Technology And Operations Management PDF

CHAPTER 3 Technology and Operations Management What is technology? Technology referred to as the transformation and manipulation of the human environment, is the application of scientific knowledge to the practical goals of human...

CHAPTER 3 Technology and Operations Management What is technology? Technology referred to as the transformation and manipulation of the human environment, is the application of scientific knowledge to the practical goals of human life. Technology, both physical and information has dramatically changed how work is accomplished in every industry, from mining to manufacturing, to education, to health care. It is the enabler that makes today’s service and manufacturing systems operate productively and meet customer needs better than ever. Technological innovation in goods, services, manufacturing, and service delivery is a competitive necessity. Understanding technology in operations  Hard Technology – refers to equipment and devices that perform a variety of tasks in the creation and delivery of goods and services. -Some examples of hard technology are computers, microprocessors, optical switches, satellites, sensors, robots, automated machines, bar-code scanners, and radio-frequency identification (RFID) tags. Radio-frequency Identification (RFID tags) – are the modern successor to bar codes. RFID tags are tiny computer chips that can be placed on shipping containers, individual products, credit cards, prescription medicine, passport, livestock, and even people. RFID Chip Implantation Soft Technology – refers to the application of the internet, computer software, and information systems to provide data, information, and analysis and to facilitate the creation and delivery of goods and services. Some examples are database systems, artificial intelligence programs, and voice –recognition software. Information Technology – provides the ability to integrate all parts of the value chain through better management of data and information. Integrated Operating Systems (IOSs), Computer-Integrated Manufacturing Systems (CIMSs), Enterprise Resource Planning (ERP) systems, Customer Relationship Management (CRM) systems – allowing managers to make better decisions and share information across the value chain. All of which use technology to create better and more customized goods and services and deliver them faster at lower prices.  Manufacturing Technology Producing automobiles, jet engines, and other sophisticated products requires far more advanced methods. However, from an operations management stand-point, all organizations face common issues regarding technology: The right technology must be selected for the goods that are produced. Process resources, such as machines and employees, must be set up and configured in a logical fashion to support production efficiency. Labor must be trained to operate the equipment. Process performance must be continually improved. Work must be scheduled to meet shipping commitments/customer promise dates. Quality must be ensured.  Computer-Integrated Manufacturing Systems (CIMSs) Computer-Integrated Manufacturing Systems (CIMSs) – represent the union of hardware, software, database management, and communications to automate and control production activities, from planning and design to manufacturing and distribution. Numerical Control (NC) – machine tools, which enable the machinist’s skills to be duplicated by a programmable device (originally punched paper tape) that controls the movements of a tool used to make complex shapes Example of Example of Lathe Machine Punch Card  Computer-Integrated Manufacturing Systems (CIMSs) Computer Numerical Control (CNC) – machines are NC machines whose operations are driven by a computer. Robot – a robot is a programmable machine design to handle materials or tools in the performance of a variety of tasks. Computer-Aided Design & Computer-Aided Engineering (CAD/CAE) – enables engineers to design, analyze test, stimulate, and “manufacture” products before they physically exist, thus ensuring that a product can be manufactured to specifications when it is released to the shop floor.  Computer-Integrated Manufacturing Systems (CIMSs) Computer-Aided Manufacturing (CAM) System – involves computer control of the manufacturing process, such as determining tool movements and cutting speeds. Flexible Manufacturing Systems (FMS) – consist of two or more computer controlled machines or robots linked by automated handling devices such as transfer machines, conveyors, and transport systems. Computers direct the overall sequence of operations and route of work to the appropriate machine, select and load the proper tools, and control the operations performed by the machine.  Advances in Manufacturing Technology Innovations in technology have changed manufacturing in many industries. 3-D printing technology Industrial robots nanotechnology  Service Technology Service Technology – Technology is used in many services, including downloading music, banking automated car washes, voice recognition in telephone menus, medical procedures, hotel and airline kiosks, and entertainment such as the robots used in Disney World’s Hall of President and Country Bear Jamboree attractions. E-Services – refers to using the internet and technology to provide services that create and deliver time, place, information, entertainment, and exchange value to customers and/or support the sale of goods. Technology in Value Chain Technology, especially the Internet and E- communications, is changing the operation, speed, and efficiency of the value chain and presents many new challenges to operations managers. Customer Relationship Management (CRM) - is a business strategy designed to learn more about customer’s wants, needs, and behaviors in order to build customer relationship and loyalty, and ultimately enhance revenues and profits. The Benefits and Challenges of Technology Benefits of Technology Challenges of Technology Create new industries and job opportunities Higher employee skill level required, such as information Restructures old and less productive industries technology and service management skills Integrates supply and value chain players Integration of old (legacy) and new technology and systems Increases market place competitiveness and Job shift and displacement Less opportunity for employee creativity and empowerment maintains the survival of the firm Protecting the employee’s and customer’s privacy and Provides the capability to focus on smaller target security market segments through mass customization Fewer human service providers, resulting in customer Improves/increases productivity, quality, ownership not being assigned, no human service encounters customer satisfaction, speed, safety, and and inability of the customer to change decisions and return goods easily flexibility/customization- does more with less Information overload Lower cost Global outsourcing and impact on domestic job Raises world’s standing of living opportunities Months the environment and health of the planet Enforcement of regulations and laws to support sustainability goals Technology Decisions and Implementation  Technology Decisions and Implementation Managers must make good decisions about introducing and using new technology. A key factor that affects technology is scalability. Scalability is a measure of the contribution margin required to deliver a good or service as the business grows and volumes increase. 1. High scalability – is the capability to serve additional customers at zero or extremely low incremental costs. 2. Low scalability – implies that serving additional customers requires high incremental variable costs. Do you have any questions?