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Chapter 1

Chapter 1. Overview: Introduction to the Field. OBJECTIVES. Operations Management Why Study Operations Management? Production System Defined Operations as a Service Plan of This Book Historical Development of OM Current Issues in OM. What is Operations Management? Defined.

wendy-velez
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Chapter 1

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  1. Chapter 1 Overview: Introduction to the Field

  2. OBJECTIVES • Operations Management • Why Study Operations Management? • Production System Defined • Operations as a Service • Plan of This Book • Historical Development of OM • Current Issues in OM

  3. What is Operations Management?Defined Operations management (OM) is defined as the design, operation, and improvement of the systemsthat create and deliver the firm’s primary products & services. This involves the transformation of inputs to outputs and is the core of any business.

  4. Why Study Operations Management? • OM is related to all areas of any business • There is no business without Operations • Education on how to produce goods or services • Most costs are incurred in creating goods or services • Global nature of operations and competition • Impetus of new technologies

  5. Systematic Approach to Org. Processes Operations Business Education Career Opportunities Management Cross-Functional Applications Why Study Operations Management?

  6. What is a Production System?Defined A production system is defined as a user of resources to transform inputs into some desired outputs

  7. OM Involves Managing Transformations Transformation Process (Value Adding) Input Output • People • Plants • Parts • Processes • Planning and Control Transformation is enabled By the 5 P’s of OM

  8. Transformations • Physical--manufacturing • Locational--transportation • Exchange--retailing • Storage--warehousing • Physiological--health care • Informational--telecommunications

  9. What is a Service and What is a Good? • “If you drop it on your foot, it won’t hurt you.” (Good or service?) • “Services never include goods and goods never include services.” (True or false?)

  10. What About McDonald’s? • Service or manufacturing? • The company certainly manufactures tangible products • Why then would we consider McDonald’s a service business?

  11. Finance Marketing Manufacturing, Production control, Quality assurance, Engineering, Purchasing, Maintenance, etc OM in the Organization Chart Operations Plant Manager Operations Manager Director

  12. Core Services Defined Core servicesare basic things that customers want from products they purchase

  13. Quality Flexibility Speed Price (or cost Reduction) Core Services Performance Objectives Operations Management

  14. Value-Added ServicesDefined Value-added servicesdifferentiate the organization from competitors and build relationships that bind customers to the firm in a positive way

  15. Problem Solving Sales Support Information Field Support Value-Added Service Categories • Help internal/external groups • solve problems Operations Management • Performance data on products • Use data for improvements • Enhance sales/marketing • through equipment demos • Replace defective parts quickly

  16. I. Operations Strategy and Managing Change 1. Introduction to the Field Plan of This Book 2. Operations Strategy and Competitiveness 3. Project Management II. Product Design and Process Selection III. Supply Chain Design 9. Supply Chain Strategy 10. Strategic Capacity Management 11. Just-in-Time and Lean Systems 4. Process Analysis 5. Product Design and Process Selection -Manufacturing 6. Product Design and Process Selection -Services IV. Planning and Controlling the Supply Chain 12. Forecasting and Demand Management 13. Aggregate Sales and Operations Planning 7. Quality Management 14. Inventory Control 15. Materials Requirements Planning 8. Operations Consulting and Reengineering 16. Operations Scheduling 17. Synchronous Manufacturing and Theory of Constraints

  17. Historical Development of OM • JIT and TQC • Manufacturing Strategy Paradigm • Service Quality and Productivity • Total Quality Management and Quality Certification

  18. Historical Development of OM (cont’d) • Business Process Reengineering • Supply Chain Management • Electronic Commerce

  19. Current Issues in OM • Effectively consolidating the operations resulting from mergers • Developing flexible supply chains to enable mass customization of products and services • Managing global supplier, production and distribution networks • Increased “commoditization” of suppliers

  20. Current Issues in OM (cont’d) • Achieving the “Service Factory” • Enhancing value added services • Making efficient use of Internet technology • Achieving good service from service firms

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