How does cost of operations relate to business strategy?

You can understand how the cost of operations relates to business strategy through focusing on three questions: (1) what is the business strategy, (2) what operations will be needed to accomplish the business strategy, and (3) what are the costs of the operations?
(1) Companies must develop a business strategy; usually a business strategy is done through strategic planning. Companies usually develop three-year or five-year strategic plans that will help the Board of Directors and executives make decisions to accomplish the goals they have for the company. (2) To accomplish the business strategy, the company must operate well, which means various departments such as finance, human resources, legal, customer service, and so on (however a business defines “operations”) need to function so that the departments contribute to accomplishing the business strategy. (3) Companies must decide how much money they will spend on operations to accomplish the business strategy. However, companies must be logical and realistic. For example, if a business strategy requires a company to open five new stores, the company must budget out how much it would cost to operate five new stores. If the company does not have that much money, the company must either raise the extra money it needs or decrease the number of stores it wants to open.
Without the adequate amount of money to cover the operating costs, the business strategy cannot be accomplished. As a result, it is important for companies to understand the operations costs that relate to their business strategies so they know if they have enough money to accomplish the business strategies, if they have to raise more money, or if they should modify their business strategies.