M ission Statem e n t C o m p a n y O b jectives E n v iro n m e n tal S c a n n ing Internal Strength and W e a k n e s s A n a lysis C o rporate S trategy

Corporate Strategy Focus: Survival Business Strategy D istinctive c o m p e t e n c e in the field C o s t l e a d e r s h ip P r o d u c t d iffe r e n t i a t i o n F o c u s ( c o s t o r d iffe r e n t i a t i o n )

Focus:

M a n u facturing O p e rations Strategy Focus: Competitive Strategies Cost Flexibility Q u a lity D e liv e ry

O t h e r O p e ratio n s S trategies M a rketing Finance H u m a n R e s o u rce E n g ineering

P o lic y
S e rvice -e n h a n c e d p r o d u c t o r d e live r e d s e r v i c e S a tisfied custom e r

Price

Quality

Delivery Flexibility

Time Service

Product Design

Order Winners Characteristics that make your customers prefer you over competitors

Qualifiers Characteristics you need to get into the game

Nonissues Characteristics that do not enter into the competitive picture for that market niche

Source: Hill, Terry, Manufacturing Strategy, (Irwin McGraw-Hill, 1994). Reprinted with permission of Irwin McGraw-Hill.

Process
Output

Internal Customer Process

Output

Internal Customer

External Customer

Elimination of Waste

Respect for People

Customer

Continuous Improvement

Focus on Customer

Reprocessing Rejects Warranty expenses Sorting inspection Customer returns

Lost sales Process downtime Extra inventory Lost discounts Damaged goods Premium freight costs Customer allowances

Delays Paperwork errors Obsolete inventory Loss of good will Extra process capacity Overtime to correct errors Incorrect orders shipped

Defects found at
Cost to the company Impact to the company

Own Next process process

End of the Final End user s line inspection hand

Very minor

Minor delay

l l

Rework Reschedule of work

Significant rework Delivery delay Inspection costs

Warranty cost Loss of market share Reputation