The Difference Between Operations and Strategy

hi my name is Chris Noel with CMO E and today we're going to help leaders and managers understand the difference between operations and strategy in today's competitive business world effective managers need to understand the difference between the operational side of the business and the strategy side of the business expanded knowledge of how these two business engines can work in parallel will drive better performance and competitiveness for the organization to provide greater clarity think of operations and strategy as two separate but related engines on a boat both engines propel the boat forward and while forward movement can occur with only one engine the boat moves faster and is more responsive if both engines are running efficiently each engine is important and each engine requires fuel maintenance skillful attention so that the boats ability to deliver results is optimized running on one engine could quickly move you in a direction that will backfire taking your future competitive advantage with it if we focus all our attention effort and resources solely on the operational side of the business we put the whole organization at risk focusing solely on that operational side may seem like the smart thing to do at the moment but over the long run your efficiency may suffer however focusing only on the strategic engine is equally as bad without the operational capacity to implement or take advantage of our insights about future innovations processes or market needs all of this strategic effort and planning will be from nothing we must understand and balance both sides of the business so let's take a look at the operational engine of the business because many people are directly connected to and support this operational engine in one way or another operations is easy to understand think of the operational engine is the current value chain of activities that drives the delivery of business objectives and is concerned with executing on those everyday activities and commitments the purpose of the operational engine is to keep the current activities in the organization moving and functioning at peak levels we focus a lot of our energy resources and brainpower on how to best execute these activities today and it's extremely important because if we're ineffective on the operational side strategy and that strategic positioning ultimately doesn't matter let's take a look at the strategic engine the strategy side of the business strategy asks you what you could be doing to equip and transform the operational engine in order to become more competitive in the long run its intent is to help the organization discover new sources of competitive advantage a business strategy defines how the business and its members should evolve in order to achieve long term success strategy ask questions concerning new solutions services and concepts the business may want to offer as well as new markets and customers you may want to serve the strategy engine needs to work in tandem with the operational engine understanding threats and opportunities experimenting with new processes and solutions and shaping the future so the organization positions itself to win both in the short term and in the long term the strategic engine helps businesses make changes or adjustments in its direction to ensure that the organization is adding value for its customers owners and employees all while doing its best work while avoiding misfires it is extremely important that everyone in the organization understands the strategy offers ideas and craft supporting strategic plans that align with the overarching strategy of the business the operational workforce will largely determine whether the strategic shifts will succeed or fail as the operations adapt to a new brave strategic change if the strategic engine does its part the organization will avoid that calcification and atrophy that occur when a business doesn't think ahead or disposes of those strategic initiatives managing the two simultaneously to drive the business for takes a lot of discipline a perfect balance between operations and strategy will never exist some days will require greater emphasis on the operational side and other days will be heavily focused on that future oriented strategic planning and execution those businesses that don't pay attention to both business engines will soon find the markets currents are driving them to ruin don't let your ship sink if you carefully manage and maintain both your operational and strategic engines you'll find yourself clearly navigating your business towards the destinations on the horizon [Music]

Channel: cmoeinc

Views: 84,223

Rating: 4.75 out of 5

Keywords: operations vs strategy, the, difference, between, operations, and, strategy, executing, strategy planning, strategic management, strategic thinking skills, business strategy, business strategy planning

Id: EQCo-7SMJ_c

Length: 5min 17sec (317 seconds)

Published: Wed May 08 2013