Operations Management Exam Notes PDF

WHAT IS OPERATIONS MANAGEMENT? **Operations Management (OM)**: Administration of business practices. **Primary Goal**: Achieve the highest level of efficiency within an organization. **Focus**: Convert materials and labor into goods and services efficiently. **Objective**: Maximize the organizat...

WHAT IS OPERATIONS MANAGEMENT? **Operations Management (OM)**: Administration of business practices. **Primary Goal**: Achieve the highest level of efficiency within an organization. **Focus**: Convert materials and labor into goods and services efficiently. **Objective**: Maximize the organization\'s profit. **Key Activities**: Balancing costs with revenue. **Ultimate Aim**: Achieve the highest possible net operating profit. WHAT IS THE SCOPE OPERATIONS MANAGEMENT? **Operations Management (OM)**: Focuses on converting inputs into outputs. **Resources Used**: Utilizes physical resources in the conversion process. **Primary Goal**: Provide desired utilities to customers. **Objectives**: **Effectiveness**: Achieving the intended results. **Efficiency**: Minimizing resource use and maximizing output. **Adaptability**: Ability to adjust to changes. **Distinct Function**: OM differs from other functions like personnel, marketing, and finance. **Core Concern**: Conversion process using physical resources. Following are the activities, which are listed under Production and Operations Management functions: 1. Location of facilities. 2. **LOCATION OF FACILITIES** 3. Plant layouts and Material Handling. - Optimum arrangement of facilities. - Includes personnel. - Operating equipment. - Storage space. - Material handling equipment. - All other supporting services. - Design of the best structure to contain all these facilities. - **Material Handling** - A. **Definition** - Moving materials from the storeroom to machines and between machines during manufacturing. - Art and science of moving, packing, and storing products in any form. - B. **Significance** - Specialized activity in modern manufacturing. - Accounts for 50 to 75% of production costs. - Cost reduction through proper selection, operation, and maintenance of material handling devices. - Benefits include: - Increased output - Improved quality - Faster deliveries - Decreased production costs - D. **Consideration in Plant Design** - Material handling is crucial in designing new plants and revising existing plants. 4. Product Design. 5. Process Design. 6. Production Planning and Control. 7. Quality Control. 1. To improve the companies\' income by making the production more acceptable to the customers i.e. by providing long life, greater usefulness, maintainability, etc. 2. To reduce companies cost through reduction of losses due to defects. 3. To achieve interchangeability of manufacture in large-scale production. 8. Materials Management. - **Demand Forecasting** - Predicting material needs based on production schedules. - **Supplier Management** - Evaluating and selecting suppliers. - **Order Processing** - Handling orders from placement to delivery. - **Quality Control** - Ensuring materials meet required standards. - **Inventory Control Systems** - Techniques like Just-in-Time (JIT) and Economic Order Quantity (EOQ). - **Material Requirements Planning (MRP)** - Systems for planning material needs based on production schedules. - **Enterprise Resource Planning (ERP)** - Integrated systems to manage materials and resources. - **Cost Efficiency** - Reducing costs through effective material management. - **Production Continuity** - Ensuring materials are available to avoid production delays. - **Quality Improvement** - Maintaining quality through proper material handling and control. - **Supply Chain Disruptions** - Managing risks and uncertainties in the supply chain. - **Inventory Management** - Balancing inventory levels to avoid overstocking or stockouts. - **Coordination with Other Functions** - Aligning materials management with production, finance, and logistics. 9. Maintenance Management