Instructor Graduate School of Business Administration Kobe University Operations Strategy/Advanced Operations Strategy Tomoaki Shimada, Associate Professor of Operations Management Office Hours: After class or by appointment Email: shimada@b.kobe-u.ac.jp Course Description Operations strategy was established primarily by a group of Harvard Business School professors. From the 1960s through the 1970s, Wickham Skinner investigated how business strategy could transform manufacturing to a source of competitive advantage. In the late 1970s, Robert Hayes and Steven Wheelwright examined how a manufacturing company could adapt to a changing environment to sustain its competitive advantage, using two key dimensions of operations (i.e., products and processes). Operations strategy is not based on Michael Porter's framework, but it shares some fundamental notions with Porter's "competitive advantage." In this course, you will study how efficient operations can be a competitive weapon in service industries as well as manufacturing sectors. The primary objective of the course is to learn how to formulate effective operations strategy. The topics include operations performance, capacity management, supply network, continuous improvement, product and service development, sustainability in the global society, etc. Thus, the course is not only for an operations manager, but also for a general manager who needs to revamp a company's operations to establish competitive advantage. Although the course syllabus was originally created for part-time MBA students, undergraduate students as well as graduate students who are interested in operations strategy, are welcome to take the course. The course is open to any student in Kobe University including exchange or part-time students. This course will be conducted in English. As a course methodology, I will deliver lectures and conduct interactive discussions using articles. I will also show a few videos to supplement some topics about operations strategy. You are expected to read assigned readings before class and to participate in class discussions. Quantitative skills are not required for this course but advanced English-speaking capability is required. Course Materials Main Textbook: The handouts should be sufficient to understand the foundation of operations strategy. However, since about 70% of the course contents are based on the following textbook, the book will be helpful to understand several important topics. 1. (OS) Nigel Slack and Michael Lewis, "Operations Strategy (3rd Edition)", Financial Times/Prentice Hall, 2011. Reference Books: The following five books are for reference only, and not required for the course. The first book was written by professors of Harvard Business School, where the basic theory of operations strategy was formulated. The second and third books are related to "Different Views on Strategy" in Session 2. The fourth book introduces strategic perspectives of "Service Management" in Session 10. The last book will be helpful to understand "Quality Management" in Session 12. 1. Robert Hayes, Gary Pisano, David Upton, and Steven Wheelwright, "Operations, Strategy, and Technology: Pursuing the Competitive Edge", John Wiley & Sons, 2005. 2. Jay B. Barney and William S. Hesterly, "Strategic Management and Competitive Advantage: Concepts and Cases (4th Edition)", Pearson/Prentice Hall, 2011. 3. W. Chan Kim and Renee Mauborgne, "Blue Ocean Strategy", Harvard Business School, 2005. 4. James A. Fitzsimmons and Mona J. Fitzsimmons, "Service Management: Operations, Strategy, Information Technology (6th Edition)", McGraw-Hill/Irwin, 2008. Page 1 of 5
5. William J. Stevenson and Sum Chee Chuong, "Operations Management: An Asian Perspective", McGraw-Hill/Irwin, 2010. Lecture Notes: Lecture notes are available at http://www.b.kobe-u.ac.jp/users/shimada/local/aos. This web site is accessible only on campus. If you would like to access the website off campus, you need to use Kobe University VPN (Virtual Private Network). You are responsible for downloading and printing course materials on your own. Grading Scheme We have different grading schemes for "Undergraduate Regular Students" and "Graduate Regular Students and Graduate/Undergraduate Exchange Students." This is because undergraduate students except exchange students are required to take a final exam according to the rules set by Kobe University. Thus, the course grade for "Undergraduate Regular Students" will be based on a weighted evaluation as follows: 20 points 30 points Final Examination 50 points Total 100 points The course grade for "Graduate Regular Students and Graduate/Undergraduate Exchange Students" will be based on a weighted evaluation as follows: 20 points 30 points Group Final Project 50 points Total 100 points You are expected to attend all the sessions and contribute to class discussions. This is because each session is designed to build upon the information covered in the previous sessions. Like a serial drama, you will not be able to follow the class if you miss even one session. Thus, I will check the attendance in every session. Although I will not practice cold calling, you should be well prepared for class participation. Otherwise, you will not have fun in this course. Each of you will choose an innovative company and analyze it using the strategy canvas and the Eliminate-Reduce-Raise-Create (ERRC) grid, which are analytical tools of Blue Ocean Strategy. I will teach them in Session 2. Since the main objective of the individual assignment is to learn how to use the strategy canvas in the process of strategy formulation, you do not need to choose an innovative company in terms of operations. Any innovative company in terms of marketing, sales, technology, and business models, etc. is fine. However, you are encouraged to choose a different company from the other students. Your individual presentation is scheduled for Session 4, and you will have 8 minutes for your presentation excluding the setup time. You may have a Q&A session after the presentation. If we have many students, Session 5 will also be allocated to the presentations of the individual assignments. For the individual assignment, you are required to prepare (1) an analysis report in MS-Word on the company consisting of 5 pages or less and (2) MS-Powerpoint slides and/or MS-Excel sheets for your presentation (no page limit). The format of the report and slides/sheets (e.g., font size, line space, etc.) is at your discretion, but the strategy canvas and the ERRC grid must be included in the report and slides. In addition, appendixes, figures, tables, and references, if any, must be included within the 5 pages. The cover page is not required, but please indicate your student ID and your name at the top of the first page. MS-Excel may be useful for you to draw the strategy canvas because you can integrate it into an MS- Word text file or an MS-Powerpoint presentation file easily. The presentation slides/sheets should be submitted to me by email (operations_strategy@hotmail.com) by the beginning of Session 4, and the analysis report must be submitted by Session 10. I will upload your files into http://www.b.kobeu.ac.jp/users/shimada/local/aos/individual_assignment to share them with all the students taking the course. Page 2 of 5
The strategy canvas should have two types of value curves (i.e., the innovative company and an industry standard), and they have to be explained concisely in the report. The values of the industry standard are not necessarily a mid-point, and the value (i.e., low or high) for each factor is decided relative to other industry standards. In addition, you can define the industry standard. It can be an average of the industry, an average of major companies in the industry, or an average of traditional companies in the industry. The emphasis is on the relative position of two different value curves. If the focus is on the specific product/service offered by the innovative company, two types of value curves should describe the innovative product/service and the industry standard for that product/service. You can refer to sample files for your assignment from the previous year's class at http://www.b.kobeu.ac.jp/users/shimada/local/aos/individual_assignment2012. The evaluation of the individual assignment consists of my evaluation (60%) and peer evaluation (40%). I will evaluate (1) each student's analysis report, (2) each student's presentation, and (3) each student's peer evaluation form. You will evaluate (1) each student's analysis report except yours and (2) each student's presentation except yours. You are required to write concise comments in the peer evaluation form and select A, B, or C (i.e., Excellent, Very Good, or Good, respectively) for each presentation along with the report in the multiple-choice question (MCQ) form. Final Examination (only for "Undergraduate Regular Students") The final exam covering Sessions 1 to 12 contains MCQs only. It will take place during the regular exam week. The duration of the final exam will be 90 minutes. The exam is open-book/notes, and an electronic or paper dictionary is permitted. However, the following items are not allowed to be used during the exam: a notebook PC, a mobile phone, or any other electronic/communication device. Sharing/discussing answers during the exam is strictly prohibited. Sharing your belongings (e.g., books, notes, dictionaries, etc.) during the exam is also prohibited because it is possible to share answers accidentally. Group Final Project (only for "Graduate Regular Students and Graduate/Undergraduate Exchange Students") The group project consists of (1) a group case writing and (2) a group presentation. Based on your experience of case analysis in other courses, you will be able to develop a teaching case. You do not need special training to write a case. The main objective of the case writing is to learn real issues/problems in operations strategy. You are to form your own group of about 3 students. If we have many students, the number of students in a group will be adjusted. Each group can choose a topic for the case, but it has to be related to the course. One of my proposed topics is corporate social responsibility (CSR), which can be a part of business strategy. You can write the case on a specific company/organization, a specific sector/industry, or a specific product/service. The group presentation of the case is scheduled for Session 13. Each group will have 20 minutes for its presentation, followed by a Q&A session for a few minutes. Only a few or all the members in your group can write the case and/or present it. It is up to your group to decide how the tasks are divided among the group members. The case and presentation will be graded on a group basis. Each group is required to introduce the company's practices as a case of operations strategy, and does not have to provide recommendations for its future direction. The case can be a success story or a failure story, but you have to describe logical reasons why the company/product succeeded or failed. Ideally the case should be written like a story based on facts (not fiction!), but you do not have to do so. An analysis report is also fine as a case of operations strategy. The case should consist of AT LEAST 10 pages, and the format of the case and of the presentation slides (e.g., font size, line space, etc.) is at your discretion. You can write the case based on public information (e.g., newspaper articles, company websites, etc.) or field research (e.g., interviews with companies, mail survey with companies, etc.). Please be careful about plagiarism. You cannot simply copy sentences or information from articles or the web without citations. You are required to submit (1) the case in MS-Word with (2) MS-Powerpoint presentation slides by email (to operations_strategy@hotmail.com) by the beginning of Session 11. I will upload your files into http://www.b.kobe-u.ac.jp/users/shimada/local/aos/group_project to share them with all the students taking the course. You can refer to sample files for your project from the previous year's class at http://www.b.kobe-u.ac.jp/users/shimada/local/aos/group_project2012. Page 3 of 5
The evaluation of the group project consists of my evaluation (60%) and peer evaluation (40%). I will evaluate (1) each group's case, (2) each group's presentation, and (3) each STUDENT's peer evaluation form. You will evaluate (1) each group's case except your own group and (2) each group's presentation except your own group. You are required to write comments in the peer evaluation form and select A, B, or C (i.e., Excellent, Very Good, or Good, respectively) for each of the cases and the presentations in the MCQ form. Although regular undergraduate students are not involved in the group project, they are required to attend and evaluate the group presentation so that they can learn practical cases on operations strategy. Class Schedule: We will have a class from 8:50 to 10:20 on Thursdays. In Sessions 1 and 2, we will learn basic concepts of operations strategy and different views on strategy, respectively. From Sessions 3 to 9 except Session 4, we will discuss the issues/problems of operations strategy based on the main textbook. In Session 4, we will have the presentations of the individual assignments. As mentioned before, if we have many students, Session 5 will also be allocated to the presentations of the individual assignments. From Sessions 10, 11, and 12, we will study important topics which are not covered in the textbook. In Session 13, we will have a brief review of what we have studied and have the presentations from the group projects. Session Topics Readings/Cases 1 12) Introduction to Operations Strategy - Course Overview - Operations Resources and Market Requirements - (OS) Chapter 1 2 19) 3 26) 4 10) 5 17) 6 24) 7 31) 8 7) 9 14) - Top-Down and Bottom-Up Different Views on Strategy - Porter's Five Forces - Resource-Based View and Dynamic Capabilities - Blue Ocean Strategy Operations Performance - Five Generic Performance Objectives - Efficient Frontier - Order-Winners and Qualifiers Individual Presentations - Individual Presentations by All the Students Substitutes for Strategy and Capacity Strategy - Basic Concepts of Quality - TQM, Lean, BPR, and Six Sigma - Capacity Management Supply Network Relationships - Basic Concepts of Supply Chain Management - Make or Buy - Arm's Length vs. Collaboration Supply Network Behavior - Bullwhip Effect (Beer Game) - Matching Supply Chain Strategies with Products - Push-Pull Strategies Continuous Improvement - Product-Process Matrix - Mass Customization - Sand Cone Model of Operations Capabilities Process of Operations Strategy - Product and Service Development - Single-Loop and Double-Loop Learning - Disruptive Technology/Innovation - HBR Paper "The Five Competitive Forces that Shape Strategy" - SMJ Paper "Dynamic Capabilities and Strategic Management" - CMR Paper "Blue Ocean Strategy" - (OS) Chapter 2 - (OS) Chapters 3 & 4 - (OS) Chapter 5 - AJS Paper "The Economics of Organization" - (OS) Chapter 5 - SMR Paper "The Bullwhip Effect in Supply Chains" - (OS) Chapters 6 & 7 - (OS) Chapters 8, 9 & 10 Page 4 of 5
10 21) 11 28) 12 (July 5) 13 (July 12) Service Management - Nature of Services - Strategic Service Classification - Competitive Service Strategies Sustainability in the Global Society - Low-Carbon Society - Recycling Society - Global Society Quality Management and Change Management - Tools for Quality Management - International Standard: ISO - Organizational Change Course Review and Group Presentations - Course Review - Group Presentations by Graduate Students and Graduate/Undergraduate Exchange Students - "Service Management" Chapters 2 & 3 - HBR Paper "Green and Competitive" - HBR Paper "Strategy and Society" - HBR Paper "Creating Shared Value" Page 5 of 5