Chapter 1 - Overview

1. Chapter 1 - Overview Operations Management Definition, Functions, Evolution SJSU Bus 140 - David Bentley

2. Definition: “Operations” SJSU Bus 140 - David Bentley

3. ___________ ___________ ___________ ___________ ___________ ___________ ____________ ____________ ____________ ____________ ____________ ____________ ____________ Resources (Inputs) SJSU Bus 140 - David Bentley

4. Definition: “Management” • Activities involved in: • Planning • Organizing • Leading • Controlling • Other terms: staffing, directing, etc. • Directed to achieving organization goals SJSU Bus 140 - David Bentley

5. “The value-added activities of planning, organizing, leading, and controlling involved in convertingresources into goods and/or services.” Definition: “Operations Management” SJSU Bus 140 - David Bentley

6. Organizational Scope of OM • Applies to all organizations • Manufacturing • Service (banks, insurance, health care) • Wholesale & retail • Schools • Religious institutions and charities • Political parties, trade groups, unions • Etc., etc., etc. SJSU Bus 140 - David Bentley

7. Primary Business Functions SJSU Bus 140 - David Bentley

8. OM Topics • Competitiveness, strategy, productivity • Quality management • Types of operations (project, job, batch, repetitive, continuous flow) • Forecasting and aggregate demand • Supply chain management (including purchasing, inventory control, MRP, JIT) • Project management • Product and service design, capacity planning • Process design, facility location and layout SJSU Bus 140 - David Bentley

9. Why Study OM? • ________________________________ • ________________________________ • ________________________________ • ________________________________ • ________________________________ ________________________________ • ________________________________ ________________________________ SJSU Bus 140 - David Bentley

10. Evolution of OM – pre-1900 • Ancient – government, military, religious • Pyramids, Great Wall, some trade • Most business small, local, family • Renaissance: exploration, trade, banking, manufacturing – 1400-1700 • Division of labor, interchangeable parts, and the steam engine – 1700’s • Transportation: RR, steel and steamships – 1800’s SJSU Bus 140 - David Bentley

11. Evolution of OM – 1900’s • Scientific management (1900-1920) • Frederick W.Taylor(1856-1915) • Industrial engineer • “Father of Scientific Management” • Published ThePrinciplesofScientificManagement in 1911 • (+ HenryGantt and HarrisonEmerson) • Time and motion study: Frank & LillianGilbreth • Assembly line and standardization: HenryFord • Inventory management model: F.W.Harris SJSU Bus 140 - David Bentley

12. Evolution of OM – 1900’s • Quality: • SPC: WalterShewhart, • Acceptance Sampling:H.G.Romig & H.F.Dodge • Motivation: • Hawthorne studies: EltonMayo • Hierarchy of needs:Abraham Maslow, Frederick Hertzberg • Theory X and Theory Y:Douglas McGregor • Theory Z:William Ouchi • Operations research: various SJSU Bus 140 - David Bentley

13. Evolution of OM – WW II • Focus on output • Post-war conditions of various countries • U.S. – capacity + consumer demand + money; women in the workplace; GI bill • Changes in emphasis: Production > Mktg > Cost management > Mergers & Acquisition • Compare to Europe and Japan SJSU Bus 140 - David Bentley

14. Evolution of OM – 1970+ • Effects of Oil Embargo 1 and 2 • Role of Quality • Understanding of “Lean Operations” (JIT) • Recent trends • See next slide SJSU Bus 140 - David Bentley

15. Global markets TQM Worker involvement Technology Reengineering Lean operations (JIT) Elimination of waste Customer satisfaction Shortening of time spans MRP, Closed Loop MRP, MRP II, ERP Extensive outsourcing Supply Chain Mgmt E-commerce: B2C, B2B Internet brokering and application hosting Cost containment Business relocation Downsizing Recent Trends SJSU Bus 140 - David Bentley