Certified Production & Operations Manager (POM) Practice Exam

Product design and choice of location are examples of which type of decisions?

1. Customer-focused

2. Operational

3. Design

4. Strategic

The correct answer is: Strategic

Product design and choice of location are considered strategic decisions because they have a long-term impact on the overall direction and success of the organization. Strategic decisions involve allocating resources to establish a competitive advantage and shape how the company operates within its industry. In terms of product design, this choice influences market positioning, customer satisfaction, and innovation capabilities. It is crucial for defining the product's features, functionality, and aesthetics, which ultimately affect consumer demand and company branding. Choosing a location is equally strategic, as it can affect operational efficiency, access to supply chains, market reach, and cost structures. The location can also influence the company’s ability to attract talent and serve its customers effectively, which are pivotal for long-term growth and sustainability. While operational decisions focus on the day-to-day management and procedures necessary to achieve strategic goals, and design decisions are certainly part of the process, the overarching nature of product design and location selection categorizes them as strategic, aligning with broader business objectives.