Topic 1- Intro to operations and productivity Flashcards
What Operation Managers Do
- Planning
- Organizing
- Staffing
- Leading
- Controlling
Ten Critical Decisions
- Design of goods and services
- Managing quality
- Process and capacity design
- Location strategy
- Layout strategy
- Human Resources and job design
- Supply-chain management
- Inventory, MRP, JIT
- Scheduling
- Maintenance
- Design of goods and service
What goods and services should we offer?
How should we design these goods and services?
Managing Quality
How do we define quality?
Who is responsible for quality?
Process and capacity design
What process and what capacity will these products require?
What equipment and technology is necessary for these processes?
Location Strategy
Where should we put the facility?
On what criteria should we base the location decision?
Layout Strategy
How should we arrange the facility?
How large must the facility be to meet our plan?
Human resources and job design
How do we provide a reasonable work environment?
How much can we expect our employees to produce?
Production
is the creation of goods and services
Operations management (OM)
is the set of activities that create value in the form of goods and services by transforming inputs into outputs
Marketing
generates demand
Production/operations
creates the product
Finance/accounting
– tracks how well the organization is doing, pays bills, collects the money
Why Study OM?
- OM is one of three major functions of any organization. We want to study how people organize themselves for productive enterprise
- We want (and need) to know how goods and services are produced
- We want to understand what operations managers do
- OM is such a costly part of an organization
Supply-chain management
Should we make or buy this component?
Who should be our suppliers and how can we integrate them into our strategy?
Inventory, material requirements planning (MRP), and JIT
How much inventory of each item should we have?
When do we reorder?
Intermediate and short–term scheduling
Are we better off keeping people on the payroll during slowdowns?
Which jobs do we perform next?
Maintenance
How do we build reliability into our processes?
Who is responsible for maintenance?
New Challenges in OM
From- To
Local or national focus – global focus
batch shipments – just-in -time
low bid purchasing–supply chain partnering
lengthy product development- rapid product development, alliances
standard products- mass customization
job specialization– empoer employees, teams
New Challenges in OM: Local or national focus
global focus
New Challenges in OM :batch shipments
just-in -time
New Challenges in OM:low bid purchasing-
supply chain partnering
New Challenges in OM:lengthy product development-
rapid product development, alliances
New Challenges in OM:standard products
mass customization
New Challenges in OM:job specialization
empoer employees, teams
Characteristics of Goods
Tangible product Consistent product definition Production usually separate from consumption Can be inventoried Low customer interaction
Characteristics of Services
Intangible product Produced and consumed at same time Often unique High customer interaction Inconsistent product definition Often knowledge-based Frequently dispersed
New Trends in OM
Ethics Global focus Environmentally sensitive production Mass customization Empowered employees Supply-chain partnering Just-in-time performance
outputs
goods and services
inputs
resources such as labour and capital used
productivity ratio
output/input
single factor productivity
output/ labour
multifactor productivity
output/ labour+ material+ energy+ capital+ miscellaneous
Productivity Variables
1, labour
2 capital
3. management
Productivity Variables: labour
contributes about 10% of the annual increase
Productivity Variables: capital
contributes about 38% of the annual increase
Productivity Variables: management
contributes about 52% of the annual increase
Key Variables for Improved Labour Productivity
- Basic education appropriate for the labour force
- Diet of the labour force
- Social overhead that makes labour available
- Challenge is in maintaining and enhancing skills in the midst of rapidly changing technology and knowledge
Service Productivity
- Typically labour intensive
- Frequently focused on unique individual attributes or desires
- Often an intellectual task performed by professionals
- Often difficult to mechanize and automate
- Often difficult to evaluate for quality
Ethics andSocial Responsibility
Developing and producing safe, quality products
Maintaining a clean environment
Providing a safe workplace
Honouring stakeholder commitments
