Summary OST By Tobias Schiphorst
1. Course objectives ................................................................................................................................. 3
1.1 Important topics in the book of Slack & Lewis......................................................................... 3
2. Context operations management ........................................................................................................ 4
2.1 Examples of the primary process: .................................................................................................. 5
2.2 Not all operations are the same (four v’s) ..................................................................................... 7
2.3 Conclusion on the primary process ................................................................................................ 7
3. Structuring decisions ............................................................................................................................ 7
3.1 Horizontal, vertical and organizational structuring ....................................................................... 8
3.2 Operational performance .............................................................................................................. 8
3.3 Trade-offs and efficient frontier .................................................................................................. 10
3.4 Conclusion operations management point of view ..................................................................... 11
4. Nature of operations strategy ............................................................................................................ 12
4.1 Statergy decisions ........................................................................................................................ 12
4.2 Operations strategy ...................................................................................................................... 12
4.3 Perspectives on operations strategy ............................................................................................ 13
4.4 Reconciliation process + model Slack .......................................................................................... 14
4.5 Operations strategy matrix .......................................................................................................... 16
5. Processes and horizontal structure .................................................................................................... 18
5.1 Horizontal structure ..................................................................................................................... 18
5.2 Process design and performance ................................................................................................. 19
5.3 Product-proces matrix.................................................................................................................. 21
5.4 Horizontal structure and complexity ........................................................................................... 22
6. Planning and control / vertical structure ........................................................................................... 24
6.1 Decoupling point .......................................................................................................................... 24
6.2 Generic element of the vertical structure.................................................................................... 27
6.3 Planning philosophies / systems .................................................................................................. 30
6.3.1 Program oriented planning systems ..................................................................................... 31
7. Socially responsible Operation Strategy ............................................................................................ 34
7.1 Trade-offs and CSR ....................................................................................................................... 34
8. Case Hagen Style ................................................................................................................................ 35
9. Case Paint ........................................................................................................................................... 37
10. Purchasing and supply strategy ....................................................................................................... 40
10.1 Supply arrangements ................................................................................................................. 40
11. Management philosophies ............................................................................................................... 41
1
, 11.1 Total Quality Management (TQM) ............................................................................................. 41
11.2 Lean operations .......................................................................................................................... 42
11.3 Business process reengineering ................................................................................................. 44
11.4 Six Sigma ..................................................................................................................................... 45
11.5 These approaches are different ................................................................................................. 46
12. Product and service development / networks ................................................................................. 47
12.1 Product and service development networks ............................................................................. 48
13. Process of operations strategy ......................................................................................................... 49
13.1 Operations strategy formulation ............................................................................................... 49
13.2 Operations strategy implementation / alignment ..................................................................... 49
14. Operations strategy monitoring ....................................................................................................... 50
14.1 Difference between operational and strategic monitoring ....................................................... 50
14.2 Balanced scorecard approach .................................................................................................... 50
14.3 Innovators dilemma / Christensen’s theory .............................................................................. 51
14.4 Power-interest grid .................................................................................................................... 51
2
,1. Course objectives
Using the sixth edition of the book of Slack & Lewis on Operations Strategy. This summary is mostly
based on the given lectures.
To get an advanced understanding of the operations function and more specific of operations
strategy
- Be aware of different concepts and frameworks for describing and analysing operations and
operations strategy
- Be able to demonstrate the ability to apply concepts in a practical setting
- Be able to understand the operations function in the context of the entire organization
1.1 Important topics in the book of Slack & Lewis
- Chapter 1: Operations Strategy
o Page 8: The Four Vs
o Page 28: Operation Strategy
o Page 30: Central model of Operations Strategy (Slack & Lewis)
o Page 35: Decision areas
o Page 40: Operations Strategy Matrix
- Chapter 2: Operations Performance
o Page 62: Performance Objectives
o Page 68: Internal and external effects on performance objectives
o Page 74: Change of importance of performance objectives
o Page 76: Trade-offs
- Chapter 3: Socially Responsible Operations Strategy
o Page 113: CSR in terms of operations management
- Chapter 4: Capacity Strategy
o Page 120: Capacity Strategy
o Page 134: Generic timing strategies (changing capacity)
- Chapter 5: Purchasing and Supply Strategy
o Page 163: Types of supply arrangement
- Chapter 6: Process Technology Strategy
o Page 206: how do market volume and variety influence process technology
▪ Scale/Scalability
▪ Degree of Automation/Analytical Content
▪ Degree of Coupling/Connectivity
o Page 214: Product-process matrix
o Page 216: New developments in process technology change cost-flexibility trade-off
- Chapter 7: Improvement Strategy
o Page 242: Improvement approaches
o Page 252: Performance measurement
o Page 258: Sandcone model
- Chapter 8: Product and service development and organization
o Page 306: Organization structures
- Chapter 9: Process of operations strategy – formulation and implementation
o Page 312: Alignment
o Page 329: How do we know when the formulation process is complete?
▪ Figure 9.7
• Comprehensiveness
• Coherence
• Correspondence
• Critically
- Chapter 10: Process of operations strategy - monitoring and control
o Page 346: Differences between operational and strategic monitoring and control
o Page 353: Balance score card
o Page 368: Innovators dilemma
o Page 370: Power-interest grid
3
, 2. Context operations management
Lecture 2
What is ‘operations’? -> Operations is the activity of managing the resources and processes that
produce and deliver goods and/or services.
Input-transformation-output model -> applies to all activities and functions in an organisation. By
transformation inputs into outputs that satisfy a customers need. Transforming resources are
allocated to activities in various parts of the operation. Transformed resources move through these
activities until they become a mix of products and services.
Primary process -> dominant operations function of a company includes all the resources and
processes which are directly linked to producing the products and or services that can be considered
as being crucial for a long-term sustainable character of the company. A company exists for a
curtained reason(s) there is product being generated or a services being offered and is the reason
why a company exist. In a way you could say that the primary process is related to the
production/generation of these products and/or services.
Primary process is not always the most important process in a company, but the primary process is
linked producing products and/or services that give the company a long-term sustainable advantage
4
1. Course objectives ................................................................................................................................. 3
1.1 Important topics in the book of Slack & Lewis......................................................................... 3
2. Context operations management ........................................................................................................ 4
2.1 Examples of the primary process: .................................................................................................. 5
2.2 Not all operations are the same (four v’s) ..................................................................................... 7
2.3 Conclusion on the primary process ................................................................................................ 7
3. Structuring decisions ............................................................................................................................ 7
3.1 Horizontal, vertical and organizational structuring ....................................................................... 8
3.2 Operational performance .............................................................................................................. 8
3.3 Trade-offs and efficient frontier .................................................................................................. 10
3.4 Conclusion operations management point of view ..................................................................... 11
4. Nature of operations strategy ............................................................................................................ 12
4.1 Statergy decisions ........................................................................................................................ 12
4.2 Operations strategy ...................................................................................................................... 12
4.3 Perspectives on operations strategy ............................................................................................ 13
4.4 Reconciliation process + model Slack .......................................................................................... 14
4.5 Operations strategy matrix .......................................................................................................... 16
5. Processes and horizontal structure .................................................................................................... 18
5.1 Horizontal structure ..................................................................................................................... 18
5.2 Process design and performance ................................................................................................. 19
5.3 Product-proces matrix.................................................................................................................. 21
5.4 Horizontal structure and complexity ........................................................................................... 22
6. Planning and control / vertical structure ........................................................................................... 24
6.1 Decoupling point .......................................................................................................................... 24
6.2 Generic element of the vertical structure.................................................................................... 27
6.3 Planning philosophies / systems .................................................................................................. 30
6.3.1 Program oriented planning systems ..................................................................................... 31
7. Socially responsible Operation Strategy ............................................................................................ 34
7.1 Trade-offs and CSR ....................................................................................................................... 34
8. Case Hagen Style ................................................................................................................................ 35
9. Case Paint ........................................................................................................................................... 37
10. Purchasing and supply strategy ....................................................................................................... 40
10.1 Supply arrangements ................................................................................................................. 40
11. Management philosophies ............................................................................................................... 41
1
, 11.1 Total Quality Management (TQM) ............................................................................................. 41
11.2 Lean operations .......................................................................................................................... 42
11.3 Business process reengineering ................................................................................................. 44
11.4 Six Sigma ..................................................................................................................................... 45
11.5 These approaches are different ................................................................................................. 46
12. Product and service development / networks ................................................................................. 47
12.1 Product and service development networks ............................................................................. 48
13. Process of operations strategy ......................................................................................................... 49
13.1 Operations strategy formulation ............................................................................................... 49
13.2 Operations strategy implementation / alignment ..................................................................... 49
14. Operations strategy monitoring ....................................................................................................... 50
14.1 Difference between operational and strategic monitoring ....................................................... 50
14.2 Balanced scorecard approach .................................................................................................... 50
14.3 Innovators dilemma / Christensen’s theory .............................................................................. 51
14.4 Power-interest grid .................................................................................................................... 51
2
,1. Course objectives
Using the sixth edition of the book of Slack & Lewis on Operations Strategy. This summary is mostly
based on the given lectures.
To get an advanced understanding of the operations function and more specific of operations
strategy
- Be aware of different concepts and frameworks for describing and analysing operations and
operations strategy
- Be able to demonstrate the ability to apply concepts in a practical setting
- Be able to understand the operations function in the context of the entire organization
1.1 Important topics in the book of Slack & Lewis
- Chapter 1: Operations Strategy
o Page 8: The Four Vs
o Page 28: Operation Strategy
o Page 30: Central model of Operations Strategy (Slack & Lewis)
o Page 35: Decision areas
o Page 40: Operations Strategy Matrix
- Chapter 2: Operations Performance
o Page 62: Performance Objectives
o Page 68: Internal and external effects on performance objectives
o Page 74: Change of importance of performance objectives
o Page 76: Trade-offs
- Chapter 3: Socially Responsible Operations Strategy
o Page 113: CSR in terms of operations management
- Chapter 4: Capacity Strategy
o Page 120: Capacity Strategy
o Page 134: Generic timing strategies (changing capacity)
- Chapter 5: Purchasing and Supply Strategy
o Page 163: Types of supply arrangement
- Chapter 6: Process Technology Strategy
o Page 206: how do market volume and variety influence process technology
▪ Scale/Scalability
▪ Degree of Automation/Analytical Content
▪ Degree of Coupling/Connectivity
o Page 214: Product-process matrix
o Page 216: New developments in process technology change cost-flexibility trade-off
- Chapter 7: Improvement Strategy
o Page 242: Improvement approaches
o Page 252: Performance measurement
o Page 258: Sandcone model
- Chapter 8: Product and service development and organization
o Page 306: Organization structures
- Chapter 9: Process of operations strategy – formulation and implementation
o Page 312: Alignment
o Page 329: How do we know when the formulation process is complete?
▪ Figure 9.7
• Comprehensiveness
• Coherence
• Correspondence
• Critically
- Chapter 10: Process of operations strategy - monitoring and control
o Page 346: Differences between operational and strategic monitoring and control
o Page 353: Balance score card
o Page 368: Innovators dilemma
o Page 370: Power-interest grid
3
, 2. Context operations management
Lecture 2
What is ‘operations’? -> Operations is the activity of managing the resources and processes that
produce and deliver goods and/or services.
Input-transformation-output model -> applies to all activities and functions in an organisation. By
transformation inputs into outputs that satisfy a customers need. Transforming resources are
allocated to activities in various parts of the operation. Transformed resources move through these
activities until they become a mix of products and services.
Primary process -> dominant operations function of a company includes all the resources and
processes which are directly linked to producing the products and or services that can be considered
as being crucial for a long-term sustainable character of the company. A company exists for a
curtained reason(s) there is product being generated or a services being offered and is the reason
why a company exist. In a way you could say that the primary process is related to the
production/generation of these products and/or services.
Primary process is not always the most important process in a company, but the primary process is
linked producing products and/or services that give the company a long-term sustainable advantage
4
