What is the right choice:
The generic operations strategy that emphasizes capital-intensive methods to achieve higher labour productivity and lower unit costs is referred to as ....
- Flexible factories strategy
- Low labour cost strategy
- Scale-based strategy
- Focused factories strategy
1 Answer | Add Yours
Of the options that you have given here, the best answer is “scale-based strategy.” None of the other strategies mentioned here apply.
Focused factories and flexible factories are opposite concepts that have to do with what a factory is made for. A flexible factory can make a variety of different things. For example, such a factory might be able to make more than one model of car. By contrast, a focused factory can make only one sort of thing. These concepts do not say anything about the mix between capital costs and labor costs.
Outsourcing is a way of cutting costs. However, it does so by having an outside company take over certain functions. It does not specify how that company will perform those functions.
A low labor cost strategy centers around paying workers less money. This is not typically done by increasing the use of capital.
A scale-based strategy does revolve around increased use of capital. In such a strategy, a firm builds the largest plants that it can, using the most machinery that it can. This increases the productivity of each worker.
For these reasons, “scale-based strategy” is the correct answer.
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