Page 144 - Operations Strategy

SummARy AnSWERS To KEy quESTionS 119
5 They must take responsibility for the (often significant) education and learning
effort that will be needed if new ideas are to be intelligently exploited.
6 Above all, they must avoid the over-exaggeration and hype that many new ideas
attract. Although it is sometimes tempting to exploit the motivational ‘pull’ of new
ideas through slogans, posters and exhortations, carefully thought out plans will
always be superior in the long run, and will help avoid the inevitable backlash that
follows ‘over-selling’ a single approach.

SummARy AnSWERS To KEy quESTionS

How does total quality management fit into operations strategy?
TQM is a philosophy of how to approach the organisation of quality improvement
that stresses the ‘total’ of TQM. It puts quality and improvement generally at the heart
of everything that is done by an operation. It provides a checklist of how to organise
operations improvement. It has also been developed into a more prescriptive form, as
in the EFQM Excellence Model, developed by the European Foundation for Quality
Management (EFQM).

How do lean operations fit into operations strategy?
The lean approach aims to meet demand instantaneously, with perfect quality and no
waste. It can be seen as having four elements: customer-based demand triggers, syn-
chronised flow, enhanced improvement behaviour and waste elimination. However,
the lean concept implies some sacrifice of capacity utilisation. It occurs because when
stoppages occur in the traditional system, buffers allow each stage to continue working
and thus achieve high-capacity utilisation. There is far less buffering in lean processes.

How does business process reengineering fit into operations strategy?
BPR is the fundamental rethinking and radical redesign of business processes to achieve
dramatic improvements in critical, contemporary measures of performance, such as
cost, quality, service and speed. The approach strives for dramatic improvements in
performance by radically rethinking and redesigning the process using ‘end-to-end’
processes and by exploiting the power of IT to integrate processes.

How does Six Sigma fit into operations strategy?
Six Sigma is a disciplined methodology of defining, measuring, analysing, improving
and controlling the quality in every one of the company’s products, processes and
transactions – with the ultimate goal of virtually eliminating all defects. Although it
started as a statistical process control-based concept, it is now a broad improvement
concept rather than a simple examination of process variation. It stresses the use of
(preferably quantitative) evidence in decision making, systematic problem solving and
the use of improvement specialists called Black Belts, Green Belts and so on.
What place do these new approaches have in operations strategy?
These approaches are not strategies in themselves (operations strategy specific to one
organisation at one point in time), they are generic in nature, but they are strategic deci-
sions. Although none of them is incompatible with operations strategy, they can all be

M03 Operations Strategy 62492.indd 119 02/03/2017 13:03