Chapter 1: Operations Management

Question 1

What is operations management

Answer 1

The management of the processes used to conceive, deliver, create, and distribute value adding goods and services to customers

Question 2

Explain what value added is

Answer 2

It is the additional value of a good over the cost used to produce it

Question 3

What is the importance of operations management

Answer 3

• It’s a management function within an organisation
• The value added to a good or service determines whether it’s seen as an option for customers to buy, this can either be classified as order qualifiers or order winners.

Question 4

What is the historical development of operations management

Answer 4

• First industrial revolution 1760 - 1830
• Second industrial revolution 1817 - 1914
• Third industrial revolution 1950 - 2010
• Fourth industrial Revolution 2011- present

Question 5

Fill in the blank
Sustainability is becoming increasingly central to ________

Answer 5

Strategic planning in organisations

Question 6

Name the three areas in which organisations need to ensure improved performance

Answer 6

1) Environmental
2) Social
3) Economic performance

Question 7

Explain environmental dimension

Answer 7

It is reported on climate change, greenhouse gas emissions, waste management, recycling, pollution etc.

Question 8

Explain social dimension

Answer 8

Reported on an employees health and safety, working conditions customer satisfaction etc.

Question 9

Explain governance dimension

Answer 9

Reported on corporate governance such as bribery cyber security etc.

Question 10

What is operations and supply chain management

Answer 10

All activities involved in the creation, operation and improvement of the processes and procedures in the production and delivery of an organisation’s products and services

Question 11

What are the three principles to ensure full integration of operations and supply chain management

Answer 11

1. All work can be classified as a process or a sub process
2. Each process can be improved
3. Improvements must ensure that the organisations processes are effective, efficient, low-cost and more robust

Question 12

Name three levels of operations management

Answer 12

• Strategic (long-term)
• Tactical (medium-term)
• Operational planning & control (short term)

Question 13

Explain organisational strategy

Answer 13

It is complex in that it involves making decisions based on information about the customer customer requirements as well as the continuous assessment of the extent to which the customers needs are being satisfied

Question 14

What are the major objectives of operations management strategic decision making

Answer 14

• Guarantee the availability of the 8Ms
• Guaranteeing the production or rendering of services to customers to the exclusion of competitors products /services
• Guaranteeing that these decisions will direct the organisation setting out the extent of activities to be undertaken

Question 15

What questions should operation managers answer

Answer 15

What? How? When? Where? Who?

Question 16

Name the five major strategic decision-making areas

Answer 16

• Certainty in the decision environment
• Price of decisions
• Degree of intricacy of decisions
• Time horizons
• Activity span

Question 17

Explain organisational and tactical planning in the supply chain

Answer 17

• Functional areas must collaborate
• Tactical planning (medium term) include sales and operational planning
• Operational planning (short term) concerned with demand planning material planning and capacity requirements

Question 18

In what five major areas do managers make decisions

Answer 18

Plan, supply, create, provide, send back

Question 19

What are the four major areas identified in how a final service or product comes into being

Answer 19

Volume, variety, variation, visibility

Question 20

What are the 8 M’s of operations management

Answer 20

1. Money
2. Manpower
3. Materials
4. Methods
5. Management
6. Machines
7. Messages
8. Markets

Question 21

Explain what are operations

Answer 21

It includes all activities that are directly related to the production and delivery of goods and services

Question 22

What are the three major functional areas

Answer 22

Operations, finance, marketing

Question 23

Name the types of service departments

Answer 23

• accounting of finance department
• the management information system department
• purchasing department
• human resources department
• corporate communication department
• quality and industrial engineering department
• maintenance department
• logistics department

Question 24

Differentiate between goods and services production

Answer 24

Services
- intangible
- provided by service organizations
- impossible to store
- cannot be transported

Goods
- tangible
- provided by manufacturers
- easy to store
- can be transported

Question 25

What are the 3 modes of operations management

Answer 25

Primary operations management
- sourcing of raw materials

Secondary operations management t
- uses raw materials from primary to manufacture

Tertiary operations management
- renders services