The role of operations executives in strategy making

Abstract

Creating 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.