Operations Management: Processes and Supply Chains - Chapter 1

Vocabulary terms and definitions from Chapter 1 regarding using operations to create value.

Operations Management

The systematic design, direction, and control of processes that transform inputs into services and products for internal, as well as external, customers.

Process

Any activity or group of activities that takes one or more inputs, transforms them, and provides one or more outputs for its customers.

Operation

A group of resources performing all or part of one or more processes.

Supply Chain Management

The synchronization of a firm’s processes with those of its suppliers and customers to match the flow of materials, services, and information with customer demand.

Supply Chain

An interrelated series of processes within and across firms that produces a service or product to the satisfaction of customers.

Manufacturing Processes

Processes characterized by physical, durable output that can be inventoried, low customer contact, long response times, being capital intensive, and having easily measured quality.

Service Processes

Processes characterized by intangible, perishable output that cannot be inventoried, high customer contact, short response times, being labor intensive, and having quality not easily measured.

Supplier relationship process

A process that selects the suppliers of services, materials, and information and facilitates the timely and efficient flow of these items into the firm.

New service/product development

A process that designs and develops new services or products from inputs received from external customer specifications or from the market in general through the customer relationship process.

Order fulfillment process

A process that includes the activities required to produce and deliver the service or product to the external customer.

Customer relationship process

A process that identifies, attracts and builds relationships with external customers and facilitates the placement of orders by customers (customer relationship management).

Support Processes

Processes like Accounting, Finance, Human Resources, Management Information Systems and Marketing that provide vital resources and inputs to the core processes.

Supply Chain Processes

Business processes that have external customers or suppliers, such as outsourcing, warehousing, sourcing, customer service, logistics, and crossdocking.