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| The management of systems or processes that create goods and/or provide services |
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| a sequence of activities and organizations involved in producing and delivering a good or service |
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| Key Decisions of Operations Managers |
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Definition
What: What resources/what amounts
When: Needed/scheduled/ordered
Where: Work to be done
How: Designed
Who: To do the work |
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| is the ability of a product, part, or system to perform its intended function under a prescribed set of conditions |
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| Design that results in products or services that can function over a broad range of conditions. |
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| to bring together engineering design and manufacturing personnel early in the design phase. |
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| Production of Goods vs. Delivery of Services |
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Definition
Production of goods – tangible output
Delivery of services – intangible, an act
Service job categories
Government
Wholesale/retail
Financial services
Healthcare
Personal services
Business services
Education
More … |
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| Differences between manufacturing and services |
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Believed in a “science of management” based on observation, measurement, analysis and improvement of work methods, and economic incentives
Management is responsible for planning, carefully selecting and training workers, finding the best way to perform each job, achieving cooperate between management and workers, and separating management activities from work activities
Emphasis was on maximizing output |
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| Scientific Management - contributors |
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Definition
Frank Gilbreth - father of motion studies
Henry Gantt - developed the Gantt chart scheduling system and recognized the value of non-monetary rewards for motivating employees
Harrington Emerson - applied Taylor’s ideas to organization structure
Henry Ford - employed scientific management techniques to his factories
Moving assembly line
Mass production |
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Definition
| A measure of the effective use of resources, usually expressed as the ratio of output to input |
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| Mission and missions statment |
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Definition
Mission
The reason for an organization’s existence
Mission statement
States the purpose of the organization
The mission statement should answer the question of “What business are we in?” |
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Definition
A plan for achieving organizational goals
Serves as a roadmap for reaching the organizational destinations |
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| Organizational strategies |
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Definition
Overall strategies that relate to the entire organization
Support the achievement of organizational goals and mission |
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| Functional level strategies |
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Definition
| Strategies that relate to each of the functional areas and that support achievement of the organizational strategy |
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| how do Businesses Compete Using Marketing Strategy |
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Definition
Identifying consumer wants and needs
Pricing
Advertising and promotion |
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| How do Businesses Compete Using Operations Strategy |
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Definition
Product and service design
Cost
Location
Quality
Quick response
Flexibility
Inventory management
Supply chain management
Service
Managers and workers |
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Definition
Product and service design
cost
location
quality
quick response
flexibility
inventory management
supply change management
service
managers and workers
delivery time |
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Definition
| Characteristics that customers perceive as minimum standards of acceptability to be considered as a potential for purchase. |
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| Characteristics of organizations goods or services that cause it to be perceived as better than the competition. |
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| Reasons for Product or Service Design & Redesign |
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Definition
Economic; example: New energy saving cars
Social and demographic; example: aging society
Political, liability, or legal; example: Macdonald’s coffee cup
Competitive; example: Barnes & Nobel bookstore web-site
Cost of availability
Technological; example: Ford hydrogen powered Model U |
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Definition
introduction
growth
maturity
decline |
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| Issues in product and service design |
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Definition
Legal
FDA, OSHA, IRS
Product liability - A manufacturer is liable for any injuries or damages caused by a faulty product. Example: nutrition information on food package
Uniform commercial code - Products carry an implication of merchantability and fitness
Ethical
Releasing products with defects
Environmental
EPA |
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Term
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Definition
Advantages
Fewer parts to deal with in inventory & manufacturing
Design costs are generally lower
Reduced training costs and time
More routine purchasing, handling, and inspection procedures
Orders fillable from inventory
Opportunities for long production runs and automation
Need for fewer parts justifies increased expenditures on perfecting designs and improving quality control procedures.
Disadvantages
Designs may be frozen with too many imperfections remaining.
High cost of design changes increases resistance to improvements.
Decreased variety results in less consumer appeal. |
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Definition
| A strategy of producing standardized goods or services, but incorporating some degree of customization. |
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Definition
| which is a postponement tactic. Example: Dell computer. |
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Definition
which is a form of standardization in which component parts are subdivided into modules that are easily replaced or interchanged. It allows
easier diagnosis and remedy of failures
easier repair and replacement
simplification of manufacturing and assembly
Eg. car seat, key board |
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Definition
| Reliability is the ability of a product, part, or system to perform its intended function under a prescribed set of conditions |
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Definition
| Situation in which a product, part, or system does not perform as intended |
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| Normal operating conditions |
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Definition
| The set of conditions under which an item’s reliability is specified |
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Definition
Component design
Production/assembly techniques
Testing
Redundancy/backup
Preventive maintenance procedures
User education
System design |
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Definition
| Design that results in products or services that can function over a broad range of conditions. |
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Definition
Service is an act
Service delivery system includes -
Facilities, processes, skills needed to provide a service
Many services are bundled with products
Example: warranty service
Service design involves
The physical resources needed
The goods that are purchased or consumed by the customer
Explicit services which customers observe
Implicit services |
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Term
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Definition
Service blueprinting is
a method used in service design to describe and analyze a proposed service
a useful tool for conceptualizing a service delivery system
Major Steps in service blueprint:
Establish boundaries
Identify steps involved
Prepare a flowchart
Identify potential failure points
Establish a time frame
Analyze profitability |
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Term
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Definition
Concurrent engineering is to bring together engineering design and manufacturing personnel early in the design phase. Example: Ford Taurus.
Computer-Aided Design (CAD) is to design product using computer graphics.
increases productivity of designers, 3 to 10 times
creates a database for manufacturing information on product specifications
provides possibility of engineering and cost analysis on proposed designs
Recycling: recovering materials for future use
Cost savings, Environment concerns, Environment regulations
Remanufacturing
Component commonality |
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Term
Quality Function Deployment
An approach that integrates the “voice of the customer” into the product and service development process. |
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Definition
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| Issues to be considered when planning capacity |
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Definition
What kind of capacity is needed?
How much capacity is needed?
When is it needed? |
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