SO

BUS261 Class 6 _ Production Operations Supply Chain

Introduction to Entrepreneurship Course: Class 6 - Production & Operations

Instructor: Arabella PollackDate: February 14th, 2025

Important Announcements

Class Schedule Changes:

  • No class on February 18th (Tuesday), February 21st (Friday), or February 25th (Tuesday).

  • Classes will be split:

    • Last names A-M in-person on February 21st; asynchronous on February 25th

    • Last names N-Z in-person on February 25th; asynchronous on February 21st

  • Cooperman Fellowship Application opens on February 14th.

Course Outline:

  • Entrepreneurial Process

    • Identifying Opportunity

    • Moving from Opportunity to Business

    • Financing

    • Business Plan

    • Pitching

    • Cashing In

    • Business Ethics

    • Key Business Functions: Accounting, Sales, Operations, Marketing, Finance, HR, Others

Learning Objectives for Today

By the end of class, students will be able to:

  • Define operations and its significance in business, emphasizing the role of operations in ensuring efficiency and effectiveness in organizational processes and its contribution to overall strategic goals.

  • Differentiate between the production of goods and services, discussing characteristics of tangible vs intangible products and how service delivery differs from manufacturing.

  • Identify components and key concepts of Lean Manufacturing, including value stream mapping and continuous improvement practices.

  • Explain Supply Chain Management (SCM) and its significance, highlighting the synchronization of supply chain components for optimized productivity and reduced costs.

  • Understand the roles of Forecasting, Procurement, and Logistics employees in streamlining operations and improving customer satisfaction.

The Resource Transformation Process

Process Steps:

  1. Plan: Establish goals and objectives.

  2. Organize: Allocate resources efficiently.

  3. Schedule: Timetable activities for optimal workflows.

  4. Control: Monitor and adjust processes for efficiency.

Inputs:

  • Knowledge

  • Physical Materials

  • Information

  • Equipment

  • Customer Insights

  • Human Skills

Transformation Activities:

  • Processing information through analysis and decision-making.

  • Converting raw materials into finished products through systematic operations.

  • Solving client problems by tailoring solutions.

  • Delivering goods/services that fulfill customer demands and enhance satisfaction.

Outputs:

  • Goods and services that meet customer needs and wants through effective production and delivery methods, ensuring quality and timely service.

Manufacturing Goods

Made-to-Order vs. Made-to-Stock:

  • Examples include custom clothing and shirts versus mass-produced items, focusing on their different supply chain implications and customer expectations.

TQM and Lean Manufacturing

Total Quality Management (TQM):

  • Ensures high-quality goods and services through continuous improvement and employee involvement.

Lean Manufacturing:

  • Focus on eliminating waste and improving efficiency in production processes.

  • The 8 Wastes of Lean Manufacturing:

    1. Transport

    2. Inventory

    3. Motion

    4. Waiting

    5. Over-Production

    6. Over-Processing

    7. Defects

    8. Unutilized Talent

Key Lean Manufacturing Terms

  • Just In Time (JIT): Aligning raw material orders with production schedules to minimize inventory costs.

  • Capacity: The maximum output that a production process can achieve under normal conditions.

  • Inventory: Total stock, including work in progress, raw materials, and finished goods that are essential to sustaining production flow.

  • Bottlenecks: Points where processes are slowed due to workflow congestion, needing focused management to ensure efficiency.

Supply Chain Management (SCM)

Components of SCM:

  • Transportation, Customs Clearance, Global Coordination, Procurement, Inventory Management, Warehousing, and Distribution.

Key SCM Decisions:

  • Determine the number of SKUs (Stock Keeping Units) to maintain efficiency and effectiveness in operations.

  • Make vs. Buy decisions that assess whether to produce items in-house or outsource.

  • Selecting key strategic sourcing partners based on reliability and cost-effectiveness.

  • Managing inventory levels and locations to ensure products are readily available without incurring excess costs.

  • Transportation logistics as a critical factor in timely delivery and customer satisfaction, balancing cost with environmental considerations.

Providing Services

Example: Restaurant

Costs Overview:

  • Labor: 30%

  • Food: 30%

  • Other Costs: 40%

Assignments

  • Guest Speaker Project: Create a "guest speaker" experience with an admired entrepreneur.

  • Interview Assignment: Interview a local entrepreneur who has established a business in your community.

  • Reverse Marketing Plan (Team): Due February 20th.

  • Choose Your Own Guest Speaker (Individual): Due February 27th.