Supply Chain 5.1 Operations Management

Operations management

business function responsible for producing a company’s goods and services in an efficient and cost-effective way

Product design

specifying the exact features and characteristics of a company’s product

Process design

developing a production process that can create the exact product that has been designed

Two categories of Processes

Intermittent and Repetitive

(Product-Process Matrix) Continuous flow

Chemical plants w/ nonstop output

(Product-Process Matrix) Assembly line

Subway prep lines

(Product-Process Matrix) Batch system

Lays making a batch at a time

(Product-Process Matrix) Job shop

custom machine shops

Theoretical Hourly Cpacity (formula)

minutes per hour / cycle time x batch size

Effective Shift Capacity (formula)

(operating minutes / cycle time) x batch size x yield

Efficiency vs. Standard (formula)

actual good output / planned output

Labor Utilization (formula)

labor used / labor available

Fixed position layout

used when a product cannot be moved during production

Product layout

machines arranged in sequence of operation

Process layout

machines grouped into similar operations

Celular layout

workstations arranged in small assembly lines, a product family for each cell

Make to stock

Produces finished products for immediate sale or delivery

Assemble to order

The product is partially completed and kept in a generic form, then finished when an order is received

Make to order

The product is made to customer specifications after an order has been received