Monday, April 5, 2010

Strategy formulation at level

Strategy formulation at level
An important source of competitive advantage is exclusion capabilities at the functional level.It is doing things better than competitors.Strategies management at functional level aims to create customer value.
1. Kaizen for improving customer value:Kaizen is an important function level strategy for process execution.Kaizen is a Japanese term.It means continuous incremental improvements.It is attempting to do better.It aims to gain competitive advantage and improve customer value.It assumes that products at lower prices are provided to the customer satisfaction.Better involved in Kaizen from managers to works.
Characteristics of Kaizen :
  • Focus on continuous improvement :Better products are provide.
  • Clear objectives:Kaizen is liked to company goals.Improving quality and reduction costs.
  • Process orientation:Finding ways to improve system and procedures.It is applied at functional level.
  • Problem solving :By involvement of everyone a mindset from improvement is created organizationwide.Convectional ideas about doing work are discarded.Current practices are question.
  • Training :It is provided for continuous improvement.
  • Team work:Kaizen terms are formed to achieve improvements.It is bottom-up-approach.Term members are lower level managers and employees.
2. Kaizen and customer value:Value is ratio of perceived benefits to costs.Benefit is what the customer gets.It can be functional or emotional.Cost is what the customer gives.It can be money,time,energy and psychic.Kaizen adds customer value by:
  • Raising benefits:Quality of products is improved.Better products are provided.
  • Reducing costs:Prices are lowed through cost reduction.
  • Raising benefits and reducing costs simultaneously.
  • Kaizen seeks to satisfy customers by adding value.

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