BADM 410 Production & Operations Management

1. BADM 410Production & Operations Management • “Operations” or “OM” • What is it? • Why study it? • Discuss • Course Requirements • Syllabus (tentative) and schedule • Questions

2. BADM 410The Product Mix Problem (PQ) • (Handout)

3. What Is Operations Management? Operations - Systematic activity focused on production and deliver of products and/or services to external customers. Operations is process oriented, transforming inputs into outputs, with the goal of creating value in the form of goods and services. Management - Systematic activity focused on personal or organizational goal achievement. Operations Management (OM) is the systematic set of activities focused on achieving operational goals.

4. Transformation Processes(Adding value) Outputs Inputs Operations Management is… “The systematic design, direction and control of processes that transform inputs into services and products for internal, as well as external, customers.”

5. BADM 410Processes and Systems • “Process” • What is it? • Why focus on processes? • Systems View • What does this mean? • What does it do for us?

6. Output Productivity = Input Productivity • Productivity is the value of outputs (services and products) produced, divided by the value of input resources(wages, costs of equipment, etc.)

7. Example -FedEx • Why are they successful? • Fast • On-time deliveries • Relatively low cost • Technology in shipment tracking

8. Functions • Accounting • Distribution • Engineering • Operations • Finance • Human resources • Marketing Types of Organizations Bank Construction Government Health care Manufacturing Retailing Transportation Wholesaling • ----------------- • ----------------- • ----------------- • ----------------- • ----------------- • ----------------- • ----------------- • ----------------- Operations Management as a Function

9. Operations Management as a Function • Essential functions: • Marketing – generates demand • Production/operations – creates and delivers the product and/or service • Finance/accounting – tracks how well the organization is doing financially, secures financing, pays bills, collects the revenue

10. OM is Management and Decision Making Applied to the Operations Function • Recognize and clearly define the problem. • Collect the information needed to analyze possible alternatives. • Choose the most attractive alternative. • Implement the chosen alternative. Four Basic Decision-making Steps?

11. Some Management and Decision Making Areas in Operations • Development of new capabilities • Maintenance of existing capabilities • Design of new processes • Development and organization of value chains • Key performance measures Tactical Decisions Strategic Decisions • Process improvement and performance measures • Management and planning of projects • Generation of production and staffing plans • Inventory management • Resource scheduling

12. So Why Study OM? • OM is a major function • We want (and need) to know how goods and services are produced • We want to understand what operations managers do • OM is a costly part of the organization

13. BADM 410The Product Mix Problem (PQ) • What answers did we get?

14. Things We Need To Do • Check the course web page • Visit the text companion web site • Powerpoint Slides are here • The self-test quizzes are here • Locate our software • Lab (Bond 251) • Student CD • Available freeware • Review what you need to do for next class (see next slide)

15. ImportantFor Next Class Meeting • Review the syllabus and schedule, and bring any questions to class • Read chapter 1 • Take the WebCT quiz for Chapter 1 before next class