Business – 4.1 The nature of operations – The transformational process | e-Consult

Operations adds value in the following ways:

• Cost Efficiency: By streamlining processes, reducing waste and improving productivity, operations lowers the unit cost of production, allowing the business to offer competitive prices or increase profit margins.
• Quality Improvement: Implementing quality management systems (e.g., ISO 9001, Six Sigma) ensures that products meet or exceed customer expectations, which enhances perceived value and can justify premium pricing.
• Speed and Flexibility: Reducing lead times and increasing the ability to respond quickly to market changes enables the firm to meet customer demand promptly, creating value through better service and reduced inventory holding costs.
• Innovation in Process Design: Introducing new technologies or redesigning workflows can create unique product features or customization options that differentiate the offering and add value.