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Operations Management

Moutaz Khouja

Business Information Systems and Operations Management DepartmentThe Belk College of Business Administration

The University of North Carolina at CharlotteCharlotte, NC 28223

Ph: (704) 687-7653, Fax: (704) 687-6330

mjkhouja@uncc.edumjkhouja@uncc.edu

http://www.belkcollege.uncc.edu/mjkhouja/http://www.belkcollege.uncc.edu/mjkhouja/

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Outline

Introductions Name cards

Brief bios

Suggested info (optional)

University history

Job history

Family and/or friends

Hobbies

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Brief bio BSME, MBA, PhD Operations Management

Married to Lisa Smith for 18 years, three cats.

Teaching Operations Management, MBA, Undergraduate (UG)

Topics in Management Information Systems (PhD)

Quantitative Analysis and Business Statistics, MBA

Service Operations Management, UG

Production Planning and Control, UG

Research and Consulting Inventory Management

Supply Chain Management

Pricing

Applications of Artificial Intelligence to Operations Management

Cooking, reading

Very happy to be in Monterrey.

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What is operations management? Operations management (OM) is defined as the design,

operation, and improvement of the systems that create anddeliver the firms primary products and services.

OM is management ofprocesses that produce and distributeproducts and/or services to customers.

OM objective is make sure that the processes work effectively and

efficiently. What is the difference between effectiveness and efficiency?

Efficiency: producing something at the lowest possible cost

Effectiveness: doing the right things to create the most value forthe firm

What is value? quality divided by price

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Typical Operations Decisions and TheirHierarchy

Strategic level

Broad scope, long term

Operational level

Narrow scope, short term

Tactical level

Moderate scope, medium term

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Physical--manufacturing

Locational--transportation

Exchange--retailing

Storage--warehousing

Physiological--health care

Informational--telecommunications

Transformations

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Transformation Processes

Inputs Use resources Outputs

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What is a Service and What is a Good?

Classic view:Physical output (tangible) of process Good

If you drop it on your foot, it may hurt you

Intangible process Service

If you drop it on your foot, it wont hurt you

McDonalds is in Service or Manufacturing sector?

Every organization is in the service business, T or F?

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OM in theOrganization

Chart

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Core Services

Core services are the basic things thatcustomers (internal or external) want fromproducts they purchase (quality, on timedelivery, price (cost), etc.) Somewhat easier to emulate or copy

OperationsManagement

Flexibility

Quality

Speed

Price (or cost

Reduction)

Performance Objectives

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Value Added ServicesValue-added services differentiate the

organization from competitors and buildrelationships that bind customers to thefirm in a positive way (sales and fieldsupport, problem solving, etc.)

Significantly more difficult to copy andimplement

OperationsManagement

Information

Problem

Solving

Sales Support

Field Support

Value-Added Service Categories

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Case: Fast-Food Feast, p. 21

Please read this very short case and visit McDonaldsand one more fast-food restaurant.

You do not have to eat there but make sure to observeas much as possible how they prepare their meals

using the seven questions listed on page 21.Also, please read the article McDonald's focus flips

back to fast

Discuss case

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Case Questions

What do these different fast food restaurants sell? Does each of them sell something different?

What is different about the operations of theserestaurants?

Processes, Technology, Service Speed, Capacity, FlexibilityHow do these stores make hamburgers?

Did you notice any differences?

What are sources of variability that these stores mustdeal with?

How do these businesses ensure quality?