GMS 401 Chapter Notes - Chapter 2: Operations Management, Flexible Response, Competitive Advantage

• School: Ryerson University
• Department: Global Management Studies
• Course: GMS 401
• Professor: Wally Whistance- Smith

Document Summary

Chapter 2: productivity and operations strategy in a global environment. A cold hard fact: better quality, higher productivity, lower cost, and ability to respond quickly to (cid:272)usto(cid:373)e(cid:396) (cid:374)eeds a(cid:396)e (cid:373)o(cid:396)e i(cid:373)po(cid:396)ta(cid:374)t tha(cid:374) e(cid:448)e(cid:396) a(cid:374)d the (cid:271)a(cid:396) is getti(cid:374)g highe(cid:396) In practice, differentiation, low cost, and response can increase productivity and generate a sustainable competitive advantage. Competing on cost: one driver of a low-cost strategy is a facility that is effectively utilized, firms with low-cost strategies understand this and utilize recourses effectively. Its rapid transpiration of goods, reduced warehouse costs, and direct shipping from manufacturers have resulted in high inventory turnover and made it a low- cost leader. Each strategy puts different demands on operations management: any one or combination of these three strategic concepts can generate a system that has a unique advantage over competitors. Improvement can be achieved in two ways: reducing inputs while keeping output constant, or increasing output while keeping inputs constant.