Page 249 - Operations Strategy

224 CHAPTER 6 • PRoCEss TECHnology sTRATEgy

Flexibility Does the process technology allow the When an airline considers the mix of aircraft
operation to change in response to changes types to include in its fleet, it does so partly
in customer demand? Such changes may be to retain sufficient flexibility to respond
in either the level or nature of demand. to such things as timetable changes or
Does the process technology allow for unexpected demand.
adjustments to the internal workings of the Some aircraft (notably the Boeing 777) permit
operations processes? the precise configuration of cabins and
seating to be changed. While this may not
happen very frequently, it offers airlines the
flexibility to provide a different mix of services
without having different types of aircraft.
Cost Does the process technology process materials, A major driver for airlines to invest in new
information or customers more efficiently? aircraft is the greater efficiency (€/ passenger
As we mentioned previously, this is by far mile flown) of each new generation of
the most common basis for justifying new aircraft that derives from the overall design
process technology, even if it is not always of the aircraft and, most especially, the
the most important. It is never unimportant, engines powering them.
however. The ‘yield management’ decision support
Does the process technology enable a greater systems used by airlines enable them to
effectiveness of the operations processes? maximise the revenue from flights by
Even if straightforward efficiency is adjusting capacity and pricing strategies to
unaffected, process technology can aid the match demand patterns.
deployment of the operations capabilities
to increase profitability or general
effectiveness.

speed, dependability, flexibility and cost. As we stressed in Chapter 2, the generic per-
formance objectives are very rarely equally important for all types of operation. Their
relative importance will reflect the actual and intended market position of the organi-
sation. The implication of this for evaluating process technology is straightforward:
any evaluation must reflect the impact of process technology on each performance
objective relative to their importance to achieving a particular market position. Often
there will be trade-offs involved in adopting a new process technology. Reverting to
our airline examples earlier, one advantage of having a fleet of mixed aircraft is the flex-
ibility it provides to match aircraft to routes as the demand on different routes changes.
Yet different types of aircraft require different spare parts, different maintenance proce-
dures and different interfaces with ground technology and so on. This may add more
cost and complexity to the total airline operations than is gained through the benefits
of flexibility. For example, Airbus, the European airline consortium and great rival to
the US aerospace giant Boeing, claims that its strategy of common cockpit and flight
control systems across its range of planes saves considerable cost. Commonality in such
systems allows pilots and ground crews to deal with similar systems with 120-seater to
400-seater aircraft.

Acceptability in terms of impact on operational resources
Using the generic performance objectives can help us to characterise the potential con-
tribution that process technology can make to market requirements. At the same time,
however, it is important to build up a picture of the contribution that process technol-
ogy can make to the longer-term capability ‘endowment’ of the operation. We can use

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