COMPETITIVENESS, STRATEGY, AND PRODUCTIVITY
The topics covered in this chapter can be used to help get your course in OM off to an interesting start.
Most of your students are aware that U.S. firms are having a difficult time competing with foreign firms
in both the domestic and international markets. Many of them have grown up using products produced by
foreign firms on an everyday basis and they have developed a great deal of respect for the quality of their
products. Students are probably as familiar with names like Minolta, Honda, Toyota, Sony, BP Oil, Nestlé
I think students will relate to the fact that companies must be productive in order to be competitive and
that to be competitive they must have some well thought out approach, plan or strategy on how to achieve
this position. In other words, students will be able to understand why it is important to learn what
productivity really is, how we measure it, what factors affect it, and how firms can improve their
productiveness. Students will become aware that business firms compete with each other in a variety of
ways and will study the key competitive factors which are of primary concern in today’s global business
environment. Finally, the students focus on operations strategy with special attention being given to some
of the newer strategies based on quality, time, and lean production systems.
Answers to Discussion and Review Questions
They would be helpful in the sense that they would give U.S. manufacturers time
to step up the use of industrial robots and other measures which would make them better
able to compete in domestic and world markets. The higher profits possible from reduced
competition or higher prices on foreign cars could be used for research and development
costs. Possible pitfalls include higher prices and less choice, which U.S. consumers would
have to endure and the possibility that U.S. companies would not use this as an opportunity
to improve, but merely a crutch. From the Japanese standpoint, they would be penalized for
doing what many would see as a good job.
Business organizations compete with one another in a variety of ways. Key
among them are price, quality, product differentiation, flexibility, and delivery time.
Characteristics such as price, quality, time, delivery speed, delivery reliability
can all be order qualifiers or order winners. It is important to determine the set of order
qualifier and order winner characteristics so that companies can emphasize or de-
emphasize a given characteristic based on their classification of importance. Marketing
must play a major role in determining order qualifiers and order winners. In classifying
order winners and order qualifiers, marketing and operations must work together to match
the market needs with the operational capability of the firm.