Unit III: Operations Management

Operations Management

• is the planning, organizing, and oversight of business practices that maximize efficiency and assure company processes are driving value.

• It involves preparing and supervising the practices that turn resources (input), such as labor, equipment, and raw materials, into goods and services (output).

Input

also known as resources like labor, equipment, and raw materials

Output

goods and services

Role of The Chief Operating Officer

The chief operating officer (COO) is a senior executive tasked with overseeing the day-to-day administrative and operational functions of a business.

General Responsibilities of an operating manager

• Cooperating with other departments

• Product design

• Forecasting

• Delivery management

• Supply chain management

• Process improvement and optimization

Examples of Managing business operations

• Healthcare / Hospital

• Manufacturing industries

• Restaurants

• Retail industry

• Transportation sector (like airports)

The 16 Principles of Operations of Management by Dr. Richard Schonberger

1. Team up with customers

2. Continual, rapid movement

3. Unified purpose

4. Know the competition

5. Focus

6. Organize Resources

7. Invest in Human Resources

8. Maintain Equipment

9. Simple “best” equipment

10. Minimize the human error

11. Cut times

12. Cut setup

13. Pull system

14. Total quality control

15. Fix causes

16. Visibility management

The 10 Principles of Operations of Management by Randall Schaeffer

1. Reality

2. Organization

3. Fundamentals

4. Accountability

5. Variance

6. Causality

7. Managed passion

8. Humility

9. Success

10. Change

Operations Management Theories

• Business process management

• Business process reengineering

• Six sigma

• Supply chain management flow

Business Process Management (BPM)

• involves the constant analysis, improvement, and automation process.

  • vision

  • design

  • modeling

  • execution

  • monitoring

  • optimizating

Business Process Reengineering

1. Business process strategy

2. As-Is Modeling and Analysis

3. To-Be design and transition planning

4. Initiate and Pilot change

5. Monitor and control

Six Sigma

1. Define

2. Measure

3. Analyze

4. Improve

5. Control

Supply Chain Management Flow

• Sale and Product Development

• Procurement

• Suppliers

• Manufacturing

• Warehouse

• Logistics

• Consumers

Major Issues in Operations

1. Designing the system

2. Implementation

3. Planning and Forecasting

4. Managing the System