From the course: Operations Strategy for Business
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Trade-offs in operational decision making
From the course: Operations Strategy for Business
Trade-offs in operational decision making
As an operations manager, almost every decision involves making trade-offs. You might want more of one thing and you can have it, but you usually have to trade it off against something else, and that's very often cost. Sometimes it can be trading-off one type of cost for another type of cost. The choice of these trade-offs forms a major part of your business strategy of what type of business you are. Take, for example, a nice restaurant compared to a service station diner. Even if we ignore the food, the level of customer service, speed of delivery, range of options, quantity of meals prepared per hour and many other aspects are operationally what defines those businesses. Two external objectives of business operations things the customer wants were customer service and low prices. So one such trade-off in setting the operational strategy would be customer service versus operational cost, which affects the price. The organization could certainly choose to offer better customer…
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