuses on managing the flow of materials and information from suppliers to customers. Effective supply chain management can reduce costs and improve delivery performance2.
8. Inventory Management:
   • Decisions about how much inventory to hold and where to hold it. Effective inventory management balances the need to meet customer demand with the cost of holding inventory3.
9. Scheduling:
   • Involves planning the timing of production activities to ensure that products are made and delivered on time. This includes workforce scheduling and production scheduling3.
10. Maintenance:
    • Ensures that equipment and facilities are kept in good working condition to avoid disruptions in production. This includes preventive maintenance and repair strategies3.

​These decision areas are interconnected and collectively contribute to the efficiency and effectiveness of an organization’s operations. By carefully managing these areas, companies can achieve their strategic goals and maintain a competitive edge.

Key Elements/Components of Operations Strategy
Operations strategy comprises specific courses of action management wants to take to achieve a specific aspect of a company's operations. Some of the key elements that go into a company's operations strategy include:
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• Design of Production Systems - An organization's production system determines the short-term and long-term planning for how resources are turned/transformed into marketable products and services. Once the general specification of a production system have been agreed upon, including precise definitions of needed resources and output expectations, three (3) important decisions remain: (1) Choice and design of technology to be used; (2) Determining the capacity of the production system;(3) Decisions on the adaptability of production system volume to meet the inevitable fluctuations in market demand that the firm will experience. A comprehensive production system includes clear work flows, quality control benchmarks, and supply chain management strategies.

1. The capacity of the system is designed to be a function of the amount of available capital, the demand forecast for the output of the facility, and many other minor factors. 
2. Decisions on the adaptability of production system volume to meet the inevitable fluctuations in market demand that the firm will experience. Capacity in most production systems is adjusted by hiring or firing workers, by scheduling overtime, or cutting back on work hours, by adding or shutting down machines or whole departments, or areas of the facility, or by changing the rate of production within reasonable limits.

• Facilities for Production and Services - The size and number of production facilities influence operational capabilities. To function properly facilities require achievable production goals, clear safety procedures, and inventory management systems. Certain specialization in production allows the firm to provide customers with products of lower cost, faster deliver, on-time delivery, high product quality, and flexibility.
• Product or Service Design and Development - Managing product or service quality is one of the important elements of operations strategy. This involves generating the idea, creating the feasibility reports, designing the prototype and testing, preparing a production model, evaluating the economies of scale for production, testing the product in the market, obtaining feedback, and creating the final design and starting the production.
• Technology Selection and Process Development - Operations strategy increasingly depends on new technological developments such as: machine leaning, production line automation, real-time metrics, and market forecasting tools. The decisions on choice and design of technology to be used include the choice of equipment and tooling, the layout of plant space and facilities, the selection of workers and work procedures, and many aspects of process design. These choices must be handled carefully; mistakes at this stage can result in business loosing its competitiveness, or the ability to sustain a profitable position in the market.
• Allocation of Resources - Operations strategy should take into account the total operations resources available to the organization including location, mechanical and human resources.
• Facility, Capacity, and Layout Planning - The location, layout and capacity creation for the production are critical decision aeeas for operations management.

Operations strategies connect the firm's programs, policies, guidelines and workforce in a way that allows each function/branch/department to support the others in achieving a common goal.

Common Types of Operations Strategies
Businesses and organizations use operations strategy to identify and implement cost-effective processes that give them competitive advantage in creating and delivering (distributing) goods and services. Operations strategy can be broken down into categories - types of decision/issue areas - that must be addressed. Some common types of operations strategies include:

1. Customer-Driven Strategies - Operations strategies to meet the needs of a targeted customer segment. These are market based strategies that enable the organization to meet the needs and desires of a target market. These strategies must allow a company to evaluate and   adapt to changing environments, continuously enhancing core competencies, and developing new strengths on an ongoing basis. This type of operations strategy aligns with sales and marketing strategies to manage and fulfill customer expectations. Companies using this type of strategy make operations decisions based on the customer experience.
2.  Customer engagement strategy - The focus of this strategy is to improve customer-centricity. In this strategy the company aspires to improve existing operations system for both new and repeat clients. The better this service process is, the higher the company's customer satisfaction rating will be. This builds loyalty and referral business. An example is, a car rental company that eliminate long lines. 
3. Core Competencies - Strategies to develop the company's key strengths and resources. Core competencies are the strengths and resources within a company. Core competency based strategies are resource-based strategies, and may include having well-trained staff, optimal business locations, and marketing and financial strengths.  By identifying its core competencies a company can develop processes such as customer satisfaction, product development, and building professional relationships with stakeholders. This type of operations strategy revolves around the main strengths of a company's business model. By identifying the best core business processes within an organization, this type of operations strategy focuses on leveraging existing strengths to maximize profitability.
4. Product and Service Development - Strategies behind the development of products - goods and service - should consider design, innovation, and added value. When developing a product - good or service - a company should consider the wants and needs of its customers, how it stands against the competition, and how its technical measures relate to its customers' needs. Companies should consider packaging services with immediately observable and psychological benefits and support services. This type of operations strategy resolves around the quality control of existing products or services as well as the development of new products and services. Businesses using this model often determine their operations strategies based on research and ideas from product managers. This operations strategy is focused on developing compelling products or services that resonate with the firms customers. It goes beyond the developing and delivering new products by providing additional ancilliary services in support of products and services.
5. Market penetration strategy - This focuses on capturing larger segments of the target customer market. This refers to. developing an operations strategy for market penetration - capture a large share of the market. It has several potential focus areas: A business can decide to attract customers away from competitors; It can attract nonusers that have no experience with your business or with a competitor. Another strategy might employ one or more geographic locations, centered around a target demographic. Businesses can also try to add more value to existing clients, thereby enticing increased spending on product or service upgrades. An insurance company might define market penetration success by the number of new automobile policies gained. 
6. ​Corporate Strategy - Overall company strategy, driving the company mission and interconnected departments/functions. This type of operations strategy adhere to a company's mission statement and aligns itself to a larger corporate strategy. Businesses using this type of operations strategy develop production initiatives, key performance indicators, and decision-making processes based on strategic plan determined by company's leadership and stakeholders.
7. Supply chain strategy - This strategy refers to the process of creating excellence through superior delivery capabilities.

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​Each organization strategy requires a tailored operations strategy. These are some common operations strategies an organization can use to enhance efficiency, boost capabilities and improve competitive advantage. Operations strategies help companies examine and implement effective and efficient systems to achieve corporate and business objectives.The role of operations strategy is to provide a plan for the operations function so that it can make the best use of its resources. 

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Operations strategy refers to the system of decisions an organization implements to achieve its long-term goals and mission. ​

​​Operations strategy binds the various operations decisions and actions into a cohesive consistent response to competitive forces by linking policies, programs, systems, and actions into a systematic response to projected demand products and services resulting from the strategic priorities chosen and communicated by the corporate or business strategy. ​

Operations strategy is concerned with the overall direction and scope of an organization's operations, including its market focus, competitive position, and resource allocation. Operations strategy may also focus on continuous cost-improvement, maximizing productivity, and cost control by planning and control activities and thereby reducing overall costs. Arriving at an appropriate operations strategy can help an organization develop capabilities that the organization needs to achieve its corporate strategies. 


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​​​Strategy Implementation
Strategy implementation viewed as a decision-making process is comprised from two (2) simultaneous processes:

1. top-down inductive process is often facilitated directive  of the business strategy into more fine-grained dub-goals for the development of technological capabilities. Stability is fostered as lower-level actors align their own decisions with the overarching directive of the business strategy (Wheelwright and Clark 1992). This inductive process is often facilitated by "strategy cascading tool" - such as Key Performer Indicator (KPI) system, portfolio selection aids, etc.
2. Bottom-up autonomous process invites undirected innovation impulses from front line actors to adapt and refine the existing operations system.

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Operations Strategy Decisions

Operational management strategic decisions encompass critical choices that significantly impact the organization’s long-term direction. These strategic decisions shape the organization’s competitive position, resource allocation, and overall success. These decisions pertain to day-to-day operational activities, ensuring efficient execution of processes. They address practical questions such as:

• How do we optimize production schedules?
• Which suppliers should we partner with?
• How do we manage inventory?
• What quality control measures should we implement?

These decisions directly affect operational efficiency, productivity, and quality. Operations management decisions are guided by the strategic choices made during operations strategy formulation. 

Operations management strategic decisions can be guided by the organization's competitive priorities, and grouped into categories, such as structural and infrastructure. The structural decisions relate to the physical attributes of operations, and infrastructural decision relate to the systems and resources. Some examples of these decisions, include:
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• Location Decisions: A company's objective in this strategic decision area is the selection of a location to allow for example, optimum transportation of its products to distribution channels; optimum transportation of material an parts to manufacturing facilities, etc. 
  1. Strategic Importance: Choosing where to establish facilities (factories, warehouses, offices) profoundly influences cost structures, accessibility to markets, and overall competitiveness.
  2. Factors Considered: Proximity to suppliers, customers, transportation networks, labor availability, and regulatory environment.
• Capacity Planning: This decision area in operations management is concerned with design strategies which support production goals including technology and resources. This category deals with designing production processes and determining the capacity needed to meet demand. Decision makers must give due consideration to strategies to flexibly increase capacity if the organization has to scale production to match increase in demand. A company's main objective in this area is on how to maintain optimum production process. ​
  1. Strategic Significance: Determining the optimal production capacity aligns with business goals.
  2. Balancing Act: Balancing excess capacity (costly) versus insufficient capacity (missed opportunities).
• Technology Investments: Process technology decisions on how to structure the conversion processes and methods used in execution. 
  1. Strategic Intent: Selecting technologies (automation, digital tools) that enhance efficiency, quality, and innovation.
  2. Impact: Technology choices shape the organization’s competitive edge.
• Supply Chain Design: ​This decision area in operations management is concerned with determining the best strategies to streamline be cost effective and to develop trusted partners. Supply chain decisions encompass sourcing raw materials, managing suppliers, inventory control, and distribution. Organizations must balance cost, lead time, and quality when making supply chain decisions. Efficient supply chain management ensures timely availability of materials and minimizes disruptions.
  1. Strategic Focus: Crafting a resilient, efficient supply chain network.
  2. Components: Supplier selection, inventory management, transportation modes, and risk mitigation.
• Product and Service Design: This decision area of operations management is applied based on market research, trends and forecasting. The company's objective in this strategic decision as it relates to Operations Management is to support the  strategic positioning of the company's products - goods and services. This includes looking for ways to implement consistency in costs, quality, and resources across business divisions or brands.
  1. Strategic Implications: Defining product/service features, quality levels, and customization options.
  2. Market Alignment: Balancing customer preferences, cost constraints, and differentiation.
• Process Selection: Process decisions include selecting the most efficient production methods, layout design, and workflow optimization.
  1. Strategic Fit: Choosing the most suitable production processes (e.g., mass production, job shop, continuous flow).
  2. Trade-offs: Efficiency, flexibility, and responsiveness.
• Facility Layout and Design:  This decision area of operations management is concerned with the company's design of its workflows and facilities.
  1. Strategic Goals: Optimizing space utilization, workflow, and resource allocation.
  2. Impact: Influences productivity, safety, and employee morale.
• Human Resources and Job Design: Implement continuous improvement programs, provide regular training, and focus on employee satisfaction. A motivated workforce contributes to success.
• ​Quality Management: Understand customer demands and meet their expectations. Use market research to determine needs and conduct quality assurance testing during production.
• ​Inventory: Strategize inventory control based on market conditions, supply shortages, and labor availability. Maintain an optimal balance to meet demand efficiently.
• Scheduling: Consider both production requirements and workforce availability. Different industries and departments have varying scheduling needs.
• Maintenance: Regularly maintain people, machines, and processes. Quality and reliability depend on effective maintenance practices.

The strategic aspects of operations management is concerned with shaping the long-term capabilities of any type of operations and its contribution to the organization's overall strategy. ​The strategic aspects of operations management involves determining the systems, tasks and technology needed to fulfill the strategic objectives, deciding how to acquire the resources and design the facilities these tasks require, and measuring service delivery to gauge the ability of the operations to reach intended targets. 

Effective operations management ensures that the strategic goals set during formulation are executed efficiently. Performance metrics from operations management inform adjustments to the overall strategy. Operations strategy formulation sets the vision, while operations management strategic decisions execute that vision in practice. Both are essential for achieving organizational success . 

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Operations strategy decisions are the actual decisions that are taken over time and shape the operations of a company.

The realized operations strategy is the total pattern of decisions which shape the long-term capabilities of any type of operations and their contribution to the overall business strategy. Operations strategy supports a company's overall business strategy in order to maximize profits, and drives a company's operations function. Operations strategy focuses on maximizing the efficiency and effectiveness of production of service or goods while minimizing operating costs. Operations strategy comprises specific actions management wants to take to achieve a specific aspect of a company's operations.

Operations strategy is concerned more with the total transformation process, that is the whole business, and less with individual processes,  and how the competitive environment is changing and what the operation has to do in order to meet current and future challenges. Operations strategy is concerned, for the long-term, with how to best determine and develop the firm's major operations resources so that there is a high degree of compatibility between those resources and the business strategy. 


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Factors Influencing Operations Strategy
​Operations strategy focuses on specific capabilities of the operations function that give the company a competitive edge/advantage. The factors that have to be taken into consideration when making operations strategy design decisions include:

1. ​Performance Objectives
2. Competitive priorities
3. Core Competencies
4. Structure and Infrastructure

Performance Objectives
Performance objectives are broad performance measures that provide a device for understanding market requirements. Performance objectives are the main device used to understand market requirements. These objective measures represent the various aspects of performance in which the market requirements can be expressed. A performance objective is a specific end result that contributes to the success of the unit or organization, and that an employee is expected to accomplish or produce. Performance objectives are a set of broad performance measures that have some meaning to the operations function. The performance objectives include:
​

1. Quality - The quality objective is considered to measure how well a product conforms to certain specifications. It is also how desirable the features of the product are; how reliable the product is; how durable it is; how easily it can be serviced; how well it performs its intended function; and how much the customer believes in its value.
2. Speed - The speed objective measures how fast a company can deliver its products and generate sales quotes. The objective will be concerned with such issues as: the time that it takes to produce one or more products of the company or the time that it takes to research a new product and develop it.
3. Dependability - This objective is a measure of company  dependability and/or product dependability. Organization dependability objective is measure of how dependable the company is when it comes to timely delivery of products to customers, in accordance with planned prices and costs. Product dependability objective is a measure of the product's ability to function in an intended way consistently over a reasonable period of time. "Dependability" could also mean a proportion of services or goods delivered late, average lateness, proportion delivered early, etc.
4. Flexibility - The flexible operations objective is a measure of operations that can configure their product lines to deal with various requirements and to also adjust these product lines quickly to new requirements. The latter is also closely related to the speed objective. 
5. Cost - The variation in costs objective looks at how much variation exists in the unit ost of a product as measured by changes in a variety of factors including: the volume and the variety of products.   

​Each of the performance objectives can be thought of as bundles of issues that will need separating out. Some of these objectives will be more important for some operations than others. One method for distinguishing between performance objectives involves classifying them as order winners and order qualifiers. ​Marketing requirements are translated into performance objectives which provides operations view of the marketing professionals view of the market.

Competitive Priorities
Competitive priorities, in operations management, are a crucial decision variable that focuses on building specific capabilities in operations/production that can improve the organization's positioning with an advantage vs its rivals in the market. Such focus may guide decisions with regards to the operations structure - facility, technology, production processes, etc. and operations infrastructure - planning and control systems, etc. Fitting operations/manufacturing practices to the competitive priorities is important to developing operations as a competitive advantage. Competitive priorities in operations are the ways in which operations management focuses on the characteristics of cost, quality, flexibility, delivery performance, and innovation.

• Cost - A firm competing on a cost/price basis is able to provide consumers with an in-demand product/service at a price that is competitively lower than that offered by firms producing the same or similar product/service. In order to compete on a price/cost basis, the firm must be able to produce the product at a lesser cost, or be wiling to accept a smaller profit margin.  
• Quality - Firms competing on the basis of quality, offer products/services that are superior to that of competitors in one or more of quality dimensions such as: performance, conformance, features/options, durability, reliability, serviceability, aesthetics, and perceived quality. Firms competing on this basis offer products or services that are superior to the competition on one or more of the eight (8) quality dimensions. Quality can be categorized as product quality and process quality. The level of quality in the product design will vary as to the particular market that it is aimed to serve. The higher quality products command higher prices in the market place. The proper level of quality is established to focus n the requirements of the customer. Process quality is critical in every market segment and its goal is to produce defect-free products.
• Flexibility - This refers to the ability of a company to offer a wide variety of [products to its customers. It is also a measure of how fast a company can convert its processes from making an old line of products to producing a new product line. Firms may compete on their ability to provide either flexibility of the product or volume. Firms that can easily accept engineering changes (changes to the product) offer a strategic advantage to their customers. This can also apply to services. 
• Delivery Speed - This relates to the speed and reliability of products to customers. It is an important determinant in the purchasing decision. The ability of a firm to produce consistent and fast delivery allows it to charge a premium price for the product. Products should be delivered to customers with minimum variance in delivery times.
• Service - This competency can be defined in a number of ways. Superior service can be characterized by the term "customer service", or it could mean rapid and reliable delivery of goods, stock availability, on-time delivery, or convenient location.

A firm's customers will determine which of the competitive priorities are emphasized. We have to make trade-offs within competitive priorities. In a competitive market, no business can normally be on top in all aspects.

The purpose of the competitive priorities is to assist in the mission of positioning an organization with an advantage versus its rivals. The level of consistency between emphasized competitive priorities and how they match decisions concerning operations structure and infrastructure determines the strength of operations strategy. To develop a manageable strategy, the priorities must be split into decision categories. As a way to prioritize among the list of competitive priorities, the idea of Order Winners and Order Qualifiers may be utilized. Order qualifiers are the qualities requires to be able to compete in the marketplace. Order winners are the qualities of a product - goods/service - which make an organization receive a new order. The main objective of analyzing a company's order-qualifiers and order-winners is to establish a basis for the manufacturing strategy. Competitive priorities signify a strategic focus on building specific manufacturing/production capabilities that can improve a company's product/service position in the marketplace. 

In operations management, competitive priorities are a crucial decision variable for operations managers. Competitive priorities operationalize the organization's competitive strategy. The two (2) generic strategies/advantages - cost and differentiation - are operationalized in terms of cost, quality, flexibility, and speed. Competitive priorities are the dimensions a firms production systems must possess to support the demands of the markets in which the firm wishes to compete. The firm's customers will determine which of the competitive priorities are emphasized. ​Operations managers must work closely with marketing in order to understand the competitive situation in the company's market, before they can determine which competitive priorities are important. We have to make trade-offs within competitive priorities in a competitive market. ​In fact, the strength of an operations strategy is dependent on the level of consistency between emphasized competitive priorities and matching decisions concerning operational structure and infrastructure. The purpose of the competitive priorities is to assist in the mission of positioning an organization with an advantage vs its rivals/competitors. ​Fitting a plant’s practices to the competitive priorities is important to developing operations as a competitive advantage. 

As a way to prioritize among the list of competitive priorities, the idea of order winners and order qualifiers may be utilized. Order-winners for a product, for example, are the qualities which make an organization receive a new order. Order-qualifiers, in contrast, are required to be able to compete in a marketplace. Identifying order-winners and order-qualifiers is not a one time activity, but needs to be done regularly, because market demands change as time passes and along with that the order-winners and  order-qualifiers. The main objective of analyzing a company’s order-winners and order-qualifiers is to establish a basis for the manufacturing strategy. Understanding how to create or add value to customers is key to developing effective production strategy. Specially, value is added through the competitive priority or priorities that are selected to support a given strategy. To develop a manageable strategy, the priorities must be split up into decision categories.


Competitive priorities are a crucial decision variable that focuses on building specific capabilities in operations/production that can improve the organization's positioning with an advantage vs its rivals in the market. Such focus may guide decisions with regards to operations structure - facility, technology, production processes, etc. and operations infrastructure - planning, control, etc. Competitive priorities in operations are the ways in which operations management focuses on the characteristics of cost, quality, flexibility, delivery performance, and innovation. A firm's customers will determine which of the competitive priorities are emphasized. We have to make trade-offs within competitive priorities. In a competitive market, no business can normally be on top in all aspects.

Structural and Infrastructure Decisions
One way of categorizing the various decisions that typically comprise an operations strategy is to consider those that are structural, in that they define the overall tangible shape and architecture (e.g., capacity, technology type) of the operation, and those that are infrastructural, in that they relate to the people, systems, and culture that tie together the operations activities.

Structural decisions:
Structural decisions define the overall tangible shape and architecture (e.g., capacity, technology type) of the operation. Structural elements decisions are grouped as capacity, location, integration/networking, and technology.

• Facility Location Strategy - This related to decisions as to how near the company and its products should be to the consumers, suppliers, and talent while taking into consideration costs, infrastructure, logistics, and government.
• Layout Strategy - This relates to integrating capacity needs, personnel levels, inventory requirements, and technology in order to ensure that material, people, and information efficiently flow through the company. 
• Capacity - It relates to decisions about the capacity of the company's facilities, production demands, and personnel that are necessary in order to maintain a reliable and stable production process.
• Process Technology - This defines how the product - good or service - is produced (i.e., the production processes utilized and the specific technology, quality, human resource, and capital investments that the management will undertaken order to determine majority of the company's basic cost structure. These involve decisions concerning the type of process, technology, measuring and performance.
• Supply Chain Management - This relates to decisions on how to integrate supply chain into the company's operations and strategy It includes decisions on what will be purchased when it will be purchased, whom it will be purchased from and the conditions for such purchases. Procurement is the process of getting the goods and materials your company needs.

Infrastructure Decisions:
​These are divided into four categories; planning & control, inventory management, quality management, and supply chain management. Examples include:

• Product Design - This involves designing the products and services to be offered . For instance, product designs normally determine the lowest volume of costs and higher grade of quality as well as other features such as sustainability and human resources required.
• Quality Management - This defines the expected quality from the consumers view point as well as established policies and procedures that the company intends to adopt towards attaining such quality levels. What quality system should we use? What impact does quality have on our organization? These decisions are concerned with: the aims, tools and programs for ensuring customer satisfaction.
• Human Resources and Job Design - This relates to decisions on how to recruit, motivate and retain the staff with necessary skills and talents. 
• Forecasting and Capacity Planning - What does the short-term and long-term schedules look like? How much can we make in what period of time?
• Inventory Management - This relates to decisions about inventory ordering and holding, and how to optimize the process in order to ensure consumers' satisfaction, enhanced supplier capabilities and effective production schedule.
• Scheduling - This relates to the decisions on how to determine and implement both intermediate and short-term schedules that can be utilized effectively and efficiently by both the personnel and facilities in the course of meeting consumers' demands.

​
Strategic decisions in operations management are the decisions that are concerned with whole environment in which the firm operates, the entire resources and the people who form the company and the interface between the two. ​


Distinctive Competencies
Distinctive competencies are defined as the dimensions that a firm's production system must possess to support the demands of the markets in which the firm wishes to compete. This type of operations strategy is based on a company developing operations processes in order to distinguish their product or service from competitors. By identifying competitive priorities within a specific economy, businesses can tailor their operations strategy toward gaining competitive advantage whether that's in higher-quality product or service, or faster lead time during production. Trade-offs in operations are the ways we are willing to sacrifice one performance objective to achieve excellence in another. This involves competing on one (1) or two (2) distinctive competencies at the necessary expense of the others. ​Analyzing markets starts with executive opinion of market order-winners and order-qualifiers, and then testing them with data showing actual demands for different customers, orders and products.


Operations Goals and Objectives
Operational goals are the workflow methods that bring the strategy to fruition, and exist at all levels of the organization, from CEO down to part-time employees. Operational goals are the short-term tactics designed to achieve the company's long-term strategy. Operational goals lay out increments called benchmarks; they streamline the day-to-day activities of the business. They measure daily, weekly, and monthly benchmarks. For example, the monthly budget report shows if a company's financial goals are on track. Manufacturing examines production reports to ensure the number of units produced meets production goals with minimum waste.

1. Supply or Sourcing Decisions - Supply chain management is the process of transforming those goods into products and distributing them to customers as efficiently as possible. These decisions specify which activities are performed internally, and which activities are outsourced, and how to manage suppliers. Decisions involve defining the process boundaries and interfaces. It includes strategic sourcing decisions, vertical integration, and supply network configuration.
2. Demand Forecast Decisions - These decisions specify how to match demand to available supply. These decisions characterize the interfaces and relationships with customers and include demand planning and forecasting, as well as tactical capacity allocation and order management. Demand management is an important driver in inflexible supply processes that cannot quickly adapt to changes in demand such as the core processes in airlines, hotels, hospital wards, and car rental companies, It also relates to service and customer relationship management.
3. Improvements and Innovation Decisions - These are decisions on characterizing the processes and incentives to improve and innovate products and processes.

• Market penetration Strategy - This refers to capturing a larger piece of the target market. An insurance company might define market penetration success by the number of new automobile policies gained. Developing an operations strategy for market penetration has several potential focus areas. A business can decide to attract customers away from competitors. It can attract nonusers that have no experience with your business or with a competitor. Another strategy might employ one or more geographic locations, centered around a target demographic. Businesses can also try to add more value to existing clients, thereby enticing increased spending on product or service upgrades.
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Operational Action Planning and Plans
Operational action planning involves defining and outlining the actions individuals will take to support the plans and objectives of the executive management team. The operational planning process describes milestones, conditions for success and explains how, or what portion of a strategic plan will be put into operation during a given operational period, in the case of commercial application, a fiscal year or another given budgetary term. Operations teams plan continuous optimizations and improvements to processes and practices in order to meet objectives in areas such as: efficiency, productivity, turnaround time, waste reduction, cost reduction, quality, customer satisfaction, and sustainability.

Operational Plans
An operational plan is a blueprint that details how the organization will achieve long-term strategic goals. It specifies how finances, employees, and other resources will be utilized on a day-to-day basis, while also mapping interim target objectives. The operational plan is the basis for and justification of an annual operating budget request. Anoperational plan is a plan to establish, expand, or improve the day-to-day processes and practices of a business. Some examples of operational plan include:

• To cut costs 10% - Single-Use or Ongoing.Continuing Plan[Strategy: Reduce Cost]
• Acquire faster or more efficient machinery and equipment - Single-use plan
• Reduce inventory levels - Single-use plan
• Reduce production waste - Single-use plan [Strategy 
• Improve material handling procedures - Single-use plan.
• []

Operational plans should establish the activities and budgets for each part of the organization for the next 1–3 years. They link the strategic plan with the activities the organization will deliver and the resources required to deliver them. An operational plan addresses four questions:[citation needed]

• Where are we now?
• Where do we want to be?
• How do we get there?
• How do we measure our progress?

The operations plan is both the first and the last step in preparing an operating budget request. 
Operational plans should contain:[citation needed]

• clear objectives of the initiatives that supports the strategic goals and objectives.
• activities to be delivered
• quality standards
• desired outcomes
• staffing and resource requirements
• implementation timetables
• a process for monitoring progress

Scope of Operations Planning
Operations planning is the process of establishing, expanding, or improving the core day-to-day processes and practices of the business.

 This requires planning and the development of operations plans.

The scope of operations planning may encompass:

1. Business Plans - The operations plan section of a business plan includes details on how you will make proposed products - goods and services - a reality. This tends to be broad and may include elements of human resources, information technology (IT), manufacturing, supply chain, distribution and customer service.
2. Go-To-Market Strategy - This is a marketing plan usually formulated in coordination with operations to launch a new product - good or service. For example, a hotel that launches a new pool side cafe requires an operations plan to detail how supplies will be procured, food prepared, and customer service provided.
3. ​Risk Management - Risk management related planning such as carried out by a transportation company that has a goal to reduce accidents and incidents with improvement in its operations processes and infrastructure (systems and people).
4. Budget - Budgeting planning for operations management may include Capex  (capital investments) related budgets, or Opex budgets for the day-to-day costs of running the business.
5. Maintenance Planning - This is a schedule plan for maintaining capital assets used in creating value for customers.
6. Sales and Operations Planning - This is the planning process of aligning sales forecasts with production.
7. Production Planning - Production planning is the process of planning the output of an organization. The focus is on utilizing capital assets and labor efficiently in producing goods and services that can be sold at a profitable level.  
8. Projects - Project planning for operations related projects.
9. Improvements - This is planned in terms of targets for management accounting metrics in areas such as costs, quality, business volumes, and turn around times.
10. Capability Planning - Capability planning in operations is the process of identifying what your business does and establishing a road map for improving and expanding these capabilities. Operational capabilities are firm-specific sets of skills, processes, and routines, developed within the operations management system, that are regularly used in solving its problems through configuring its operational resources.
11. Quality Management - Planning for quality management involves establishing targets for quality metrics, and developing actionable plans to achieve those metrics. For example, a hotel may have a target to improve customer satisfaction with improvements to housekeeping services through quality control inspection to ensure rooms are spotlessly cleaned. 
12. Asset Management - Planning for asset management includes maintenance, evaluation of assets, and plans to retire aging assets.
13. Procurement - This involves planning for the identification, selection, and management of suppliers and contractors. 
14. Supply Chain - Supply chain planning involves planning for the warehousing and transportation of material and parts for production, as well as the finished products..
15. Distribution - Distribution planning is a process of planning on how to reach the customer to deliver your products - goods and services.

Operational decisions are made to execute the short-term processes with the aim of achieving the long- and medium-term goals that the strategic and tactical level decisions have adopted.

Operational Planning Decisions
Operational planning decisions are essential for translating strategic and operational management decisions into actionable plans. These decisions focus on the detailed planning and scheduling necessary to ensure that operations run smoothly and efficiently. Here are some key aspects of operational planning decisions:

1. Production Scheduling: This involves developing a weekly production schedule that outlines what products will be manufactured, in what quantities, and on which days.
2. Resource Allocation: This includes assigning specific machines and personnel to different tasks based on their availability and skill sets to maximize productivity.
3. Inventory Planning: This entails determining the optimal inventory levels for raw materials and finished goods to meet production needs without overstocking.
4. Capacity Planning: This involves planning for future capacity needs by analyzing current production levels and forecasting demand to ensure that the facility can meet future requirements.
5. Workforce Planning: This includes creating shift schedules for employees to ensure that there are enough workers available to meet production targets while considering labor laws and employee preferences.
6. Maintenance Scheduling: This involves planning regular maintenance activities to prevent equipment breakdowns and ensure that machinery is always in good working condition.
7. Supply Chain Coordination: This includes coordinating with suppliers to ensure timely delivery of raw materials and components needed for production.
8. Performance Metrics Establishment: This involves setting up key performance indicators (KPIs) to monitor production efficiency, quality, and other critical aspects of operations.

Operational planning decisions are the tactical steps designed to implement the broader operations strategy. They focus on the specifics of how to achieve operational objectives and can be categorized into several types:

1. Resource Allocation Decisions:
   • Capacity Planning: Determining the optimal level of production capacity to meet demand.
   • Workforce Planning: Determining the number and type of employees needed.
   • Inventory Management: Deciding on inventory levels, ordering quantities, and reorder points.
2. Scheduling Decisions:
   • Production Scheduling: Creating detailed production plans, including sequence and timing.
   • Work Scheduling: Assigning tasks to employees and allocating time for each task.
   • Equipment Scheduling: Planning the use of machinery and equipment.
3. Quality Planning Decisions:
   • Quality Standards: Setting quality benchmarks and performance metrics.
   • Quality Control Methods: Selecting quality control techniques (e.g., inspection, statistical process control).
   • Quality Improvement Initiatives: Identifying opportunities to enhance product or service quality.
4. Supply Chain Planning Decisions:
   • Supplier Selection: Choosing suppliers based on cost, quality, and reliability.
   • Logistics Planning: Determining transportation and warehousing strategies.
   • Supply Chain Coordination: Establishing effective communication and collaboration with suppliers.

By making effective operational planning decisions, organizations can optimize resource utilization, improve efficiency, and meet customer demands. These decisions provide the detailed roadmap that guides day-to-day activities and helps achieve operational goals.
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[TBD]

Market-Based Approach to Operations Strategy Development
In this approach, an organization makes a decision regarding its positioning in the markets and the customers within those markets it intends  to target. The organizations market position is one in which its performance enables it to attract customers to its products and services in a more successful manner than its competitors. Market requirements are translated into performance objectives. 

Resource-Based View of Operations Strategy
Resource-based operations strategy looks at how a firm develops and leverages its unique operations resources to achieve manufacturing objectives with the support of operations capabilities deeply anchored within business processes and organisational routines 

The resource-based view (RBV) is a managerial framework used to determine the strategic resources a firm can exploit to achieve sustainable competitive advantage. Barney's 1991 article "Firm Resources and Sustained Competitive Advantage"

The Resource based view (RBV) analyzes and interpret internal resources of the organizations and emphasizes resources and capabilities in formulating strategy to achieve sustainable competitive advantages. Resources may be considered as inputs that enable firms to carry out its activities.

1. Choice and design of technology to be used - These decisions include the choice of equipment and tooling, the layout of plant space and facilities, the selection of workers and work procedures, and many aspects of process design. These choices must be handled carefully; mistakes at this stage can result in business loosing its competitiveness, or the ability to sustain a profitable position in the market.
2. Determining the capacity of the production system is the next decision after choice of technology. The capacity of the system is designed to be a function of the amount of available capital, the demand forecast for the output of the facility, and many other minor factors. Establishing to much capacity, too soon, can burden a company with excess costs and inefficient operations.Too little capacity can make it difficult and expensive to increase output later.  
3. Decisions on the adaptability of production system volume to meet the inevitable fluctuations in market demand that the firm will experience. Capacity in most production systems is adjusted by hiring or firing workers, by scheduling overtime, or cutting back on work hours, by adding or shutting down machines or whole departments, or areas of the facility, or by changing the rate of production within reasonable limits.

​[TBD]
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