Operations Management Overview

Operations Management

• Deals with all aspects of running a business, including process design, quality management, location and layout strategies, human resources and job design, supply chain management, inventory management, and scheduling.
• Operations is the core of an organization, interacting with other functional areas and suppliers to produce goods or services.
• Strategy and operations are interconnected, with strategy guiding the company's mission and ensuring it is on the correct path.
• Primary tasks and core competencies of a company are defined, which helps tailor strategy.
• Companies can be positioned based on cost (reducing costs with lean production methods, eliminating waste), speed (efficient service or manufacturing operations), quality (minimizing defects and ensuring high performance), and flexibility (adjusting to changing needs).

Production and Manufacturing

• Manufacturing involves applying physical and chemical processes to modify a starting material's geometry, properties and appearance, including assembly.
• Elements like machinery, tooling, power, and labor are crucial for manufacturing. Different product types fall under different categories.
• Process Industries focus on continuous production, while Discrete products are produced through sequential steps.
• Fixed-Position Layout is used when products are large and heavy, where other resources are moved to the product, rather than the product itself moving.

Production Quantity Ranges

• Production quantity ranges include low (1-100 units), medium (100-10,000 units), and high (10,000-millions of units).

Different Production Facilities

• Low Production Quantities (Job Shops): Customized, complex products with general-purpose equipment and a skilled workforce. Suitable for large or small output.
• Medium Production Quantities (Batch Production): Multiple batches of products. Flexible systems and set-up time between batches are a concern.
• High Production Quantities (Mass Production/Flow Production): Highly specialized systems for mass production of a single product.

Production Layout

• Process Layout: Equipment is arranged by function, allowing for versatility and accommodating different production sequences.
• Product Layout: Equipment is arranged sequentially, based on the order of operations in production. This is suited for high-volume, repetitive processes.

Manufacturing Metrics

• Production Performance Measures: Production rate, cycle time, capacity, lead time, and productivity.
• Manufacturing Costs: Labor, materials, overhead, and cost per unit.
• Productivity: A key metric relating output to inputs used to measure efficiency and competitiveness. Calculated as single factor or multi-factor productivity, assessing efficiency using output to measure all inputs.

Production Capacity & Utilization

• Production Capacity:Maximum production rate of a facility, department or line.
• Production Utilization: Output compared to available capacity.
• Increasing capacity can be gained through adding shifts, more machines or improvements in processes.

This quiz covers the fundamentals of Operations Management, focusing on areas such as process design, quality management, and supply chain management. It explores the interconnection between strategy and operations, emphasizing the importance of core competencies and positioning based on cost, speed, quality, and flexibility.