Operations Management: An Integrated Approach, 5th Edition

OPERATIONS STRATEGY ACROSS THE ORGANIZATION

The business strategy defines the long-range plan for the entire company and guides the actions of each of the company's business functions. Those functions, in turn, develop plans to support the business strategy. However, in defining their individual strategies, it is important for the functions to work together and understand each other's needs.

Marketing identifies target markets, studies competition, and communicates with customers. In developing its own strategy, marketing needs to fully understand the capabilities of the operations function, the types of resources being used, and the way those resources are utilized. Otherwise, marketing's strategy could entail making promises that operations cannot deliver. In turn, marketing needs to communicate to operations all its observed and anticipated market changes.

Finance develops financial plans to support the business strategy. However, since it is the operations function that manages all the organization's resources, the financial plans in effect support operations activities. Before it can develop its own strategy, finance needs to communicate with operations in order to understand the financial requirements of planned resources. In turn, operations managers cannot fully develop a ...