1. A company can increase efficiency through a number of steps: exploiting economies of scale and learning effects; adopting flexible manufacturing technologies; reducing customer defection rates; implementing just-in-time systems; getting the R&D function to design products that are easy to manufacture; upgrading the skills of employees through training;
introducing self-managing teams; linking pay to performance; building a companywide commitment to efficiency through strong leadership; and designing structures that facilitate cooperation among different functions in pursuit of efficiency goals.
2. Superior quality can help a company lower its costs, differentiate its product, and charge a premium price.
3. Achieving superior quality demands an organization-wide commitment to quality, and a clear focus on the customer. It also requires metrics to measure quality goals and incentives that emphasize quality, input from employees regarding ways in which quality can be improved, a methodology for tracing defects to their source and correcting the problems that produce them, a rationalization of the company’s supply base, cooperation with the suppliers that remain to implement total quality management programs, products that are designed for ease of manufacturing, and substantial cooperation among functions.
4. The failure rate of new-product introductions is high because of factors such as: uncertainty, poor commercialization, poor positioning strategy, slow cycle time, and technological myopia.
5. To achieve superior innovation, a company must build skills in basic and applied research; design good processes for managing development projects; and achieve close integration between the different functions of
the company, primarily through the adoption of cross-functional product development teams and partly parallel development processes.
6. To achieve superior responsiveness to customers often requires that the company achieve superior efficiency, quality, and innovation.
7. To achieve superior responsiveness to customers, a company must give customers what they want, when they want it. It must ensure a strong customer focus, which can be attained by: emphasizing customer focus through leadership; training employees to think like customers; bringing customers into the company through superior market research; customizing products to the unique needs of individual customers or customer groups;
and responding quickly to customer demands.
