Page 88 - Operations Strategy

Judging OPERATiOns PERfORmAnCE AT An OPERATiOnAl lEvEl? 63
‘Our management principle is the commitment to quality and reliability . . . to deliver safe
and innovative products and services . . . and to improve the quality and reliability of our busi-
nesses’ (Komatsu).
‘The management team will . . . develop high quality, strongly differentiated consumer
brands and service standards . . . use the benefits of the global nature and scale economies of the
business to operate a highly efficient support infrastructure (with) . . . high quality and service
standards which deliver an excellent guest experience . . .’ (InterContinental Hotels Group).
‘A level of quality durability and value that’s truly superior in the market place . . . the prin-
ciple that what is best for the customer is also best for the company . . . (our) . . . customers have
learnt to expect a high level of service at all times – from initiating the order, to receiving help
and advice, to speedy shipping and further follow-up where necessary . . . (our) . . . employees
“go that extra mile”’ (Lands’ End).

the relative priority of performance objectives differs between
different products and services within the same businesses
If, as is likely, an operation produces goods or services for more than one customer
group, it will need to determine a separate set of competitive factors and, therefore,
different priorities for the performance objectives for each group. For example, one of
the most obvious differences to be found within an airline’s activities is that between
the operations supporting business and first-class travellers on one hand, and those
supporting economy-class travellers on the other. This is shown in Figure 2.5.

the polar representation of performance objectives
A useful way of representing the relative importance of performance objectives is shown
in Figure 2.6(a). This is called the polar representation because the scales that represent
the importance of each performance objective have the same origin. A line describes
the relative importance of each performance objective. The closer the line is to the
common origin, the less important is the performance objective to the operation. Two
services are shown – a newspaper collection (NC) recycling service and general recy-
cling (GR) service. Each essentially provides a similar type of service, but for different
markets and therefore different objectives. Of course, the polar diagram can be adapted
to accommodate any number of different performance objectives. For example, Figure
2.6(b) shows a proposal for using a polar diagram to assess the relative performance of
different police forces in the UK. Note that this proposal uses three measures of quality
(reassurance, crime reduction and crime detection), one measure of cost (economic
efficiency) and one measure of how the police force develops its relationship with
‘internal’ customers (the criminal justice agencies). Note also that actual performance
as well as required performance is also marked on the diagram.

Order-winning and qualifying competitive factors
One way of determining the relative importance, or at least the different nature, of com-
petitive factors is to distinguish between what are sometimes called ‘order-winning’ and
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‘qualifying’ factors. Although not a new idea, it is a particularly useful one. Different
authors use different terms, so order-winners can also be called ‘competitive edge fac-
tors’, ‘critical’ or ‘primary factors’, ‘motivating factors’, ‘enhancing factors’, and so on.
Qualifiers sometimes go under the names ‘hygiene factors’ or ‘failure preventers’.

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