Page 251 - Operations Strategy

226 CHAPTER 6 • PRoCEss TECHnology sTRATEgy
Tangible and intangible resources

It is important to recall that in our discussion in Chapter 1 on the importance of opera-
tions resources and process, we were careful to distinguish between tangible and intan-
gible resources. Tangible resources are the actual physical assets that the company
possesses. In process technology terms these will be the machines, computers, mate-
rials handling equipment and so on, used within the operation. Intangible resources
are not necessarily directly observable but, nevertheless, have value for the company.
Things such as relationship and brand strength, supplier relationships, process knowl-
edge and so on, are all real but not always directly tangible. This concept of intangible
resources is important when considering process technology. A unit of technology
may not be any different physically from the technology used by competitors. How-
ever, its use may add to the company’s reputation, skills, knowledge and experience.
Thus, depending on how the process technology is used, the value of the intangible
aspect of a process technology may be greater than its physical worth. If the usefulness
of process technology also depends on the software it employs, then this also must
be evaluated. Again, although software may be bought off the shelf and is therefore
available to competitors, if it is deployed in imaginative and creative ways its real value
can be enhanced.

evaluating market and resource acceptability

Consider, for instance, a Windows-based data management system for a police force
to help manage their crime laboratory. The lab is where samples from a range of crime
scenes are tested in a large variety of different processes (DNA testing, fingerprint analy-
sis etc.) that vary widely in their sophistication and complexity. Although speed is often
of the essence in the lab, accuracy and dependability are equally critical, as is their legal
requirement to store and access information over extended periods of time (for legal
appeals, long-term investigations etc.). While this operation does not have a market
position as such, it still has a set of social and legal priorities that are its direct equiva-
lent. Figure 6.13 illustrates this by adding a further line to the profile that indicates what
the laboratory’s performance targets are. Although the new process technology does
not improve operations performance in all aspects of the crime lab’s ‘market’ require-
ments, it does improve some specific areas of performance and does not appear to have
any negative effects. However, it is when we turn our attention to the resource profile of
the technology that the relevance for ‘not-for-profit’ operations of dimensions derived
from a competitive marketplace needs to be more closely examined. Although we might
see the usefulness of a unique and difficult-to-copy crime database in the ‘war against
crime’, the positive advantage of having resources that rank highly on the RBV dimen-
sions is not clear for an accountable public sector operation.
In other words, if a resource (such as knowledge or experience) is difficult to move
or copy, this can contribute to sustainable advantage in a competitive marketplace.
However, such characteristics can act against critical public sector objectives such as
effective information transfer or even accountability over performance. In this type of
application, therefore, it is necessary to see the resource characteristics as useful in a dif-
ferent way. So, for instance, imagine that the staff experience associated with analysing
particular types of DNA evidence is crucial for the crime lab but very difficult to copy
and therefore shared both within and between labs. The operations strategy response
might therefore be to diminish (rather than embrace) this ‘imitability’ characteristic
by developing systems and procedures that seek to codify (i.e. papers, technical diaries

M06 Operations Strategy 62492.indd 226 02/03/2017 13:05