Four Stages

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Hayes and wheelwright proposed a capability and maturity model that explains how an operation could move from being a barrier to strategic success, in stage one, to becoming an innovator and creator of opportunity, in stage four.

Strategic steps

It suggested that as operational capabilities increase, so does the strategic impact of the operations function.


Stage 1: Internal neutrality

The poorest level of operational contribution. The other areas of the business view operations as a barrier to opportunity. Lacking in flair and competitive drive. The operations function is inward looking and at best reactive. Its vision is to be internally neutral, a position it attempts to achieve  not by anything positive but by avoiding the next ‘big mistake’


Stage 2: External neutrality

The operations function must compare itself to other companies in the outside marketplace. By implementing best practice strategies already in use they seek to catch up to their peers.

HandW External Neut

Stage 3: Internally supportive

The operations strategy is now aligned to the overall business strategy. It can internally support the objectives of the business and considers itself to be one of the best in class. It aspires to be number one in its field and the effort to be number one is likely to yield its own rewards.

Hand W Internally Supportive

Stage 4: Externally supportive

An operation at stage four is unambiguously the best at what they do. Their creativity and proactive attitude has put them ahead of the others and are easily able to out compete their competition when following the same rules. The operations is now interested in changing these rules and redefining the expectations for the whole industry.


Nigel Slack has written an excellent book that incorporates this model. To get a deeper understanding look up this text book:
Operations and Process Management: Principles and Practice for Strategic Impact
By Nigel Slack, Stuart Chambers, Robert Johnston

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13 thoughts on “Four Stages

  1. This is an illuminating article. I wonder if the consequential four steps have an end-to-beginning relationship, or do they interfere creating fuzzy boundaries?

    • I would suggest that they rest somewhere between Stage 3 and Stage 4. The benefits of TPS, that allowed Toyota to gain a competitve advantage, are now so common place that they have become a norm. This model is a fluid strategic positioning tool that uses the relative position of rivals to understand ones current status. Yesterdays Stage 4 may be todays Stage 3. You are only as good as your next worst rival……

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