18-Operations management

Operations management

The area of management concerned with designing and controlling the process of production.

Efficiency

Producing output at the lowest cost.

Effectiveness

Being able to achieve a desired result.

Goods

Tangible products.

Services

Intangible products.

Process

A set of activities that transform inputs into outputs.

Inventory

Goods and materials that a business holds.

Critical path

The sequence of activities in a project that is expected to take the longest to complete.

Vertical integration

An arrangement in which the supply chain of a company is owned by that company.

Outsourcing

Contracting out of a business process to another party.

Offshoring

The relocation of a business process from one country to another.

Servicescape

The environment in which a customer and service provider interact.

Computer Aided Design (CAD)

The use of computer systems to aid in design.

Computer Aided Manufacturing (CAM)

The use of software to control machine tools in manufacturing.

Total Quality Management (TQM)

Organization-wide efforts to continuously improve quality.

Six Sigma

Processes to improve quality by identifying and removing the causes of defects and minimizing variability.

Lean production

A systematic method for the elimination of waste within a manufacturing system.

Just in Time (JIT) production

An inventory strategy to increase efficiency and decrease waste by receiving goods only as they are needed in the production process.

Mass production

The production of large amounts of standardized products.

Mass customization

The use of flexible computer-aided manufacturing systems to produce custom output.

Custom production

Producing custom work for a specific customer or in quantities less than those of mass-market products.

Quality

Fitness for purpose.