COB 300 – Benchmark 2 The Operations Plan

Operations Section “What operational processes will you establish to deliver goods/services?” Once your business strategy is defined, look closely at your competitive priority/priorities: cost, quality, delivery reliability, flexibility, speed. These will be the basis for defining your operations strategy.

Points to Consider Will you produce a tangible product or will you be a service provider? Are you business to business or are you business to consumer? For how much are you responsible (i.e., do you subcontract out part or all of the fabrication/assembly process or service)? How do you ensure quality?

Points to Consider At what stage is the industry you’re entering (introduction, growth, maturity, decline)? Will you enter as a low volume, custom producer or will you need to have substantial capital investment for immediate volume capability? When do you expect to break even (volume of output and date) given your process design? How quickly will you move toward higher volume operations? What challenges or opportunities does this present?

Points to Consider Do you provide a customized (one of a kind) product or service or do you have a standard catalog listing of goods/services? How will you forecast demand for your product/service? How will that forecast help you operationally? How much error is there likely to be in that forecast? What is your finished goods inventory policy? How will your operations capabilities lead to competitive advantage (e.g., cost, quality, superior service, etc.)?

Points to Consider For Service Provider: Detail the flow of your operation (See Figure 7.9, page 259, Operations Management) Customer enters system  Customer leaves system For Goods Producer: Detail layout of facility (Product layout or process layout). Why?

Points to Consider “Location, Location, Location!”

Points to Consider What are your competitors doing operationally? How can you use this information to help position your own operations? Finally – How does what you do in operations add value for the consumer/business you are serving?