Operations management overview

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Operations management overview

  1. 1. Project and Production  Project: Concrete entity Idea Facory Design Building Plan Highway Prototype Products Services
  2. 2. PROJECTS PRODUCTION  Automobile factory Produce automobiles  Build a house Operate house holds  Construct hospital Treat Patients  Conceive new product Manufacture  Develop prototype Produce multiples  DONE ONCE DONE REPETITIVELY
  3. 3. MIX OF PROJECTS AND PRODUCTION  Projects and production are intimately interwoven in real life.  Projects Starts production and solve problems relating to -operation, maintenance, house keeping -Marketing, Distribution, quality
  4. 4. ISSUES FOR DISCUSSION  Pervasiveness of projects and production  Growing organizational complexity  Products vs services  Value addition in operations  Generalized model of production  Productivity and other performance indicators  Kinds of production system  Key decisions in the life cycle of a production system
  5. 5. AIM OF PRODUCTION  To provide goods and services for mankind -in the right quantity -at the appropriate place -at the desired time -with the required quality -at a reasonable cost
  6. 6. Nature of production  Inputs OutputTransformation
  7. 7. Nature of production  Inputs Output men Desirable machines Undesirable materials money information energy ------ Transformation
  8. 8. Nature of production  Inputs Output men Desirable machines Undesirable materials feedback money information energy ------ Transformation
  9. 9. Nature of production  Inputs Output men Desirable machines Undesirable materials feedback money information Environment energy social ------ economic political Transformation
  10. 10. VALUE ADDITION THROUGH TRANSFORMATIONS  Operations is the process of changing inputs into outputs and thereby adding value to some entity. This constitutes the primary function of virtually every organization.
  11. 11. HOW VALUE ADDITION TAKES PLACE?  ALTER -physical -sensual -psychological • TRANSPORT • STORE • INSPECT
  12. 12. KINDS OF TRANSFORMATIONS  Physical as in manufacturing  Location as in transpotation  Exchange as in retailing  Storage as in warehousing  Physiological as in hoapital  Attitudinal as in reading  Informational as in entertainment
  13. 13. GROSS MEASURES OF PRODUCTION  PRODUCTION=OUTPUT/TIME  PRODUCTIVITY=OUTPUT/INPUT(in a given time)  EFFICIENCY= ACTUAL/TARGET  EFFECTIVENESS= CAPACITY TO ACHIEVE DESIRED GOAL  FLEXIBILITY=CAPACITY TO RESPOND TO CHANGES (internal and external)
  14. 14. ECONOMIC MEASURES OF PERFORMANCE  Investment(initial and phased)  Profit(gross and net after taxes)  Revenue  Turn over  Net present value  Benefit/cost value  Internal rate of return  Payback period
  15. 15. NEW CHALLENGES IN PRODUCTION   COMPETITION •More producers •Demanding customers price quality Reduced Lead time Greater variety Customer satisfactio n
  16. 16. PRODUCTION AS PART OF THE SUPPLY CHAIN TRANSFORMATION PROCESS VEN DO RS WAREH OUSES RET AIL
  17. 17. FEATURES OF SERVICE ORGANIZATIONS  Customer participation  Services not inventoried  Service capacity time perishable  Customer governs location  Generally labour intensive  Intangible nature of service
  18. 18. OPERATIONS MANAGEMENT  The performance of managerial activities in  Selecting  Designing  Operating  Controlling and  Updating  Productive systems

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