Key Concepts in Operations Management

Operations Management

The management of resources to achieve efficient outputs of goods and services.

Efficiency

How well a business has used its resources to achieve its stated objectives.

Effectiveness

The degree to which a business achieves its stated objectives.

Manufacturing business

Produces a tangible, physical good, either as a finished product of a component part, used as an input in another manufacturing system.

Inputs

The resources that will be converted into products.

Process

The activities that help transform inputs into outputs.

Outputs

Final good or service that is produced and ready for customers.

Materials Management

Involves the planning and coordination of all inputs that are required for an operation system.

Forecasting

Planning strategy where past data and trends are used to predict future demand so informed decisions can be made around materials.

Master production schedule

Outlines what is going to be produced in what quantities and when it is going to be produced.

Material requirement planning

An itemised list of materials that are required to meet specific orders.

Quality

Achieving a standard of excellence in a finished good or service that is provided or delivered to an end customer.

Quality management

The management of the production process that ensures the outputs produced are consistently reliable and durable.

Quality Control

A procedure that aims to ensure that a good or service adheres to a set of quality criteria by performing checks at regular intervals.

Quality Assurance

A system where the business meets a set of predetermined quality standards often set by an independent body.

Total quality management

A holistic approach to quality where all members of an organisation focus on continuous process improvement, customer focus, defect prevention and universal responsibility.

Technology

Practical application of science to achieve a commercial or industrial objective.

Automated production lines

Equipment and machines are arranged in a sequence and controlled by computer systems to perform tasks automatically.

Robotics

Integrates computer science and engineering in the design, construction and use of machines to perform manual tasks.

Computer aided design

Software that creates product possibilities from a series of parameters.

Computer aided manufacturing

Software used to allow the production process to be directed and controlled by computers.

Artificial intelligence

Deals with the development of computer programs that imitate human intellect.

Online services

Providing information or support over the internet.

Waste

Waste includes any action in the production process that does not add value for the customer.

Waste minimalisation

The process of reducing the amount of discarded resources created by the businesses operations system.

Reduce

Decrease use of resources, activities, labour and time to decrease waste production.

Reuse

If waste is produced, make effort to repurpose instead of discarding.

Recycle

Convert waste materials into useable products.

Recover

Recover waste that cannot be reused or recycled instead of discarding.

Lean Management

Aims to deliver customer value by systematically reducing waste and focusing on continuous improvement.

Pull

Production of the good or service is only started when the customer places an order.

One-piece flow

An uninterrupted flow of process from the beginning until the end of the production process.

Takt

The operations process seeks to create a rhythm whereby all the steps in the production of the good or service are synchronised to create a 'continuous flow.'

Environmental Sustainability

Business making decisions that will allow it and the rest of society, to interact with the environment both now and into the future.

Corporate social responsibility

The commitment by businesses to go above and beyond legal obligations to ensure they are acting in an ethical manner in relation to social, economic and environmental considerations.

Supply chain management

Involves meeting consumer demand for goods and services while making the most efficient use of the production process and the distribution of the finished product to the customer.

Difference between Goods and Services

Tangible vs intangible.

TIMWOODS - Types of waste

Transportation, inventory, motion, waiting, overprocessing, overproducing, defects, skills.

4Rs - Waste reduction

Reduce, Reuse, Recycle, Recover.

POTZ - Lean Management

Pull, One-piece-flow, Takt, Zero defects.

ARACCO - Technology

- Automated production line

- Robotics

- Artificial Intelligence

- Computer aided design (CAD)

- Computer aided manufacturing (CAM)

- Online services

FJMM - Materials Management

Forecasting, Just-in-time, Master production schedule, Materials requirement planning

Cam - Quality strategies

Control, Assurance, total quality management (TQM)

SEO

Strategy elaborate objectives

TPSSC - Manufacturing vs Service

Tangible, Production/consumption, Storage, Standardisation, Customer contact

TMQWL - Operations Strategies

Technology, Materials, Quality, Waste, Lean management

Global sourcing of inputs

A business uses suppliers from overseas countries.

Overseas manufacturing

When the production of a good occurs in an overseas location

Global Outsourcing

Where a business hands over part of its operations to an overseas business