Putting these two together,

the idea of order qualifiers and winners,

and the idea of competitive capabilities or qualifiers and winners,

are features attractive to customers.

Competitive capabilities are what the company can do well.

You can see that there are two sides of the same coin.

So let's take a few generic order qualifiers

and winners that we talk about in operations.

So, one is low price,

and this is something that customers might desire.

If customers want low price,

the competitive capability that must come from operations has to be low cost.

They should be able to make things at a low cost to be able to offer them at a low price.

The example of company that I have up here for this is Walmart.

Walmart is a company that is able to get lower prices from

its suppliers and is able to pass them on

because of its focus on keeping low inventories,

keeping information about sales,

and that's how it keeps its low inventories and is able to keep its costs low.

Conformance quality is something else that customers might value.

And we differentiate here between conformance quality and the idea of added features,

because conformance quality is what the customer expects in terms of the quality.

So, using the example of Rolls-Royce that I have here,

there is a certain degree of quality that customers of Rolls-Royce cars expect.

It's a high quality car and they have certain expectations of

perfection in every feature of the car that they're going to purchase from Rolls-Royce.

So for that, the competitive capability of

the company would need would be very tight quality control.

In terms of the other aspect of quality,

adding more and more features,

you can think about Apple computers or Apple phones as

the products where there are many different features

being added and now with apps coming into the picture,

even the phone is being enhanced in

different ways and different features are being added to them.

So, that's the idea of quality improvement or

quality enhancement from a competitive capability,

from an operations perspective.

We've talked about cost,

quality, as being two competitive capabilities.

The third capability that an operation can have,

can be the speed at which they are able to deliver products.

And if the competitive capability for an operation is speed,

it is able to cater to the customer need or fast delivery,

and the example that you can think of here is Amazon which in the US is able

to deliver products to customers at a very fast pace.

They've gone to two-day shipping, one day shipping.

In larger cities, they are even contemplating the use of drones to

drop packages off to customers and deliver them within hours of them ordering something.

So, what you can see is the match between the competitive capability of

speed with the order qualifier and winner things that customers desire a fast delivery.

Moving on in terms of delivery,

fast delivery is one thing,

but the other aspect of delivery that customers might desire is reliable delivery.

I don't care if you send it to me quickly or not,

as long as you send it to me when you promised it to me.

That's the idea of reliable delivery,

and the competitive capability there is dependability.

So, if the company promises me something, it gets me there.

Southwest Airlines is known for being low cost but it's also known for its dependability,

getting from and to the gate

for a particular flight on time is something that they pride themselves on,

and they are dependable for that.

The final two categories cater to different needs,

changing needs of customers.

So, customers might want value,

the capability of being able to change their orders,

being able to get different products from a particular provider,

and they might value the idea that even when they change their orders,

the prices are not increased.

And here the two examples that I have are Ikea and Subway.

Ikea is a furniture company that involves customers in assembling the product.

So, you should get the product from Ikea, from their store,

and then you go and assemble it on your own with the idea that

they are giving you a lot of flexibility

and how you're going to put together your furniture.

You put it together in different combinations based on what they're able to provide you.

For personalization, Subway sandwiches is a company

that is known in the US and has presence worldwide,

is a company that uses the idea of using customer involvement in the production process.

Customers go and choose what they want in the sandwich and are

able to customize their sandwich exactly to their needs.

So, the idea of customization is coming

from using the customer to decide what exactly they want.

So, here I'm going to ask you to take these concepts,

the idea of order winners and qualifiers,

and apply it to a situation that you might be familiar with.

So take any fast food chain that you know of,

any fast food chain that you visit.

In contrast, take any luxurious sit-down restaurant

that you might have visited or that you would like to visit.

So, fast food restaurant versus a luxurious sit-down restaurant.

Now, what you want to do with this is,

you want to list,

think about the order qualifiers and winners of both these products that you care about.

So, for the fast food restaurant,

what would be the order qualifiers?

The essential criteria that you would want.

And then on the other hand,

the same kind of thing for the sit-down restaurant.

Similarly, for the order winners.

Additional features that you would love to have although you don't expect it,

but you would love to have those for fast food versus a sit-down restaurant.

So, take these two kinds of services,

two kinds of food providers,

and think about the order qualifiers and winners for both,

and then we'll come back,

and we'll compare the two lists.

Well, so you may have thought of the fast food restaurant,

such as McDonald's or Burger King,

and the order qualifiers there should be obvious just from their name, all right?

Fast food. It should be quickly delivered.

It should be cheap. You're probably thinking

off it should be very convenient to go to a fast food restaurant.

So, it should be located in a very convenient location.

On the other hand, for the sit-down restaurant,

the order qualifiers are going to be different.

You don't really care about price or not as much as you would for a fast food restaurant,

and you probably don't care too much about delivery speed there.

You don't expect the food to be delivered quickly to you.

You're going to a sit-down restaurant to spend some quality time,

and you're going to expect a good ambiance.

So, that would be the order qualifier there.

There is a good ambiance there, and a good menu.

That would be the order qualifier there. Order winners.

What would you absolutely love to have without having to

pay extra in a fast food restaurant?

And a fast food restaurant that might be healthier foods.

That's something that you might say,

well, that would be great if we could get healthier foods.

It would be great if they would allow extreme degrees of

customization which you don't expect from a fast food restaurant.

Now, for a sit-down restaurant,

the order of winners would be completely different.

What would you expect there?

You already getting a very high quality service.

You're getting this great ambiance.

Perhaps, it's something to do with personalization.

They keep a record of what you like,

and they remember your name at that restaurant when you go back.

They might also have tie-ups with charities that you value,

and that would be order winners.

That would make you choose that particular restaurant versus another sit-down restaurant,

and those would be the order winners that are attracting you to those restaurants.

So, that would be the concept of order winners and qualifiers for

the same type of a service except for two different customer segments.

1-2.2c Focused Operations

Operations Management

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