OM week 2-1

The Strategic Hierachy
*Mission Statement
-A short statement of what a business does, what its values are, who its market is and why.
*Corporate Strategy
-Broad and general in large diversified companies
-Defines the business the corporation will engage in and how resource will be expended in these business.
-Set expectation for business performance
*Business Strategy
-The general basis on which the business will complete
-Cost leadership - keep cost lower than competition, may lead to lower price than competitor
-Differentiation - Create products or services that are different enough to be more attractive or better match customers view of value
-Focus - Target small segment of the market
*Functional Strategy
- Set priorities so that day-to-day decisions support business strategy

Business & Operation Strategy
*Understand what is "valued" in the market
*Choose which attributes to emphasize
*Prioritize those attributes
*Design business process with the capabilities to support those prirority

Operate Strategy
-How to design the operation
-How to allocate productive resource

Environmental Scanning
*Enable the business to stay abreast of changes in
-Technology
-Customer expectations
-Competitor's offering
-Global politics
-Regulations
-Cost of inputs

Deming- The goal of business isn't to make alternative

Structural vs. Infrastructural Decisions
*Structural - Related to tangible resources (building, equipment, process, supply-chain integration)
*Examples
-Capacity
*High vs. Low volume equipment, Adding capacity, Flexibility of capacity
-Facilities
*Location, size, design, number
-Process Technology
*Layout, Automatic
-Vertical Integration/Supplier Relationships
*Supplier links, partnerships, integration vs. outsourcing

Ask self question. What most important 4 concept of the chapter was?