PART 1.docx

**Operations Management (OM):** \- Responsible for producing goods and services (ex. restaurant, making or serving food) - *How can we define OM?* \- the management of systems or processes that create goods and/or provide services **Goods:** -includes raw materials, parts, subassemblies, and...

**Operations Management (OM):** \- Responsible for producing goods and services (ex. restaurant, making or serving food) - *How can we define OM?* \- the management of systems or processes that create goods and/or provide services **Goods:** -includes raw materials, parts, subassemblies, and final products. Ex. automobile, computer, oven, shampoo **Services:** -activities that provide some combination of time, location, form or psychological value Ex. air travel, education, haircut, legal counsel **Supply Chain** -sequence of activities and organizations involved in producing and delivering a good or service **Transformation process** -where you add value **Value-Added** Measurement and Feedback Measurement and Feedback **Feedback:** measurements taken at various points in the transformation process **Control:** comparison of feedback against previously established standards to determine if corrective action is needed **Goods-Service Continuum** -products are neither purely service nor purely goods-based -automobile assembly, steelmaking -home remodeling, retail sales -computer repair, restaurant meal -songwriting, software development -surgery, teaching **Why study OM?** -every aspect of business affects or is affected by operations -many service jobs are closely related to operations. ex. financial, marketing, accounting, and information services -through learning about operations and supply chains you will have a better understanding of: - the world you live in - global dependencies of companies and nations - reasons that companies succeed or fail - importance of working with others **3 basic functions of an organization** -Marketing -Operations -Finance - Finance and operations -budgeting -economic analysis of investment proposals \- provision of funds - Marketing and operations -demand data -product and service design -competitor analysis -lead time data OM and supply chain career opportunities -Operations manager -supply chain manager -production analyst -schedule coordinator -production manager -industrial engineer -purchasing manager -inventory manager -quality manager **Process** - one or more actions that transform inputs into outputs *3 categories:* - Upper management processes: govern the operation of the entire organization - Operational processes: core processes that make up the value stream - Supporting processes: support core processes **Supply and Demand** *Operations and Supply chains* *Sales and marketing* **Supply** \> **Demand** wasteful, costly \< opportunity loss, customer dissatisfaction = ideal **4 sources of variation:** - Can be disruptive to operations and supply chain processes. They may result in additional costs, delays and shortages, poor quality, and inefficient work systems. - *variety of goods or services being offered*: greater variety of goods and services offered, greater variation in production - *structural variation in demand*: generally predictable and important for capacity planning ex. restaurant - *random variation*: natural that is present in processes, cannot be influenced by managers - *assignable variation*: has identifiable sources, can be reduced, eliminated, by analysis or corrective action **Operations Function** consists of all activities directly related to producing goods or providing services Primary function of the operations manager is to guide the system by decision making -System Design Decisions -System Operation Decisions **System Design** - typically strategic decisions that usually require long-term commitment of resources and determine the parameters of system operations -capacity -facility layout -product and service planning -acquisition and placement of equipment **System Operation** - generally tactical and operational decisions -management of personnel -inventory management and control -scheduling -project management -quality assurance - Operations managers spend more time on system operation decision than any other decision area -they still have a vital stake in system design **OM decision making** -Most operations decisions involve many alternatives that can have quite different impacts on costs or profits General Approach in decision making -modeling is a key tool used by all decision makers model: abstraction of reality, simplification of something, mimic so that attention can be focused on the most important aspects of the real-life system Operations management is the process of managing the activities involved in producing and delivering goods or services to customers. This includes tasks such as setting policies, assigning tasks and resources, and monitoring and controlling performance. Operations management has a long history, dating back to the Industrial Revolution, when businesses first began to mass-produce goods. Since then, operations management has evolved to encompass a wide range of activities, from managing projects to ensuring product quality. - Operations management is the management of systems or processes that creates or provides goods or services. The transformational process is where you add value to an input, and the feedback loops ensure that you constantly improve your products or services. - Operations management is the study of how an organization manages its inputs and outputs in order to provide goods and services to its customers. This includes understanding how marketing, finance, and operations work together to identify and satisfy customer needs. - Operations management is the process of managing the activities involved in producing and delivering goods or services to customers. Operations management includes tasks such as setting policies, assigning tasks and resources, and monitoring and controlling performance. There are many career opportunities in operations management, including Operations Manager, Supply Chain Manager, Production Analyst, Schedule Coordinator, Production Manager, Industrial Engineer, Purchasing Manager, Inventory Manager, and Quality Control Manager. - Operations management includes decision-making about how much capacity to build, where to put it, what to produce, how to distribute it, and how to staff it. - Operations management is the process of coordinating the activities of various parts of a business in order to achieve desired goals. The key aspects of operations management include scheduling employees and resources, ensuring product quality, and managing projects. - The lecture begins by discussing the Industrial Revolution, which saw a shift from craft production to industrial production. Management theory and practice during this period did not advance, but there was a shift to scientific management. Efficiency engineer Frederick Winslow Taylor believed in a science of management based on observation, measurement, analysis, improvement of work methods, and economic incentives. The human relations movement began with Gilbreth, and Mayo studied worker motivation. - Operations management is the process of managing the activities of a business to achieve its goals. Operations management includes planning, organizing, directing, and controlling the activities of employees to achieve objectives. The Hawthorne study is one example of how management can increase productivity by paying attention to workers. Maslow\'s hierarchy of needs is a theory that explains human motivation. The two-factor theory is a theory that explains how people tend to act based on two factors: a need and a want. Theory X, Theory Y, and Theory Z are all decision models that are used in operations management. Statistical sampling theory was developed in the 1930s, and it is used to calculate the probability of obtaining a desired result from a sample. Operations research groups were formed in the 1940s, and they focused on war-related problems. Linear programming was developed in the 1940s, and it is used to solve problems of efficiency and resource allocation. Ethics, financial statements, worker safety, product safety, and community relations are all issues that are common in operations management. - In this lecture, the presenter discusses the definition of operations management, the differences between goods and services, the supply chain, and the historical evolution of operations management.