Professional Documents
Culture Documents
Objectives
The student will be able to:
Define Operations Management Describe the nature and role of the operations function Construct and use transformation models Appreciate that operations produce both products and services Understand the difference between micro and macro operations Understand the importance of internal suppliercustomer chains Build a Typology of Operations based on the Four Vs Appreciate how operations fit in with Operations Strategy 2
Topics
What is Operations? What do Operations Managers do? Operations Management in Goods and Services Transformation Model Business Process Analysis Typology of Operations Missions and Strategies
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Definition
Operations Management (OM) management of activities that lead to the creation of goods and services through the transformation of inputs to outputs
Functions - Airline
Marketing
Operations
Finance/
Accounting
Flight Operations
Ground Support
Facility Maintenance
Catering
OM - Critical Decisions
1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Managing quality Design of goods and services Process and capacity design Layout design Human resources Location strategies Supply-chain management Inventory management Scheduling Maintenance
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What product or service should we offer? How should we design these products and services?
What processes will these products require and in what order? What equipment and technology is necessary for these processes?
How do we provide a reasonable work environment? How much can we expect our employees to produce?
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Should we make or buy this item? Who are our good suppliers and how many should we have? How much inventory of each item should we have? When do we re-order?
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Is subcontracting production a good idea? Are we better off keeping people on the payroll during slowdowns?
Who is responsible for maintenance? Where should we put the facility On what criteria should we base this location decision?
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Maintenance
Location
Tangible Can be stored Production precedes consumption Low customer contact Can be transported Quality is evident
RESTAURANT COMPUTER SYSTEMS SERVICES
PSYCHOTHERAPY CLINIC
MANAGEMENT CONSULTANCY
Intangible Cannot be stored Production and consumption are simultaneous High customer contact Cannot be transported Quality difficult to judge
PURE SERVICES
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Can be resold Can be inventoried Some aspects of quality measurable Selling is distinct from production
Reselling unusual Difficult to inventory Quality difficult to measure Selling is part of service
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Service
Provider, not product is transportable Site of facility important for customer contact Often difficult to automate Revenue generated primarily from intangible service.
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Customers
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Process
Economic system transforms inputs to outputs at about an annual 1% increase in productivity: - capital 1/6 of 1% - labour 1/6 of 1% - management 2/3 of 1%
Feedback Loop
Outputs
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Macro
An operation or process that can be split up into smaller operations and processes
The Four Vs
Volume of demand
How many the organisation makes Service vs. Mass Production
Variety in operations
The ability to adapt the transformation process to meet needs of the customer Taxi vs. Train
Variation in demand
Adapting to changing demand
Visibility of transformation
How much of the operations functions are visible to the customer Some operations have mixed high/low visibility eg Restaurant Front and Kitchen
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A Typology of Operations
Electricity generator factory Gourmet restaurant Pioneering surgery Taxi service
Low
Volume
High
Television plant Fast food restaurant Routine surgery Mass rapid transport
High
Variety
Low
High
Variation in Demand
Low
High
Visibility
Low
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Product
Unique
Unique aspect to each product Very low to low Very high to high
Made to order
Made to stock
Commodity
Volume
Very low
High
Very high
Variety
Infinite
Low
Very low
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Project
Job Batch
Variety
Low
Volume
High
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Professional
Service (e.g shops)
Variety
Mass Services
Low
Low
Volume
High
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Strategies
Strategy How an organisation expects to achieve its missions and goals Generic Strategies
Competing on price Competing on differentiation Competing on response
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