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| the set of managerial activities used by an organization to transform resource inputs into products, services, or both |
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- efficient and effective management of operation is necessary for competitiveness and overall organization performance
- creates value and utility throughthe production of products and services |
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| the nature of operations management |
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importance
manufacturing and production
service organization
the role of operations in organizational strategy |
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| a form of business that combines and transforms resource inputs into tangible outcomes that are then sold to others |
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| an organization that transforms resources into an intangible output and creates time and place utility for its customers |
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| the role of operation in organizational strategy |
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operations management has a direct impact on competitiveness, quality, productivity, and effectiveness
- operations management and organizational strategy have reciprocal effects on each other
- strategic goals cannot be met if there are deficienceis and insufficiencies in operations resources. |
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| designing operations systems |
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Definition
determining product-service mix
capacity decisions
facilities decisions |
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| determining product-service mix |
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| involves deciding how many and what kinds of products to offer in the marketplace |
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- involve choosing the amount of products, services, or both that can be produced by an organization
- high-risk decisions due to uncertaitny about future product demand and the significant costs of additional, possibly excess, capacity. |
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the physical locations where products or services are created, stored, and distributed
- location- the physical positing or geographic site of facilities |
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| the physical configuration of facilities, the arrangement of equipment within facilities, or both |
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| facilities arranged around the product; used when large quantities of a single product are needed |
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| facilites arranged around the process; used in facilities that create or process a variety of products |
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| facilities arranged around a single work area; used for the manufacture of large and complex products |
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| a configuration of facilities used when families of products can follow similar paths. |
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| organizational technologies |
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Definition
manufacturing technologies
service technology |
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technology
automation
computer-assisted manufacturing
robot
robotics |
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Term
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Definition
| the set of processes and systems used by organizations to convert resources into products or services |
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| the process of designing work so that it can be completely or almost complety performed by machines |
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| computer-assisted manufacturing (CAM) |
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Definition
computer-aided design (CAD)
computer- integrated manufacturing (CIM)
flexible manfuacuring systems (FMS) |
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| computer-aided design (CAD) |
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Definition
| the use of computers to design and complete products and to simulate performance so that prototypes need not be constructed |
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| computer integrated manufacturing (CIM) |
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| CAD and CAM are linked and computer networks adjust placements and settings automatically. |
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| flexible manufacturing systems (FMS) |
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| the use of robotic systems and computers to cooridinate and integrate automated production and materal handling facilities. |
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| any artificial device that can perform functions ordinarily though to be appropriate for human beings |
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| the science and technology of the constrution, maintenance, and use of robots |
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| services are rapidly moving toward automated systems and procedures (e.g., automated teller machines). |
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| implementing operations through supply chain management |
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Definition
operations management as control
purchasing management
inventory management |
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Definition
| the process of managing operations control, resource and inventory acquisition and purchasing, and thus improving overall efficiency and effectiveness |
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| operations management as control |
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Definition
| coordinating it with other organizational functions to insure that the system focuses on the elements that are most crucial to goal attainment. |
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Definition
procurement
- controlling the buying of the materials and resources is at the heart of effective supply chain management. |
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Definition
inventory control (materials control)
just-in-time (JIT) method
inventory types purposes and sources |
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Definition
materials control
managing the organizations raw materials, work in process, finished goods, and products in transit. |
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| just-in-time (JIT) method |
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Definition
| an inventory system that has necessary materials arriving as soon as they are needed so that the production process is not interrupted |
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raw materials
work-in-process
finsihed goods
in-transit (pipeline |
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purposes- provide the materials needed to make the product
source of control- purchasing models and systems |
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purpose- enables overall production to be divided into s tages of manageable size
souce of control- shop-floor control systems |
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purpose- provide ready supply of prodducts on customer demand and enable long, efficient production runs
soucre of control- high level production shecduling systems in conjuntion with marketing |
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purpose- distributes products to customers
source of control- transportation and distributuion control systems |
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Definition
the totality of features and characteristics of a product or service that bear on its ability to satisfy stated or implied needs
- both a relative and absolute concept
- relevean to both products and services |
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competitiion
productivity
costs |
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| quality has become one of the most important competitive points in businsess today |
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| quality enhancement programs decrease the number of defects, reduce resourceds dedicated to rework, and reduces the need for inspectors as emplyees become responsible for quality. |
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| improved quality reduces costs from customer returns, warranty, and lawsuits for faulty products, and lost sales to future customers |
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| total quality management (TQM) |
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| a strategic commitment by top management to change its whole approach to business and to make quality a guiding factor in everything the organization does. |
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Definition
- value- added analysis
- benchmarking
outsourcing
reducing cycle time
iso 9000:2000 (quality, ISO 14000 (environment)
statistical quality control (SQC)
six sigma |
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Definition
| the process of learning how and what other firms do in an exceptionally high-quality manner |
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| subcontracting operations/services to those who can do them cheaper and/or better |
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| statistical quality control (SQC) |
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Definition
acceptance sampling- testing product after completed
in-process sampling |
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| guidlines for increasing the speed of operations |
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Definition
1 start from scratch
2 minimize the number of approvals needed to do something
3 use work teams as a basis for organization
4 develop and adhere to a schedule
5 do no ignore distribution
6 integrate speed into the organizations plan |
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| an economic measure of efficiency that summarizes the value of outputs relative to the value of the resources used to produce them |
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Definition
unit of analysis used to calculate or define productivity
- aggregat productivity
- industry productivity
- company productivity
- unit productivity
- individual productivity |
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| total level of productivity for a country |
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| total productivity of all the firms in an industry |
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| level of productivity of a single company |
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| productivity level of a unit or department |
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| productivity attained by a single person |
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total factor productivity
labor productivity |
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| total factor productivity |
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| an overall indeicator of how well an organization uses all of its resoures (i.e., labor, capital, materials, and energy) to create all of its products and services |
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Definition
| a prartial productivity ratio that uses only one category of resource (labor) to gage the organization's prodcutivity in utilizing that resource |
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| importance of productivity |
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| primary determinant of an organization's level of profitability and its ability to survive |
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- u.s has the highes level of productivity in the world, although the gap is closing as other countries become more productive
- manufacturing productivity growth continues to exceed that of the service sector |
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Definition
improving operations
increasing employee involvement |
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Definition
spending more resources on research and development helps indentify new products, new uses for existing products, and new methods for making products
- reworking transformation process and facilities can boost productivity |
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| increasing employee involvement |
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Definition
- increased employee participation can increase quality and productivity
- cross- training of employees allws the firm to function with fewer workers
- rewards are essential to success in improving productivity |
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