Thats all are the most important part that a business must learn wheyn they are trying produce
- 2. Learning Objectives 1-2 •- Define the term operations management +- Basics of “Value Addition” •- Compare and contrast service and manufacturing operations •- Basics of “Goods-Services Continuum” •- Describe the operations function and the nature of the operations manager's job •- Describe the key aspects of
- 3. Operations Management 1-3 •- Managing that part of the organization responsible for producing goods and services •- Management of systems or processes that create goods and/or provide services Operations Examples Storage/ Transpoft ation Warehousing, trucking, mail service, moving, taxis, buses, hotels, airlines Entertainme nt Films, radio and television, concerts, recording
- 4. O ganiz hon Operations 1-4 Secure Lin. Resou ces Budget ing Fund ing P oducing Assess Customer Selling & Promoting The Organization The Three Basic Functions • Productivity • Quality • E-business • Global Competition • Customer Service Competitiveness ?
- 5. Value-Added Proceu 1-5 The operations function involves the conversion of inputs into outputs Value-added = Value or price of outputs — Cost of inputs
- 6. Value-Added Process 1-6 The operations function involves the conversion of inputs into outputs Inputs Land Labor pital Feedback Value added Transformation/ Conversion process Control * Feedback Goods Services Feedback
- 7. Input s 1-7 Raw Vegetables Metal Sheets Water Energy Labor Building Equipmen t Input s Doctors, nurses Hospital Medical Supplies Equipment Laboratories Food Processor Processing Outputs Cleaning Making cans Cutting Cooking Packing Labeling Processing Examinatio n Surgery Monitorin g Medication Therapy Canned vegetables Scraps! Healthy patients
- 8. 1-8 Value-Added & Product Packages •-Value-added is the diñerence 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.
- 9. Goods-service Continuum 1-9 Tangible Goods Service Surgery, teaching Song writing, software development Computer repair , restaurant meal Product packages Good(s) + servicets) Make a company more competitive- more value to
- 10. 1-10 Production of Goods vs. Delivery of Services +-Production of goods — tangible output, production oriented •- Delivery of services —an act •-Service job categories •-Government •-Wholesale/retail °-Financial services °-Healthcare •-Personal services °-Business services °-Education
- 11. 1-11 Characteristic Goods Service Gustomer contact Low High Uniformity of input High Low Labor content Low High Uniformity of output High Low Output Tangible Intangible Measurementof productivity Easy Difficult Opportunity to correct problems High Low Inventory Much Little Evaluation Easier Difficult Patentable Usually Not usual Goods vs Service: Key Differences
- 12. 1-12 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 aPected by worker's personal factors
- 13. 1•13 3cope of Operations Management •-Operations Management includes: +-Forecasting •-Capacity planning •-Scheduling +-Managing inventories +-Assuring quality •-Motivating employees +-Deciding where to locate facilities •-Supply chain management •-And more ...
- 14. 1-14 Key Decisions of Operations Managers •-What What resources/what amounts •-When Needed/scheduled/ordered •-Where Work to be done •-How Designed +-Who To do the work
- 15. 1-15 Decision Making System Design —capacity —location —arrangement of departments —product and service planning —acquisition and placement of equipment System operation personne l inventory schedulin g — project manage ment
- 16. 1-16 Operations Management Decision Making •-Models •-Quantitative approaches •-Analysis of trade-offs •-Systems approach •-Establishing priorities •-Ethics
- 17. /VtO@€?lS 1-17 A model is an abstraction of reality. Typically a simplified version — Physical (Crash tests) — Schematic (Blueprints) Mathematical, statistical Tradeoffs What are the pros and cons of models?
- 18. 1-18 Models Are Beneficiai •-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
- 19. 1-19 Limitations of Models •-Quantitative information may be emphasized over qualitative •-Models may be incorrectly applied and results misinterpreted •-NonquaIified users may not comprehend the rules on how to use the model •-Use of models does not guarantee good decisions
- 20. 1-20 Quantitative Approaches • Linear programming • Queuing Techniques • Inventory models • Project models • Statistical models
- 21. Analysisof Trade- Offs 1•21 •-Decision on the amount of inventory to stoCk •-Increased cost of holding inventory Vs. °-Level of customer Customer Cost
- 22. Systems Approach 1-22 The whole is greater than the sum of the parts. Suboğ ization
- 23. 1•23 Trends in Business +-Major trends +-The Internet, e-commerce, e- business °-Management technology •-Globalization +-Management of supply chains +-Outsourcing •-Agility +-Ethical behavior
- 24. 1-24 Other Important Trends •-Ethical behavior •-Operations strategy •-Working with fewer resources +-Revenue management •-Process analysis and improvement •-Increased regulation and product liability •-Lean production +-Combination of Mass Production (high volume, low unit cost) and Craft Production (variety and Flexibility)