Page 70 - Operations Strategy

Chapter
2 Operations performance

Introduction
Operations ‘performance’ means the extent to which an operation accomplishes its
objectives. In this chapter we look at how we judge the performance of operations. First
we describe a very broad approach to assessing operations performance at a societal
level that uses the ‘triple bottom line’ to judge an operation’s social, environmental
and economic impact. Second, we look at how operations performance can be judged
in terms of how it affects an organisation’s ability to achieve its overall strategy. Third,
we look at the more directly operational level aspects of performance – quality, speed,
dependability, flexibility and cost. We also look at three related aspects of performance
that are fundamental to understanding operations strategy: how the relative impor-
tance of different aspects of performance changes over time; how performance objec-
tives trade off against each other (do improvements in some aspects of performance
necessarily mean a reduction in the performance of others?); and how exceptional
performance levels can be reached by focusing on a limited set of objectives and exploit-
ing the trade-offs between objectives (see Figure 2.1).

Figure 2.1 this chapter looks at how the relative importance of the market
requirements and operations resource perspectives change over time, how
performance objectives trade off between each other, and how operations focus
can lead to exceptional performance

Relative Relative
importance of importance of
the operations Performance objective B ? the market
resource requirements
perspective TRADE-OFFS perspective

Performance objective A

M02 Operations Strategy 62492.indd 45 02/03/2017 13:01