OM AND TQM

Operations Management

Focuses on internal processes within an organization, including production, quality control, inventory management, and process improvement.

Supply Chain Management

Broad network of organizations involved in the creation and delivery of a product or service, including managing relationships with suppliers, manufacturers, distributors, and customers.

Value Chain Management

Sequence of activities to deliver a product or service, maximizing value with each step while minimizing cost.

Customer Benefit Package (CBP)

Set of tangible (goods) and intangible (service) features that a customer recognizes, pays for, and uses or experiences.

Physical Goods

Tangible products, which can be durable (e.g., tables) or non-durable (e.g., toothpaste).

Services

Activities that do not directly produce a physical product and are intangible.

The Concept of Value

Perception of benefits associated with goods or services in relation to how buyers are willing to pay for them.

Value Formula

Perceived Benefits / Price (Cost) to customer.

Key Work Processes

Core, Support, and General processes aimed at achieving specific business results.

Forecasting for Goods vs. Services

Goods require longer terms and time horizons with physical inventory as a buffer; services have generally shorter, more variable, and time-dependent forecasting.

Efficiency in Operations Management

Central to operations management, focusing on cost and quality in order to streamline processes and improve productivity.

Feedback Loop

Mechanism for communication and information flow that provides real-time data on processes.

Customization and Design in Operations

Focus on product design as a competitive strategy to meet specific customer needs.

Sustainability in Operations

Ability to continue operations in a sustainable manner, focusing on environmental, social, and economic impacts.

Globalization Challenges in OM

Managing operations across different countries and cultures can present unique challenges.

Resource Management

Matching demand and supply to ensure cost efficiency.

Service Management Skills

Critical for successful service encounters, since services cannot be stored as physical inventory.

Postproduction Activities

Servicing loans, installation, maintenance, and warranty claims to keep customers satisfied.

Importance of Quality Merchandise

According to William Cooper Procter, producing quality merchandise that customers will buy repeatedly is fundamental to earning profit.