The role of operations executives in strategy making

Abstract

a b s t r a c tCreating competitive advantage based on operations capabilities is likely to require much analysis and communication within the operations function. At the same time, much communication and joint strategizing with the top and other functional executives is likely to be needed as well. Hence, given that operations executives have limited time and also have to perform many other routine tasks, they need to manage two tradeoffs. The first one is between the time spent on strategy making and the time spent on everything else. The other is within strategy making, between the time spent on "functional deliberation" within the operations function and "top-level communication" with other executives. Using a survey of 134 operations executives, we find that an increase in the time the operations executive spends on strategy making is positively associated with performance in complex and hostile environments and when the relative strength of the operations function within the firm is low. Within the operations executive's strategy making, an increased emphasis on top-level communication is positively associated with performance in environments that are complex, stable (less uncertain), or hostile.

The appointment of chief supply chain officers to top management teams: A contingency model of firm‐level antecedents and consequences

“…This emerging phenomenon is noteworthy, given that just a decade ago supply chain executives “rarely reported directly to the CEO; [and] the function was somewhat removed from the concerns of top management” (Groysberg et al., 2011, p. 66). The increase in CSCO appointments appears consistent with the claims of both early and recent operations management researchers, who argue that operations capabilities are crucial sources of competitive advantage in many corporations (Skinner, 1969, 2007; Hayes and Wheelwright, 1984; Wheelwright, 1984; Krause et al., 2014) and that operations executives should play active roles in strategic decision‐making (Papke‐Shields and Malhotra, 2001; Swamidass and Newell, 1987; Hayes and Wheelwright 1984; Demeester et al., 2014). Though these assertions originally referenced manufacturing operations, they are easily extended to the broader view of operations that dominates current research and practice, the management of supply chain operations .…”

“…CSCOs prove to be detrimental when diversification is low, most beneficial when diversification levels are moderate, and still beneficial when diversification is high, but perhaps to a slightly lesser extent. Together, these findings test and extend arguments regarding the important, and potentially contingent, roles of operations leadership in the firm (Skinner, 1969, 2007; Hayes and Wheelwright, 1984; Wheelwright, 1984; Krause et al., 2014; Papke‐Shields and Malhotra, 2001; Demeester et al., 2014).…”

“…CSCOs continuously identify and develop capabilities that support the goals of the firm's businesses and the larger enterprise. Demeester et al. (2014, p. 405) describe this role as “the accumulation of operations resources and capabilities,” needed either to keep up with moving efficiency frontiers or to support a firm's unique strategic positioning.…”

“…The second core CSCO responsibility is to develop strategic partnerships with the business units that the supply chain management organization supports. Demeester et al. (2014) suggest that, in performing this second task, operations executives ensure that operations resources spread across functions and locations work together seamlessly and coherently.…”

“…The final core responsibility of the CSCO is to serve as an active member of the TMT. In this executive capacity, CSCOs need to understand what is important to the rest of the executive team and relate how the supply chain operational functions help other TMT members with their respective subunits' unique imperatives (Wheelwright, 1984; Demeester et al., 2014). A successful CSCO secures buy‐in from, and alignment with, the other subunits, thereby building an operating governance across the diverse membership and boundaries to get tasks accomplished (Kador, 2012).…”