Solutions Operations and Supply Chain Management for MBAs, 8th Ed
Complete Chapters Solutions included + Cases answers given
Chapter 1
Operations Strategy and Global Competitiveness
Chapter Summary
This is one of the most important chapters in the text as it defines operations management
as the activities associated with transforming inputs into valued outputs. The chapter also
shows that the actual production system is defined in terms of its environment, inputs,
transformation system, outputs, and the mechanism used for monitoring and control. In
our definition of the production system, we define all transformation systems as
services—with or without facilitating goods (physical entities accompanying the
transformation process).
This chapter continues with a definition of customer value as perceived benefits divided
by costs. Customer costs include upfront monetary investment, other lifecycle costs for
maintenance, and the hassles involved in obtaining the product or service. Discussion of
customer benefits focuses on innovative products and services, functionality, quality,
customization, and responsiveness.
Following the discussion of customer value, the chapter continues with a discussion of
strategy and competitiveness. Global trade trends are discussed. Next, the chapter
provides an overview of the business strategy formulation process and includes timely
material on vision and mission statements, internal and external forces, business strategy,
the business model, and business unit strategies. After that, business unit strategic
frameworks are described: the life-cycle approach, the performance frontiers concept,
focus on one or two key areas of strength, and the sand cone model. Finally, the chapter
concludes with a discussion of core capabilities, outsourcing, and offshoring.
The chapter concludes with a discussion of productivity as a key measure to assess how
well the value-creating process is performing. Included in the discussion of productivity
are alternative productivity measures including single factor, multifactor, and total factor
productivity measures. After discussing these measures, the topic of productivity is
linked to the standard of living and the productivity of alternative countries discussed.
Chapter Teaching Tips
There are a number of ways to introduce the course material. Many MBA students work
at companies that have recently initiated a Lean/Six Sigma project, have outsourced
processes to suppliers in low-wage countries, or have implemented an Enterprise
Resource Planning system. Therefore, students naturally should be inquisitive about
operations management and the aforementioned topics.
Chapter 1 – Page 1
, One approach is to have the students read cases prior to first class. “Wyatt Earp – The
Buffalo Hunter” case is a short, but interesting case, that touches upon many aspects of
operations strategy. A second case, “American Outsourcing” discusses the outsourcing of
manufacturing and service jobs from the United States to Mexico, China, and India.
Citations for these cases can be found at the end of these notes.
Another useful approach for illustrating the importance of operations management is to
have students read the Harvard Business Review article “Fast Heat: How Korea Won the
Microwave War (January/February 1989). The article emphasizes a number of important
themes including:
Ø A strong production orientation. Samsung emphasized production over
marketing.
Ø Design done with manufacturing in mind.
Ø Measures like payback and return on investment were not used.
Ø The customer should never be kept waiting.
Ø Engineers travel, not just the sales force.
Other benefits of using the Fast Article, is that it is a brand students are likely familiar as
it is a major player in smartphones and it has continued to achieve considerable success
in a number of other industries.
Another approach is to start with a movie or video that illustrates the operations activities
of some firm or organization and use this to lead to a discussion of the operations
function.
Then, the instructor can introduce the topics of global competiveness and strategy by
asking students for the slogans of firms they are familiar with (e.g., "Everyday low
prices—always!"). From this, the number of areas of strength that are in the operations
area can be counted. Typically, 80-90% will fall in the operations area indicating its
strategic importance. The discussion can then move to the Chinese successes in world
markets and American firms' often typical lack of attention to operational activities.
Chapter 1 – Page 2
Complete Chapters Solutions included + Cases answers given
Chapter 1
Operations Strategy and Global Competitiveness
Chapter Summary
This is one of the most important chapters in the text as it defines operations management
as the activities associated with transforming inputs into valued outputs. The chapter also
shows that the actual production system is defined in terms of its environment, inputs,
transformation system, outputs, and the mechanism used for monitoring and control. In
our definition of the production system, we define all transformation systems as
services—with or without facilitating goods (physical entities accompanying the
transformation process).
This chapter continues with a definition of customer value as perceived benefits divided
by costs. Customer costs include upfront monetary investment, other lifecycle costs for
maintenance, and the hassles involved in obtaining the product or service. Discussion of
customer benefits focuses on innovative products and services, functionality, quality,
customization, and responsiveness.
Following the discussion of customer value, the chapter continues with a discussion of
strategy and competitiveness. Global trade trends are discussed. Next, the chapter
provides an overview of the business strategy formulation process and includes timely
material on vision and mission statements, internal and external forces, business strategy,
the business model, and business unit strategies. After that, business unit strategic
frameworks are described: the life-cycle approach, the performance frontiers concept,
focus on one or two key areas of strength, and the sand cone model. Finally, the chapter
concludes with a discussion of core capabilities, outsourcing, and offshoring.
The chapter concludes with a discussion of productivity as a key measure to assess how
well the value-creating process is performing. Included in the discussion of productivity
are alternative productivity measures including single factor, multifactor, and total factor
productivity measures. After discussing these measures, the topic of productivity is
linked to the standard of living and the productivity of alternative countries discussed.
Chapter Teaching Tips
There are a number of ways to introduce the course material. Many MBA students work
at companies that have recently initiated a Lean/Six Sigma project, have outsourced
processes to suppliers in low-wage countries, or have implemented an Enterprise
Resource Planning system. Therefore, students naturally should be inquisitive about
operations management and the aforementioned topics.
Chapter 1 – Page 1
, One approach is to have the students read cases prior to first class. “Wyatt Earp – The
Buffalo Hunter” case is a short, but interesting case, that touches upon many aspects of
operations strategy. A second case, “American Outsourcing” discusses the outsourcing of
manufacturing and service jobs from the United States to Mexico, China, and India.
Citations for these cases can be found at the end of these notes.
Another useful approach for illustrating the importance of operations management is to
have students read the Harvard Business Review article “Fast Heat: How Korea Won the
Microwave War (January/February 1989). The article emphasizes a number of important
themes including:
Ø A strong production orientation. Samsung emphasized production over
marketing.
Ø Design done with manufacturing in mind.
Ø Measures like payback and return on investment were not used.
Ø The customer should never be kept waiting.
Ø Engineers travel, not just the sales force.
Other benefits of using the Fast Article, is that it is a brand students are likely familiar as
it is a major player in smartphones and it has continued to achieve considerable success
in a number of other industries.
Another approach is to start with a movie or video that illustrates the operations activities
of some firm or organization and use this to lead to a discussion of the operations
function.
Then, the instructor can introduce the topics of global competiveness and strategy by
asking students for the slogans of firms they are familiar with (e.g., "Everyday low
prices—always!"). From this, the number of areas of strength that are in the operations
area can be counted. Typically, 80-90% will fall in the operations area indicating its
strategic importance. The discussion can then move to the Chinese successes in world
markets and American firms' often typical lack of attention to operational activities.
Chapter 1 – Page 2
