Operation performance

Redefine the operation performance objective: What does operation advantage mean for service operation in the luxury watch industry? Chart source: Wikipedia It is not sensible to compete by offering superior performance along all of these dimensions, because it will probably end up second best on each dimension to some other company that devotes more of its resources to developing that competitive advantage (Hayes and Wheelwright 1984).

Therefore, to prioritize the above 5 competitive objectives (Slack et al.2004) will be helpful to provide a competitive advantage, thus upgrade the service stage. Let’s reconsider the watch service operation’s 4Vs position. When a customer walks into OMEGA service center, what does s/he expect? Cost-effective? –If one can afford the watch with average price of 20,000RMB, cost won’t be the major concern. Flexibility? – Service with variety may not be her/his major interest when the specific demand is raised by the customer.

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Dependability?– Being punctual is important for a watch manufacture, but not quite applicable unless some customer wants the watch delivered after being taken care of. Speed? – Probably important to someone who need their watch returned quickly. Quality? – Yes! Customers want watch is as good as it’s new! Obviously, quality is the king for watch service center. It is common for repair center offers certain period of repair warranty to assure the repair quality. And hopefully the customers never have to visit the center again if the quality fails to be delivered at the first time.

Meanwhile, we need to carefully measure the rest of competitive priorities and draw an informative competitive construct. To the customer service operation of OMEGA, unfortunately, quality is not yet to be the highlight of OMEGA watch service center. 6 out of 10 complaints are recorded under “customer service”, though all the complaints would be settled in a satisfying way. It is said that quality is multidimensional and that each of its dimensions can be used strategically to gain competitive advantage.

(David Garvin 1987) We have good reason to believe the high performance in quality leads to better customer satisfactory, thus links to competitive advantage in the operation system. Operational strategy and business strategy: Hayes et all (2005) set the criteria for evaluating an operation strategy. A good operation strategy: A Enable operations to set priorities that enhance competitive advantage. We have discussed the importance of priorities for OMEGA service operation that quality is crucial contribution to competitive advantage.

B Highlight opportunities for operations to complement the business strategy; It won’t be easy until we reset OMEGA watch service operation from internal support to external support. The opportunities can only be scanned with an extensive ladder out of the organization. (Ref. scan for success…). Therefore, for my organization, customer service should be perceived as unit with an independent function open to external opportunity for better achievement, rather than internal after-sales support.

C Make operations strategy clear to the rest of the organization; We have a sales target to be achieved and a marketing objective to be followed every year. However, there is never such “operation strategy” communicated within the company, let alone to external customers. A clear statement like Volkswagen’s service operation will be helpful to refine the strategy. Such statement could be designed as part of the business statement, contenting value and goal, to improve the operation performance.

D Provide the operating capabilities that will be required in the future; The current service operation of OMEGA lacks of initiation and vision to take the step ahead. We need to be equipped with the vision of the business. With the rapid development of and digital economy, small step-ahead will boost big performance improvement: the supermarkets chains provide online shopping service; The restaurants chains launched the iphone /ipad app of food delivery. However, OMEGA watch service center still operates in a rather traditional way, and mainly depends on service on the counter.

There are quite lot capabilities to be explored, e. g. : Shall we consider providing online “door-to-door” service delivery for the busy businessmen’s luxury watches? Is it possible to launch an app for watch owner so that they will receive some regular tips about watch maintenance? These services with future consideration will definitely turn into operation advantage and redefine the industry expectation. The above discussion addressed the reason why I position the customer service operation of OMEGA at the stage III of Hayes and Wheelwright model.

And more importantly, the improvement we can make to step forward to the world-class level by uplifting the internal support to external, redefining the priority of the objective and developing and implementing a successful operations strategy should be taken action in the future.

References:

1. Hayes, R. H. and Wheelwright, S. C. (1984) Restoring our competitive edge: competing through manufacturing, New York: John Wiley 1. Slack, N. , Chambers, S. and Johnston R. (2004) Operations Management (4th Edition), 2. Garvin, D. A, 1987. Competing on the eight dimensions of quality. Harvard Business Review 65

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