Session 1 Introduction to Operations Management 3.0

8/16/2019 Session 1 Introduction to Operations Management 3.0

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Production andOperationsManagement

Vishal Gupta, PMP


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Introduction to the

Field• Introduction to Production and Operations

Management

• Transformation Processes Defined

• Scope of Operations Management

• Servicing as a part of Operations

Management

OBJECTIVES


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Introduction to the

Field• Evolution of Operations Management

•

W! Stud! Operations Management"• Current Issues in POM

• POM#s future callenges

• Manufacturing trends in India

OBJECTIVES


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Operations Management at I$E%

IKEA has reduced its retail prices by a total of

about 20 percent during last four years.

Trofe MugRedesigned 3 times to fit in a pallet

!" to #20 to 202"Reduced shipping costs by !0$

A notch at the bottom that pre%ents &ater from

pooling at the base during dish&asher run

Refinements ha%e optimi'ed the speed at

&hich cup can pass through the machines


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Operations Management at I$E%


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Operations management & '%'O


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They are

all

operations

(ac) office operation

in a ban)Kitchen unit

manufacturing operation

Retail operation Ta)e*out + restaurant

operation


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Operations ManagementFunctions

Product Design & Development Forecasting

Process Design Production Planning and Control

Quality Management Supply Chain ManagementLocation and Layout of facilities Maintenance Management

Capacity Planning Continuous improvement of operations

Design of Operations Operational Control of Operations


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Wat is Operations Management"

Operations: refers to theprocesses that are used totransform the resources

employed by a rm into productsand services desired bycustomers

Operations management !OM" isdened as the design, operation,and improvement of the systems that create and deliver the rm#s


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$enition and %riteria

Production and operations management(POM) concerns itself with the conversion ofinputs into outputs using physical resourcesso as to meet its criteria of performance.

Criteria of Performance

Customer satisfaction

Eectiveness : oing the right thing tocreate most value

E!ciency : oing at the lowest possi"lecost

#alue


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$enition and %riteria

Criteria of Performance

#alue : $uality%Price


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(uestion Bo)l& ' ma(or ob(ective of POM is to

sho) ho) smart managers can do

)hich of the follo)ing*

a Improve e+ciency by lo)ering

costs

b Improve eectiveness by creating

valuec Increasing value by reducing

prices

d -erving customers )ell


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Wat is a Transformation Process

% transformation process is defined

as a user of resources to transform

inputs into some desired outputs


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OM as .ransformation process

Inputs / .ransformation /Outputs

I,-T/T-T/

-ER1RMA,E

MA,AEME,T

-RE//


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Transformations

4 Physical&&manufacturing

4 'ocational&&transportation

4 Echange&&retailing

4 torage&&warehousing

4 Physiological&&health care

4 *nformational&&telecommunications


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(uestion

& In the Input0.ransformation0Output 1elationship, a typical2input3 for a $epartment -tore is)hich of the follo)ing*

a. isplays". toc+s of goods

c. ales cler+sd. ,ll of the a"ovee. -one of the a"ove


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(uestion

& In the Input0.ransformation0Output 1elationship, a typical2input3 for an 'irline )hich ofthe follo)ing*

a. ,irplanes". ,irports

c. ic+eting ystemsd. ,ll of the a"ove


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Operations Management *OM+Salient Aspects

4 OM is a systematic approach 5 using scientifc tools & techniques and solution

methodologies to analyze problems

4 OM is a"out addressing several issues 5 varying in terms o time horizon, nature o

decisions

4 ransformation processes are central to

Operations4 /ocusing on +eeping costs to the minimum

4 eveloping a set of measures to assess

performance of the system


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Operations ManagementA systems Perspective

I NP !

" ! P !

Labour

Capital

Material

Goods

Services

Forecasting

Operations

Planning &

Control

Process &

ProductDesign

Material &

Capacity

Planning

F e e d b a c k

Purchasing &

InventoryControl

Maintenance

Manageent

Process

Iproveent

!uality

Manageent

P#"C$SSIN%


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Operations ManagementFunctions

Product Design & Development Forecasting

Process Design Production Planning and Control

Quality Management Supply Chain Management

Location and Layout of facilities Maintenance ManagementCapacity Planning Continuous improvement of operations

Design of Operations Operational Control of Operations

• 6esign issues in perations Management lay do&n o%erall

constraints under &hich the operations system functions

• perational ontrol issues focuses on optimi'ing the use of

a%ailable resources in the short*term &hile deli%ering goods

and ser%ices as per plan under the gi%en design constraints


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OperationsA key functional area in an Organisation

"perations

Finance

Mareting ' # M


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"perations"perations

Plant

Manager

PlantManager

"perations

Manager

"perationsManager

Director Director

Manufacturing( Production control(Quality assurance( $ngineering(

Purchasing( Maintenance( etc

Manufacturing( Production control(Quality assurance( $ngineering(

Purchasing( Maintenance( etc

1inance Mar)eting

OM in te Organi,ation Cart


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Interface )ith other functions

4 Operation Management 0 Mar+eting*nterface

4 Operation Management& /inance

*nterface4 Operation Management& esign

*nterface

4 Operation Management& 1uman2esource *nterface

4 Operation Management& *nformationystem *nterface


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4 2If you drop it on your foot, it)on#t hurt you3 !Good orservice*"

4 2-ervices never include goodsand goods never include

services3 !.rue or false*"

Wat is a Service and Wat is a -ood"


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Service Operations

4 angi"ility: ervices areperformances and actions ratherthan o"3ects4 therefore having poortangi"ility (Cannot "e patented)

4 1eterogeneity: 1igh varia"ility in theoperation system performance

4 imultaneous Production 5

Consumption: egree of customercontact is very high

4 Perisha"le: ervices cannot "e

inventoried as in the case of


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Service . Manufacturing Continuum

Pure Product Pure Service

"yurvedic #ealing $reatent

Legal%$a Consulting

Cyber Ca'( ) $elephone *ooths

+ergency Maintenance Services

Facilities Maintenance

#igh ,uality restaurant eal

Fast 'ood in a eat out -oint

Custoi.ed durable goods

Fast oving coodities

/ending Machines


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Manufacturing / ServiceManufacturing Organi4ations -ervice Organi4ations

$ierences

Physical durable product Intangible, perishable product

Output can be inventoried Output can#t be inventoried

5o) customer contact 6igh customer contact

5ong response time -hort response time

1egional, national, Intl

mar7ets 5ocal mar7ets5arge facilities -mall facilities

%apital intensive 5abour intensive

8uality easily measured 8uality not easily measured

-imilarities

Is concerned about 9uality, productivity timely response toits customers

Must ma7e choices about capacity, location, layout

6as suppliers to deal )ith

6as to plan its operations, schedules and resources

;alance capacity )ith demand by a careful choice of resources


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Indian ManufacturingExport Potential of Sectors

ector of *ndustryCurrentEports

PotentialEports

trengths 6ea+nesses

Electrical 5 Electronics 7 8.9 " 7 8 & 8; " esign 5Engineerings+ills4 vendor"ase

'ac+ of scale4'ow domesticdemand

,pparel Manufacturing 7


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Service Sector in IndiaGDP growth rate

ervice ectors 9==8&=9

9==9&=>

9==>&=?

9==?&=

9==&=<

9==.A .?


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-ro)t in Services Sector


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%ase: OM in -nac7s'etBs say that you decided to go for

some snac+s with your friends. ,mongmany options4 you can go to aroadside cart4 a pia%"urger outlet4 or

a snac+ 3oint li+e a Ddipi restaurant(which serves many things includingfull meals).

6hile en3oying the delicious snac+s4 didyou o"serve the following from the

point of view of understanding


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8. 6here are they located 6hat +indof customers do they intend to

serve9. o they serve you while standing

or do they Frst seat you 1ow "ig is

their seating capacity>. 6hat is the process of

communicating yr orders to others

wor+ing in the outlet so that youcan "e served

?. ,re the items prepared after ta+ingyr order or are they alreadyre ared


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8. *dentify the type of Productionystem they followed.

9. Chec+ how Production ystem is

managed.>. /ind out the utiliation of the

resources namelyG manpower4

capacity 5 material.?. 1ow the customer service is

rendered (feed"ac+ system eist or

not)

OM in -nac7s :


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Business Education

S!stematic %pproac

to Org0 Processes

Career Opportunities

Cross12unctional

%pplications

OperationsManagement

W! Stud! Operations Management"


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><

6istory of POM

Individual e+ciency 6or+ study

%ollective e+ciency Production control4 ,ssem"ly line

8uality and materials tatistical Huality control4 *nventory control

3i t i l D l t f OM


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3istorical Development of OM

>ra >vents?%on @ear Originator

8. *nd. 2ev team Engine 8@ /ord

>. 1um 2el. 1awthorne tu. 8A>= Mayo

?. OP. 2es. 'inear Prog. 8A?@ antig

. $uality 2ev I*4 $M 8A@=48A;= Oho4eming

3istorical De elopment of OM


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>ra >vents?%on @ear Originator


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3i i l D l f OM


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4 ynergies must eist withother functional areas of theorganiation

4 Operations account for


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4 .ypical (ob titles include: 5 ;usiness 'nalyst

5 ;usiness Process Improvement 'nalyst

5 Pro(ect Manager

5 Facilities Manager

5 ;ranch Manager !;an7"

5 $epartment -tore Manager

5 -upply %hain Manager

5 Production Planner 5 8uality 'nalyst?8uality %ontrol -pecialist

5 Materials Manager ?Purchasing Manager

Careers in Operations Management


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4 >=amples of public0 and private0

sector employers )ho hire operationsmanagement graduates include: 5 1etail establishments

5 6ospitals

5 ;an7s

5 Insurance companies

5 'irlines

5 Government agencies 5 Manufacturing companies

5 1esearch corporations

Careers in Operations Management


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4Competitive Pressures due to economicreforms

5 Tariff reduction has e7posed Indian companies

to global competition

5 Abolition licensing policies had enabled se%eralne& players to enter into business increasing

domestic competition and capacity build up

Callenges in Operations Management


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4Gro)ing customer e=pectations 5 Eamples: ari plans and options

provided "y mo"ile operators4 options inpassenger car

5 Customers tend to demand more andreFne their epectations

5 Manufacturing 5 ervice organiationsmust learn to respond to theseepectations

5 -eed to develop capa"ilities to "ringnewer products and services faster and

yet proFta"ly



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4 .oday#s businesses are constantly

challenged by the rapid technologicaladvancements

5 ,Ms 5 *nternet Lan+ing.

5 Luying a train tic+et. http:%%www.irctc.co.in%4 a

customer can accomplish all tas+s pertaining totic+et "oo+ing and cancellation at leisure.

5 Procurement of goods 5 services. ,manufacturing organiation can procure goods

5 services "y organiing a reverse auction onthe *nternet.

5 -ew Product evelopment. , team of designpersonnel from across dierent geographical

locations can participate in new product


http://www.irctc.co.in/http://www.irctc.co.in/


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4 >nvironmental Issues

5 Jrowing industrialiation raises concernsregarding the depletion of natural resources

5 6aste generated from production systems andend&of&life products.

5 Jeneration of solid wastes. 5 Consumption of energy and water in countries

li+e *ndia is on the rise.

5 *ncreasingly4 Frms are under pressure to ta+e

responsi"ility of restoring4 sustaining4 andepanding the planetBs ecosystem instead ofmerely eploiting it.

4 OM practices must address

environmental concerns in order to



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Session 1 Introduction to Operations Management 3.0

Documents

Transcript of Session 1 Introduction to Operations Management 3.0