What Is an Operations Strategy & Why You Need One

Lucija Bakić

April 24, 2024

A screenshot of an operations strategy software interface displaying a project management dashboard with tasks categorized under 'Planning' and 'Design', showing status, start and due dates, assignees, and priority levels.

Have you developed a sound operations strategy? If not, now’s the time to start.

An operations strategy is essential for ensuring that all aspects of your business are working smoothly. It’s a structured approach to end-to-end business management that considers overarching business goals and capabilities.

Keep reading to learn about the importance of an operational strategy and how to best develop and implement one in your company (and the best operations software to support these processes).

What Is Operations Strategy?

Your operations strategy is part of the broader operations management process. It’s a comprehensive plan to ensure sustained operational effectiveness over the short and long term.

The type of processes that your operations strategy involves can differ depending on your industry and business model. For manufacturing companies, it encompasses the life cycle of products from inception to market (we also have an article on capacity planning for the manufacturing sector that you can check out).

For professional services agencies, such as marketing or creative agencies, it usually includes end-to-end project delivery and various background operations.

Why Is a Successful Operational Strategy Important

Without an operations strategy, your business will be working blind. And while this can be fine for a while, it’s unsustainable if you want to scale your business and grow your market presence.

An operations strategy is the foundation of a successful business. It ensures the continuous functioning of day-to-day operational processes and long-term alignment with company goals (or the corporate strategy).

For agencies, it encompasses core agency processes such as:

A well-developed business strategy guides teams towards more effective workflows, fosters alignment and collaboration, maximizes efficiency, and monitors business performance.

Guide Your Operations Strategy

Companies use Productive to track their performance and support operations.

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The Benefits of Strategic Process Management

An effective operation strategy helps:

  • Increase the company’s resilience and ability to adapt to sudden changes
  • Optimize costs in operations through balanced resource utilization
  • Improve overall profitability by helping companies focus on what matters most
  • Standardize and align procedures across various departments
  • Foster a proactive rather than reactive approach

5 Types of Strategies

Depending on what your main goals and business needs are, there are multiple types of operations strategies that you can utilize. Your company can focus mainly on one approach or combine multiple — for example, using a cost-based approach to reduce administrative costs with elements of the quality-based approach to maintain service standards.

An overview of the most common competitive strategies include:

Cost-Based Strategy

A cost efficiency strategy focuses on minimizing expenses to offer competitive pricing. For manufacturing companies, this might involve optimizing supply chain management and production processes to reduce waste and lower unit costs. Professional services agencies would focus on delivering services faster by automating workflows and prioritizing crucial tasks.

Cost optimization can be considered one of the essential strategies for successful businesses:

A screenshot of an operations strategy software interface showing a social media post by Jason Fried, discussing the unnecessary need for a mission, AI, or investors in a business, emphasizing the importance of profitability.


Source: Linkedin

Main goals:

Learn more by heading over to our article on the project analyst roles and responsibilities.

Quality-Based Strategy

A quality-based strategy focuses on maintaining high standards of product and service quality. Companies can improve quality control processes to ensure output meets or exceeds customer expectations. Another potential part of this strategy is focusing on building up your workforce. Highly skilled employees can deliver superior and more innovative client services, giving companies a unique selling point.

Main goals:

  • Deliver high-quality products or services
  • Increase customer satisfaction
  • Enhance brand reputation

Flexibility Strategy

A flexibility strategy enables businesses to rapidly adapt to changes in the market landscape and customer demands, as well as internal circumstances. For agencies, a flexibility strategy can be especially beneficial, especially considering how prevalent scope creep is. Flexibility is fostered by adopting responsive systems for workload scheduling and balancing.

A screenshot of an operations strategy software's calendar view, showing scheduled tasks for team members, including project time allocations, vacation days, and personal time, with color-coded entries for clear visual organization.


Make a real-time capacity planNING GRAPH with Productive

This helps project managers find the best solution for reallocation, especially in multi-project management. Another important aspect is to have a space where project progress and tasks are clearly visible — this helps onboard new employees and reduces the chance for miscommunication.

Main goals:

Growth Strategy

A growth strategy focuses on expanding the company’s scale and scope. This might include entering new markets, launching new product lines, or acquiring other companies. Growth approaches for manufacturing and agencies of various types require scaling up operations, enhancing infrastructure, and possibly diversifying service offerings. Partnerships and investments in innovation are another great way to support company growth.

Main goals:

  • Increase market share
  • Diversify products and services
  • Strengthen competitive positioning

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Customer-Driven Strategy

Finally, a customer-oriented approach tailors processes to meet the specific needs and preferences of customers. It includes analyzing and segmenting the customer base to develop effective service strategies. Manufacturers might focus on customizable product options, and agencies can offer tailored service packages.

Main goals:

  • Improve customer experience
  • Increase retention
  • Attract new business

Key Elements of Operational Management

No matter which type of initiative you decide to focus on in your company, here are some of the main elements you’ll need to consider:

  • Capacity planning: Evaluating current resource availability and forecasting future needs is an essential part of long-term planning. In-depth insights into your business capabilities provide an understanding of what needs to be done to maintain or grow operations.
  • Human resources management: Human resource planning includes various approaches, from talent acquisition to retention. Focusing on your employees reduces voluntary turnover, ensuring more stable operations and continued institutional know-how.
  • Quality management: Quality management includes steps to ensure product development is organized to meet desired quality standards. In a professional service agency, this might include focusing on client feedback loops for improved collaboration.
  • Supply chain management: Supply chain management is a crucial concern in manufacturing strategy. Optimizing the flow of goods from suppliers is an essential part of saving costs, facilitating growth, and ensuring quality customer service.
  • Technology and innovation: Digital transformation and integration of leading technologies are the main drivers of business efficiency. For companies of all shapes and sizes, solutions such as AI, automation, and cloud computing can significantly enhance capabilities and decision-making.

Tips for Successful Business Initiatives

According to research by McKinsey, the main causes for ineffective operations include:

  • Unclear roles and responsibilities (40%)
  • Redundant activities (32%)
  • Unclear processes (28%)

Ideally, your operations strategy (both implementation and your work plan) will take into account these potential challenges.

Here are the main steps for developing and implementing your strategies:

Analyze Company Goals

Before implementing an operational strategy, you’ll need to consider it within the context of your overarching business mission. This helps alleviate issues such as time spent on redundant activities and unclear processes, as it supports alignment across cross-functional teams.

Strategic planning involves a throughout assessment of market conditions, evaluation of internal capabilities, and identification of key performance indicators. It ensures that the operations strategy is tailored to guide the company towards its objectives, such as increasing profitability, market share, or customer satisfaction.

Find out more about the most important metrics for capacity management.

Define Responsibilities

A clear definition of roles and responsibilities avoids confusion and ensures accountability within the organization. Consider using a framework such as RACI to streamline this process. It includes defining who is:

  • Responsible: The employees who need to perform a task.
  • Accountable: The person who monitors completion and outcome.
  • Consulted: The person who can support execution, usually a subject expert.
  • Informed: People who need to be kept in the loop but don’t directly contribute to completion.

Having well-defined roles helps manage expectations and streamline processes, significantly reducing inefficiencies and improving productivity.

Foster Buy-In

Any change or initiative you want to implement in your company requires buy-in from all levels of the organization. This usually starts from the management level.

For example, if a new type of software is introduced to save on costs and promote flexibility, all company teams should be aware of its importance. If business leaders resist using the new tool, it can lead to company-wide low adoption rates and inefficiencies, ultimately wasting the time and finances invested in the implementation.

Another important thing is to encourage input and feedback from employees. This can lead to more engaged and committed teams, as your staff feel they’re part of the decision-making process and understand how their work contributes to the company’s goals.

Document Decisions

Putting strategic plans into writing ensures consistency and continuity. Your operational plan should involve specific processes, goals, and metrics that contribute to the completion of specific business goals.

This documentation constitutes a clear guide for current and future stakeholders and provides a reference point for measuring progress. It reduces the potential for redundant or unclear processes and helps leaders make sound decisions.

A screenshot of an operations strategy software document editor displaying the 'Project Specification' with an introduction for a new web-based sales system by Solar Based Energy, Inc., highlighting the need for accounting with purchase transaction data.


Consider USING a single platform FOR YOUR DOCUMENTATION, such as Productive’s Docs

Continuous Improvement

Developing an operational strategy isn’t a one-and-done process. Your strategies will need to evolve according to external and internal demand.

Continuous improvement involves regular reviews and updates to incorporate new insights, technologies, and methods. This includes ongoing assessments of operational efficiency, feedback loops, and keeping track of innovations in business practices.

Using Software for Strategic Planning

Nowadays, integrating the best software solution is an essential step to take your operational strategies to the next level. There are many potential solutions available, but some of the best options include all-in-one agency management software.

A screenshot of an operations strategy software showing a rebranding campaign dashboard, with graphs of weekly spending and hours worked, and tables detailing time, budget, and invoicing, including remaining amounts and percentages.


Get in-depth insights into your performance and plan out your future

Productive is an example of a comprehensive solution for agencies of all shapes and sizes. This includes consultancies, marketing agencies, website development companies, and creative companies of all kinds.

What makes it one of the best tools to support agency operations?

A combination of capabilities that include:

Businesses use Productive to scale their operations. Book a demo today to find out how it can help your agency today.

FAQ

What are operations strategies?

Operations strategies include various initiatives for managing the day-to-day functioning of your business. They also ensure that your core processes are aligned with long-term company goals. Depending on your industry, they can include product management, supply chain, forecasting, and revenue operations strategy.

What are the four elements of operations strategy?

The four elements of operations strategy include capacity planning, supply chain optimization, quality control, and technology and innovation. Each of these elements are essential to streamlining business processes and improving overall performance.

What are the 4 perspectives of operations strategy?

The four perspectives of operations strategies include the top-down, bottom-up, market perspective, and competitors perspective. The top-down approach comes from senior management, while the bottom-up approach focuses on insights from operational staff. The market perspective aligns needs with demand from customers, while the competitors’ perspective considers your company in the context of the broader industry landscape.

What is the operations strategy of a project?

The operations strategy of a project refers to the careful management of the operational aspects involved in the successful completion of projects. This includes resource management and organization, project execution, progress management and reporting, and delivery.

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Lucija Bakić

Content Specialist

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