OMIS 430 TEST 1 - WAIKER SELU

Operations

specific part of the organization that produces goods or services using a set of activities (system)

Operations Management

management of systems that create goods or provide services

Three Main functions in business organizations

1. operations
2.finance
3. marketing

operations

creation of goods/services

finance

providing funds for operations/marketing

marketing

promoting and/or selling goods and series

operations can be described as a process of transformations of

inputs into outputs

the conversion ____ during this transformation

adds value

_____ and ____ are important aspects of conversion for assuring ____ and _____

feedback and control, effectiveness and efficiency

Operations is part of the

supply chain

different types of inputs

humans/labor(operators, supervisors, clerks)
raw materials
sub assemblies
capital
technology (robots, machines)
information (time standards, process charts)
time

transformations/conversion

processes
equipment
facilities/buildings

outputs

goods of different types or services of different types

interfaces

interaction of operations function with other functions in organizations

operations and marketing interaction is seen in

product and process design
forecasting
scheduling - realistic schedules
quality - level decisions - how much? how?
quantity decisions - EOQ
evaluations - assessing strengths and weaknesses

operations and finance interactions is seen in

budgeting - allocation of money
economic analysis of investment proposals

Three major characteristics of classification

type of set-up, manufacturing vs services
variety
volume

type of set-up, manufacturing vs services

operational management of production systems that manufacture products may be different than that of the systems that provide service because of some of the inherent difference between manufacturing and services

1. nature and consumption of output

manufacturing: tangible and measurable
service : intangible, difficult to measure

2. uniformity of outputs

manufacturing :same little variance
service : may vary greatly

3. uniformity of input

manufacturing: same all the time
service : may vary

4. labor content

manufacturing : lot of machinery, some labor
service : labor intensive

5. measuring productivity

manufacturing : easier
service: difficult

6. quality assurance

manufacturing : difficult
service : more challenging

7. amount of inventory

manufacturing : more
service : less

variety

degree of standardization - output many range from highly standardized with high degree of uniformity ( like gasoline, tvs, tires) to custom output (like dental work, eyeglasses)

the more variety

the greater the variation in production/ service requirements

volume

classifications is also dictated by volume of production and may range from a project type operation (VERY LOW VOLUME), to job shop (BATCH PROCESSING), to repetitive production (ASSEMBLY LINE) to continuous processing which involves producing high volumes of highly uniform products with high degree of automation

scope of POM

in POM managers must make decisions related to: system design and system operation

system design

before producing can begin - decisions involve determining system parameter, such as location, capacity layout, product or service design, equipment selection and acquisition

system operation

production itself - decision for example are concerned with :
1. management of personnel - motivation, training, performance
2. inventory management - have enough today
3. scheduling - who will work what
4. project management - project on time? adjustments?
5. quality control and quality assurance

quality control

detecting defects

quality assurance

making sure defects are fixed

roles of operation manager:

-plan
-organize
-direct
-control
-make decision
-follow-thru
-improve

real responsibilities of POM manager

1. quality
2. cost-effective
3. timely

operations managers' decisions

1. use of models
2. use of quantitative approaches
3. use of trade-offs
4. use of systems approach
5. need for establishing priorities
6. ethics

a model

abstraction of reality

a model has types;

physical
schematic
mathematical

models can be _____ and ___ to use

inexpensive . easy

Models permit ___ but can have ____

experimentation . limitations

Quantitative methods or approaches

available to POM managers that allow them to obtain solutions to business problems mathematically

common techniques of quantitative approaches

1. linear programming
2. queuing theory
3. inventory models
4. project management tools
5. forecasting techniques
6. simulation
7. decision theory tools

analysis of trade-offs

implies inability to achieve all goals and thus compromising in various areas for overall best

system approach

embracing the philosophy that "whole is greater than the sum of the component individual parts".

establishing priorities

solving more important problems first since many resources are scarce. Pareto phenomenon or principle (80-20) can help

80-20 rule

relatively few (20%) items, variables, factors generally account for the lions share (80%) of the problems
1. all thins are not equally important
2. must identify key factors, problems, etc.
3. focus resources and efforts on these

ethics

operations managers have an obligation to make ethical decisions. they must pay attention to the impact of their decisions on their workers, their customers, other people and the environment . they must obey the laws

how do you assess managerial decisions in the context of ethics?

1. utilitarian principle
2. professional ethics
3. golden rule
4. Kant's categorical imperative principle
5. Tv test

utilitarian principle

act in away that results in the greatest good for the greatest number.

professional ethics

only take actions that would be viewed as proper by a disinterested panel of professional peers

golden rule

act in a way you would expect other to act towards you

Kant's Categorical Imperative principle

act in such a way that the action taken under the circumstance could be a universal law or rule of behavior

TV test

act in such a way that you would feel comfortable explaining your actions on national TV news show

Historical evolution

-industrial revolution 1770
-division of labor and mass production 1776
-interchangeable parts:
-scientific management
-decision models, inventory models and management science
-computers and automation
-QC and SQC, JIT
-INTERNET SUPPLY CHAIN MANAGEMENT OUTSOURCING PRACTICES

division of labor and mass production 1776

breaking up production process into small tasks so that each worker performs a small portion of the overall job, better and more efficiently
-efficiency and cost

interchangeable parts:

standardized parts - product parts need not be custom fitted, making replacements easy and cutting cost
-cost effectiveness

scientific management

f.w. taylor

decision models, inventory models and management science

efficiency

Computers and automation

quality and cost

QC and SQC, JIT

influence of Japanese manufacturers

which is not a milestone

cell phones

Recent Trends

operations managers must pay attention to many new trends such as the global nature of the marketplace today

business environment is _____ not just local

global

this will require them to _____ the _______ and the management of_____ for effective supply chain management.

utilize , internet and e-commerce, technology

it will demand cutting costs and constantly improving productivity and ______ without compromising _____.

agility, ethics

Using TQM

achieve flexibility through use of automation and technology, employ Worker involvement, have effective supply chain management and run a lean production system

Operations is part of

company strategy

agility

ability to respond quickly to demands and opportunities

operations managers must strive for

agile manufacturing systems

supply chain

sequence of activities and organizations involved in production and delivery of goods and services

all of this has created and ___ for effective management of the supply chain

urgent need