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Chapter 1
Overview,Introduction to the
Field
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? Operations Management
? Why Study Operations Management?
? Production System Defined
? Operations as a Service
? Plan of This Book
? Historical Development of OM
? Current Issues in OM
OBJECTIVES
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What is Operations Management?
Defined
Operations management (OM) is
defined as the design,operation,and
improvement of the systems that
create and deliver the firm’s primary
products and services
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Why Study Operations Management?
Business Education
Systematic Approach
to Org,Processes
Career Opportunities
Cross-Functional
Applications
Operations
Management
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What is a Production System?
Defined
A production system is defined as a
user of resources to transform inputs
into some desired outputs
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Transformations
? Physical--manufacturing
? Locational--transportation
? Exchange--retailing
? Storage--warehousing
? Physiological--health care
? Informational--telecommunications
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What is a Service and What is a Good?
?,If you drop it on your foot,it won’t hurt
you.” (Good or service?)
?,Services never include goods and
goods never include services.” (True or
false?)
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OM in the Organization Chart
Operations
Plant
Manager
Operations
Manager
Director
Manufacturing,Production control,
Quality assurance,Engineering,
Purchasing,Maintenance,etc
Finance Marketing
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Core services are basic things that
customers want from products
they purchase
Core Services
Defined
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Core Services Performance Objectives
Operations
ManagementFlexibility
Quality
Speed
Price (or cost
Reduction)
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Value-added services differentiate
the organization from competitors
and build relationships that bind
customers to the firm in a positive
way
Value-Added Services
Defined
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Value-Added Service Categories
Operations
ManagementInformation
Problem Solving
Sales Support
Field Support
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Plan of This
Book
I,Operations Strategy
and Managing Change
1,Introduction
to the Field
2,Operations Strategy
and Competitiveness
3,Project
Management
III,Supply
Chain Design
9,Supply
Chain Strategy
10,Strategic
Capacity
Management
11,Just-in-Time
and Lean
Systems
IV,Planning and
Controlling the
Supply Chain
12,Forecasting
and Demand
Management
13,Aggregate Sales and
Operations Planning
14,Inventory
Control
15,Materials
Requirements Planning 8,Operations Consulting and Reengineering
16,Operations Scheduling
II,Product Design
and Process
Selection
4,Process
Analysis
5,Product
Design and
Process Selection
-Manufacturing
6,Product
Design and
Process Selection
-Services
7,Quality
Management
17,Synchronous Manufacturing
and Theory of Constraints
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Historical Development of OM
? JIT and TQC
? Manufacturing Strategy Paradigm
? Service Quality and Productivity
? Total Quality Management and
Quality Certification
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Historical Development of OM (cont’d)
? Business Process Reengineering
? Supply Chain Management
? Electronic Commerce
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Current Issues in OM
? Effectively consolidating the operations
resulting from mergers
? Developing flexible supply chains to
enable mass customization of products
and services
? Managing global supplier,production and
distribution networks
? Increased,commoditization” of suppliers
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Current Issues in OM (cont’d)
? Achieving the,Service Factory”
? Enhancing value added services
? Making efficient use of Internet
technology
? Achieving good service from service
firms
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End of Chapter 1