The 10 strategic operations management (OM) decisions typically include:

1. Goods and services design
2. Quality management
3. Process and capacity design
4. Location strategy
5. Layout design
6. Human resources and job design
7. Supply chain management
8. Inventory management
9. Scheduling
10. Maintenance

These decisions relate closely to the three key competitive strategies: differentiation, cost leadership, and response, as follows:

Relation to Differentiation Strategy

• Goods and Services Design: Differentiation focuses on unique product features or high quality, so strategic decisions here emphasize innovation, customization, and superior design to create distinct offerings.
• Quality Management: Ensuring superior quality supports differentiation by enhancing customer perception and brand reputation.
• Process and Capacity Design: Processes may be designed for flexibility to accommodate product variety and innovation, supporting unique customer needs.
• Human Resources and Job Design: Skilled employees and creative work environments are critical to sustaining differentiation through innovation and service excellence.
• Supply Chain Management: May prioritize responsiveness and quality over cost, ensuring reliable delivery of differentiated products.

Relation to Cost Leadership Strategy

• Process and Capacity Design: Focus on efficient, standardized processes to minimize costs and maximize throughput.
• Location Strategy: Choosing locations that minimize costs such as labor, transportation, and taxes.
• Layout Design: Optimizing layout for efficiency and reduced waste to lower operational costs.
• Inventory Management: Tight control to reduce holding costs and avoid excess inventory.
• Maintenance: Preventive maintenance to avoid costly downtime and expensive repairs.
• Supply Chain Management: Emphasis on cost-effective sourcing and logistics to maintain low overall costs.

Relation to Response Strategy

• Process and Capacity Design: Design for flexibility and quick changeover to respond rapidly to market demands.
• Location Strategy: Strategic placement to reduce delivery times and improve customer service.
• Scheduling: Agile scheduling to meet fluctuating demand and ensure timely delivery.
• Inventory Management: Balancing inventory levels to enable fast response without excessive holding costs.
• Human Resources: Staffing flexibility to adjust quickly to demand changes.

In summary, the 10 strategic OM decisions are the levers through which companies implement their overarching competitive strategies:

OM Decision| Differentiation Focus| Cost Leadership Focus| Response Focus
---|---|---|---
Goods and Services| Unique, innovative products| Standardized, cost-effective| Adaptable products to meet demand
Quality Management| Superior quality and reliability| Consistent quality at low cost| Quality that supports quick delivery
Process and Capacity| Flexible, innovation-friendly| Efficient, high-volume processes| Flexible, fast changeover
Location| Proximity to markets or talent| Low-cost locations| Close to customers for speed
Layout Design| Supports customization| Optimized for efficiency| Supports quick throughput
Human Resources| Skilled, creative workforce| Cost-effective labor| Flexible staffing
Supply Chain| Responsive, quality-focused| Cost-minimizing suppliers| Agile, responsive supply chain
Inventory Management| Inventory to support variety| Minimized inventory costs| Balanced inventory for responsiveness
Scheduling| Focused on quality and customization| Maximizes utilization| Agile scheduling for quick response
Maintenance| Supports reliability and quality| Cost-effective maintenance| Minimizes downtime for responsiveness

This alignment ensures that operations management decisions support and enable the firm's chosen competitive strategy, whether it is differentiation, cost leadership, or rapid response to customer needs