Never Stand Still Business School

Course OverviewAGSM @ UNSW Business SchoolAGSM MBA Programs

Session 3, 2014

business.unsw.edu.au/agsmCRICOS Code 00098G

MNGT6233Operations Management

(Online)

Contents

Course calendar 1

Session 3, 2014 1

Course outline 2

Course structure 3

Aims of the course 7

Assessment 8

Student responsibilities and conduct 8

Assessment policy 8

Summary of requirements 8

Assessment 1 – Assignment 1 9

Assessment 2 – Assignment 2 9

Assessment 3 – Assignment 3 9

Assessment 4 – Final exam 9

Assessment – Participation 11

Assignment preparation and submission 12

Learning methods and technology 14

AGSM on-line learning and teaching philosophy 14

Class interaction 15

Notes and DVD 15

Unit notes, readings and exercises 16

Equipment you will need 16

Saturday workshops 17

Other Online resources 18

AGSM MBA Programs contact details 18

Appendices 20

Operations Management 2

Course Overview 1

Course calendar

Session 3, 2014

Operations Management 2

Course outline

At a fundamental level, any business or organisation is concerned with delivering value to its customers or clients. The ‘operations’ of a company are the direct processes that a company uses to create value: they involve transforming inputs of some sort into outputs. Operations management is the task of managing these processes. Each company or organisation will have a unique set of operations, whether this is dealing with phone calls at a call centre, manufacturing cardboard from recycled paper, running room service in a hotel or dealing with passengers of an airline. This course is about the fundamentals of operations management, covering both service industries and manufacturing. The aim is to give you a set of frameworks and concepts you can use to understand the operations functions and strategies of any company.

MBA Program Learning Goals

This course contributes to the development of the MBA (Executive) Program Learning Goals, which are the qualities, skills and understandings we want you to have by the completion of your degree, as indicated below:

• An in-depth engagement with the relevant disciplinary knowledge in its interdisciplinary context

• Team based skills

• Critical and analytical thinking

• Decision-making and problem-solving

• An ability to manage change.

Program Learning Goals are developed throughout the program of study. Each course will not necessarily address all Program Goals or develop them to an equal extent.

Course Overview 3

Course structure

There are three themes that run through this course:

• Customers – we will keep on coming back to the customer, since value

to the customer is our ultimate aim;

• Systems – we will treat the operations of a company as a system, and try

to understand the interacting elements;

• Variability – dealing with operations will force us to recognise the

unpredictability and variability of the processes that we manage.

The course content is organised into four sections:

Firstly, we investigate the processes that are at the heart of operations management. Even though there is enormous variety in these processes, there are a number of important ideas that will apply in any operation.

Secondly, we look at achieving excellence in operations. What does it mean to have high quality operations and how can this be achieved? Answering these questions will take us beyond purely quality issues and we will see how lean operations aim to eliminate all forms of waste within operations.

Thirdly, we deal with the movement of materials through the supply chain. We will consider the control of inventory and the way in which coordination between supply chain partners can be achieved.

Our focus for most of the course is on processes that are carried out repeatedly. In the fourth section, however, we will consider processes that are individual and unique – as happens with a project. The operational challenges in managing projects are quite different from those involved in managing repeated processes, and involve careful planning of inter-related activities.

Operations Management 4

Processes

Unit 1 Operations

Unit 2 Process analysis

Unit 3 Queues in service operations

Achieving excellence

Unit 4 Managing for quality

Unit 5 Statistical quality control

Unit 6 Lean operations

Supply chains

Unit 7 Introduction to supply chains and inventory management

Unit 8 Inventory with uncertain demand

Unit 9 Improving supply chain performance

Projects

Unit 10 Managing projects

Unit 11 Risk in projects

Summary

Unit 12 Course review

Course Overview 5

1. Processes

Our starting point is to review some of the variety of different types of operations. In Unit 1, Operations, we will explore different ways in which the operations of a company can be organised. We will explain the connection between this choice and the aim of delivering value to the customer. This unit will provide a context for the material in later units and also introduce you to some important concepts and vocabulary.

In Unit 2, Process analysis, we will look in more detail at the nature of operations as transformations. In this unit our focus is on the process. We introduce the flow diagram as a tool for understanding processes, and we introduce key concepts that relate to processes: cycle time, capacity and lead-time. We look in detail at what determines the capacity of an interacting set of activities, which together make up an operations process. Then we apply these ideas to designing a balanced system to maximize process output.

For customers, one of the most visible aspects of a service operation is the waiting time. In Unit 3, Queues in service operations, we focus on queues that are both a symptom and cause of waiting. Queues are a feature of situations in which there is high variability and high capacity utilisation. We will give some important tools that can help you to understand and manage congestion and queues.

2. Achieving excellence

Good operations management is not about setting up the operations of an organisation and then walking away. Operational excellence involves a continual process of monitoring and improvement. In Unit 4, Managing for quality, we discuss ways to achieve high quality in operations processes. We introduce some of the tools to achieve quality within operations processes. We also discuss issues associated with employee empowerment: front line employees are the key to obtaining high quality in any organisation.

A fundamental issue for quality is the variability inherent in all processes. In Unit 5, Statistical quality control, we discuss types of variability and the way that control charts can be used to track process performance. Carefully measuring and monitoring what is actually happening in a process is the only way to achieve long-term improvement in performance.

In Unit 6, Lean operations, we introduce some ideas from Just-in-Time (or lean) operations. A lean operation treats any kind of waste as a defect in the process. Lean operations move away from a ‘batch and queue’ approach, and instead aim for very low inventory levels and small batches. In lean operations, control is usually achieved using a ‘pull’ mechanism that requires close relationships with suppliers who need to deliver small batches on demand.

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3. Supply chains

In the third part of the course, we look at how the value chain operates. We consider the role of inventory in supply chains. Often different firms own different parts of the supply chain. We address ways in which actions of different firms in the value chain can be coordinated to deliver value to the final customer. In Unit 7, Introduction to supply chains and inventory management, we discuss the fundamentals of supply chain management and the reasons for holding inventories as well as the costs associated with them. We focus, in particular in this unit, on cycle inventory and the best way to trade off the various costs involved.

Besides cycle inventory, the most important type of inventory is buffer inventory, which is used to deal with uncertainty in demand. In Unit 8, Inventory with uncertain demand, we investigate a number of different inventory control methods. It is important to understand the nature of variability in demand in order to choose the best way to manage the inventory.

In Unit 9, Improving supply chain performance, we turn to the broader supply chain context for our decisions. By only looking at our own company or organisation and ignoring the rest of the supply chain, we run the risk of taking decisions that lead to poor outcomes for the supply chain as a whole. The solution is to ensure that the contract structure between different supply chain partners is set up appropriately.

4. Projects

In the final part of the course, we consider project management. We will explain the key techniques of project management and show how they can be used in practice. In Unit 10, Managing projects, we will review fundamental issues associated with the role of the project manager and the ways in which projects can be set up. We also explain the use of network methods for scheduling project activities.

In Unit 11, Risk in projects, we look at how to track the progress of projects. We discuss different types of project risk. We show how Monte Carlo techniques can be used to assess the way that uncertainty in activity duration impacts on the project as a whole.

Finally, in Unit 12, Course review, we will summarise all the concepts from the course. We will review the material of the course from the point of view of the three themes: customers, systems and variability. Successful operations management requires us to keep the customer in mind in all the decisions we take, to view our operations as a system made up of interconnected activities, and to understand the impact of variability in our operations.

Course Overview 7

Aims of the course

When you have completed this course you should be able to:

• Analyse different types of operations processes, calculate the capacity of operations systems and predict customer waiting times.

• Develop and use strategies for improving the performance and quality of operations.

• Determine appropriate levels of inventory within a supply chain and diagnose reasons for poor service and excessive inventory.

• Plan activities in a project environment and analyse the effect of variability.

Operations Management 8

Assessment

Student responsibilities and conduct You are encouraged to actively participate in your on-line class, submit all assessments by the due date and sit a final exam.

You should take note of all announcements made in your online class or on the AGSM student website. From time to time, the university will send important announcements to your university email address without providing you with a paper copy. You will be deemed to have received this information.

Assessment policy

The assessment process plays two roles: it provides feedback to you on your progress, and is a means of testing and grading your performance. All information on assessment is provided in the Assessments & examinations section of the AGSM website.

http://www.asb.unsw.edu.au/currentstudents/agsmmba/academicinformation/assessmentsandexaminations/Pages/default.aspx

Summary of requirements

In order to pass this course, you must achieve an aggregate (overall) mark of at least 50 in the assessment tasks detailed below. You must also demonstrate satisfactory participation in the on-line activities. Further details on what comprises satisfactory participation is detailed below.

Assessment 1 – Assignment 1

Due: Week 4

Weight: 20%

Assessment 2 – Assignment 2

Due: Week 7

Weight: 20%

Assessment 3 – Assignment 3

Due: Week 10

Weight: 20%

Assessment 4 – Final exam

Date: Saturday, 6 December 2014

Weight: 40%

Duration: Three (3) hours

Course Overview 9

Assessment 1 – Assignment 1

Due: Week 4 – 9.30am (EST) Wednesday 1st October, 2014

Weight: 20%

The first assignment is given out in week 1 and has to be submitted on or before the due date, via the Turnitin link on the e-learning website. It assesses material covered in the first three units. This is a short assignment. It serves as a check that you have a good understanding of this foundation material.

Assessment 2 – Assignment 2

Due: Week 7 – 9.30am (EST) Wednesday 22nd October, 2014

Weight: 20%

The second assignment is given out in week 1 and has to be submitted on or before the due date, via the Turnitin link on the e-learning website. This assignment requires you to look in detail at one quality issue arising in your organisation. Some of the exercises in Units 4 and 5 suggest that you consider applying the concepts to your own organisation and these exercises may well assist you in carrying out this assignment.

Assessment 3 – Assignment 3

Due: Week 10 – 9.30am (EST) Wednesday 12th November, 2014

Weight: 20%

The third assignment is given out in week 7 and has to be submitted on or before the due date, via the Turnitin link on the e-learning website. It assesses material covered in Units 7, 8 and 9. The questions in this assignment are related to supply chain management practices.

Assessment 4 – Final exam

Date: Saturday, 6 December 2014

Weight: 40%

Duration: Three (3) hours

Operations Management 10

Open book exam policy

The MBA (Executive) Program has a policy of open book examinations. Participants may bring their course materials into the exam session. The materials may be annotated, and the use of Post-itTM Notes is permitted. Your own study notes are also permitted. But participants are strongly cautioned against copying the work of others. Copying the work of others is plagiarism.

Calculators with alpha keypads, laptop computers and other electronic devices are prohibited. Students from non-English speaking backgrounds who have written approval from Academic Affairs may use standard linguistic dictionaries; no other dictionaries are permitted. If you inadvertently enter the exam session with prohibited material or equipment, please surrender it immediately to the examination supervisor.

Participants should not rely heavily on looking up answers during the exam itself. This will be time consuming and a source of frustration. A recommended method of preparing for the exam is to write a one-page summary of each unit. Before participants commence writing their examination answers, they may find it helpful to prepare a brief plan for each question.

Exam location

All on-line students will be expected to sit the same exam as those student completing the course in the physical classroom environment. In most cases students will be expected to attend the AGSM location, in each capital city where other course exams are being conducted, and copy of the exam paper will be provided. Students will comply with all the normal exam requirements expected of those students who attend face to face classes.

Any students who, due to the remoteness of their location, are unable to attend an AGSM examination site on the required day will be asked to nominate an examination supervisor who will be provided the information required to administer and supervise the exam at a their nominated location. The Student Experience Team will co-ordinate this with the relevant students if required.

Information on the examination location and time will be advised closer to the exam date. For full details on examination policy and procedures, please refer to the AGSM MBA Programs website. For your reference, a sample exam paper is included as Appendix 2.

Course Overview 11

Assessment – Participation

Active participation and interaction with peers is a vital ingredient in learning. Participation is broadly assessed on your contributions to discussions and other learning activities in the class. You need to incorporate the concepts and theories from the course when expressing your own opinions and when responding to contributions from your fellow students. In this way we develop a learning environment that is supportive, dynamic and informative. Your facilitator may set specific interactive tasks for you to complete as part of this assessment.

Assessment criteria:

There is a general requirement for students to attend 80% of all classes. In the face-to-face teaching this is monitored by facilitators maintaining a record of weekly attendance. The on-line teaching environment has an 80% participation requirement. Students are expected to participate in a minimum of 80% of the on-line activities posted by the course facilitator.

The on-line teaching platform has tools, available to the facilitator, that enable them to monitor both the quantity and the quality of each student’s participation in the on-line learning environment.

No assessment marks are awarded for participation, however, failure to meet the participation requirement may give the course facilitator grounds to fail students for not satisfactorily completing all aspects of the course assessment requirements.

The five categories that will be used to assess contributions are as follows.

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Assignment preparation and submission NB: Assignments must be received by 9.30 am Sydney time on the due date.

Assignment presentation

use 1.5 or single spacing; use 11 or 12 point font

number each page and use wide margins (2.5–3 cm)

include your name, class number, assignment number and word count on the title page and in the footer on every page

Assignment file name

Please use the following file naming convention for each assignment.

z999999_MNGT6233_AssX_Surname

where:

z999999 is your student ID

X is the assignment number

Surname is your Last Name

Assignment submission

Unless otherwise advised you must submit your assignment through your online classroom as per the instructions in your Moodle User Manual.

Assignment submission in Moodle is performed via Turnitin, the similarity detection software used by UNSW students and teaching staff to prevent plagiarism by ensuring referencing is correct and that work has not been inadvertently copied from elsewhere.

You are able to submit a draft version of your assignment prior to the due date. This enables you to view the Turnitin similarity report on your work and decide whether it complies with the guidelines regarding referencing and plagiarism, before you submit your final version for marking. More information about plagiarism can be found here:

www.lc.unsw.edu.au/onlib/plag.html

Please note that draft assignments submitted in this way will be regarded as the final version at the due date if you have not uploaded a subsequent, finalised version (each file uploaded overwrites the previous version).

Late submissions are possible but will be marked as such and may be subject to late penalties.

If for any reason you are unable to submit a late submission via Turnitin please contact your Facilitator.

Course Overview 13

Please note that your assignment may not be returned to you. You will receive a detailed feedback sheet, and your assignment mark, via email from your facilitator.

Please keep a copy of your assignment in case your work is lost or mislaid.

Operations Management 14

Learning methods and technology

AGSM on-line learning and teaching philosophy The AGSM learning and teaching philosophy is to create an interactive learning experience where participants from a wide range of professional, academic and geographic backgrounds actively participate with their Class Facilitator and each other. The AGSM embraces the concept of real-world learning, which requires participants to leverage the professional experiences of all participants in the class to help understand, challenge and apply the course concepts. By sharing experiences with participants from different professional backgrounds across different organisational contexts, students are encouraged to broaden their frames of reference in relation to the course material.

eLearning

eLearning@AGSM MBA (http:// telt.unsw.edu.au)

We are also using an online environment called eLearning. By providing you with this online environment we hope to stimulate the sharing of ideas and understandings around the content of this course.

The online documents are PDF (Portable Document Format) files, which allow you to access the course units in the same visual format contained in the course material binders. The PDF files can be viewed, printed and navigated using Adobe Acrobat® Reader.

Articles to which the AGSM MBA Programs do not have copyright are not included as online documents.

To access eLearning@AGSM MBA, go to http://telt.unsw.edu.au/ and select Login to UNSW Moodle.

Login to the web Single Sign On (wSSO) using these details: Username: zNumber Password: zPass

Should you have any difficulties accessing your course online, contact eLearning Coordinator on:

Tel: +61 2 9931 9541 Email: elearning@agsm.edu.au

For after-hours support contact IT Service Centre.

Hours: Mon–Fri: 8am–9am; 5pm–8pm Sat–Sun: 11am–2pm Tel: +61 2 9385 1333 Email: itservicecentre@unsw.edu.au

Course Overview 15

Class interaction

AGSM classes, online and face-to-face, are designed to be an interactive experience. By interacting with your Class Facilitator and co-participants, you have the opportunity to develop your ideas and broaden your learning through a diversity of experiences and viewpoints. Discussing topics and issues in this way will help you understand the course more thoroughly – and improve your ability to think critically.

Facilitators will use a range of strategies to encourage interaction amongst participants and reinforce the Unit’s concepts, and to help you engage with the week’s learning and apply it to your own work situation. If there are aspects of the Unit you have not fully understood, this should be raised in your class, where your facilitator and other participants should be able to further clarify and explain the topic.

On-line students undertake their weekly interaction in the Seminar Room. Students also have access to a Coffee Shop discussion forum. The Coffee Shop is an ideal location for informal interaction, general discussion, question raising and getting feedback from your facilitator. Your facilitator will advise how they will specifically use both the Seminar Room and the Coffee Shop.

In addition, the AGSM office and your Class Facilitator will use the Noticeboard to post additional information and bulletins. You should always check this each time you log in.

Notes and DVD The notes for Operations Management include a course overview and 12 study

units. Units often include readings and case studies complementing the notes. They are included at the end of each unit as appendices. Many of the case studies are new and have been specially written for this course. Besides showing how the course material is relevant to Australian business practice, they also serve to introduce you to the variety of operations found in different industries.

A DVD is included and contains a number of Excel spread sheets and

Extend files. These files have been designed to allow you to experiment with various parameters and obtain a better understanding of some of the important relationships that we explore in the course. This DVD is called MNGT6233 Operations Management, the files can be found inside the Students’ Data Files folder, under Resources. The DVD is included in your course materials pack. A list of the files on this DVD can be seen in Appendix 1 at the end of this course overview.

Operations Management 16

The exercises in the notes are placed to reinforce concepts and help you acquire skills. In addition, an appendix at the end of each unit includes solutions to the exercises in the unit, another appendix at the end of each unit gives some additional practice questions for that unit. Finally last year’s exam paper, together with solutions, is given in Appendix 2.

This course makes occasional reference to probability distributions. This concept will be familiar to you if you have already studied Data Analysis and Statistical Modelling for Business. But you need not worry if you have not yet studied Data Analysis. The particular concepts we need are introduced as we go along. A summary of the material we will use is given in Appendix 1 at the end of this course overview.

Unit notes, readings and exercises

Each Unit is designed to cover the core course concepts for the week. Additional readings are usually included at the end of the Unit.

Throughout the Units you’ll find exercises to complete as you study. These exercises aim to help you:

actively make sense of what you are reading

apply what you are reading to your own working context and experience.

Without stopping every so often to process what you are reading it’s easy to lose concentration and miss the key learning points of the text. You’ll find your own best approach to the exercises – jotting down notes, discussing on-line with fellow students and colleagues or maybe writing complete answers for later reference and revision. You’ll soon find that the exercises form a valuable way to assess whether you are understanding the material correctly. They also serve to develop the concepts and theories presented in the Units.

Equipment you will need

Internet Access

You will need internet access to access your Moodle on-line learning environment (classroom).

If you don’t have Firefox 15 or above, please download this (free) from the Firefox site:

www.mozilla.com/en-US/firefox/ie.html

Course Overview 17

If you don’t have Internet Explorer (IE), or don’t have IE Version 9 or above, please download this (free) from the Internet Explorer site:

http://www.microsoft.com/windows/internet-explorer/default.aspx

If you need assistance or have any questions regarding how to check your browser version or how to download from the Microsoft website, please contact the UNSW IT Service Centre

itservicecentre@unsw.edu.au, or speak to your local IT administrator where applicable.

Windows compatible PC and MS Excel

You will need a windows compatible PC to run Excel and the Extend software package. However we will not assume any skills beyond that of a novice user of Excel.

In the examination you will need to carry out calculations using a calculator (since you are not allowed to bring a computer into the examination).

Text books

The course notes have been written to be complete and self-contained and there is no need to refer to any other material. However, if you wish to read further about the subject of Operations Management, there are a number of textbooks available. The following texts are all worthwhile:

Davis, M. & Heineke, J. 2005, Operations management: Integrating manufacturing and services, 5th ed., McGraw-Hill, Boston.

Heizer, J. & Render, B. 2013, Operations management, 11th ed., Pearson Prentice Hall, Upper Saddle River, N.J.

Krajewski, L., Ritzman, L. & Malhotra, M. 2012, Operations management: Processes and supply chains, 10th ed., Prentice Hall, Upper Saddle River, N.J.

Slack, N., Chambers, S. & Johnston, R., 2010, Operations management, 6th ed., Pearson Education, New York.

Saturday workshops

There are two workshops for Operations Management. These will be held on the dates indicated in the course calendar. The workshops provide you with the opportunity to learn more about analysing operations processes using simulation methods and also about the dynamic behaviour of supply chains.

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Students located in Sydney will be invited to attend the face-to-face workshops to be held at the CBD campus. Students from other locations are also welcome to attend the Sydney workshops but must make their own arrangements regarding travel and accommodation. Students not able to attend the face-to-face workshops will be able to work through the teaching materials and participate in an on-line discussion on the main learning points to be obtained from the workshop. An on-line simulation of the supply chain game, played in the second workshop will also be available to those students unable to attend the face-to-face workshop.

The ExtendSim 8 software, required for the first workshop can be downloaded from the Imagine That Inc. website:

http://www.extendsim.com/prods_demo.html

Instructions for installing this are given in Appendix 3. Students should install this as soon as possible to allow time to sort out any problems and to get familiar with using it. Students need to be able to use this software before the workshop.

Other Online resources

Website

The MBA (Executive) current students’ website provides administrative information relating to classes, workshops, exams and venues. The students’ website should be referred to for information on policies and relevant forms required.

• http://www.asb.unsw.edu.au/currentstudents/Pages/default.aspx

AGSM MBA Programs contact details

Student Experience

If you have any administrative queries, they should be addressed to Student Experience.

Student Experience AGSM MBA Programs Australian School of Business UNSW SYDNEY NSW 2052

Tel: +61 2 9931 9400 Fax: +61 2 9931 9205 Email: studentexperience@agsm.edu.au

Course Overview 19

Additional student resources and support

The University and the Australian School of Business provide a wide range of support services for students, including:

• AGSM manual: Managing Your Learning

• ASB Education Development Unit (EDU)

(www.business.unsw.edu.au/edu) Academic writing, study skills and maths support specifically for ASB, AGSM and MBT students. Services include workshops, online and printed resources, and individual consultations. EDU Office: Room GO7, Ground Floor, ASB Building (opposite Student Centre); Ph: ++61 2 9385 5584; Email: edu@unsw.edu.au

• UNSW Learning Centre (www.lc.unsw.edu.au) Academic skills support services, including workshops and resources, for all UNSW students. See website for details.

• Library training and search support services

http://info.library.unsw.edu.au

• eLearning information elearning@agsm.edu.au

• UNSW IT Service Desk Technical support for problems logging in to websites, downloading documents etc. Library, Level 2; Ph: +61 2 9385 1333. Website www.its.unsw.edu.au/support/support_home.html

• UNSW Counselling Service (www.counselling.unsw.edu.au) Free, confidential service for problems of a personal or academic nature; and workshops on study issues such as ‘Coping With Stress’ and ‘Procrastination’. Office: Level 2, Quadrangle East Wing; Ph: +61 2 9385 5418

• Student Equity & Disabilities Unit

(http://www.studentequity.unsw.edu.au) Advice regarding equity and diversity issues, and support for students who have a disability or disadvantage that interferes with their learning. Office: Ground Floor, John Goodsell Building; Ph: +61 2 9385 4734

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Appendices

Appendix 1 Software and files for Operations Management

Appendix 2 Sample exam paper and solutions

Appendix 3 Software installation instructions for Extend Demo

Appendix 4 Note on probability distributions

Appendix 5 Assessment cover sheet