Operations and Supply Chain Strategies Lecture Tw o
Customers seek value in terms of four main performance dimensions … Quality Cost Flexibility Delivery (Time) 2 Performance Dimensions
Quality ... Sub-dimensions Performance Quality – addressing the basic operating characteristics of the product or service. Conformance Quality – addressing whether the product was made or the service performed to specifications. Reliability Quality – addressing whether a product will work for a long time without failing or requiring maintenance. The relative importance of these quality sub-dimensions will differ from one customer to another. Performance Dimensions ... Quality 3
Performance Dimensions ... Time Time ... Sub-dimensions Delivery Speed – the ability for the operations or supply chain function to quickly fulfill a need once it has been identified. Delivery Reliability – The ability to deliver products or services when promised. Two important measures: delivery window - the acceptable time range in which deliveries can be made. accuracy of the quantity shipped. 4
Flexibility – how quickly operations and supply chains can respond to the unique needs of different customers. Flexibility ... Sub-dimensions Mix Flexibility – The ability to produce a wide range of products or services. Volume Flexibility – The ability to produce whatever volume the customer needs. Changeover Flexibility – The ability to produce a new product with minimal delay. Performance Dimensions ... Flexibility 5
Flexibility has become particularly valuable in new product development . Some firms compete by developing new products or services faster than their competitors.
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