Chandigarh School

Of Business

Management Department

Master of Business
Administration
MBA-1 Semester Introduction
operations
Operations Strategy strategy
MBA 951-18

Dr Gunjan Sharma
Assistant Professor

CAMPUS: JHANJERI, MOHALI

 Today’s Agenda….

Operations Strategy
Process of Operations Strategy
Competitive Positioning
Value Chain
Operations Strategy

• Operations strategy is only one part of overall business or

corporate strategy, but it’s crucial for competitiveness and
success.
• E.g. Amazon: Once known for books, Amazon is now known
as the go-to platform for online shoppers of any product. Its
distribution network is widely touted and even includes
experiments with drone delivery.
• Operations strategy is the total pattern of decisions which
shape the long-term capabilities of any type of operation and
their contribution to overall strategy, through the reconciliation
of market requirements with operations resources
Process of Operations Strategy:

Operation Operation Operation

Operation
strategy strategy strategy
strategy control
formulation implementation monitoring

Competitive Positioning: Competitive positioning is a

marketing strategy that refers to how a marketing team
can differentiate a company from its competitors. The
position of the company depends on how the value it
provides with goods and services compares to the value of
similar goods and services in the market. 
Value Chain
• A value chain is a concept describing the full chain of a
business's activities in the creation of a product or
service - from the initial reception of materials all the
way through its delivery to market, and everything in
between.
• The value chain concept was first described in 1985 by
Harvard Business School professor Michael Porter, in
his book Competitive Advantage: Creating and
Sustaining Superior Performance.
Conti..
Conti..
• Primary activities
Primary activities contribute to a product or service's physical creation, sale,
maintenance and support. These activities include the following:
• Inbound operations. The internal handling and management of resources coming
from outside sources -- such as external vendors and other supply chain sources.
These outside resources flowing in are called "inputs" and may include raw materials.
• Operations. Activities and processes that transform inputs into "outputs" -- the
product or service being sold by the business that flow out to customers. These
"outputs" are the core products that can be sold for a higher price than the cost of
materials and production to create a profit.
• Outbound logistics. The delivery of outputs to customers. Processes involve systems
for storage, collection and distribution to customers. This includes managing a
company's internal systems and external systems from customer organizations.
Conti..

• Marketing and sales. Activities such as advertising and brand-

building, which seek to increase visibility, reach a marketing
audience and communicate why a consumer should purchase a
product or service.
• Service. Activities such as customer service and product support,
which reinforce a long-term relationship with the customers who
have purchased a product or service.
• As management issues and inefficiencies are relatively easy to
identify here, well-managed primary activities are often the
source of a business's cost advantage. This means the business
can produce a product or service at a lower cost than its
competitors.
Secondary activities
• Procurement and purchasing. Finding new external vendors,
maintaining vendor relationships, and negotiating prices and other
activities related to bringing in the necessary materials and
resources used to build a product or service.
• Human Resource Management. The management of human
capital. This includes functions such as hiring, training, building
and maintaining an organizational culture; and maintaining
positive employee relationships.
• Technology development. Activities such as research and
development, IT management and cybersecurity that build and
maintain an organization's use of technology.
• Company infrastructure. Necessary company activities such as
legal, general management, administrative, accounting, finance,
public relations and quality assurance.