can operations ans supply chain capabilities drive the business strategy? Can you tink of any examples in?

Question

industry? This question is for operational management class

Answer 1

Yes, look at brick-and-mortar who want to compete with eBusinesses (Blockbuster - Netflix). Blockbuster can provide the ability that Netflix cannot. And that is the ability to return your movies to the store (and renting new ones).

Answer 2

They could but the question is really around what the strategy is. You don't build a strategy around supply chain and ops-- The strategy should determine what the supply chain and operations characteristics need to be.

Let's take Southwest Airlines as an example-- they're strategy is to be the low cost leader in airlines. Their ops certainly drive their strategy-- quick turn around times, all same equipment (737's), no frills (only peanuts and drinks), no assigned seating, etc. All these OPERATIONs capabilities drive their business strategy.

On the supply chain front-- many companies optimize their supply chain to minimize inventory. JIT inventory was a huge craze years ago. Even today, one has to manage the supply chain to minimize inventory costs etc. If your strategy is to drive efficiency and cost in your product, then yes supply chain and ops very much drive the strategy.

Think Dell-- they have a direct model where you can order pretty much what you want. Building competitively priced computers with that level of flexibility is very much driven by ops and supply chain management.

But, if you take something like Ferarri or Lamborgini -- their business is exotic cars. So their strategy is not efficient ops per se. Its building the exotic cars. What drives their stategy is product and brand, not their ops or supply chain.