Chap001 BUS 140
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Transcript of Chap001 BUS 140
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Chapter 1
Introduction to Operations Management
McGraw-Hill/Irwin Copyright © 2012 by The McGraw-Hill Companies, Inc. All rights reserved.
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Chapter 1: Learning ObjectivesYou should be able to:
1. Define the term operations management2. Identify the three major functional areas of organizations and describe how
they interrelate3. Identify similarities and differences between production and service
operations4. Describe the operations function and the nature of the operations manager’s
job5. Summarize the two major aspects of process management6. Explain the key aspects of operations management decision making7. Briefly describe the historical evolution of operations management8. Characterize current trends in business that impact operations management
1-2Student Slides
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Operations Management• What is operations?
– The part of a business organization that is responsible for producing goods or services
• How can we define operations management?– The management of systems or processes that
create goods and/or provide services
1-3Student Slides
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Goods are physical items that include raw materials, parts, subassemblies, and final products.
•Automobile•Computer•Oven•Shampoo
Services are activities that provide some combination of time, location, form or psychological value.
•Air travel•Education•Haircut•Legal counsel
Good or Service?
1-4Student Slides
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Supply Chain
Student Slides
Suppliers’suppliers
Directsuppliers Producer Distributor Final
Customers
Supply Chain – a sequence of activities and organizations involved in producing and delivering a good or service
1-5
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The Transformation Process
Student Slides
Inputs•Land•Labor•Capital•Information
Outputs•Goods•Services
Transformation/Conversion
Process
Control
Measurementand Feedback
Measurementand Feedback
Measurementand Feedback
Value-Added
Feedback = measurements taken at various points in the transformation process
Control = The comparison of feedback against previously established standards to determine if corrective action is needed.
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Manufacturing vs. Service1. Degree of customer contact2. Uniformity of input3. Labor content of jobs4. Uniformity of output5. Measurement of productivity6. Production and delivery7. Quality assurance8. Amount of inventory9. Evaluation of work10.Ability to patent designStudent Slides 1-7
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Scope of Operations Management
The operations function includes many interrelated activities such as:
ForecastingCapacity planningFacilities and layoutSchedulingManaging inventoriesAssuring qualityMotivating employeesDeciding where to locate facilitiesAnd more . . .
The scope of operations management ranges across the organization.
1-8Student Slides
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Role of the Operations Manager
The Operations Function consists of all activities directly related to producing goods or providing services.
A primary function of the operations manager is to guide the system by decision making.
– System Design Decisions– System Operation Decisions
Student Slides 1-9
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Why Study OM?• Every aspect of business affects or is affected by operations• Many service jobs are closely related to operations
– Financial services– Marketing services– Accounting services– Information services
• There is a significant amount of interaction and collaboration amongst the functional areas
• It provides an excellent vehicle for understanding the world in which we live
Student Slides1-10
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OM and Supply Chain Career Opportunities
• Operations manager• Supply chain manager• Production analyst• Schedule coordinator• Production manager• Industrial engineer• Purchasing manager• Inventory manager• Quality manager
Student Slides1-11
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Decision MakingMost operations decisions involve many alternatives that can have quite
different impacts on costs or profitsTypical operations decisions include:
What: What resources are needed, and in what amounts?When: When will each resource be needed? When should the work be
scheduled? When should materials and other supplies be ordered?Where: Where will the work be done?How: How will he product or service be designed? How will the work be
done? How will resources be allocated?Who: Who will do the work?
1-12Student Slides
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Historical Evolution of OM• Industrial Revolution• Scientific Management• Human Relations Movement• Decision Models and Management Science• Influence of Japanese Manufacturers
Student Slides 1-13
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Key Issues for Operations Managers Today
• Economic conditions• Innovating• Quality problems• Risk management• Competing in a global economy
1-14Student Slides
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The Need for Supply Chain Management
• In the past, organizations did little to manage the supply chain beyond their own operations and immediate suppliers which led to numerous problems:– Oscillating inventory levels– Inventory stockouts– Late deliveries– Quality problems
Student Slides 1-15