Operations entails all activities in the day to day functions of a business entity performed for the sole purpose of making profits and developing an organization. This involves all the tasks entailing one or more elements that are performed typically in a given location. Operations convert resources into desired goods and services or results that create of deliver values to customers (Bayraktar, Jothishankar, Tatoglu & Wu, 2007). On the other hand, strategy is a plan of actions aimed at achieving specific objectives or series of goals in an organization framework. It basically includes setting goals, determining the actions in the achievement of the goals and organizing resources in order to achieve the goals. Strategy within an organizations can be deliberate or it can emerge from the pattern of operations in the process of a business entity adapting to its environment. They entail actions such as operation planning and strategic thinking. Operation strategies entails the methods an organization employs in attaining their objectives. These are the collective solid actions selected, mandated, or triggered by the corporate strategy. Operations strategy engrosses different operations decisions and activities into a consistent, response to the competitive forces by connecting an organization policies, programs, systems and actions. It therefore means that operations strategy entails how an organization employs its operations capabilities in order to support their business strategy.
Types of operations strategies
There are three main types of organizational strategies at different levels. These are the corporate level, business level and functional level. Corporate operations strategy is the highest level of strategy decision making that covers all the activities operations as well as the goal of an organization, acquisition and the allocation of resources and coordination of all the other strategies. The decisions at corporate strategy are made by the top management team of the organization. Furthermore, the nature of strategic decisions are value oriented, conceptual and less concrete as compared with other levels, for instance at the business and functional level.
Business level strategy is engrossed in organizations that have different business units. Business strategies and tactics are aimed at setting goals for the performance and evaluates activities of competing firms and establishes actions that an organization need to put in place in order to uphold its competitive advantage (Masanell & Ricart, 2009). These include low pricing actions, attaining differentiation in quality and focusing on promotion.
Functional level strategy of an organization involves the operating divisions as well as the different departments. The planned concerns at the functional level are connected to the business processes as well as the value chain. Functional level strategies in department like marketing or finance entails all the development and coordination of resources in which an organization unit strategizes and be implemented effectively.
Operations strategy and corporate strategy process
The process of business planning entail different stages. An effective business strategic plan is used to outline an organizations objectives and also defining ways through which the objective is reached at. Therefore, operational strategies is the comprehensive pattern in which each department within an organization will make use of its resources in the attainment of an organizations goals. Formidable links between strategic and operations plans are significant in ensuring an organization operates effectively (Adamides, 2015). Both operational and strategic planning are linked decision processes that need to be designed in order to inform as well a supporting each other for management strategies effectiveness of an organization. The basic variance between operational and strategic planning is the time limit of decisions. This means that the significant difference between operational and strategic planning is more than the concept of short or long term planning horizon.
Despite any form of differences entailed in the operational and strategic planning, they are both interrelated and complimentary decision making processes, which affect the outcome of any organization as indicated earlier. Operational planning is the day to day, or week to week planning of the local and functional actions while the strategic planning sets the overall direction of an organization in the long term. All decisions that are entailed in strategic planning are the concepts that the organization is not doing presently but ought to be undertaking. Therefore, in as much as strategic and corporate strategy exhibit some differences, the two forms of planning must be linked and integrated without any confusion.
Operations strategy and supply chain management
We have talked about the concept of operations strategy. It is important to also look at supply chain management and find out how they operate and influence one another in an organization. Supply chain mainly focuses on the operations of an organization. These are defined in the basic functions, which are plan, source, make, deliver and return. With regards to different organizations, some of the functions mentioned fall under supply chain. Supply chain management functions are basically intended to provide an organizations with a solid cost reduction activities both directly and indirectly. For instance, service like warehouse automation directly entails cost reduction action to an organization. This among many other activities in the supply chain management offer opportunities that create competitive advantage for organizations, since they can directly affect an organization cost basis and offer cost advantages at the same time.
There are also supply chain functions and management that offer product differentiation through integration process. The factions are significant in enhancing operational efficiency and offer differentiation in customer services in the fulfillment of customer wants. Effective planning in the supply chain management are significant in reducing costs and enhancing output, which assist organizations in establishing and distribution operation efficiency (Happek, N2005). Therefore, organizations need to assess their operation strategies as well as divide their value chain management operations in order to come up with goals set by the strategies. Supply chain management offer several opportunities and other solutions in helping organizations attain their operation strategic goals analytically through aligning the efforts with strategic goals.
The corporate strategy function
Corporate strategies are concerned with how organizations can add value over and above what they create for themselves. This calls for organizations to come invest in a number of resources in order to ensure a transfer of skills across the business. Successful corporate strategies will ensure that appropriate and effective value is added to the organization through correct timing. Corporate strategy cannot be successful minus value construction strategies. At the same time, competitive strategy cannot be successful if the corporate strategy fails to dissociate after they have stopped to add values.
Senior management committees in all organization’s commitment and effective planning are some of the key features of effective manager sin organizations (Kane, 2006). Furthermore, these are the basic characteristics of an effective planning process too. Therefore, it is very significant that organizations have the foundation to build and come up with goals that maximize value addition to the organization. As a corporate strategy function, value addition add meaning to the organization and ensure it remains relevant in the competitive world and market. Values are also essential in impacting on the decisions on the paths and direction an organization takes in all its activities and operations.
Adamides, E. D. (2015). Linking operations strategy to the corporate strategy process: a practice perspective. Business Process Management Journal, 21(2), 267-287.
Bayraktar, E., Jothishankar, M. C., Tatoglu, E., & Wu, T. (2007). Evolution of operations management: past, present and future. Management Research News, 30(11), 843-871.
Happek, S. (2005). Supply chain strategy: The importance of aligning your strategies. UPS Supply Chain Solutions, 1-6.
KANE‐URRABAZO, C. H. R. I. S. T. I. N. E. (2006). Management’s role in shaping organizational culture. Journal of nursing management, 14(3), 188-194.
Masanell, R. C., & Ricart, J. C. (2009). From strategy to business models and to Tactics (pp. 10-14). Working Paper: 10-036.