PROCESS STRATEGY

- A process (or transformation) strategy is an organization’s

approach to transforming resources into goods and
services.
- It is a pattern of decisions that is made in managing
process that can help to achieve the competitive priorities.
A process that involves the organization’s resources to
provide goods and services.
 HOW TO PRODUCE A PRODUCT OR PROVIDE A
SERVICE THAT:

 Meet or exceeds customer requirements.

 Meets cost and managerial goals.

HAS A LONG TERM EFFECTS ON:

 Efficiency and production flexibility.
 Costs and quality.
 MAJOR PROCESS DECISION
• PROCESS STRUCTURE DETERMINES how processes are designed relatively
to the kinds of resources needed, how resources are partitioned between
them, and their key characteristics.
• CUSTOMER INVOLVEMENT refers to the ways in which customers become
part of the process and the extent of their participation.
• RESOURCE FLEXIBILITY is the ease with which employees and equipment
can handle a wide variety of products, output levels, duties, and functions.
• CAPITAL INTENSITY is the mix of equipment and human skills in a process.
 4 BASIC
PROCESS
STRATEGIE
S
PROCESS FOCUS
 Similar processes or equipment grouped together.
(Example: All drill presses are together.) other examples:
hospitals, repair shop and banks.
 Low volume, high variety products.
 75% of all global products.
 Products follow many different paths.
Other names: Intermittent Process, Job Shop.
 REPETITIVE FOCUS
 Facilities often organized by assembly lines.
 Characterized by MODULES.
 Parts & assemblies made previously.
 Combined for many output options.
Other names: Assembly line, Production line.
EXAMPLES: Fast food chains, Appliance Center.
 PRODUCT FOCUS
 High volume, low variety products.
 Long, continuous production runs.
 Discrete unit manufacturing.
 Continuous process manufacturing.
Other names: Line flow production, Continuous production.
EXAMPLES: CHIPS FACTORIES, BASIC COMMODITIES FACTORY
(soap, sardines, shampoo etc.)
MASS CUSTOMIZATION

 The rapid, low-cost production of goods and services to satisfy

increasingly unique customer desires.
 Combines the flexibility of a process focus with the efficiency
of a product focus.
EXAMPLES: DELL COMPUTERS, ADIDAS.
 WHICH PROCESS TO USE?

• How do we choose which process strategy to used?

• What type of data would help us?

• CHANGING PROCESSES
• DIFFICULT AND EXPENSIVE
• MAY MEAN STARTING OVER
• PROCESS STRATEGY DETERMINES TRANSFORMATION STRATEGY FOR
AN EXTENDED PERIOD
• IMPORTANT TO GET IT RIGHT
 CHANGING PROCESSES

• DIFFICULT AND EXPENSIVE

• MAY MEAN STARTING OVER
• PROCESS STRATEGY DETERMINES TRANSFORMATION STRATEGY
FOR AN EXTENDED PERIOD
• IMPORTANT TO GET IT RIGHT
 PROCESS ANALYSIS AND DESIGN

• FLOW DIAGRAMS- SHOWS THE MOVEMENT OF MATERIALS

• TIME-FUNCTION MAPPING- SHOWS FLOWS AND TIME FRAME
• VALUE STREAM MAPPING -SHOWS FLOWS AND TIME AND VALUE ADDED
BEYOND THE IMMEDIATE ORGANIZATION
• PROCESS CHARTS -USES SYMBOLS TO SHOW KEY ACTIVITIES
• SERVICE BLUEPRINTING- FOCUSES ON CUSTOMER/PROVIDER INTERACTION
 PROCESS REDESIGN

The fundamental rethinking of business processes to bring about dramatic

improvements in performance
• RELIES ON REEVALUATING THE PURPOSE OF THE PROCESS AND QUESTIONING
BOTH THE PURPOSE AND THE UNDERLYING ASSUMPTIONS
• REQUIRES REEXAMINATION OF THE BASIC PROCESS AND ITS OBJECTIVES
• FOCUSES ON ACTIVITIES THAT CROSS FUNCTIONAL LINES
• ANY PROCESS IS A CANDIDATE FOR REDESIGN
ETHICS AND ENVIRONMENTALLY FRIENDLY
PROCESSES
• REDUCE THE NEGATIVE IMPACT ON THE ENVIRONMENT
• ENCOURAGE RECYCLING
• EFFICIENT USE OF RESOURCES
• REDUCTION OF WASTE BY-PRODUCTS
• USE LESS HARMFUL INGREDIENTS
• USE LESS ENERGY