SlideShare a Scribd company logo
1 of 30
Download to read offline
   Operations Strategy/ 

Competitive Advantage
N.K.Agarwal
Production Function
• Operation/Production function essential to every
business
• Operations create wealth in a global economy
• Operation function responsible to make four key
decisions
–
–
–
–

Process
Quality
Capacity
Inventory
Production Function
• Production function in manufacturing involves
– Transforming a set of inputs through a process into a
predetermined set of outputs
Production Manager
• Production / operations manager is the wealth
creator in the company
• Operations managers make
– Decisions regarding the operations function,
– Its interaction with other functions within the organisation
and the external environment, and
– Plan and control the production process
• In an efficient and effective manner
Major Decisions at Pizza USA
A Framework for OM
• Process
– How to produce & deliver

• Quality
– Criteria, measurement & process for achieving

• Capacity
– Physical facilities & labor

• Inventory
– What, when & how much?
Productive System 
Means by which
Input resources
Are transformed to create
Useful goods (products) & services
As outputs.
AN OPERATING SYSTEM

Control (Feedback)
subsystem

Transformation

Output

Material
Products

Labour
Energy
Capital

Production process
(Converter)

Information

Information Processor
(controller)

Services
Information

Environment

Conversion subsystem

Inputs
Products and Services
• Products
– Tangible things that can be carried away with the person

• Services
– Intangible and perishable and are consumed in the process
of their production.
Characteristics of Products Vs Services
Products
Services
Intangible & perishable; consumed in the
process of their production
Can be produced to inventory for off-the- Availability achieved by keeping the
shelf availability
productive system open for services
Complex and interrelated processing
Simple processing
Tangible

Minimal contact with ultimate consumer High contact with clients/customers
Demand on system varies on weekly,
monthly or seasonal basis

Demand commonly variable on hourly,
daily and weekly basis

Markets served by productive systems
are regional,national or international

Markets served are usually local

Large units that can take advantage of
economies of scale
Location of system is in relation to
regional, national and international
markets

Relatively small units to serve local
markets
Location dependent on location of local
customers, clients & users
Production / Operation
Management (POM)
• Defined as
– Decision making in the operations function
– Integration of these decisions with other functions
– A transformation system that converts inputs into outputs
• In an efficient and effective manner
Interfacing with other systems
• Basic functional groups:
– Marketing
• Generates demand
– Finance
• Generates the capital
– Production
• Generates the supply of outputs.
Marketing and POM
• Marketing system
– Discovers and transmits the need of consumers to the total
organisation including the POM system
• Which supplies these needs.
– Translates the demand for future into units of production &
desired delivery schedules.
POM-Marketing interface
• Marketing furnishes data on:
– Size of market
– Volume of production needed to meet anticipated market
needs
– Desired inventories
– Anticipated changes in production of other products
– Anticipated delivery schedules: amount,location,timing
– Packaging needs
Conflicts between Marketing and
POM
• Unreasonable commitment to customers regarding
– Customisation
– Delivery schedule
– Order quantity
Production/Operation
Management
• POM system generally consists of:
–
–
–
–
–
–
–
–

Forecasting facility requirement
Designing total production facility
Planning output levels
Planning inventory levels
Controlling work input
Controlling work output
Feedback
Replanning
Production/ Operation
Management
• POM
– Provides production facilities-plants,equipment and
personnel.
– Provides statistical quality control
– Sustains technological growth and improvement & economic
viability.
POM- Finance & Accounting
interface
• F&A Function
– Responsible for all cash flows between the organisation and
external environment.
– Interfaces from the inception of the idea of product through
its development stages till it is sold
POM-F&A Interfacing
• Important areas
– Accumulation of operating data to form a starting point for
standards
– Accumulation of cost data of a job, a time period or a
process
– Assignment of general costs to profit centres
– Determination of profit/loss of profit centres
– Determination of value of work-in-process (w-i-p)
– Determination of financial value of raw material & finished
goods inventories
– Providing status of jobs or w-i-p
POM- Information system
• Information function
–
–
–
–

Incorporates policy information flow from management
Feedback information to management
Information from external environment, as well as
Internal systems within the organisation
POM-Information interfacing
• Information function interfaces in respect of
–
–
–
–
–
–
–
–
–
–

Inventory control
Cost control
Reporting status on orders
Production schedules
Forecasting & scheduling material requirement
Control of w-i-p
Quality control
Preventive maintenance planning
Make or buy decision
Labour efficiency records
Operations Strategy
• Strategy formulation a process by which a firm
determines how it will compete in its industry
• It involves goal determination and the development of
policies for achieving these goals
• Some of these functional areas to define key
operating policies are
–
–
–
–
–
–

Marketing
Sales
Target markets
Product line
Finance & control
Engineering and R&D
Operations Strategy
–
–
–
–

Labour
Purchasing
Production
Distribution

• Purchasing, Production and Distribution must be
carefully related for the operation function
• Production stand alone can not work
– Purchasing provides the material inputs
– Physical distribution system actually involves additional
processing steps in the product flow
– Engineering, R&D and labour provide key inputs to the
operations function
• Product design and key process technology comes from
R&D function
– Labour provides a crucial input to the production
Operations Strategy
• All the activities in the line of material flow from
suppliers through fabrication and assembly and
culminating in product distribution must be integrated
for a sensible operational strategy formulation
• There are six major components to operations
strategy
–
–
–
–
–
–

Strategic implications of operating decisions
Matching the productive system design to market needs
Capacity and location
Technological choices
The work force and job design
Suppliers and vertical integration
Enterprise Competitiveness and
the Operations Function
• Four dimensions of competitiveness that measure the
effectiveness of the operations function
–
–
–
–

Cost
Quality
Dependability as a supplier
Flexibility/ service

• Cost
– Profitability is related to the difference between price and
cost
– To compete on the basis of price requires an operations
function capable of manufacturing at low cost
Enterprise Competitiveness and
the Operations Function
• The effects of location, product design, equipment
use and replacement, labour productivity, good
inventory management, employment of process
technology etc.,all contribute to the resulting costs
• Unit costs are usually reduced as experience is
gained through production
• However, a number of additional sources contribute
to this
– Improved production methods and tools, improved product
design, standardisation, improved material utilisation,
reduction of system inventories, improved layout and flow,
economics of scale and improved organisation
Enterprise Competitiveness and
the Operations Function
• Quality
• Product quality has often been cited as a reason for
preferring the products purchased by the customers
– Dominance by Japanese products

• Customers are often willing to pay more for or wait for
delivery of superior quality products
• Dependability of a Supplier
– Reputation for dependability of supply or even off-the-shelf
availability is often strong competitive weapon
– Customers may compromise on cost or even quality in order
to obtain on-time delivery when they need an item
– The scheduling and coordination of all elements of the
productive system determine its ability to produce on time
Enterprise Competitiveness and
the Operations Function
• Flexibility / Service
• Ability to be flexible will depend upon the design of
the productive system and the process technology
employed
• For large volume production of a standardised item,
perhaps it is not worthwhile
• A competitor could offer such flexibility and there may
a substantial market for him
• Ready availability of good service facility, spare parts
can be winners in the competitive market
Reference
• Production & Operations Management:
Aswathappa / Bhat
• Modern Production/Operations Management:
Buffa / Sarin
• Operations Management: Roger G. Schroeder
Thank You
Om lect 01(r0-may08)_operations strategy_mms_bharti_sies

More Related Content

What's hot

Unit 1 production and operation management
Unit 1 production and operation managementUnit 1 production and operation management
Unit 1 production and operation managementAbu Bashar
 
Production and Operations Mangement
Production and Operations MangementProduction and Operations Mangement
Production and Operations MangementSwapnil Thakur
 
Production Planning and Control
Production Planning and ControlProduction Planning and Control
Production Planning and Controlshrinivas kulkarni
 
Lecture notes of production & operation management
Lecture notes of production & operation managementLecture notes of production & operation management
Lecture notes of production & operation managementComplaint2015
 
Ch 1 introduction_om
Ch 1 introduction_omCh 1 introduction_om
Ch 1 introduction_omitzmeyash
 
Introduction to production operation management
Introduction to production operation managementIntroduction to production operation management
Introduction to production operation managementSumit Malhotra
 
Introduction to Production Planning and control.
Introduction to Production Planning and control.Introduction to Production Planning and control.
Introduction to Production Planning and control.PraveenManickam2
 
Introduction to operation management
Introduction to operation managementIntroduction to operation management
Introduction to operation managementPOOJA GOYAL
 
Introduction to Production and Operations Management
Introduction to Production and Operations ManagementIntroduction to Production and Operations Management
Introduction to Production and Operations ManagementSadashiva Tandur
 
Transforming resources into goods and services
Transforming resources into goods and servicesTransforming resources into goods and services
Transforming resources into goods and servicesgemdeane1
 

What's hot (20)

Introduction to pom
Introduction to pomIntroduction to pom
Introduction to pom
 
Unit 1 production and operation management
Unit 1 production and operation managementUnit 1 production and operation management
Unit 1 production and operation management
 
Operations management overview
Operations management overviewOperations management overview
Operations management overview
 
Production cycle
Production cycle Production cycle
Production cycle
 
Production and Operations Mangement
Production and Operations MangementProduction and Operations Mangement
Production and Operations Mangement
 
Production Planning and Control
Production Planning and ControlProduction Planning and Control
Production Planning and Control
 
Lecture notes of production & operation management
Lecture notes of production & operation managementLecture notes of production & operation management
Lecture notes of production & operation management
 
Ch 1 introduction_om
Ch 1 introduction_omCh 1 introduction_om
Ch 1 introduction_om
 
Unit 1
Unit 1Unit 1
Unit 1
 
Introduction to production operation management
Introduction to production operation managementIntroduction to production operation management
Introduction to production operation management
 
Introduction to Production Planning and control.
Introduction to Production Planning and control.Introduction to Production Planning and control.
Introduction to Production Planning and control.
 
Introduction to operation management
Introduction to operation managementIntroduction to operation management
Introduction to operation management
 
Introduction to Production and Operations Management
Introduction to Production and Operations ManagementIntroduction to Production and Operations Management
Introduction to Production and Operations Management
 
Operation Process
Operation ProcessOperation Process
Operation Process
 
Transforming resources into goods and services
Transforming resources into goods and servicesTransforming resources into goods and services
Transforming resources into goods and services
 
Production planning-and-control
Production planning-and-controlProduction planning-and-control
Production planning-and-control
 
Production system
Production system Production system
Production system
 
PPC
PPCPPC
PPC
 
Controlling
ControllingControlling
Controlling
 
Pom introduction
Pom introductionPom introduction
Pom introduction
 

Viewers also liked

H:\Introduction To Production & Operations Management
H:\Introduction To Production & Operations ManagementH:\Introduction To Production & Operations Management
H:\Introduction To Production & Operations ManagementGraphic Era University
 
What is pom
What is pomWhat is pom
What is pomeseema
 
Sanket Kubal MCD PPT
Sanket Kubal MCD PPTSanket Kubal MCD PPT
Sanket Kubal MCD PPTSanket Kubal
 
Modern Production Systems by Gaston Cedillo
Modern Production Systems by Gaston CedilloModern Production Systems by Gaston Cedillo
Modern Production Systems by Gaston CedilloGaston Cedillo
 
Mba ii pmom_unit-1.1 introduction to production & operation management a - copy
Mba ii pmom_unit-1.1 introduction to production & operation management a - copyMba ii pmom_unit-1.1 introduction to production & operation management a - copy
Mba ii pmom_unit-1.1 introduction to production & operation management a - copyRai University
 
POM Wonderful
POM WonderfulPOM Wonderful
POM Wonderfulmbp817
 
Production and Operations Management
Production and Operations ManagementProduction and Operations Management
Production and Operations ManagementNishant Agrawal
 
Introduction to Operation & production Management
Introduction to Operation & production ManagementIntroduction to Operation & production Management
Introduction to Operation & production ManagementQamar Farooq
 
production and operations management(POM) Complete note
production and operations management(POM) Complete note production and operations management(POM) Complete note
production and operations management(POM) Complete note kabul university
 
Operation Management
Operation ManagementOperation Management
Operation ManagementMAJU
 
Mc Donalds presentation
Mc Donalds presentationMc Donalds presentation
Mc Donalds presentationanshitakashyap
 
Production and operation management ppt @ bec doms bagalkot
Production and operation management ppt @ bec doms bagalkot Production and operation management ppt @ bec doms bagalkot
Production and operation management ppt @ bec doms bagalkot Babasab Patil
 
Mcdonalds presentation
Mcdonalds presentationMcdonalds presentation
Mcdonalds presentationdkirupalli
 
Mc donalds ppt
Mc donalds pptMc donalds ppt
Mc donalds pptrakesh9334
 
Operations Management: Production System
Operations Management: Production SystemOperations Management: Production System
Operations Management: Production SystemSarabjeet Singh
 
types of production system
types of production systemtypes of production system
types of production systempakkiaarzoo
 

Viewers also liked (20)

McD
McDMcD
McD
 
H:\Introduction To Production & Operations Management
H:\Introduction To Production & Operations ManagementH:\Introduction To Production & Operations Management
H:\Introduction To Production & Operations Management
 
What is pom
What is pomWhat is pom
What is pom
 
Sanket Kubal MCD PPT
Sanket Kubal MCD PPTSanket Kubal MCD PPT
Sanket Kubal MCD PPT
 
Modern Production Systems by Gaston Cedillo
Modern Production Systems by Gaston CedilloModern Production Systems by Gaston Cedillo
Modern Production Systems by Gaston Cedillo
 
Mba ii pmom_unit-1.1 introduction to production & operation management a - copy
Mba ii pmom_unit-1.1 introduction to production & operation management a - copyMba ii pmom_unit-1.1 introduction to production & operation management a - copy
Mba ii pmom_unit-1.1 introduction to production & operation management a - copy
 
POM Wonderful
POM WonderfulPOM Wonderful
POM Wonderful
 
Production and Operations Management
Production and Operations ManagementProduction and Operations Management
Production and Operations Management
 
Production and operation management
Production and operation management Production and operation management
Production and operation management
 
Introduction to Operation & production Management
Introduction to Operation & production ManagementIntroduction to Operation & production Management
Introduction to Operation & production Management
 
production and operations management(POM) Complete note
production and operations management(POM) Complete note production and operations management(POM) Complete note
production and operations management(POM) Complete note
 
Mcdonalds
Mcdonalds Mcdonalds
Mcdonalds
 
Operation Management
Operation ManagementOperation Management
Operation Management
 
Mc Donalds presentation
Mc Donalds presentationMc Donalds presentation
Mc Donalds presentation
 
Production and operation management ppt @ bec doms bagalkot
Production and operation management ppt @ bec doms bagalkot Production and operation management ppt @ bec doms bagalkot
Production and operation management ppt @ bec doms bagalkot
 
Mcdonalds presentation
Mcdonalds presentationMcdonalds presentation
Mcdonalds presentation
 
Mc donalds ppt
Mc donalds pptMc donalds ppt
Mc donalds ppt
 
Production and Operation Management
Production and Operation ManagementProduction and Operation Management
Production and Operation Management
 
Operations Management: Production System
Operations Management: Production SystemOperations Management: Production System
Operations Management: Production System
 
types of production system
types of production systemtypes of production system
types of production system
 

Similar to Om lect 01(r0-may08)_operations strategy_mms_bharti_sies

PRODUCTION MGT-world-class-manufacturing.pptx
PRODUCTION MGT-world-class-manufacturing.pptxPRODUCTION MGT-world-class-manufacturing.pptx
PRODUCTION MGT-world-class-manufacturing.pptxChandrasen Sharma
 
Ch11 introto business
Ch11 introto businessCh11 introto business
Ch11 introto businessAjit Kumar
 
Om lect 05_a(r0-aug-08)_manufacturing planning & scheduling_mms_sies
Om lect 05_a(r0-aug-08)_manufacturing planning & scheduling_mms_siesOm lect 05_a(r0-aug-08)_manufacturing planning & scheduling_mms_sies
Om lect 05_a(r0-aug-08)_manufacturing planning & scheduling_mms_siesvideoaakash15
 
Kingsleys Power Point Presentation on Operations Management.pptx
Kingsleys Power Point Presentation on Operations Management.pptxKingsleys Power Point Presentation on Operations Management.pptx
Kingsleys Power Point Presentation on Operations Management.pptxKingsley Aduma
 
Principles of management – mgt101
Principles of management – mgt101Principles of management – mgt101
Principles of management – mgt101Fallahchay Ali
 
Measuring Long-Run and Nonfinancial Organizational Performance
Measuring Long-Run and Nonfinancial Organizational PerformanceMeasuring Long-Run and Nonfinancial Organizational Performance
Measuring Long-Run and Nonfinancial Organizational Performancenarman1402
 
Operations Management and Quality
Operations Management and QualityOperations Management and Quality
Operations Management and QualityMahbuba Yeasmin Era
 
Barcelona mazliach sap_qm
Barcelona mazliach sap_qmBarcelona mazliach sap_qm
Barcelona mazliach sap_qmdeepsblue007
 
Cb12e basic ppt ch11
Cb12e basic ppt ch11Cb12e basic ppt ch11
Cb12e basic ppt ch11Eric
 
Operations strategy and startaegic sourcing 0113
Operations strategy and  startaegic sourcing 0113Operations strategy and  startaegic sourcing 0113
Operations strategy and startaegic sourcing 0113ashish1afmi
 
OPERATIONS MANAGEMENT- Full Slides.pptx
OPERATIONS MANAGEMENT- Full Slides.pptxOPERATIONS MANAGEMENT- Full Slides.pptx
OPERATIONS MANAGEMENT- Full Slides.pptxThusharaVinay
 
Innovative Inventory and Production Management Techniques
Innovative Inventory and  Production Management TechniquesInnovative Inventory and  Production Management Techniques
Innovative Inventory and Production Management Techniquesnarman1402
 
Om lect 03_a(r0-aug08)_process selection_process design_mms_sies
Om lect 03_a(r0-aug08)_process selection_process design_mms_siesOm lect 03_a(r0-aug08)_process selection_process design_mms_sies
Om lect 03_a(r0-aug08)_process selection_process design_mms_siesvideoaakash15
 
Lessons learned supply chain - s3
Lessons learned   supply chain - s3Lessons learned   supply chain - s3
Lessons learned supply chain - s3Matt Crane
 
Production, Logistics, and Purchase strategy
Production, Logistics, and Purchase strategyProduction, Logistics, and Purchase strategy
Production, Logistics, and Purchase strategyPrashant Mehta
 

Similar to Om lect 01(r0-may08)_operations strategy_mms_bharti_sies (20)

Om ibs
Om   ibsOm   ibs
Om ibs
 
PRODUCTION MGT-world-class-manufacturing.pptx
PRODUCTION MGT-world-class-manufacturing.pptxPRODUCTION MGT-world-class-manufacturing.pptx
PRODUCTION MGT-world-class-manufacturing.pptx
 
UNIT V CONTROLLING.pptx
UNIT V CONTROLLING.pptxUNIT V CONTROLLING.pptx
UNIT V CONTROLLING.pptx
 
Ch11 introto business
Ch11 introto businessCh11 introto business
Ch11 introto business
 
Om lect 05_a(r0-aug-08)_manufacturing planning & scheduling_mms_sies
Om lect 05_a(r0-aug-08)_manufacturing planning & scheduling_mms_siesOm lect 05_a(r0-aug-08)_manufacturing planning & scheduling_mms_sies
Om lect 05_a(r0-aug-08)_manufacturing planning & scheduling_mms_sies
 
Kingsleys Power Point Presentation on Operations Management.pptx
Kingsleys Power Point Presentation on Operations Management.pptxKingsleys Power Point Presentation on Operations Management.pptx
Kingsleys Power Point Presentation on Operations Management.pptx
 
Principles of management – mgt101
Principles of management – mgt101Principles of management – mgt101
Principles of management – mgt101
 
Om
OmOm
Om
 
Pom full
Pom fullPom full
Pom full
 
Measuring Long-Run and Nonfinancial Organizational Performance
Measuring Long-Run and Nonfinancial Organizational PerformanceMeasuring Long-Run and Nonfinancial Organizational Performance
Measuring Long-Run and Nonfinancial Organizational Performance
 
Operations Management and Quality
Operations Management and QualityOperations Management and Quality
Operations Management and Quality
 
Barcelona mazliach sap_qm
Barcelona mazliach sap_qmBarcelona mazliach sap_qm
Barcelona mazliach sap_qm
 
Cb12e basic ppt ch11
Cb12e basic ppt ch11Cb12e basic ppt ch11
Cb12e basic ppt ch11
 
Operations strategy and startaegic sourcing 0113
Operations strategy and  startaegic sourcing 0113Operations strategy and  startaegic sourcing 0113
Operations strategy and startaegic sourcing 0113
 
OPERATIONS MANAGEMENT- Full Slides.pptx
OPERATIONS MANAGEMENT- Full Slides.pptxOPERATIONS MANAGEMENT- Full Slides.pptx
OPERATIONS MANAGEMENT- Full Slides.pptx
 
Innovative Inventory and Production Management Techniques
Innovative Inventory and  Production Management TechniquesInnovative Inventory and  Production Management Techniques
Innovative Inventory and Production Management Techniques
 
Om ibs-1
Om ibs-1Om ibs-1
Om ibs-1
 
Om lect 03_a(r0-aug08)_process selection_process design_mms_sies
Om lect 03_a(r0-aug08)_process selection_process design_mms_siesOm lect 03_a(r0-aug08)_process selection_process design_mms_sies
Om lect 03_a(r0-aug08)_process selection_process design_mms_sies
 
Lessons learned supply chain - s3
Lessons learned   supply chain - s3Lessons learned   supply chain - s3
Lessons learned supply chain - s3
 
Production, Logistics, and Purchase strategy
Production, Logistics, and Purchase strategyProduction, Logistics, and Purchase strategy
Production, Logistics, and Purchase strategy
 

More from videoaakash15

Articlesof association
Articlesof associationArticlesof association
Articlesof associationvideoaakash15
 
Allotment of shares vamsi
Allotment of shares vamsiAllotment of shares vamsi
Allotment of shares vamsivideoaakash15
 
Allotment of shares total
Allotment of shares totalAllotment of shares total
Allotment of shares totalvideoaakash15
 
2448661 issue-of-shares
2448661 issue-of-shares2448661 issue-of-shares
2448661 issue-of-sharesvideoaakash15
 
87099 19849-book bulding process
87099 19849-book bulding process87099 19849-book bulding process
87099 19849-book bulding processvideoaakash15
 
Ultravires. cons.notice & indoor
Ultravires. cons.notice & indoorUltravires. cons.notice & indoor
Ultravires. cons.notice & indoorvideoaakash15
 
Procedure for incorporating a public limited company
Procedure for incorporating a public limited companyProcedure for incorporating a public limited company
Procedure for incorporating a public limited companyvideoaakash15
 
Minor as a member of a limited company
Minor as a member of a limited companyMinor as a member of a limited company
Minor as a member of a limited companyvideoaakash15
 
Mergers and amalgamations
Mergers and amalgamationsMergers and amalgamations
Mergers and amalgamationsvideoaakash15
 
Legal environment of business
Legal environment of businessLegal environment of business
Legal environment of businessvideoaakash15
 
Law of special contracts
Law of special contractsLaw of special contracts
Law of special contractsvideoaakash15
 
Introduction to legal frame work
Introduction to legal frame workIntroduction to legal frame work
Introduction to legal frame workvideoaakash15
 
Exhaus comp old form
Exhaus comp old formExhaus comp old form
Exhaus comp old formvideoaakash15
 

More from videoaakash15 (20)

Articlesof association
Articlesof associationArticlesof association
Articlesof association
 
Allotment shares
Allotment sharesAllotment shares
Allotment shares
 
Ca
CaCa
Ca
 
Allotment of shares vamsi
Allotment of shares vamsiAllotment of shares vamsi
Allotment of shares vamsi
 
Allotment of shares total
Allotment of shares totalAllotment of shares total
Allotment of shares total
 
2448661 issue-of-shares
2448661 issue-of-shares2448661 issue-of-shares
2448661 issue-of-shares
 
87099 19849-book bulding process
87099 19849-book bulding process87099 19849-book bulding process
87099 19849-book bulding process
 
Ultravires. cons.notice & indoor
Ultravires. cons.notice & indoorUltravires. cons.notice & indoor
Ultravires. cons.notice & indoor
 
The contract act
The contract actThe contract act
The contract act
 
Procedure for incorporating a public limited company
Procedure for incorporating a public limited companyProcedure for incorporating a public limited company
Procedure for incorporating a public limited company
 
Notes on wto etc
Notes on wto etcNotes on wto etc
Notes on wto etc
 
Mms la12corsout
Mms la12corsoutMms la12corsout
Mms la12corsout
 
Minor as a member of a limited company
Minor as a member of a limited companyMinor as a member of a limited company
Minor as a member of a limited company
 
Mergers and amalgamations
Mergers and amalgamationsMergers and amalgamations
Mergers and amalgamations
 
Legal environment of business
Legal environment of businessLegal environment of business
Legal environment of business
 
Law of special contracts
Law of special contractsLaw of special contracts
Law of special contracts
 
It act,2000 note
It act,2000 noteIt act,2000 note
It act,2000 note
 
Ipr notes
Ipr notesIpr notes
Ipr notes
 
Introduction to legal frame work
Introduction to legal frame workIntroduction to legal frame work
Introduction to legal frame work
 
Exhaus comp old form
Exhaus comp old formExhaus comp old form
Exhaus comp old form
 

Recently uploaded

Plano de marketing- inglês em formato ppt
Plano de marketing- inglês  em formato pptPlano de marketing- inglês  em formato ppt
Plano de marketing- inglês em formato pptElizangelaSoaresdaCo
 
Boat Trailers Market PPT: Growth, Outlook, Demand, Keyplayer Analysis and Opp...
Boat Trailers Market PPT: Growth, Outlook, Demand, Keyplayer Analysis and Opp...Boat Trailers Market PPT: Growth, Outlook, Demand, Keyplayer Analysis and Opp...
Boat Trailers Market PPT: Growth, Outlook, Demand, Keyplayer Analysis and Opp...IMARC Group
 
Harvard Business Review.pptx | Navigating Labor Unrest (March-April 2024)
Harvard Business Review.pptx | Navigating Labor Unrest (March-April 2024)Harvard Business Review.pptx | Navigating Labor Unrest (March-April 2024)
Harvard Business Review.pptx | Navigating Labor Unrest (March-April 2024)tazeenaila12
 
Intellectual Property Licensing Examples
Intellectual Property Licensing ExamplesIntellectual Property Licensing Examples
Intellectual Property Licensing Examplesamberjiles31
 
PDT 88 - 4 million seed - Seed - Protecto.pdf
PDT 88 - 4 million seed - Seed - Protecto.pdfPDT 88 - 4 million seed - Seed - Protecto.pdf
PDT 88 - 4 million seed - Seed - Protecto.pdfHajeJanKamps
 
Slicing Work on Business Agility Meetup Berlin
Slicing Work on Business Agility Meetup BerlinSlicing Work on Business Agility Meetup Berlin
Slicing Work on Business Agility Meetup BerlinAnton Skornyakov
 
HELENE HECKROTTE'S PROFESSIONAL PORTFOLIO.pptx
HELENE HECKROTTE'S PROFESSIONAL PORTFOLIO.pptxHELENE HECKROTTE'S PROFESSIONAL PORTFOLIO.pptx
HELENE HECKROTTE'S PROFESSIONAL PORTFOLIO.pptxHelene Heckrotte
 
TalentView Webinar: Empowering the Modern Workforce_ Redefininig Success from...
TalentView Webinar: Empowering the Modern Workforce_ Redefininig Success from...TalentView Webinar: Empowering the Modern Workforce_ Redefininig Success from...
TalentView Webinar: Empowering the Modern Workforce_ Redefininig Success from...TalentView
 
Borderless Access - Global B2B Panel book-unlock 2024
Borderless Access - Global B2B Panel book-unlock 2024Borderless Access - Global B2B Panel book-unlock 2024
Borderless Access - Global B2B Panel book-unlock 2024Borderless Access
 
NewBase 25 March 2024 Energy News issue - 1710 by Khaled Al Awadi_compress...
NewBase  25 March  2024  Energy News issue - 1710 by Khaled Al Awadi_compress...NewBase  25 March  2024  Energy News issue - 1710 by Khaled Al Awadi_compress...
NewBase 25 March 2024 Energy News issue - 1710 by Khaled Al Awadi_compress...Khaled Al Awadi
 
BCE24 | Virtual Brand Ambassadors: Making Brands Personal - John Meulemans
BCE24 | Virtual Brand Ambassadors: Making Brands Personal - John MeulemansBCE24 | Virtual Brand Ambassadors: Making Brands Personal - John Meulemans
BCE24 | Virtual Brand Ambassadors: Making Brands Personal - John MeulemansBBPMedia1
 
MoneyBridge Pitch Deck - Investor Presentation
MoneyBridge Pitch Deck - Investor PresentationMoneyBridge Pitch Deck - Investor Presentation
MoneyBridge Pitch Deck - Investor Presentationbaron83
 
Q2 2024 APCO Geopolitical Radar - The Global Operating Environment for Business
Q2 2024 APCO Geopolitical Radar - The Global Operating Environment for BusinessQ2 2024 APCO Geopolitical Radar - The Global Operating Environment for Business
Q2 2024 APCO Geopolitical Radar - The Global Operating Environment for BusinessAPCO
 
To Create Your Own Wig Online To Create Your Own Wig Online
To Create Your Own Wig Online  To Create Your Own Wig OnlineTo Create Your Own Wig Online  To Create Your Own Wig Online
To Create Your Own Wig Online To Create Your Own Wig Onlinelng ths
 
Anyhr.io | Presentation HR&Recruiting agency
Anyhr.io | Presentation HR&Recruiting agencyAnyhr.io | Presentation HR&Recruiting agency
Anyhr.io | Presentation HR&Recruiting agencyHanna Klim
 
Data skills for Agile Teams- Killing story points
Data skills for Agile Teams- Killing story pointsData skills for Agile Teams- Killing story points
Data skills for Agile Teams- Killing story pointsyasinnathani
 
Entrepreneurship & organisations: influences and organizations
Entrepreneurship & organisations: influences and organizationsEntrepreneurship & organisations: influences and organizations
Entrepreneurship & organisations: influences and organizationsP&CO
 
MC Heights construction company in Jhang
MC Heights construction company in JhangMC Heights construction company in Jhang
MC Heights construction company in Jhangmcgroupjeya
 

Recently uploaded (20)

Plano de marketing- inglês em formato ppt
Plano de marketing- inglês  em formato pptPlano de marketing- inglês  em formato ppt
Plano de marketing- inglês em formato ppt
 
Boat Trailers Market PPT: Growth, Outlook, Demand, Keyplayer Analysis and Opp...
Boat Trailers Market PPT: Growth, Outlook, Demand, Keyplayer Analysis and Opp...Boat Trailers Market PPT: Growth, Outlook, Demand, Keyplayer Analysis and Opp...
Boat Trailers Market PPT: Growth, Outlook, Demand, Keyplayer Analysis and Opp...
 
Harvard Business Review.pptx | Navigating Labor Unrest (March-April 2024)
Harvard Business Review.pptx | Navigating Labor Unrest (March-April 2024)Harvard Business Review.pptx | Navigating Labor Unrest (March-April 2024)
Harvard Business Review.pptx | Navigating Labor Unrest (March-April 2024)
 
Intellectual Property Licensing Examples
Intellectual Property Licensing ExamplesIntellectual Property Licensing Examples
Intellectual Property Licensing Examples
 
PDT 88 - 4 million seed - Seed - Protecto.pdf
PDT 88 - 4 million seed - Seed - Protecto.pdfPDT 88 - 4 million seed - Seed - Protecto.pdf
PDT 88 - 4 million seed - Seed - Protecto.pdf
 
WAM Corporate Presentation Mar 25 2024.pdf
WAM Corporate Presentation Mar 25 2024.pdfWAM Corporate Presentation Mar 25 2024.pdf
WAM Corporate Presentation Mar 25 2024.pdf
 
Slicing Work on Business Agility Meetup Berlin
Slicing Work on Business Agility Meetup BerlinSlicing Work on Business Agility Meetup Berlin
Slicing Work on Business Agility Meetup Berlin
 
HELENE HECKROTTE'S PROFESSIONAL PORTFOLIO.pptx
HELENE HECKROTTE'S PROFESSIONAL PORTFOLIO.pptxHELENE HECKROTTE'S PROFESSIONAL PORTFOLIO.pptx
HELENE HECKROTTE'S PROFESSIONAL PORTFOLIO.pptx
 
TalentView Webinar: Empowering the Modern Workforce_ Redefininig Success from...
TalentView Webinar: Empowering the Modern Workforce_ Redefininig Success from...TalentView Webinar: Empowering the Modern Workforce_ Redefininig Success from...
TalentView Webinar: Empowering the Modern Workforce_ Redefininig Success from...
 
Borderless Access - Global B2B Panel book-unlock 2024
Borderless Access - Global B2B Panel book-unlock 2024Borderless Access - Global B2B Panel book-unlock 2024
Borderless Access - Global B2B Panel book-unlock 2024
 
NewBase 25 March 2024 Energy News issue - 1710 by Khaled Al Awadi_compress...
NewBase  25 March  2024  Energy News issue - 1710 by Khaled Al Awadi_compress...NewBase  25 March  2024  Energy News issue - 1710 by Khaled Al Awadi_compress...
NewBase 25 March 2024 Energy News issue - 1710 by Khaled Al Awadi_compress...
 
BCE24 | Virtual Brand Ambassadors: Making Brands Personal - John Meulemans
BCE24 | Virtual Brand Ambassadors: Making Brands Personal - John MeulemansBCE24 | Virtual Brand Ambassadors: Making Brands Personal - John Meulemans
BCE24 | Virtual Brand Ambassadors: Making Brands Personal - John Meulemans
 
MoneyBridge Pitch Deck - Investor Presentation
MoneyBridge Pitch Deck - Investor PresentationMoneyBridge Pitch Deck - Investor Presentation
MoneyBridge Pitch Deck - Investor Presentation
 
Q2 2024 APCO Geopolitical Radar - The Global Operating Environment for Business
Q2 2024 APCO Geopolitical Radar - The Global Operating Environment for BusinessQ2 2024 APCO Geopolitical Radar - The Global Operating Environment for Business
Q2 2024 APCO Geopolitical Radar - The Global Operating Environment for Business
 
Investment Opportunity for Thailand's Automotive & EV Industries
Investment Opportunity for Thailand's Automotive & EV IndustriesInvestment Opportunity for Thailand's Automotive & EV Industries
Investment Opportunity for Thailand's Automotive & EV Industries
 
To Create Your Own Wig Online To Create Your Own Wig Online
To Create Your Own Wig Online  To Create Your Own Wig OnlineTo Create Your Own Wig Online  To Create Your Own Wig Online
To Create Your Own Wig Online To Create Your Own Wig Online
 
Anyhr.io | Presentation HR&Recruiting agency
Anyhr.io | Presentation HR&Recruiting agencyAnyhr.io | Presentation HR&Recruiting agency
Anyhr.io | Presentation HR&Recruiting agency
 
Data skills for Agile Teams- Killing story points
Data skills for Agile Teams- Killing story pointsData skills for Agile Teams- Killing story points
Data skills for Agile Teams- Killing story points
 
Entrepreneurship & organisations: influences and organizations
Entrepreneurship & organisations: influences and organizationsEntrepreneurship & organisations: influences and organizations
Entrepreneurship & organisations: influences and organizations
 
MC Heights construction company in Jhang
MC Heights construction company in JhangMC Heights construction company in Jhang
MC Heights construction company in Jhang
 

Om lect 01(r0-may08)_operations strategy_mms_bharti_sies

  • 2. Production Function • Operation/Production function essential to every business • Operations create wealth in a global economy • Operation function responsible to make four key decisions – – – – Process Quality Capacity Inventory
  • 3. Production Function • Production function in manufacturing involves – Transforming a set of inputs through a process into a predetermined set of outputs
  • 4. Production Manager • Production / operations manager is the wealth creator in the company • Operations managers make – Decisions regarding the operations function, – Its interaction with other functions within the organisation and the external environment, and – Plan and control the production process • In an efficient and effective manner
  • 5. Major Decisions at Pizza USA A Framework for OM • Process – How to produce & deliver • Quality – Criteria, measurement & process for achieving • Capacity – Physical facilities & labor • Inventory – What, when & how much?
  • 6. Productive System  Means by which Input resources Are transformed to create Useful goods (products) & services As outputs.
  • 7. AN OPERATING SYSTEM Control (Feedback) subsystem Transformation Output Material Products Labour Energy Capital Production process (Converter) Information Information Processor (controller) Services Information Environment Conversion subsystem Inputs
  • 8. Products and Services • Products – Tangible things that can be carried away with the person • Services – Intangible and perishable and are consumed in the process of their production.
  • 9. Characteristics of Products Vs Services Products Services Intangible & perishable; consumed in the process of their production Can be produced to inventory for off-the- Availability achieved by keeping the shelf availability productive system open for services Complex and interrelated processing Simple processing Tangible Minimal contact with ultimate consumer High contact with clients/customers Demand on system varies on weekly, monthly or seasonal basis Demand commonly variable on hourly, daily and weekly basis Markets served by productive systems are regional,national or international Markets served are usually local Large units that can take advantage of economies of scale Location of system is in relation to regional, national and international markets Relatively small units to serve local markets Location dependent on location of local customers, clients & users
  • 10. Production / Operation Management (POM) • Defined as – Decision making in the operations function – Integration of these decisions with other functions – A transformation system that converts inputs into outputs • In an efficient and effective manner
  • 11. Interfacing with other systems • Basic functional groups: – Marketing • Generates demand – Finance • Generates the capital – Production • Generates the supply of outputs.
  • 12. Marketing and POM • Marketing system – Discovers and transmits the need of consumers to the total organisation including the POM system • Which supplies these needs. – Translates the demand for future into units of production & desired delivery schedules.
  • 13. POM-Marketing interface • Marketing furnishes data on: – Size of market – Volume of production needed to meet anticipated market needs – Desired inventories – Anticipated changes in production of other products – Anticipated delivery schedules: amount,location,timing – Packaging needs
  • 14. Conflicts between Marketing and POM • Unreasonable commitment to customers regarding – Customisation – Delivery schedule – Order quantity
  • 15. Production/Operation Management • POM system generally consists of: – – – – – – – – Forecasting facility requirement Designing total production facility Planning output levels Planning inventory levels Controlling work input Controlling work output Feedback Replanning
  • 16. Production/ Operation Management • POM – Provides production facilities-plants,equipment and personnel. – Provides statistical quality control – Sustains technological growth and improvement & economic viability.
  • 17. POM- Finance & Accounting interface • F&A Function – Responsible for all cash flows between the organisation and external environment. – Interfaces from the inception of the idea of product through its development stages till it is sold
  • 18. POM-F&A Interfacing • Important areas – Accumulation of operating data to form a starting point for standards – Accumulation of cost data of a job, a time period or a process – Assignment of general costs to profit centres – Determination of profit/loss of profit centres – Determination of value of work-in-process (w-i-p) – Determination of financial value of raw material & finished goods inventories – Providing status of jobs or w-i-p
  • 19. POM- Information system • Information function – – – – Incorporates policy information flow from management Feedback information to management Information from external environment, as well as Internal systems within the organisation
  • 20. POM-Information interfacing • Information function interfaces in respect of – – – – – – – – – – Inventory control Cost control Reporting status on orders Production schedules Forecasting & scheduling material requirement Control of w-i-p Quality control Preventive maintenance planning Make or buy decision Labour efficiency records
  • 21. Operations Strategy • Strategy formulation a process by which a firm determines how it will compete in its industry • It involves goal determination and the development of policies for achieving these goals • Some of these functional areas to define key operating policies are – – – – – – Marketing Sales Target markets Product line Finance & control Engineering and R&D
  • 22. Operations Strategy – – – – Labour Purchasing Production Distribution • Purchasing, Production and Distribution must be carefully related for the operation function • Production stand alone can not work – Purchasing provides the material inputs – Physical distribution system actually involves additional processing steps in the product flow – Engineering, R&D and labour provide key inputs to the operations function • Product design and key process technology comes from R&D function – Labour provides a crucial input to the production
  • 23. Operations Strategy • All the activities in the line of material flow from suppliers through fabrication and assembly and culminating in product distribution must be integrated for a sensible operational strategy formulation • There are six major components to operations strategy – – – – – – Strategic implications of operating decisions Matching the productive system design to market needs Capacity and location Technological choices The work force and job design Suppliers and vertical integration
  • 24. Enterprise Competitiveness and the Operations Function • Four dimensions of competitiveness that measure the effectiveness of the operations function – – – – Cost Quality Dependability as a supplier Flexibility/ service • Cost – Profitability is related to the difference between price and cost – To compete on the basis of price requires an operations function capable of manufacturing at low cost
  • 25. Enterprise Competitiveness and the Operations Function • The effects of location, product design, equipment use and replacement, labour productivity, good inventory management, employment of process technology etc.,all contribute to the resulting costs • Unit costs are usually reduced as experience is gained through production • However, a number of additional sources contribute to this – Improved production methods and tools, improved product design, standardisation, improved material utilisation, reduction of system inventories, improved layout and flow, economics of scale and improved organisation
  • 26. Enterprise Competitiveness and the Operations Function • Quality • Product quality has often been cited as a reason for preferring the products purchased by the customers – Dominance by Japanese products • Customers are often willing to pay more for or wait for delivery of superior quality products • Dependability of a Supplier – Reputation for dependability of supply or even off-the-shelf availability is often strong competitive weapon – Customers may compromise on cost or even quality in order to obtain on-time delivery when they need an item – The scheduling and coordination of all elements of the productive system determine its ability to produce on time
  • 27. Enterprise Competitiveness and the Operations Function • Flexibility / Service • Ability to be flexible will depend upon the design of the productive system and the process technology employed • For large volume production of a standardised item, perhaps it is not worthwhile • A competitor could offer such flexibility and there may a substantial market for him • Ready availability of good service facility, spare parts can be winners in the competitive market
  • 28. Reference • Production & Operations Management: Aswathappa / Bhat • Modern Production/Operations Management: Buffa / Sarin • Operations Management: Roger G. Schroeder