Name: Vargas, Mary Grace L.

Subject Code: CBM 001

Course, Year and Section: BSA 2C

ACTIVITY 2: Competitiveness, Strategy, & Productivity

COMPETITIVENESS

We've all competed in sports or school activities. There may have been awards
for winning these contests. Business is no exception. A firm's capacity to sell and provide
products and services in a particular market relative to other businesses' ability to do so.
To put it another way, how will one company gain consumers and become the
preferred product or service.

Organizations conduct business competition via both their marketing and

operational processes. Marketing may affect competition in a number of ways,
including making an effort to learn customers' desires and requirements, setting prices,
and promoting and advertising.

MARKETING INFLUENCES

1. Identifying Consumer Wants and / or Needs

- A crucial element in an organization's decision-making process, and a key
factor in a company's ability to compete. The mission is to find a connection
between the desires and needs of consumers and the company's goods.
2. Pricing and Quality
- Companies must determine how much their customers are willing to spend
for an item. If customers believe goods are substantially comparable, they'll
buy based on price. Many shoppers are ready to pay extra for a product that
has particular features or is well-known. Not only is a beautiful design
important, but a long-lasting and flawless product is important as well. Both
price and quality are one of the factors that may affect how the consumers
buy a goods.
3. Advertising and Promotion
- Advertising and promotions are the big help when it comes to attracting the
consumer itself. Even your goods have lowest price and high quality if it is not
advertised or spread in any way, no one will know that there are products like
yours. This is the way how to inform potential customers.

OPERATIONS THAT HAVE A MAJOR INFLUENCES

1. Product and Service Design
- It should represent the firm's attempts to balance financial resources,
operations, supply chain, and customer demands. Specific qualities of a
good or service may influence customer purchasing choices. Innovation and
time-to-market for new goods and services are also important.

2. Cost
- The production of a company influences pricing and profitability. Cost-
cutting initiatives are continuing in most businesses. Cost is influenced by
productivity. Those that outperform their rivals in terms of productivity get a
cost advantage. To reduce expenses, increase efficiency, or improve quality,
a business may outsource a part of its operations
3. Location
- It is essential in terms of cost and consumer convenience. Production costs
may be reduced through location. Allocation near markets reduces
transportation costs and speeds up delivery. Convenience is crucial in retail.
4. Quality
- Consumers assess quality by how effectively a product or service fulfills its
intended functions. Customers are ready to pay extra for a product or service
if they believe it is superior to a competitor. Quality includes materials,
craftsmanship, design and service.
5. Quick Response
- One approach is to rapidly introduce new or better goods or services.
Another is being able to promptly provide requested goods and services, and
still another is addressing consumer concerns fast.
6. Flexibility
- This factor is about the ability of the business to respond to changes. Changes
may be in the design of a product or service, the amount required by
consumers, or the organization's product or service mix. Flexibility may be a
benefit in a volatile economy.
7. Inventory Management
- Inventory management may help businesses compete by efficiently
balancing supply and demand.
8. Supply Chain Management
- In supply chain management, internal and external activities are
coordinated to ensure timely and cost-effective delivery of products.
 9. Service
- A significant difference in service quality is typically sustainable. Moreover,
companies with high customer satisfaction ratings tend to be more lucrative
and expand quicker.
10. People Under the Certain Company / Business
- Managers and employees are the lifeblood of a company, and their talents
and ideas may provide it a unique competitive advantage. Answering the
phone is an important skill. How complaints or information requests are
handled may be good or bad. A harsh or unhelpful response may tarnish a
person's image. Calls answered quickly and cheerfully may create a good
image and perhaps a competitive edge.

WHY SOME ORGANIZATIONS FAIL

Organizations fail for many reasons. Those factors may help managers avoid similar
blunders. Among the main causes are:

1. Neglecting operations strategy.

2. Failing to identify competitive risks or exploit strengths and opportunities.
3. Prioritizing short-term financial results above long-term innovation.
4. Focusing on product and service design rather than process design and
improvement.
5. Ignoring capital and human resource investments.
6. Ineffective internal communication and collaboration across functional sectors.
7. Ignoring consumer desires and requirements.

Finding out what consumers want and then fulfilling their expectations is the key to
competitive success. Two fundamental problems arise.

1. What do they want? (Which of the previous competitive strategies are essential
to customers?)
2. What is the best way to satisfy those wants?

Market research is required to determine the relative significance of different

products to each key consumer or target market. Competitive problems assist
managers create winning strategies.
STRATEGY

A strategy is a blueprint for accomplishing corporate objectives. They may be of various

lengths, from long-term to short-term to intermediate-term. Strategies should be crafted
to help the company achieve its objectives and purpose.

MISSION AND GOALS

The purpose of an organization is defined by its mission. The organization's

purpose is outlined in its mission statement, which asks the question “What business are
we in?” A mission statement serves as the foundation for organizational goals, which go
into more depth and define the breadth of the mission statement's objectives.

Businesses frequently describe their missions and goals in reference to how they
want to be perceived by their employees, suppliers, and customers. Strategic planning
involves determining what objectives will be met and setting up ways to achieve them.
All of this plays a key role in the operation of the organization's functional units.

STRATEGIES AND TACTICS

Strategies help decision making. The overarching strategy of an organization is

termed an organizational strategy. Functional strategies relate to each of the
organization's functions. Functional strategies should assist organizational strategies,
which should support the organization's objectives and purpose.

Tactics are how strategies are implemented. They offer advice and direction for
real operations, which need the most precise and comprehensive planning and
decision making in an organization. Consider tactics as the “how to” portion of the
process and operations as the “doing” part.

HIERARCHY
DIFFERENT STRATEGIES OF AN ORGANIZATION

1. Low Cost
- Do business with countries that have inexpensive labor, such underdeveloped
nations.
2. Scale – Based Strategies
- Maximize production volume while lowering unit costs.

3. Specialization
- Quality may be improved by limiting product ranges or services.
4. Newness
- Focus on new product or service development.
5. Flexible Operations
- Focus on speed and / or personalization.
6. High Quality
- Strive to outperform rivals in quality.
7. Service
- Focus on various service aspects.
8. Sustainability
- Prioritize eco-friendly and energy-efficient operations.

STRATEGY FORMULATION

A strategy's success depends nearly always on its formulation. To develop a

successful strategy, top managers must assess their companies' fundamental
capabilities and the external environment. They must know what their rivals are doing or
intending to do. They must evaluate additional variables that may have positive or
negative impacts. A winning approach considers both order qualifiers and order
winners.

1. Order qualifiers are qualities that prospective consumers deem acceptable for a
product to be purchased. But it may not be enough to entice a prospective
client to buy.
2. Order winners are features of an organization's products or services that set it
apart from the competition.

In the context of an organization, environmental scanning refers to the

consideration of events and trends that may offer risks or opportunities. External
environmental scanning is the term used to describe this process. Internal variables that
influence one's own strengths and weaknesses are considered to be part of one's own
internal environment. Internal and external influences may both be significant.

INTERNAL FACTORS EXTERNAL FACTORS

1. Human Resources
2. Facilities and
1. Economic Conditions
Equipment
2. Political Conditions
3. Financial Resources
3. Legal Environment
4. Customers
4. Technology
5. Products and Services
5. Competition
6. Technology
6. Markets
7. Suppliers
8. Others

GLOBAL STRATEGY

As globalization grew in importance, many businesses recognized that they

needed to make strategic choices about how they would approach globalization. It is
a reality that businesses must confront: What is successful in one nation or area isn't
always successful in another, and plans must be carefully designed to take these
variabilities into consideration. Another problem to consider is the possibility of political
or social unrest. Another problem is the difficulty of coordinating and controlling
activities that are spread over a large geographical area. Indeed, "In today's global
marketplaces, you don't have to go to another country in order to compete against
foreign competitors." “Either you come to the world or the world comes to you.”
OPERATIONS STRATEGY

This strategy defines the course the company takes. The scope is extensive,
including the whole company. The operational strategy is more specific and focuses on
the organization's activities. Products, processes, techniques, operational resources,
quality, costs, lead - times and scheduling pertain to operational strategy.

To be successful, operations strategy must be tightly linked to the organization's

strategy; in other words, the two should not be made separately. Instead, the
development of a business plan should take into consideration the strengths and
weaknesses of operations, using strengths and overcoming shortcomings. Operations
strategy must be compatible with the organization's overall plan and the strategy of
other functional units.

STRATEGIC OPERATIONS MANAGEMENT DECISION AREAS

QUALITY AND TIME STRATEGIES

Traditional company strategies have emphasized cost reduction or product

differentiation. While not abandoning them, many companies have adopted quality
and/or time-based initiatives.

1. Quality-based strategies aim to maintain or improve an organization's product or

service quality. Quality usually attracts and retains consumers. Diverse variables
drive quality-based initiatives. They may represent an attempt to improve a bad
image, catch up with the competition, preserve a good image, or a mix of these
and other reasons. Quality-based methods may be used to reduce costs,
improve productivity, or save time.
2. Time-based strategies are geared at reducing the time required to complete
activities like developing new goods or services, responding to a change in client
demand, or providing a product or service. To put customers first and gain a
competitive advantage over companies that take longer to do similar tasks, the
aim is to improve customer service. Processes that are centered on time save
time overall. The reasoning is that time, prices, productivity, quality, and product
innovations all increase when you reduce the time needed to develop a
product.

ORGANIZATIONS HAVE ACHIEVED TIME REDUCTION IN THE FOLLOWING:

1. Planning Time
- To implement countermeasures, to plan, to authorize modifications, to
implement new technologies, and so on.
2. Product Service Design Time
- Development and marketing of new or altered goods or services takes time.
3. Processing Time
 - Time required to manufacture or deliver products or services. All of this
includes scheduling, maintaining equipment, training, and other activities.
4. Changeover Time
- The amount of time it takes to go from one product or service to another.
New equipment settings, attachments, techniques, equipment, schedules,
and materials may be involved.
5. Delivery Time
- The duration of order fulfillment.
6. Response Time for Complaints
- These complaints may include customers voicing concerns regarding
product quality, delivery times, and misdeliveries. These complaints may also
come from workers, who have gripes about working conditions equipment
issues, or product defects.

Marketing and operations must work together to develop strategies that meet
the needs of the most significant consumers in each market category.

Agile operations is a competitive advantage strategy that stresses flexibility to

adapt and thrive in a changing environment. Agility combines affordability, quality,
and dependability with adaptability. Flexibility in processing includes fast equipment
swaps, scheduling, and innovation. Variations in production volume and product mix
are two examples. Agile operations involve careful planning of personnel, equipment,
and information technology.

PRODUCTIVITY

One of the most important duties of a manager is to ensure that the resources of
the company are used productively. This is referred regarded as "productivity" in the
business world. Products are measured in terms of their productivity, which is the ratio of
output (goods and services) to input (labor, materials, energy, and other resources)
required to create them.

In order to calculate a productivity ratio, a single operation, a department, an

organization, or a whole nation must first be identified. Productivity ratios are used in
corporate organizations to estimate labor needs, schedule equipment, do financial
analysis, and perform a variety of other essential activities and analyses.
 For a nation, the rate of productivity growth is of great importance. Productivity
growth is the increase in productivity from one period to the next relative to the
productivity in the preceding period.
 Productivity growth is a critical element in determining the pace of inflation in a
nation as well as the quality of living of its citizens. Productivity gains provide value to
the economy while keeping inflation under control.

COMPUTING PRODUCTIVITY

Productivity measures can be based on a single input (partial productivity), on

more than one input (multifactor productivity), or on all inputs (total productivity). The
choice of productivity metric relies on the measurement's objective. If the goal is to
monitor labor productivity gains, labor is the obvious input metric.

PRODUCTIVITY MEASURES

Units of output per labor hour

Labor Productivity Units of output per shift

Value - added per labor hour

Units of output per machine hour

Machine Productivity
machine hour

Units of output per dollar input

Capital Productivity
Dollar value of output per dollar input

Units of output per kilowatt - hour

Energy Productivity
Dollar value of output per kilowatt - hour

Productivity measures have many applications. Productivity metrics may be used

to monitor an organization's performance over time. This helps managers assess
performance and identify areas for improvement. To improve productivity in the future,
operations personnel may analyze the variables used to calculate productivity to
identify what has changed.

Productivity measures may also be used to assess an industry's performance or a

country's overall productivity. These are aggregate productivity metrics.
FACTORS THAT AFFECT PRODUCTIVITY

1. Capital
2. Quality
3. Technology
4. Management
5. Standardization
- Using processes and procedures to minimize variability may improve both
productivity and quality.
6. Quality of Difference
- Quality has improved, yet it is difficult to integrate quality gains into
productivity measures.
7. Use of Internet
- Can reduce transaction costs and therefore increase productivity. This
impact is expected to continue increasing productivity for some time.
8. Computer viruses
- May greatly reduce productivity.
9. Searching for lost or misplaced items
- Costs time and reduces production.
10. New workers
- Less productive than seasoned employees. So expanding businesses may
have a productivity slowdown.
11. Safety
- Be addressed. Accidents may reduce production.
12. Shortage of Information Technology Workers and Other Technical Workers
- Businesses to upgrade computer resources, expand, and seize new
possibilities.
13. Layoffs
- The outcome is mixed. Initially, productivity may improve following a layoff
since the task stays constant but fewer people are required to accomplish it.
However, the surviving employees may suffer from burnout and dread more
job losses. The best employees may depart.
14. Labor Turnover
- A loss of production and substitutes need time to learn.
15. Design of the Workspace
- This may affect output. Having tools and other work materials easily
accessible may boost productivity.
16. Incentive Plans that Reward Productivity Increase
- Can boost productivity
IMPROVING PRODUCTIVITY

A business or department may improve productivity by:

1. Identify and measure all operations' output. Measuring an operation is the initial
stage.

2. Consider the system as a whole when determining essential operations. Overall

productivity is critical. Managers should consider the worth of possible
productivity gains before approving initiatives. The problem is efficacy. This has
many aspects. One is to ensure the outcome is desired by consumers. For
example, if a business can boost production via productivity but cannot sell it,
the productivity gain is ineffective. Second, take a systems perspective: An
improvement in one component of an operation that does not enhance system
productivity is ineffective. Assume a system consists of two processes, each of
which may finish its portion of the process at a pace of 20 units per hour. If the
first operation's productivity increases but the second operation's productivity
does not, the system's output remains at 20 units per hour.

3. Create techniques for increasing efficiency, such as asking employees for

suggestions (forming teams of workers, engineers, and managers), researching
other companies' approaches, and rethinking work processes.

4. Set realistic improvement objectives.

5. Emphasize management's commitment to productivity growth. Consider

rewarding employees for contributions.

6. Measure improvements and publicize them.

Mistakenly equated with efficiency is getting the most out of a given set of
resources; productivity is getting the most out of total resources. For example, mowing a
lawn with a hand mower would be efficient, while mowing a lawn with a power mower
would be productive.

Many organizations are driven by competition. Price, quality, unique features or

services, time, etc. Organizations must identify which variables are order qualifiers and
which ones are order winners in order to create successful business strategies.
 Goals and tactics must be linked with the organization's purpose. Strategies are
plans for accomplishing objectives. They help make decisions. Strategies must include
current and future consumer needs, as well as the organization's risks and possibilities.
These may range from rivals' actions to technology, supply chain management, and e-
business. Organizations often have overall plans and strategies for each of their
functional areas. However, functional strategies should be connected to overarching
plans. Time-based and quality-based methods are frequently employed by businesses
to better service their clients and increase productivity. The chapter also discusses the
implications of organization strategy for operations management and the Balanced
Scorecard method.

Productivity measures resource utilization. Productivity is highly valued both

organizationally and nationally. Businesses desire greater productivity because it
reduces costs and increases competitiveness. Increased productivity makes products
and services more appealing, reduces inflationary pressures associated with higher
salaries, and raises people's quality of life.

References:
http://bbagroupb.weebly.com/uploads/1/7/7/4/17745991/stevenson11e_sample_ch02.
pdf

https://studylib.net/doc/10256886/competitiveness--strategy-and-productivity

https://pressbooks.senecacollege.ca/operationsmanagement/chapter/operations-
strategy/