Introduction to

Operations Management

Talk 1:
Operations –
Competitiveness, Strategy, and Productivity
Linh Phuc
Email: tgkhoafmt01@hanu.edu.vn
MSTeam: tgkhoafmt10@hanu.edu.vn
• Reading material: Chapter 1 & 2, Stevenson, W.J. (2021). Operations
Management, edition 14th. New York, USA: McGraw-Hill/Irwin.

Content
• Operations
01

• Competitiveness
02

• Mission and Strategy

03

• Productivity
04
01 Operations
A. Three basic functions of business organizations
B. Function Overlap
C. Goods or Services
A. Three basic functions of business organizations

Responsible for Responsible for Responsible for

• Securing financial producing goods • Assessing
resources at favorable and/ or services consumer wants
prices and needs
• Allocating resources • Selling and
throughout the promoting the
organization organization’s
• Budgeting, analyzing goods or services.
investment proposals,
  Marketing &
B. Function Overlap operations
 Finance &  Demand data
 Product and service
operations
 Budgeting
design
 Competitor analysis
 Economic analysis of
 Lead time data
investment proposals
 Provision of funds

1-5
C. Good or Service?
Goods are physical items that include raw materials, parts, subassemblies, and
final products (E.g: Automobile, Computer, Oven, Shampoo)

Services are activities that provide some combination of time, location, form or
psychological value (E.g: Air travel, Education, Haircut, Legal counsel)

1-6
C. Good or Service? (cont.)
Goods-service Continuum

1-7
 02 Competitiveness

Competitiveness: How effectively an organization

meets the wants and needs of customers relative to
others that offer similar goods or services.
Competitiveness determines whether a company
prospers, barely gets by, or fails.
 Mission,
03 Organizational strategies
& Operations strategies
A. Hierarchy of Planning and Decision making in organizations
B. 10 operations management (OM) decisions
C. Link them together
 A. Hierarchy of Planning and Decision making in
organizations
The reason for the existence of an organization
Provide detail -> Mission statement answers the question “What business
and scope of are we in?”
the mission.
- Plans for achieving organizational goals.
- 03 basic organizational/ business strategies:
• Cost leadership
• Responsiveness
• Differentiation from competitors

- The approach, consistent with the

organization strategy, that is used to guide
the operations function.
- 10 operations management (OM) decisions
(Next slides)

The methods and actions taken to

accomplish strategies.
B. 10 operations management (OM) decisions
Products - Talk 2 Talk 3
Be clear on the customer’s
demands and then meet those
expectations. Use market
research to determine customer
needs and batch quality
assurance testing on products
and services in production.

Talk 4 Talk 4
B. 10 operations management (OM) decisions (cont.)
HR subjects
Talk 4

Talk 5 Talk 6
B. 10 operations management (OM) decisions (cont.)

Talk 7 Talk 8
 C. Link them together
10 Operations Strategy Example Competitive
Decisions Advantage

Product
DIFFERENTIATION: Distinguishing the offerings of an
Quality organization in a way that the customer perceives as
adding value
Process & Innovative design___________________________Biti’s
Capacity Broad product line________________________Ananas Response
After-sales service______________________Tailor Bros (faster)
Location Experience___________________________Cộng Cà Phê

Layout COST LEADERSHIP: Reducing operating costs, while Differentiation

achieving maximum value, as perceived by the customer. (better)
Human Low overhead __________________________Vietjet Air
resources Effective capacity use ________________________Grab Cost
Inventory management ____TikiNOW Smart Logistics leadership
Supply chain (cheaper)
RESPONSE: A set of values related to rapid, flexible, and
Inventory reliable performance.
Flexibility ______________________________Pizza 4P’s
Scheduling Reliability__________________________Hoa Phat Steel
Quickness_____________________________ViettelPost
Maintenance
 DIFFERENTIATION: Biti’s Innovative design
https://www.bitis.com.vn/products/phien-ban-ky-niem-40-nam-giay-the-thao-nam-hunter-x-dsm
h09700trg-trang
 DIFFERENTIATION: Ananas’ Broad product line
https://ananas.vn/product-list
 DIFFERENTIATION: Tailor Bros’ After-sales service
https://tailorbros.com
DIFFERENTIATION: Cộng Cà Phê’s Experience
https://congcaphe.com/page/gioi-thieu
COST LEADERSHIP: Vietjet Air’s Low overhead
Annual report 2021 of Vietjet Air
COST LEADERSHIP: Grab’ Effective capacity use
https://www.grab.com/vn
COST LEADERSHIP: TikiNOW Smart Logistics Inventory management
https://www.tikinow.biz/tiki-%E1%BB%A9ng-d%E1%BB%A5ng-robot-v%C3%A0o-logistics
RESPONSE: Pizza 4P’s Flexibility
https://www.facebook.com/Pizza4Ps/photos/2975053325865030
RESPONSE: Hoa Phat Steel’s Reliability
https://thep.hoaphat.com.vn/chat-luong-hoa-phat
RESPONSE: ViettelPost’s Quickness
https://viettelpost.com.vn/dich_vu/van-chuyen-hoa-toc
04 Productivity
A. Definition
B. Formula
A. Definition: A measure of the effective use of resources,
usually expressed as the ratio of output to input

B. Formula:
Outputs produced
Productivity =
Inputs used

Current Productivity – Previous Productivity

Productivity
= Previous Productivity x 100%
growth

Productivity
measure Formula Example

Partial
measures

Multi-factor
measures ;

Total measure
Thank you