1

McGraw-Hill/Irwin

© 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.
2

Chapter 1
Introduction to the Field

McGraw-Hill/Irwin

© 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.
3

OBJECTIVES









Operations Management
Why Study Operations Management?
Transformation Processes Defined
Oper...
4

What is Operations Management?
Defined
Operations management (OM) is
defined as the design, operation,
and improvement ...
5

Why Study Operations
Management?
Systematic Approach
to Org. Processes

Business Education

Operations
Management

Care...
6

What is a Transformation
Process?
Defined
A transformation process is defined
as a user of resources to transform
input...
7

Transformations


Physical--manufacturing



Locational--transportation



Exchange--retailing



Storage--warehous...
8

What is a Service and What is a
Good?


“If you drop it on your foot, it won’t
hurt you.” (Good or service?)



“Serv...
9

OM in the Organization Chart
Finance

Operations
Operations

Marketing

Plant
Plant
Manager
Manager

Operations
Operati...
10

Core Services
Defined
Core services are basic things
that customers want from
products they purchase

McGraw-Hill/Irwi...
11

Core Services Performance Objectives
Quality

Flexibility

Operations
Managemen
t

Speed

Price (or cost
Reduction)

M...
12

Value-Added Services
Defined
Value-added services
differentiate the organization
from competitors and build
relationsh...
13

Value-Added Service Categories
Problem Solving

Information

Operations
Management

Sales Support

Field Support

McGr...
14

The Importance of
Operations Management
 Synergies

must exist with other
functional areas of the
organization
 Oper...
15

Historical Development of OM


JIT and TQC



Manufacturing Strategy Paradigm



Service Quality and Productivity

...
16

Historical Development of OM
(cont’d)


Business Process Reengineering



Supply Chain Management



Electronic Com...
17

Current Issues in OM


Coordinate the relationships between
mutually supportive but separate
organizations.



Optim...
18

Current Issues in OM (cont’d)


Managing the customers
experience during the service
encounter



Raising the awaren...
19

End of Chapter 1

©The McGraw-Hill Companies, Inc., 2006
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Chap001

  1. 1. 1 McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.
  2. 2. 2 Chapter 1 Introduction to the Field McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.
  3. 3. 3 OBJECTIVES        Operations Management Why Study Operations Management? Transformation Processes Defined Operations as a Service The Importance of Operations Management Historical Development of OM Current Issues in OM McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.
  4. 4. 4 What is Operations Management? Defined Operations management (OM) is defined as the design, operation, and improvement of the systems that create and deliver the firm’s primary products and services McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.
  5. 5. 5 Why Study Operations Management? Systematic Approach to Org. Processes Business Education Operations Management Career Opportunities Cross-Functional Applications McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.
  6. 6. 6 What is a Transformation Process? Defined A transformation process is defined as a user of resources to transform inputs into some desired outputs McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.
  7. 7. 7 Transformations  Physical--manufacturing  Locational--transportation  Exchange--retailing  Storage--warehousing  Physiological--health care  Informational--telecommunications McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.
  8. 8. 8 What is a Service and What is a Good?  “If you drop it on your foot, it won’t hurt you.” (Good or service?)  “Services never include goods and goods never include services.” (True or false?) McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.
  9. 9. 9 OM in the Organization Chart Finance Operations Operations Marketing Plant Plant Manager Manager Operations Operations Manager Manager Director Director Manufacturing, Production control, Manufacturing, Production control, Quality assurance, Engineering, Quality assurance, Engineering, Purchasing, Maintenance, etc Purchasing, Maintenance, etc McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.
  10. 10. 10 Core Services Defined Core services are basic things that customers want from products they purchase McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.
  11. 11. 11 Core Services Performance Objectives Quality Flexibility Operations Managemen t Speed Price (or cost Reduction) McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.
  12. 12. 12 Value-Added Services Defined Value-added services differentiate the organization from competitors and build relationships that bind customers to the firm in a positive way McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.
  13. 13. 13 Value-Added Service Categories Problem Solving Information Operations Management Sales Support Field Support McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.
  14. 14. 14 The Importance of Operations Management  Synergies must exist with other functional areas of the organization  Operations account for 60-80% of the direct expenses that burden a firms profit. McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.
  15. 15. 15 Historical Development of OM  JIT and TQC  Manufacturing Strategy Paradigm  Service Quality and Productivity  Total Quality Management and Quality Certification McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.
  16. 16. 16 Historical Development of OM (cont’d)  Business Process Reengineering  Supply Chain Management  Electronic Commerce McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.
  17. 17. 17 Current Issues in OM  Coordinate the relationships between mutually supportive but separate organizations.  Optimizing global supplier, production, and distribution networks.  Increased co-production of goods and services McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.
  18. 18. 18 Current Issues in OM (cont’d)  Managing the customers experience during the service encounter  Raising the awareness of operations as a significant competitive weapon McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved.
  19. 19. 19 End of Chapter 1 ©The McGraw-Hill Companies, Inc., 2006

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