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A Short History of Operations Strategy

In the period following World War II corporate strategy in the United States was usually developed by the marketing and finance functions within a company With the high demand or consumer products that had built up during the war years U.S. companies could sell virtually everything they made at comparatively high prices. In addition there was very little international competition. The main industrial competitors of the United States today Germany and Japan. lay in ruins from massive bombings. They could not even satisfy their own markets. let alone export globally. Within the business environment that existed that time the manufacturing or operations function was assigned the responsibility to produce large quantities of standard products at minimum costs. regardless of the overall goals of the firm. To accomplish this the
operations function focused on obtaining low-cost unskilled labor and installing highly automated assembly-line-type facilities. With no global competition and continued high demand the role of operations management (that is. to minimize costs) remained virtually unchanged throughout the 1950 and early 1960 By the late 1960 however Wick Skinner of the Harvard Business School. who is often referred to as the grandfather of operations strategy, recognized this weakness among U.S. manufacturers. He suggested that companies develop an operations strategy that would complement the existing marketing and finance strategies. In one of his early articles on the subject. Skinner referred to manufacturing as the missing link in corporate strategy.” Subsequent work in this area by researchers at the Harvard Business School. including Abernathy. Clark. Hayes. and Wheelwright, continued to emphasize the importance of using the strengths of a firm’s manufacturing facilities and people as a competitive weapon in the marketplace as well as taking a longer-term view of how to deploy them.