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Click to edit Master title style,Click to edit Master text styles,Second level,Third level,Fourth level,Fifth level,1/7/2013,2-,0,Strategy,Chapter Two,Copyright 2021 by The McGraw-Hill Companies,Inc.All rights reserved.,McGraw-Hill/Irwin,Learning Objectives,LO21:,Know what a sustainable business strategy is and how it relates to operations,and supply,chain management.,LO22:Define,operations and supply chain strategy.,LO23:,Explain how operations and supply chain strategies are implemented.,LO24:,Understand why strategies have implications relative to business risk.,LO25:,Evaluate productivity in operations and supply chain management.,2-2,Cliff Bar,2-,3,Company Aspirations Beyond Making a Profit,2-,4,Cliff Bars Aspirations(an example),1.Sustaining,our,PlanetKeep,our impact,on the,planet,small,even as we grow.,2.Sustaining our CommunityBe good,neighbors.Give,back to the community.,3.Sustaining our People Create an,environment where,people can live life to the,fullest,even,from 9 to 5.,4.Sustaining our BusinessGrow,slower,grow better,and stick around longer.,5.Sustaining our BrandsMake what,people actually,need.Never compromise quality.,Sustainable Strategy,The firms strategy describes how it will create and sustain value for its current shareholders,Shareholders individuals or companies that legally own one or more shares of stock in the company,Stakeholders individuals or organizations who are directly or indirectly influenced by the actions of the firm,Adding a sustainability requirement means meeting value goals without compromising the ability of future generations to meet their own needs,Triple bottom line evaluating the firm against social,economic,and environmental criteria,2-,5,Triple Bottom Line,2-,6,Operations and Supply Chain Strategy,Setting broad policies and plans for using the resources of a firm must be integrated with corporate strategy,Corporate strategy provides overall direction and coordinates operational goals with those of the larger organization,Operations effectiveness performing activities in a manner that best implements strategic priorities at a minimum cost,2-,7,Formulating an Operations and Supply Chain Strategy,2-,8,Competitive Dimensions,Price,Make the product or deliver the service cheap,Quality,Make a great product or delivery a great service,Delivery Speed,Make the product or deliver the service quickly,Delivery Reliability,Deliver it when promised,Coping with Changes in Demand,Change its volume,Flexibility and New-Product Introduction Speed,Change it,2-,9,Trade-Offs,Management must decide which parameters of performance are critical and concentrate resources on those characteristics,For example,a firm that is focused on low-cost production may not be capable of quickly introducing new products,Straddling seeking to match a successful competitor by adding features,services,or technology to existing activities,Often a risky strategy,2-,10,Order Winners and Order Qualifiers,Order qualifiers are those dimensions that are necessary for a firms products to be considered for purchase by customers,Features customers will not forego,Order winners are criteria used by customers to differentiate the products and services of one firm from those of other firms,Features that customers use to determine which product to ultimately purchase,2-,11,SC Risk,a Picture,2-,12,SC Risk Examples,2-,13,Japanese Tsunami(March 2021).,In 1996 General Motors experienced an 18-day labor strike at a brake supplier factory.,This strike idled workers at 26 assembly plants and led to an estimated$900 million reduction in earnings.,In 1997 a Boeing suppliers failure to deliver two critical parts led to a loss of$2.6 billion.,Assessing Risk Associated with OSCM Strategy,All strategies have an inherent level of risk,Uncertainty in the environment causes supply chain planners to evaluate the relative riskiness of their strategies,Supply chain risk is the likelihood of a disruption that would impact the ability of a company to continuously supply products or services,Supply chain coordination risks are associated with the day-to-day management of the supply chain,Disruption risks are caused by natural or manmade disasters,2-,14,Risk Mitigation Framework,2-,15,1.Identify,the sources of potential,disruptions and assess a,type of,vulnerability.,Focus on highly,unlikely events that would cause a,significant disruption to,normal operations.,2.Assess,the potential impact of the risk.Here the goal is to quantify the probability,and the,potential impact of the,risk.,C,ould,be based on,financial,impact,environmental impact,ongoing business viability,B,rand,image/reputation,potential human lives,and so on.,3.Develop,plans to mitigate the risk.A detailed strategy for minimizing the impact of,the risk could take many different forms,depending on the nature of the problem.,Risk Mitigation Strategies,2-,16,Productivity Measurement,2-,17,Productivity is a measure of how well resources are used,Productivity=,Productivity is a re
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