Name: Operation Management
Uploaded: 2021-11-10
Duration: 9 min 19 s
Description: Operation Management. Gears And Operations Management Mechanism Stock Photo Picture And Royalty Free Image Image 57464235.

Operation Management. Gears And Operations Management Mechanism Stock Photo Picture And Royalty Free Image Image 57464235. 

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Gears And Operations Management Mechanism Stock Photo Picture And Royalty Free Image Image 57464235

LEARNING OBJECTIVES. Define the term operations management. Identify the three major functional areas of organizations and describe how they interrelate. Compare and contrast service and manufacturing operations. Describe the operations function and the nature of the operations manager’s job. Differentiate between design and operation of production systems. Describe the key aspects of operations management decision making. Briefly describe the historical evolution of operations management. Identify current trends that impact operations management.. 

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Define the term  operations management. Identify the three major functional areas of organizations and describe how they interrelate. Compare and contrast service and manufacturing operations. Describe the operations function and the nature of the operations manager’s job. Differentiate between design and operation of production systems. Describe the key aspects of operations management decision making. Briefly describe the historical evolution of operations management. Identify current trends that impact operations management.

HOME. Access. The Best ERP Solutions for Operation Management | TA. 

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The Best ERP Solutions for Operation Management | TA

Operation Management. The management of systems or processes that create goods and/or provide services.. 

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The  management  of systems or processes that  create  goods  and/or provide services.

Operations Management affects: Companies’ ability to compete Nation’s ability to compete internationally

The  business function   responsible for planning, coordinating, and controlling the  resources  needed to  produce   products  and services for a company.

THE ORGANIZATION. Figure 1.1. The Three Basic Functions. 

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Organization Finance Operations Marketing

VALUE ADDED PROCESS. The operations function involves the conversion of inputs into outputs. 

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The operations function involves the conversion of inputs into outputs

Inputs     Land    Labor     Capital Transformation / Conversion   process Outputs     Goods     Services Control Feedback Feedback Feedback Value   added

VALUE-ADDED AND PRODUCT PACKAGES. Value-added elements make the difference between the cost of inputs and the value or price of outputs. Product packages are a combination of goods and services. Product packages can make a company more competitive.. 

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Value-added elements make the difference between the cost of inputs and the value or price of outputs. Product packages are a combination of goods and services. Product packages can make a company more competitive.

THE GOODS-SERVICE CONTINUM. Figure 1.3. Automobile assembly, steel making. 

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FOOD PROCESSOR. Table 1.2. Inputs. Processing. Outputs. 

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Raw Vegetables Cleaning Canned     vegetables  Metal sheets Making cans Water Cutting Energy Cooking Labor Packing Building Labeling Equipment

HOSPITAL. Table 1.2. Inputs. Processing. Outputs. 

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Doctors, nurses Examination Treated    patients Hospital Surgery Medical supplies Monitoring Equipment Medication Laboratories Therapy

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PRODUCTION OF GOODS VS. DELIVERY OF SERVICE. Production of goods – tangible output Delivery of services – an act Service job categories Government Wholesale/retail Financial services Healthcare Personal services Business services Education. 

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PRODUCTION OF GOODS VS. DELIVERY OF SERVICE

Production of goods – tangible output Delivery of services – an act Service job categories Government Wholesale/retail Financial services Healthcare Personal services Business services Education

KEY DIFFERENCES. 1. Customer contact 2. Uniformity of input 3. Labor content of jobs 4. Uniformity of output 5. Measurement of productivity 6. Production and delivery 7. Quality assurance 8. Amount of inventory 9. Evaluation of work 10. Ability to patent design. 

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1.  Customer contact 2.  Uniformity of input 3.  Labor content of jobs 4.  Uniformity of output 5.  Measurement of productivity 6.  Production and delivery 7.  Quality assurance 8.  Amount of inventory 9.  Evaluation of work 10. Ability to patent design

GOODS VS. SERVICE. Table 1.3. Characteristic Goods Service Customer contact Low High Uniformity of input High Low Labor content Low High Uniformity of output High Low Output Tangible Intangible Measurement of productivity Easy Difficult Opportunity to correct problems High Low Inventory Much Little Evaluation Easier Difficult Patentable Usually Not usually. 

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Characteristic Goods Service Customer contact Low High Uniformity of input High Low Labor content Low High Uniformity of output High Low Output Tangible Intangible Measurement of productivity Easy Difficult Opportunity to correct problems High Low Inventory Much Little Evaluation Easier Difficult Patentable Usually Not usually

SCOPE OF OPERATIONS MANAGEMENT. Operations Management includes: Forecasting Capacity planning Scheduling Managing inventories Assuring quality Motivating and training employees Locating facilities Supply chain management And more . . .. 

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Operations Management includes: Forecasting Capacity planning Scheduling Managing inventories Assuring quality Motivating and training employees Locating facilities Supply chain management And more . . .

TYPES OF OPERATION. Table 1.4. Operations Examples Goods Producing Farming, mining, construction , manufacturing, power generation Storage/Transportation Warehousing, trucking, mail service, moving, taxis, buses, hotels, airlines Exchange Retailing, wholesaling, financial advising, renting or leasing Entertainment Films, radio and television, concerts, recording Communication Newspapers, radio and TV newscasts, telephone, satellites. 

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Operations Examples Goods Producing Farming, mining, construction , manufacturing, power generation Storage/Transportation Warehousing, trucking, mail service, moving, taxis, buses, hotels, airlines Exchange Retailing, wholesaling, financial  advising, renting or leasing Entertainment Films, radio and television, concerts, recording Communication Newspapers, radio and TV  newscasts, telephone, satellites

Figure 1.4a. Figure 1.4b. Singapore Manufacturing vs. Service Employment. 

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Services '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 66.3 67.7 68.599999999999994 68.900000000000006 68.7 68.400000000000006 67.7 67.3 69.2 70.3 70.599999999999994 Manufacturing '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 19.8 19.8 19.7 20.2 20.5 20.7 20.8 19.899999999999999 17.399999999999999 16.7 16.2

Singapore Manufacturing vs. Service Employment

DECLINE IN MANUFACTURING JOBS. Productivity Increasing productivity allows companies to maintain or increase their output using fewer workers Outsourcing Some manufacturing work has been outsourced to more productive companies. 

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Productivity Increasing productivity allows companies to maintain or increase their output using fewer workers Outsourcing Some manufacturing work has been outsourced to more productive companies

CHALLENGES OF MANAGING SERVICES. Service jobs are often less structured than manufacturing jobs Customer contact is higher Worker skill levels are lower Services hire many low-skill, entry-level workers Employee turnover is higher Input variability is higher Service performance can be affected by worker’s personal factors. 

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Service jobs are often less structured than manufacturing jobs Customer contact is higher Worker skill levels are lower Services hire many low-skill, entry-level workers Employee turnover is higher Input variability is higher Service performance can be affected by worker’s personal factors

KEY DECISIONS OF OPERATION MANAGERS. What What resources/what amounts When Needed/scheduled/ordered Where Work to be done How Designed/Resources allocated Who To do the work. 

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What      What resources/what amounts When      Needed/scheduled/ordered Where      Work to be done How      Designed/Resources allocated Who      To do the work

OPERATIONS MANAGEMENT DECISION MAKING. Models Quantitative approaches Performance metrics Analysis of trade-offs Systems approach Establishing priorities Ethics. 

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Models Quantitative approaches Performance metrics Analysis of trade-offs Systems approach Establishing priorities Ethics

MODELS. A model is an abstraction of reality„. – Physical – Schematic – Mathematical. 

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– Physical – Schematic – Mathematical

MODELS ARE BENEFICIAL. Easy to use, less expensive Require users to organize Increase understanding of the problem Enable “what if” questions Consistent tool for evaluation and standardized format Power of mathematics. 

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Easy to use, less expensive Require users to organize Increase understanding of the problem Enable “what if” questions Consistent tool for evaluation and standardized format Power of mathematics

LIMITATIONS OF MODEL. Quantitative information may be emphasized over qualitative Models may be incorrectly applied and results misinterpreted Nonqualified users may not comprehend the rules on how to use the model Use of models does not guarantee good decisions. 

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Quantitative information may be emphasized over qualitative Models may be incorrectly applied and results misinterpreted Nonqualified users may not comprehend the rules on how to use the model Use of models does not guarantee good decisions

QUANTITATIVE APPROACHES. Linear programming Queuing techniques Inventory models Project models Statistical models. 

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Linear programming Queuing techniques Inventory models Project models Statistical models

PERFORMANCE METRICS. To control different aspects of operations Many:	Profits Costs Quality Productivity Assets Inventory Schedules Forecast accuracy. 

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To control different aspects of operations Many:	Profits 		Costs 		Quality 		Productivity 		Assets 		Inventory 		Schedules 		Forecast accuracy

SYSTEMS APPROACH. “ The whole is greater than the sum of the parts .”. 

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“ The whole is greater than  the sum of the parts .”

ESTABLISHING PRIORITIES. Pareto phenomenon A few factors account for a high percentage of the occurrence of some event(s). 80–20 Rule: 80% of problems are caused by 20% of the activities.. 

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Pareto phenomenon A few factors account for a high percentage of the occurrence of some event(s). 80–20 Rule: 80% of problems are caused by 20% of the activities.

ETHICAL ETHICS. Financial statements Worker safety Product safety Quality Environment Community Hiring/firing workers Closing facilities Worker’s rights. 

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Financial statements Worker safety Product safety Quality Environment Community Hiring/firing workers Closing facilities Worker’s rights

OVERLAP OF BUSINESS FUNCTIONS. Figure 1.5. Operations. 

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OPERATIONS INTERFACES. Figure 1.6. Operations Personnel Human resources MIS Legal Public Relations Accounting. 

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Operations Personnel Human  resources MIS Legal Public  Relations Accounting

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HISTORICAL SUMMARY OF OPERATIONS MANAGEMENT. Industrial revolution (1770s) Scientific management (1911) Mass production Interchangeable parts Division of labor Human relations movement (1920 – 60) Decision models (1915, 1960 –’ 70s) Influence of Japanese manufacturers. 

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HISTORICAL SUMMARY OF OPERATIONS MANAGEMENT

Industrial revolution (1770s) Scientific management (1911) Mass production Interchangeable parts Division of labor Human relations movement (1920 – 60) Decision models (1915, 1960 –’ 70s) Influence of Japanese manufacturers

TRENDS IN BUSINESS. Major trends The Internet, e-commerce, e-business Management technology Globalization Management of supply chains Outsourcing Agility Ethical behavior. 

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Major trends The Internet, e-commerce, e-business Management technology Globalization Management of supply chains Outsourcing Agility Ethical behavior

MANAGEMENT TECHNOLOGY. Technology: The application of scientific discoveries to the development and improvement of goods and services Product and service technology Process technology Information technology. 

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Technology: The application of scientific discoveries to the development and improvement of goods and services Product and service technology Process technology Information technology

SIMPLE PRODUCT SUPPLY CHAIN. Figure 1.7. Suppliers’ Suppliers. 

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Supply Chain :  A sequence of activities And organizations involved in producing And delivering a good or service

A SUPPLY CHAIN FOR BREAD. Stage of Production Value Added Value of Product Farmer produces and harvests wheat $0.15 $0.25 Wheat transported to mill $0.08 $0.33 Mill produces flour $0.15 $0.48 Flour transported to baker $0.08 $0.56 Baker produces bread $0.54 $1.00 Bread transported to grocery store $0.08 $1.08 Grocery store displays and sells bread $0.21 $1.29 Total Value-Added $1.29. 

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Stage of Production Value Added Value of Product Farmer produces and harvests wheat $0.15 $0.25 Wheat transported to mill $0.08 $0.33 Mill produces flour $0.15 $0.48 Flour transported to baker $0.08 $0.56 Baker produces bread $0.54 $1.00 Bread transported to grocery store $0.08 $1.08 Grocery store displays and sells bread $0.21 $1.29 Total Value-Added $1.29

OTHER IMPORTANT TRENDS. Operations strategy Working with fewer resources Revenue management Process analysis and improvement Increased regulation and product liability Lean production. 

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Operations strategy Working with fewer resources Revenue management Process analysis and improvement Increased regulation and product liability Lean production