LESSON 1: OPERATIONS
PERFORMANCE
Operations are judged by the way they perform. However, there are many ways of judging
performance and there are many different individuals and groups doing the judging. Also,
performance can be assessed at different levels. In this chapter, we start by describing a very
broad approach to assessing operations performance at a societal level that uses the ‘triple
bottom line’ to judge an operation’s social, environmental, and economic impact. We then
look at how operations performance can be judged in terms of how it affects an
organization’s ability to achieve its overall strategy. The chapter then looks at the more
directly operational-level aspects of performance – quality, speed, dependability, flexibility,
and cost. Finally, we examine how performance objectives trade off against each other.
📌 Triple Bottom Line - (also known as people, plants, and profit) the idea that
organizations should measure themselves on social and environmental criteria as
well as financial ones.
LO1: Explain the need for operations performed in an organization (pg. 39-40)
Operations management can ‘make’ the organization.
1. It is concerned with doing things better, which can make operations the driver of
improvement for the whole organization;
2. It can build ‘difficult to imitate’ capabilities that can have a significant strategic
impact;
3. It is very much concerned with ‘process’, with how things are done.
There is a relationship between process and outcome - operations
failures are both obvious and serious.
LESSON 1: OPERATIONS PERFORMANCE 1
, Performance at three
levels 1. It is multifaceted
in the sense that a single
measure can never fully
communicate the success,
or otherwise, of
something as complex as
an operation; 2. It can be
assessed at different
levels, from the broad,
long-term, societal level,
to its more operational-
level concerns over how
it improves day-to-day
efficiency and serves its
individual customers.
Operations principle Long Description
Good operations The diagram is as follows. On the left at the top is an
performance is arrow labeled societal level, operations sustainability.
fundamental to the This arrow points to three overlapping ovals labeled
sustainable success of planet, people, and profit. The overlapped part
any organization. common to all three ovals is labeled sustainability. On
▶ The broad, societal the left below the top arrow is an arrow labeled
level, using the idea of strategic level, operations strategic impact. This arrow
the ‘triple bottom line’. points to a large green oval with a yellow oval labeled
▶ The strategic level of operations strategic impact. There are arrows pointing
how an operation can out from this oval that is labeled risk, learning,
contribute to the capital, revenue, and cost.
organization’s overall
strategy.
▶ The operational
level, using the five
operations ‘performance
objectives’.”
LO2: Describe how operations performance is judged at a societal level (pg. 40-43)
The operations performance is judged at a societal level by using
“CSR” and “triple bottom line” (TBL, or 3BL), also known as
LESSON 1: OPERATIONS PERFORMANCE 2
PERFORMANCE
Operations are judged by the way they perform. However, there are many ways of judging
performance and there are many different individuals and groups doing the judging. Also,
performance can be assessed at different levels. In this chapter, we start by describing a very
broad approach to assessing operations performance at a societal level that uses the ‘triple
bottom line’ to judge an operation’s social, environmental, and economic impact. We then
look at how operations performance can be judged in terms of how it affects an
organization’s ability to achieve its overall strategy. The chapter then looks at the more
directly operational-level aspects of performance – quality, speed, dependability, flexibility,
and cost. Finally, we examine how performance objectives trade off against each other.
📌 Triple Bottom Line - (also known as people, plants, and profit) the idea that
organizations should measure themselves on social and environmental criteria as
well as financial ones.
LO1: Explain the need for operations performed in an organization (pg. 39-40)
Operations management can ‘make’ the organization.
1. It is concerned with doing things better, which can make operations the driver of
improvement for the whole organization;
2. It can build ‘difficult to imitate’ capabilities that can have a significant strategic
impact;
3. It is very much concerned with ‘process’, with how things are done.
There is a relationship between process and outcome - operations
failures are both obvious and serious.
LESSON 1: OPERATIONS PERFORMANCE 1
, Performance at three
levels 1. It is multifaceted
in the sense that a single
measure can never fully
communicate the success,
or otherwise, of
something as complex as
an operation; 2. It can be
assessed at different
levels, from the broad,
long-term, societal level,
to its more operational-
level concerns over how
it improves day-to-day
efficiency and serves its
individual customers.
Operations principle Long Description
Good operations The diagram is as follows. On the left at the top is an
performance is arrow labeled societal level, operations sustainability.
fundamental to the This arrow points to three overlapping ovals labeled
sustainable success of planet, people, and profit. The overlapped part
any organization. common to all three ovals is labeled sustainability. On
▶ The broad, societal the left below the top arrow is an arrow labeled
level, using the idea of strategic level, operations strategic impact. This arrow
the ‘triple bottom line’. points to a large green oval with a yellow oval labeled
▶ The strategic level of operations strategic impact. There are arrows pointing
how an operation can out from this oval that is labeled risk, learning,
contribute to the capital, revenue, and cost.
organization’s overall
strategy.
▶ The operational
level, using the five
operations ‘performance
objectives’.”
LO2: Describe how operations performance is judged at a societal level (pg. 40-43)
The operations performance is judged at a societal level by using
“CSR” and “triple bottom line” (TBL, or 3BL), also known as
LESSON 1: OPERATIONS PERFORMANCE 2
