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Operations Strategies and Checklists - May 1998
| Operations Management |
Operations Strategies and Checklists
Addressing Vital Concerns
As a company grows, or as its business environment changes, it is faced with many strategic decisions which may
appear to be of little consequences. But it's important to realize that these decisions and any procedure or policy
change can have a substantial impact on a company's operational effectiveness and its long-term strategic direction.
Operations Strategy Checklists
Too often, business decisions - big and small - are based on financial considerations and costs or market implications
with little regard for operational strategies. Certain courses of action are then taken which may unkowingly have
adverse consequences on the effectiveness of an organization's operations. Thus, while it is important to consider
all financial and marketing factors in the decision-making and business development process, it is also critical that
the organization's operations strategy be evaluated.
This page will spotlight these issues in very practical terms. I'll briefly discuss some of the major dimensions of an
operations strategy and include a checklist that can be used as a starting point for managers to gauge the
effectiveness and cohesiveness of the policies and practices regarding these operational aspects of their
organizations. The checklist points can be used to fundamentally analyze an organization's operations and decisions
to ensure a cohesive, coordinated approach to the business and the decision-making process.
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Operations Strategy
All companies , whether explicitly stated or not, have an overall top-level business strategy (a specific method of
competing in their industry) and certain competitive objectives.
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Dimensions of Operations Strategy
An operations strategy is multi-dimensional. It encompasses all aspects of a business from customer service to
capital spending. Company managers...
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Operations Strategy Checklist
Operations strategy exists and is stated.
Strategy
is communicated throughout the organization.
is aligned with business objectives.
builds on identified internal strengths.
reinforces the organization's identified capabilities and competitive differentiator.
was developed with input from all functions of the organization (strategic initiatives of all business functions support
the strategy).
is periodically evaluated to ensure continued alignment with business and environment.
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Organizational Structure Checklist
Management reporting structure is such that managers are given appropriate responsibility and authority.
Organizational structure and reporting heirarchy are developed so as not to create contradictory incentives for
employees.
Organizational structure allows the company to exploit its capabilities and competencies.
Organizational Structure.
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Intercompany Communications Checklist
Communication channels are available and open at all levels of the organization.
Major changes in business strategy or business environment are communicated throughout the organization.
Methods of communication are effective and timely.
Intercompany Communications.
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Facilities Checklist
Organizational roles of individual plants/departments are identified.
Facilities
are structured and utilized in a way that exploits the strengths and competencies of individual departments or plants.
are coordinated in such a way that supports the operations strategy and eliminates unwanted redundancy.
can support future forecasted capacity needs.
are arranged to allow for an appropriate level of flexibility.
can support sudden changes in production volume and product mix.
The interdependencies between various parts of the organization are known and considered during decision-making.
Facilities.
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Work Force Checklist
Employees are
adequately trained and educated.
reasonably empowered.
accountable for their work.
motivated and encouraged.
Work Force.
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Use of Technology Checklist
Appropriate level of technology is apparent where needed.
Level of technological advancement is consistent with operations strategy.
Technology provides readily accessible needed information at its point of use.
Actual benefits realized from the use of technology outweigh the associated costs.
Use of Technology.
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Processes / Process Improvement Checklist
Major business and production processes are identified.
Processes
are consistent and repeatable.
are capable of desired results.
are monitored and controlled.
are evaluated and improved to optimize costs and waste reduction.
make use of available technology to optimize investments.
Critical (important) processes are focused on while less important processes receive less attention.
Processes / Process Improvement.
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Performance Measures Checklist
Performance measures
are monitored and controlled
are linked to specific operational objectives
have established standards which are challenging yet attainable
create incentives that are not contradictory and that support the operations strategy.
Benefits gained from performance measures outweigh the cost of obtaining them.
Performance Measures.
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Capital Allocation Checklist
Operations strategy and current state are criteria considered when evaluating capital outlays.
Capital investments support future growth of company and industry.
Allocation of company resources is consistent with operations strategy.
Capital Allocation.
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Supplier Management Checklist
Suppliers are
appropriately involved in development efforts.
encouraged to pursue high quality and delivery standards
educated in the use and importance of their products
Policies and practices regarding individual suppliers are consistent over time and are appropriate for the chosen
operations strategy.
Supplier Management.
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The Bottom Line.
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- END -
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