Productions/Operations Management
Chapter 1
Stevenson
What is Production/Operations?
- Past - manufacturing orientation
- Current - production of goods and services
- Operations management
- Forecasting, design of goods and services, capacity planning, process selection, design of work systems, quality assurance
Functions in business organizations
- Organizations pursue goals collectively
- Three basic functions
- Finance
- Production/Operations
- Marketing
Functions in business organizations
- Function Interface - performance improvement
- Supporting functions
- Personnel
- Accounting
- Engineering
Operations
- Related to producing/providing
- Goods
- Services
- Transform inputs to finished goods
- Value added
Systems model
Value added
- Difference between cost of inputs and price of outputs
- Products - selling price
- Service - value to customer/society
- Productivity question
- Do the processes add value ?
- If not, they are waste.
Finance
- Secure & allocate resources
- Budgeting - plan financial requirements
- Economic analysis of investments - alternative plans evaluated
- Provision of funds - amount and timing
Marketing
- Delivery of goods to customers
- What they want
- When they want it
- Where they want it
- How much they want to pay for it
- Requires lead time for production
Other functions
- Accounting
- Purchasing
- Personnel
- Public relations
- Industrial engineering
- Distribution
- Maintenance
Design & operation
- PO Managers involved in
- System design
- System operation
- System design influences system operation
Production Systems
- Degree of standardization
- Customized, low volume, high cost
- Standardized - high volume, low cost
- Type of operation
- Project
- Unit or batch processing
- Repetitive
- Continuous
Manufacturing versus service operations
Manufacturing - product-oriented
Service - act-oriented
Differences in manufacturing and service
Customer contact
Uniformity of input
Labor content of jobs
Uniformity of output
Measurement of productivity
Quality assurance
A systems approach
- Interrelated parts that work towards a common goal
- Whole is greater than the sum of the parts
- Objectives of organization take precedence over subunit objectives
- Key is to identify THE goal
Decision making
- Quantitative
- Qualitative
- Analysis of trade-offs
- Systems approach
Where do I start?
- Pareto phenomenon
- A few factors have a large impact
- A few tasks will consume most of your time
- 80/20 principle
Ethics and decision making
- Safety, worker and consumer
- Quality
- Environment
- Community
- Workers
- Closing facilities
- Workers rights
Current pressures
- Global marketplace
- Corporate + Operations strategy
- TQM - quest for quality
- Flexibility - adapt quickly to change
- Time reduction - concept to delivery
- Technology advances
Current pressures
- Worker involvement
- Reengineering
- Environmental issues
- Downsizing
- Supply chain management
- Lean production
True or False
- Operations, marketing and finance are not interrelated.
- Operations functions exist only in manufacturing firms.
- OM involves system design and system operation
- Value-added is measured by the price set by a firm for its goods or services
True or False
- Operations managers have primary responsibility for system design decisions
- Storing an item before delivery is value adding
- Production systems can be classified according to their degree of standardization
True or False
A systems approach emphasizes the subsystem optimization above the whole system
The pareto phenomenon is off limited use to POM
Quantitative approaches to decision making reduce the importance of ethics in the decision
Many OM decisions involve tradeoffs
Fill it in
What are the three primary functions that exist in a business?
Give examples of value adding and non value adding activities
What is the purpose of feedback in the transformation process?
Is staffing a transformation process?
Fill it in
- What are the responsibilities of operations managers?
- What are the general approaches to decision making?
- What are the characteristics of a systems approach to decision making?
- Production systems with customized outputs typically:
Fill it in
- Job shops are classified as:
- What are the differences between service and production operations?
- What are the recent trends in business?
- What is considered in reengineering?