Make Better Strategic Decisions and Improve Sustainable Competitive Advantage
Business organizations exist as one system in a complex environment of systems of external/internal factors which influence managements decisions on strategic choices - the means by which the organization responds or adapts to its environment. The strategy chosen is a critical determinant in the organization achieving competitive advantage in order to survive, grow and prosper. Competitive advantage is an emergent property of the organization as a complex system. An emergent property is a property which a collection of complex system has, but which the individual members do not have. An organization must develop strategic management skills in strategic thinking and leadership allowing the organization to successfully implement and execute its chosen strategy to gain competitive advantage. Success in business is not a random occurrence. It is the result of effective interplay of strategic management, and operations management to continuously improve sustainable competitive advantage through successful execution of value creating strategy. Strategic management is about strategic decisions and decision-making and is the means by which management's intentions are realized. Managing for strategic success involve making decisions that are strategic nature and involve managers influencing outcomes by the way they lead and communicate, and through their ability to inspire and encourage others to excel. And striving to gain competitive advantage over rivals - doing better than rivals is vital; this is the where strategy comes in.
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Strategic Engine
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Operatng Model
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Execution System
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Operations Engine
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Strategic Engine
The Strategic Engine refers to a layered model of strategy comprising a 3-level hierarchy of corporate strategy, business strategy, and operations strategy with the rest of the other functional strategies as supporting tools that exist at all levels of the hierarchy. The strategic engine model is useful for managers seeking to safeguard the competitive of their companies. A strategic engine is company specific, customized to the company's own situation and performance objectives.
Strategy Conceptual Model
The Strategic Engine conceptual model is a 3-level hierarchy and reinforcing relationships to functional strategies at each level in the hierarchy. In this strategy model, the mission of Corporate Strategy (CS) is to achieve economy of scope - being effective; Operations Strategy (OS) is to achieve economy of scale - being efficient, while Business Strategy (BS) is just striving to be different. The elements of the model include:
The three (3) levels of strategy hierarchy are interrelated through a specific dual integration, built through a vertical orientation - top-down and bottom-up interactions. Top-down implies Operations strategy has a vertical relationship with corporate and business strategy, that might come down from the levels above. Bottom-up implies operation strategy comes from within operations to improve resources and capabilities. All the levels in the hierarchy have horizontal relationships with functional strategy. The unique combination of top-down (CS and BS) with bottom-up (OS and BS) approaches ensures the right fit of strategy levels. It provides an intersection between vision and details, a crossing point between long-term and short-term objectives. The success of both approaches is reinforced by organization functions (e.g., marketing, HR, IT, Finance, etc.) and functional strategies which appear at all levels.
Determinants of Competitive Advantage
To create competitive advantage you have to be clear about these three (3) determinants:
To be successful, you need to be able to articulate the benefit you provide to your target market that's better than the competition. This is your competitive advantage. You must reinforce that message in every communication to your customers and employees through advertising, public relations, sales aids; and even your store front and messaging to employees.
Drivers of Competitive Advantage
Competitive advantage is driven by functional areas such as:
Examples of Factors of Competitive Advantage
Some examples of the factors of competitive advantage includes:
These factors support the productive organization to generate more sales or superior margins compared to its market rivals leading to sustained profitable organization growth.
Process Model
The three (3) levels of strategy hierarchy are interrelated through a specific dual integration, built through a vertical orientation - top-down and bottom-up interactions.
[TBD]
Strategic engine focuses on the creation, evolution and control of the means - strategy - by which organizations achieve mission goals and objectives. A valid strategy for an organization can gain extraordinary results for an organization with an average general level of competence and leadership. Most managers in organizations have difficulty developing valid strategy statements without the determination process degenerating into solemn recording of platitudes, and trappings of strategy which is useless for either clarification of the direction or achievement of consensus among managers.
Strategy Analytics Model
Model-based approach to strategy design and evaluation involves developing an explicit dynamic model of the organization and strategy. The dynamic strategy model is an intentional goals model of the intended/deliberate corporate, business and operations strategy layers The goals model integrates the strategy hierarchy of the different levels of corporate, business and operations strategy levels into a coherent organization system model that aligns with the organization system purpose - defined by mission goals. The strategic goals define expected outcomes or results the organization wants to change to better meet the organization's mission. The strategic goals correspond to the various levels/layers at which strategy concept exists in the organization i.e., corporate, business, and functional levels. The strategy concept at each layer is the means of achieving the results defined by the strategic goals for that layer e.g., corporate strategy, business strategy, and functional strategy respectively.
The Strategic Engine refers to a layered model of strategy comprising a 3-level hierarchy of corporate strategy, business strategy, and operations strategy with the rest of the other functional strategies as supporting tools that exist at all levels of the hierarchy. The strategic engine model is useful for managers seeking to safeguard the competitive of their companies. A strategic engine is company specific, customized to the company's own situation and performance objectives.
Strategy Conceptual Model
The Strategic Engine conceptual model is a 3-level hierarchy and reinforcing relationships to functional strategies at each level in the hierarchy. In this strategy model, the mission of Corporate Strategy (CS) is to achieve economy of scope - being effective; Operations Strategy (OS) is to achieve economy of scale - being efficient, while Business Strategy (BS) is just striving to be different. The elements of the model include:
- Corporate Strategy (CS) - Corporate strategy is concerned with creating corporate advantage through adding up value to corporate whole, making it more than the sum of its parts - business units. It involves choices about the scope of the organization's products, the vertical and geographic coverage. Corporate strategy decisions/choices determine the long-term orientation of organization development, and corporate activities that evaluate current market positions and identifies investment priorities for the businesses.
- Business Strategy (BS) - Business strategy is concerned with creating competitive advantage through differentiation or cost leadership. The point of interest is on how the organization competes within a specific industry/market as constrained by the SWOT analysis basic elements. It involves decisions and choices regarding competitors, and the nature of competition and competitive advantage. It involves formulating responses to changes in the industry, crafting competitive moves and market approaches leading to sustainable competitive advantage by building valuable, rare and hard to copy competencies and capabilities.
- Operations Strategy (OS) - Operations strategy is concerned with creating operations advantage through achieving optimal combination of all five (5) performance objectives/factors such as: quality, cost, dependability, flexibility, and speed. Operations strategy, in this layered model, represents top-down reflection of what the business wants to do (Market-Based Theory), simultaneously with bottom-up activity (Resource-Based Theory), where operations improvements cumulatively build strategy. The market-based view works from the outside-in, and the resource-based view works from an inside-out of the firm perspective. The market-based view advocates that organizations take into consideration external factors such as the attractiveness of the industry, and how the organization positions itself within the industry structure as source to gain competitive advantage. The resource-based view advocates that product offering must generate extra value that exceeds that of competitors for the organization to be profitable.
The three (3) levels of strategy hierarchy are interrelated through a specific dual integration, built through a vertical orientation - top-down and bottom-up interactions. Top-down implies Operations strategy has a vertical relationship with corporate and business strategy, that might come down from the levels above. Bottom-up implies operation strategy comes from within operations to improve resources and capabilities. All the levels in the hierarchy have horizontal relationships with functional strategy. The unique combination of top-down (CS and BS) with bottom-up (OS and BS) approaches ensures the right fit of strategy levels. It provides an intersection between vision and details, a crossing point between long-term and short-term objectives. The success of both approaches is reinforced by organization functions (e.g., marketing, HR, IT, Finance, etc.) and functional strategies which appear at all levels.
Determinants of Competitive Advantage
To create competitive advantage you have to be clear about these three (3) determinants:
- Determine the benefits your company provides - What are the real benefits your products provide? This must be something that your customers truly need; and must also offer real value.
- Determine your Target Market - Who are your customers? What are their needs? You have to know exactly who buys from you and how you can make their lives better. That's how you create demand, the driver of all economic growth.
- Identify your Competitors - Have you identified your real competitors?
To be successful, you need to be able to articulate the benefit you provide to your target market that's better than the competition. This is your competitive advantage. You must reinforce that message in every communication to your customers and employees through advertising, public relations, sales aids; and even your store front and messaging to employees.
Drivers of Competitive Advantage
Competitive advantage is driven by functional areas such as:
- Marketing
- Finance
- Human Resources
- Legal
- customer Service
- Sales
- IT
Examples of Factors of Competitive Advantage
Some examples of the factors of competitive advantage includes:
- Access to natural resources that are restricted from competitors.
- Highly skilled labor
- A unique geographic location
- Access to new or proprietary technology
- Low cost manufacturing
- Brand Image recognition
These factors support the productive organization to generate more sales or superior margins compared to its market rivals leading to sustained profitable organization growth.
Process Model
The three (3) levels of strategy hierarchy are interrelated through a specific dual integration, built through a vertical orientation - top-down and bottom-up interactions.
- Top-down Perspective - Top-down implies Operations strategy has a vertical relationship with corporate and business strategy, that might come down from the three levels. The whole process begins with establishing Corporate Strategy (CS) goals. Posing questions about business portfolios and investment decisions, such as "Where?", "How much?", and "What kind of?". Then it follows the business strategy (BS), identifying how to compete in specific markets and industries, trying to find coherent answer to a generic question"How?", and with which generic strategy to compete. And finally the operations strategy (OS) comes, that should provide in with that should provide the right answer to a specific question "How?", ("Which way to compete?"), to deliver the highest result from the sum of of the basic performance objectives - speed, quality, dependability and flexibility ar appropriate cost level.
- Bottom-up Perspective - Bottom-up implies operation strategy comes from within operations to improve resources and capabilities. Operations strategy tries to improve these objectives, supports and reinforces the final outcome.of Business Strategy (BS) to achieve sustainable competitive advantage that in turn, contributes to achieve superior economic returns on a corporate level. Based on results of business strategy (BS), executive managers decide on entering/leaving markets, enlarging/shortening the value chains, or pursuing business diversification. Once the dyadic flow of information is completed, further refinement of the whole process might start again, based on the outcome of this process.
[TBD]
Strategic engine focuses on the creation, evolution and control of the means - strategy - by which organizations achieve mission goals and objectives. A valid strategy for an organization can gain extraordinary results for an organization with an average general level of competence and leadership. Most managers in organizations have difficulty developing valid strategy statements without the determination process degenerating into solemn recording of platitudes, and trappings of strategy which is useless for either clarification of the direction or achievement of consensus among managers.
Strategy Analytics Model
Model-based approach to strategy design and evaluation involves developing an explicit dynamic model of the organization and strategy. The dynamic strategy model is an intentional goals model of the intended/deliberate corporate, business and operations strategy layers The goals model integrates the strategy hierarchy of the different levels of corporate, business and operations strategy levels into a coherent organization system model that aligns with the organization system purpose - defined by mission goals. The strategic goals define expected outcomes or results the organization wants to change to better meet the organization's mission. The strategic goals correspond to the various levels/layers at which strategy concept exists in the organization i.e., corporate, business, and functional levels. The strategy concept at each layer is the means of achieving the results defined by the strategic goals for that layer e.g., corporate strategy, business strategy, and functional strategy respectively.
Operating Model and Capability Building
The operating model is an abstract representation of how an organization operates across process, organization structure, partner network, technology domains in order to deliver value defined by the organization in scope. Operating models facilitate the conversion of strategy to results. The Operating Model serves as a blueprint for how resources are organized and operated to get critical work done. It encompasses decisions around the shape and size of the business organization, where to draw the boundaries for each line of business, how people work together within and across these boundaries, how the corporate center will add value to the business units, and what norms and behaviors should be encouraged.
Design Considerations
The design of an Operating Model starts by describing the strategy in sufficient detail that one can articulate a set of design principles = statements defining what the organization must do to enable execution of the strategy.
Based on design principles the Operating Model takes shape through choices in the following areas::
Organization capability and culture are intangible, soft assets not directly visible to the organization. They are managed through the hard disciplines that shape them, such as: organization structure, decision rights, talent, management systems, and measures and incentives.
[TBD]
Strategy implementation is about investment decisions and plans to build a capable organization that can make the formulated strategy work as intended. Strategy Implementation is concerned with translating the chosen strategic options into action plans and operations plans that guides the successful execution of the chosen strategy.
The skills and capabilities of employees in a company are central to the success of the organization.
Through the talent management process, the gaps in the current and the desired capabilities that support the organization's strategy can be assessed.
Operating Model
The Operating Model is the result of the Operations Strategy, and is focused on how to best enable and implement the organization's strategy. Operations strategy defines through the Operating Model, an organization structure design on how an entire business will allocate its resources to support operations and its strategic goals.
Organization Capability Development
process involves planning for acquisition of resources, and /or development of appropriate organizational capabilities to strengthen existing organizational capabilities and competencies, or building new organizational capabilities to improve the organization's strategic capability. A business can improve its strategic capability by strengthening its organizational capabilities and resources, enabling it to better perform its strategic management functions in tandem to its operations management functions. Those functions involve a number of different decision-making approaches. Most managers face difficult challenges with strategic decisions - decisions with consequences for the performance (sustainable growth and profitability) of the company.
Changes in strategic direction do not occur automatically; operations plans must be established to make a strategy work as intended.
The operating model is an abstract representation of how an organization operates across process, organization structure, partner network, technology domains in order to deliver value defined by the organization in scope. Operating models facilitate the conversion of strategy to results. The Operating Model serves as a blueprint for how resources are organized and operated to get critical work done. It encompasses decisions around the shape and size of the business organization, where to draw the boundaries for each line of business, how people work together within and across these boundaries, how the corporate center will add value to the business units, and what norms and behaviors should be encouraged.
Design Considerations
The design of an Operating Model starts by describing the strategy in sufficient detail that one can articulate a set of design principles = statements defining what the organization must do to enable execution of the strategy.
Based on design principles the Operating Model takes shape through choices in the following areas::
- Structure - This defines the appropriate boundaries for lines of business and shared services, centers of expertise, and other coordinating mechanisms that allow a company to leverage scale and expertise. The structure also specifies the size and shape of the organization with indicative resource levels and locations. Organizations are composed of interrelated (sub) organization units serving as specialized function, departments, divisions, geographic locations, etc. The organization unit is conceptualized as a social system - complexes of people and/or groups that according to commonly agreed rules and procedures strive to realize one or more preset objectives. Typical functions in a business organization may include Finance, Marketing and Sales, Human Resources, Operations, etc. A Business organization is a dynamic social system in that it has a purpose and is greater than the sum of its parts. Essentially, you can think of this high level organizational chart as the "hardware" of the operating model with the next four dimensions (Accountability, Governance, Culture, and Capabilities) serving as the "software" that makes the "hardware" run. The organization structure design focuses on enabling effective management of complexity, coordination and control of organizational behavior. This is critical as the decision rights cascade grows, because the structure and operating principles as well as governance of the organization becomes more complex and critical to manage.
- Accountability - This describes the roles and responsibilities of the main organization entities including ownership of P&Ls and a clear, value adding role for the corporate center. There should be clear guidelines for the roles each organizational unit will play in critical decisions. A reward framework linked to accountability reinforces strong execution.
- Governance - Governance and behavior refers to executive forums and management processes that yield high-quality decisions on strategies, priorities, resource allocation and business performance management. A management dashboard with the key metrics keeps the focus on the company's top priorities.
- Culture and Values (Ways of working) - This describes the expected cultural norms for how people collaborate within and across functions or teams. Organizational culture is the collective behavior of humans who are part of an organization, and the meanings they attach to their actions. Culture includes the organizational values, visions, norms, working language, systems, symbols, beliefs and habits. Culture manifests itself in the particular way things are done in an organization. It affects who gets hired, how they get trained (formally or informally), what behaviors get rewarded, who gets promoted, and virtually all organizational procedures and administrative protocols. Organizational culture can be supportive of the following: Learning and Development (Growth), Participatory Decision-Making, Power Sharing, Support and Collaboration,
- Capabilities - This refers to how the organization combines people, processes, and technology in a repeatable way to deliver desired outcomes. Organizational capabilities refer to a business's ability to successfully employ competitive strategies that allows it to survive and increase its value overtime.
Organization capability and culture are intangible, soft assets not directly visible to the organization. They are managed through the hard disciplines that shape them, such as: organization structure, decision rights, talent, management systems, and measures and incentives.
[TBD]
Strategy implementation is about investment decisions and plans to build a capable organization that can make the formulated strategy work as intended. Strategy Implementation is concerned with translating the chosen strategic options into action plans and operations plans that guides the successful execution of the chosen strategy.
The skills and capabilities of employees in a company are central to the success of the organization.
Through the talent management process, the gaps in the current and the desired capabilities that support the organization's strategy can be assessed.
Operating Model
The Operating Model is the result of the Operations Strategy, and is focused on how to best enable and implement the organization's strategy. Operations strategy defines through the Operating Model, an organization structure design on how an entire business will allocate its resources to support operations and its strategic goals.
Organization Capability Development
process involves planning for acquisition of resources, and /or development of appropriate organizational capabilities to strengthen existing organizational capabilities and competencies, or building new organizational capabilities to improve the organization's strategic capability. A business can improve its strategic capability by strengthening its organizational capabilities and resources, enabling it to better perform its strategic management functions in tandem to its operations management functions. Those functions involve a number of different decision-making approaches. Most managers face difficult challenges with strategic decisions - decisions with consequences for the performance (sustainable growth and profitability) of the company.
Changes in strategic direction do not occur automatically; operations plans must be established to make a strategy work as intended.
Strategy Execution System
Execution is a function of the strategic management process, and it occurs within the context of strategy implementation. It is concerned with managing initiatives - this is where strategy is translated into practice or remains on paper - and building adequate organization strategic capability. Strategy execution is about how decisions take place within an organizational context of power, culture, leadership and ability to manage change. This requires the ability to understand and manage the interactions among those execution decisions and contextual forces. The execution flow involves both top down flows of decisions and actions from corporate strategy decisions through business strategy decisions to strategy implementation decision and actions (participation and communication down and across operating units), and bottom up flows of participation and communication information up the organization.
Execution
[TBD]
[TBD]
Strategy execution depends on each member of the organization's daily tasks and decisions, so its vital that to ensure everyone understands not only the broader strategic goals, but how their individual responsibilities make achieving them possible.
Strategy execution is the continuous process of closing the gap between where the company is, and what the strategy calls for. Bringing the strategy "execution gap" may require addressing the shortcomings in the implementation and/or flawed execution plans. Technically, a strategy can never actually be fully implemented because every thing that was necessarily assumed when formulating the strategy - about customers, technology, regulation, labor market, competitors, and so on - is in a constant state of flux.
Model-Driven Execution
The Strategy Execution Model is an open, social systems model that captures the organization as system elements, their interactions (dynamic and static), and a state-space that captures the dynamic behavior and system properties.
In the traditional strategy execution, "Plan-then-Do" approach, the organization creates its best forecast of the future market and competitive landscape. Leadership then specifies a plan that it believes will position the company to win in this predicted future. This approach is prone to failure because in the today's fast-paced world, the "cone of uncertainty" surrounding future market and competitive conditions is too great for companies to prescribe every element of a multi-year strategy. An agile, test-and-learn approach is better suited to today's tumultuous environment.
[TBD]
Strategic capability refers to the organization's ability to harness all its skills, organizational capabilities, and resources in order to gain competitive advantage, and thus survive and increase its value over time. The focus of strategic capability is on the organization's assets, resources, market position in projecting how well it will be able to employ strategies in the future.
[TBD]
Successful strategy development and execution concerns balancing gut feel with in-depth situational analysis so that action is not delayed, but also focuses on areas of maximum impact.
[TBD]
Organizations must acquire the necessary organizational capabilities to better respond to changing environments in order to attain sustainable growth and profitability. Those required organizational capabilities include: accountability, leadership, coordination, strategic unity, and efficiency, in addition to talent.
Strategy Execution System Model
Effective strategy execution requires a systematic approach to exposing reality and acting on it. The organization's actions involve decisions made every day by employees acting, according to the information they have and their own self-interest, within the context of strategy implementation, and activities undertaken at all levels in the organization - top management, middle management, and front-line managers and workers - to turn implemented strategy into commercial/social success.
The execution system is a joint configuration of resources and processes with resulting competencies that facilitate effective and efficient change management in evolving the organization. Execution management involves integration of the series of decisions/actions that take place over time, and inextricably changes the organization and its relationship with its environments. The change may be planned or emergent. Successful execution involves decisions about changes to strategy, structure, capabilities (organizational and individuals), and incentives, and involves coordination, information sharing, and controls that results in an organization's actual strategy.
Strategy execution systems are social-technical systems that provide the framework that integrates the following elements:
Closing the strategy gap in organizations in today's world involves bridging the chasm that exists between great strategy, great execution, and great performance.
[TBD]
Value Creating Strategy and Competitive Advantage
The competitive ability of a firm may be based on its capability to capitalize on opportunities and mitigate threats form external environment factors (top-down) or leverage its strengths while managing its weaknesses (bottom-up) approaches to create sustainable competitive advantage and add value to the organization.
Operations Strategy can be market-driven (top down), market-driving (bottom up) or both. Businesses must analyze markets before they can develop an operations strategy. They need to agree on the current and future markets in which to compete, and determine the known or anticipated order-winners and qualifiers within these markets.
[TBD]
Operations Management
Operations Management involves administrative and management processes focused on operational control of the organization's capacity to efficiently carry out the tasks set forth by executive and senior management through strategic management decisions.
Operations management from an operational perspective focuses on how to best use the organizations production resources, capabilities and competencies to create and deliver value to customers.
Operations management focuses on the control of the means - processes and resources - by which organizations create and deliver value
It involves structured decision-making, concerned with how efficiently and effectively resources are utilized and how well operations units are performing. Operations management takes place within the context of broad policies and objectives set out by strategic decision-making.
Operations Management involves administrative and strategic decision-making processes focused on Operations Strategy design, Operations Systems design, operations process design and operations control systems design.
Execution is a function of the strategic management process, and it occurs within the context of strategy implementation. It is concerned with managing initiatives - this is where strategy is translated into practice or remains on paper - and building adequate organization strategic capability. Strategy execution is about how decisions take place within an organizational context of power, culture, leadership and ability to manage change. This requires the ability to understand and manage the interactions among those execution decisions and contextual forces. The execution flow involves both top down flows of decisions and actions from corporate strategy decisions through business strategy decisions to strategy implementation decision and actions (participation and communication down and across operating units), and bottom up flows of participation and communication information up the organization.
Execution
[TBD]
[TBD]
Strategy execution depends on each member of the organization's daily tasks and decisions, so its vital that to ensure everyone understands not only the broader strategic goals, but how their individual responsibilities make achieving them possible.
Strategy execution is the continuous process of closing the gap between where the company is, and what the strategy calls for. Bringing the strategy "execution gap" may require addressing the shortcomings in the implementation and/or flawed execution plans. Technically, a strategy can never actually be fully implemented because every thing that was necessarily assumed when formulating the strategy - about customers, technology, regulation, labor market, competitors, and so on - is in a constant state of flux.
Model-Driven Execution
The Strategy Execution Model is an open, social systems model that captures the organization as system elements, their interactions (dynamic and static), and a state-space that captures the dynamic behavior and system properties.
In the traditional strategy execution, "Plan-then-Do" approach, the organization creates its best forecast of the future market and competitive landscape. Leadership then specifies a plan that it believes will position the company to win in this predicted future. This approach is prone to failure because in the today's fast-paced world, the "cone of uncertainty" surrounding future market and competitive conditions is too great for companies to prescribe every element of a multi-year strategy. An agile, test-and-learn approach is better suited to today's tumultuous environment.
[TBD]
Strategic capability refers to the organization's ability to harness all its skills, organizational capabilities, and resources in order to gain competitive advantage, and thus survive and increase its value over time. The focus of strategic capability is on the organization's assets, resources, market position in projecting how well it will be able to employ strategies in the future.
[TBD]
Successful strategy development and execution concerns balancing gut feel with in-depth situational analysis so that action is not delayed, but also focuses on areas of maximum impact.
[TBD]
Organizations must acquire the necessary organizational capabilities to better respond to changing environments in order to attain sustainable growth and profitability. Those required organizational capabilities include: accountability, leadership, coordination, strategic unity, and efficiency, in addition to talent.
Strategy Execution System Model
Effective strategy execution requires a systematic approach to exposing reality and acting on it. The organization's actions involve decisions made every day by employees acting, according to the information they have and their own self-interest, within the context of strategy implementation, and activities undertaken at all levels in the organization - top management, middle management, and front-line managers and workers - to turn implemented strategy into commercial/social success.
The execution system is a joint configuration of resources and processes with resulting competencies that facilitate effective and efficient change management in evolving the organization. Execution management involves integration of the series of decisions/actions that take place over time, and inextricably changes the organization and its relationship with its environments. The change may be planned or emergent. Successful execution involves decisions about changes to strategy, structure, capabilities (organizational and individuals), and incentives, and involves coordination, information sharing, and controls that results in an organization's actual strategy.
Strategy execution systems are social-technical systems that provide the framework that integrates the following elements:
- Strategic decisions and actions taken resulting from decisions.
- Operations management decisions and activities performed resulting from decisions.
- Observing the outputs and outcomes of strategic actions through reporting and monitoring environment changes.
- Diagnosing the issues resulting from the patterns of organization behavior effected by organization outputs.
- Timely adaptation to changes in environment and timely response to any identified opportunities or threats to achieving the mission objectives and strategic goals.
Closing the strategy gap in organizations in today's world involves bridging the chasm that exists between great strategy, great execution, and great performance.
[TBD]
Value Creating Strategy and Competitive Advantage
The competitive ability of a firm may be based on its capability to capitalize on opportunities and mitigate threats form external environment factors (top-down) or leverage its strengths while managing its weaknesses (bottom-up) approaches to create sustainable competitive advantage and add value to the organization.
- Top-Down: A top-down approach to operations strategy design involves senior management formally defining the mission, then progressively expanding this to give the corporate, business, and functional strategies. Once organizational purpose/mission, corporate strategy, business and competitive strategy, and values are clear, the organization can be structured in such a way that roles and functions are clearly defined and differentiated, lines of communications and accountability untangled, and decision-making procedures transparent and functional.
- Bottoms-Up: The actual business and corporate strategy eventually emerges over time from a bottom-up perspective as a result of the sum of the practical decisions made, and actions taken by managers in continually responding to actual conditions and problems as they arise in the organization. Operations strategy is the collective concrete actions chosen, mandated, or stimulated by corporate strategy
Operations Strategy can be market-driven (top down), market-driving (bottom up) or both. Businesses must analyze markets before they can develop an operations strategy. They need to agree on the current and future markets in which to compete, and determine the known or anticipated order-winners and qualifiers within these markets.
[TBD]
Operations Management
Operations Management involves administrative and management processes focused on operational control of the organization's capacity to efficiently carry out the tasks set forth by executive and senior management through strategic management decisions.
Operations management from an operational perspective focuses on how to best use the organizations production resources, capabilities and competencies to create and deliver value to customers.
Operations management focuses on the control of the means - processes and resources - by which organizations create and deliver value
It involves structured decision-making, concerned with how efficiently and effectively resources are utilized and how well operations units are performing. Operations management takes place within the context of broad policies and objectives set out by strategic decision-making.
Operations Management involves administrative and strategic decision-making processes focused on Operations Strategy design, Operations Systems design, operations process design and operations control systems design.
- Operations Strategy design decisions are concerned with choices and commitment to organization performance and involve decisions on choices in operations infrastructure, facility - operations structure, performance objectives, and distinguishing competencies.
- Operations System for the organization's production unit - This is the joint configuration of resources and processes with the resulting competencies ...
- Tactical Decisions - Tactically, Operations Management focuses on utilizing the Operations System to carefully manage the processes and resources, of the organization to produce and distribute products and services to customers which in turn realize strategic decisions to capitalize on opportunities.
- Operational Control Decisions - Operational control decisions involve determining which organization units will carry out the tasks, establishing criteria for completion, resource utilization, and evaluating outputs. Operations decisions, unlike strategic decisions, are repetitive, routine and involve definite procedure for handling so they do not have to be treated each time as if they were new.
Capacity Management
Businesses typically have a mix of production of goods and services that collectively define the value proposition offered to customers. Decisions about the product-mix are usually supported by analytical methods such as Linear Programming (LP). These decisions are usually made so that the market demand is met and the firm profit is maximized. However, the complexity, and the dynamic stochastic nature of real-world production and service delivery systems often lead to goods and service production and delivery systems effective capacity levels that are different from those determined by analytical methods. Analytical methods also have problems coping with the dynamic changes in the product-mix which usually requires enhancing system parameters and/or reconfiguration of the operations systems. Business operations constitute many processes including materials acquisition and inventory management, manufacturing/production, product delivery, service delivery, etc.
Capacity utilization impacts business performance. Capacity analytics helps to determine whether the business is running at optimum capacity utilization. It can help spot if the resources are being under utilized or if the employees are working over-capacity. It can also help the business to determine how much and when to increase capacity.
Operations System
Operations management from an operational perspective focuses on how to best use the organizations production resources, capabilities and competencies to create and deliver value to customers.
Operations Systems Simulation-Based Analysis
Analyzing Operations Engine performance and effective capacity based on process simulation techniques to provide information on resource utilization (labor and equipment and storage), production process performance in delivering products and/or services to customers that informs management decisions on optimum effective capacity for an Operations System configuration for a given product-mix. The Operations Engine production process refers to any activity or group of activities that take one or more inputs, transforms and adds value to them, and provides outputs for customers or clients. Typical simulation analyses focus on experiments to help understand impact of changes at:
Process simulation provides participants, decision-makers, and stakeholders with understanding of interplay of process concepts and elements, and constraints, as well as insight into the influence on future performance (efficiency and effectiveness) of organization processes. The simulation experiment is driven by customer events and operations decisions and choices with respect to Operations System's configuration and system elements such as processes, labor, equipment, and facility such that the resulting competencies are aligned with and support the organization's mission.
Simulation of the Operations System design for the different types of transformation i.e., manufacturing, transport, supply and service helps managers and key operations staff gain insight into the "real world" situations facing the company and the factors (i.e., changes in demand, changes in product-mix, etc.) that influence the capacity and resource utilization decisions relative to the different types of transformation i.e., manufacturing, transport, supply and service.
[TBD]
Operations Strategy can be market-driven (top down), market-driving (bottom up) or both. Businesses must analyze markets before they can develop an operations strategy.They need to agree on the current and future markets in which to compete, and determine the known or anticipated order-winners and qualifiers within these markets.
Operations Management
Operations Management involves administrative and management process focused on operational control of the organization's capacity to efficiently carry out the tasks set forth by strategic and middle management decisions and decision-makers. Operations management focuses on how to best use the organizations production resources, capabilities and competencies to create and deliver value to customers.
Operations system is the joint configuration of resources and processes with the resulting competencies ...
Operations management focuses on the control of the means - processes and resources - by which organizations create and deliver value
It involves structured decision-making, concerned with how efficiently and effectively resources are utilized and how well operations units are performing. Operations management takes place within the context of broad policies and objectives set out by strategic decision-making.
Operations Management involves administrative and strategic decision-making processes focused on Operations Strategy design, Operations Systems design, operations process design and operations control systems design.
Businesses typically have a mix of production of goods and services that collectively define the value proposition offered to customers. Decisions about the product-mix are usually supported by analytical methods such as Linear Programming (LP). These decisions are usually made so that the market demand is met and the firm profit is maximized. However, the complexity, and the dynamic stochastic nature of real-world production and service delivery systems often lead to goods and service production and delivery systems effective capacity levels that are different from those determined by analytical methods. Analytical methods also have problems coping with the dynamic changes in the product-mix which usually requires enhancing system parameters and/or reconfiguration of the operations systems. Business operations constitute many processes including materials acquisition and inventory management, manufacturing/production, product delivery, service delivery, etc.
Capacity utilization impacts business performance. Capacity analytics helps to determine whether the business is running at optimum capacity utilization. It can help spot if the resources are being under utilized or if the employees are working over-capacity. It can also help the business to determine how much and when to increase capacity.
Operations System
Operations management from an operational perspective focuses on how to best use the organizations production resources, capabilities and competencies to create and deliver value to customers.
Operations Systems Simulation-Based Analysis
Analyzing Operations Engine performance and effective capacity based on process simulation techniques to provide information on resource utilization (labor and equipment and storage), production process performance in delivering products and/or services to customers that informs management decisions on optimum effective capacity for an Operations System configuration for a given product-mix. The Operations Engine production process refers to any activity or group of activities that take one or more inputs, transforms and adds value to them, and provides outputs for customers or clients. Typical simulation analyses focus on experiments to help understand impact of changes at:
- The resource level (e.g., what if the organization bought a faster check sorter?),
- The process structure level (e.g., what if the organization allowed existing customers to skip the credit check activity?), or
- The process context level (e.g., what if the customer demand increased dramatically because of marketing campaign?).
Process simulation provides participants, decision-makers, and stakeholders with understanding of interplay of process concepts and elements, and constraints, as well as insight into the influence on future performance (efficiency and effectiveness) of organization processes. The simulation experiment is driven by customer events and operations decisions and choices with respect to Operations System's configuration and system elements such as processes, labor, equipment, and facility such that the resulting competencies are aligned with and support the organization's mission.
Simulation of the Operations System design for the different types of transformation i.e., manufacturing, transport, supply and service helps managers and key operations staff gain insight into the "real world" situations facing the company and the factors (i.e., changes in demand, changes in product-mix, etc.) that influence the capacity and resource utilization decisions relative to the different types of transformation i.e., manufacturing, transport, supply and service.
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Operations Strategy can be market-driven (top down), market-driving (bottom up) or both. Businesses must analyze markets before they can develop an operations strategy.They need to agree on the current and future markets in which to compete, and determine the known or anticipated order-winners and qualifiers within these markets.
Operations Management
Operations Management involves administrative and management process focused on operational control of the organization's capacity to efficiently carry out the tasks set forth by strategic and middle management decisions and decision-makers. Operations management focuses on how to best use the organizations production resources, capabilities and competencies to create and deliver value to customers.
Operations system is the joint configuration of resources and processes with the resulting competencies ...
Operations management focuses on the control of the means - processes and resources - by which organizations create and deliver value
It involves structured decision-making, concerned with how efficiently and effectively resources are utilized and how well operations units are performing. Operations management takes place within the context of broad policies and objectives set out by strategic decision-making.
Operations Management involves administrative and strategic decision-making processes focused on Operations Strategy design, Operations Systems design, operations process design and operations control systems design.
- Operations Strategy design decisions are concerned with choices and commitment to organization operations infrastructure, operations structure design.
- Operations System for the organization's production unit - This is the joint configuration of resources and processes with the resulting competencies ...
- Tactical Decisions - Tactically, Operations Management focuses on utilizing the Operations System to carefully manage the processes and resources, of the organization to produce and distribute products and services to customers which in turn realize strategic decisions to capitalize on opportunities.
- Operational Control Decisions - Operational control decisions involve determining which organization units will carry out the tasks, establishing criteria for completion, resource utilization, and evaluating outputs. Operations decisions, unlike strategic decisions, are repetitive, routine and involve definite procedure for handling so they do not have to be treated each time as if they were new.
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