Question

What is the definition of an operations and supply chain strategy?

Answer 1

OPERATIONAL STRATEGY: They are the strategies, methods or ways using which the companies reach their objectives and targets. They help in designing, implementing and controlling efficient systems using man, machine and material. They are also used to link long and short-term goals to achieve organizational targets. A well defined organizational strategy helps in:

1. achieving Economies of scale

2. Moving towards six sigma quality levels of 3.4 DPMO

3. System efficiency and effective utilisation of resources

4. Reduction of Wastage

.5. Minimising costs and hence increasing profits

SUPPLY CHAIN STRATEGY: It is the strategy which evaluates the cost-benefit paradigm of a process involved in the operational system. It defines the elements to achieve the efficiency throughout the value chain. A well-defined Supply chain strategy helps in:

1. Outsourcing the secondary services to focus on core competency

2. Maintaining the EOQ (Economic order quantity) to have reduced inventory and warehousing costs

3. Eliminate spillage and thefts losses which create inefficiency in the system.

4. Getting the work done by those who have domain expertise in domains like logistics.

5. Automate the process and control the system through options like ERP (Enterprise resource planning).