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Introduction to operations management fms

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Introduction to operations management fms

  1. 1. INTRODUCTION TO OPERATIONS MANAGEMENT<br />Prof. Kaushik Paul<br />
  2. 2. 2<br />OBJECTIVES<br />To recognise that Operations Management exists<br />The Operations Management Framework<br />To understand the concepts of core and value added services<br />To understand how Operations management is used in practice<br />The position and role of the Operations Management function<br />Operations management activities<br />To understand how the transformation process works<br />Pure Services vs. Pure Goods: The continuum <br />The Operations Management Framework revisited<br />Historical Development of Operations Management (OM)<br />
  3. 3. 3<br />Kitchen unit manufacturing operation<br />Back office operation in a bank<br />They are all operations<br />Take-out / restaurant operation<br />Retail operation<br />
  4. 4. 4<br />Operation’s strategic objectives<br />ENVIRONMENT<br />Operations strategy<br />The operation’s competitive role and position<br />Input transformed resources<br />Improvement<br />Design<br />Materials Information Customers<br />Output products and services<br />Input resources<br />Customers<br />Facilities Staff<br />Planning and control<br />Input transforming resources<br />ENVIRONMENT<br />THE OPERATIONS MANAGEMENT FRAMEWORK<br />
  5. 5. 5<br />CORE SERVICES DEFINED<br />Core services are basic things that customers want from products they purchase<br />
  6. 6. 6<br />Quality<br />Flexibility<br />Speed<br />Price (or cost <br />Reduction)<br />CORE SERVICES PERFORMANCE OBJECTIVES<br />Operations<br />Management<br />
  7. 7. 7<br />VALUE-ADDED SERVICESDEFINED<br />Value-added services differentiate the organization from competitors and build relationships that bind customers to the firm in a positive way<br />
  8. 8. 8<br />Problem Solving<br />Sales Support<br />Information<br />Field Support<br />VALUE-ADDED SERVICE CATEGORIES<br />Operations<br />Management<br />
  9. 9. 9<br />The “technological” specification of its product/service?<br />Product/Service Technology<br />The way it produces its goods and services?<br />Marketing<br />Operations<br />The way it positions itself in its market?<br />OPERATIONS MANAGEMENT IN PRACTICE:WHERE DOES THE BUSINESS GET ITS COMPETITIVE ADVANTAGE FROM?<br />
  10. 10. 10<br />which gives<br />which funds etc.<br />Mass fashion orientation<br />but also<br />Increased variety does not increase costs<br />but because volume is high<br />THE THREE FUNCTIONS WORKING TOGETHER .... e.g. SWATCH<br />Further innovations<br />Innovative plastic design with few parts<br />which funds<br />Product/ service design<br />allows<br />Standardize, easy to make product at high volume so low cost<br />Marketing<br />Operations<br />Extended range<br />
  11. 11. 11<br />Core functions<br />Engineering/ technical function<br />Support functions<br />Accounting and finance function<br />Product/services development function<br />Others<br />Operations function<br />Marketing function<br />Human resources function<br />Information/ technical (IT) function<br />A broad definition of operations management<br />CORE AND SUPPORT FUNCTIONS<br />
  12. 12. 12<br />THE POSITION AND ROLE OF THE OPERATIONS FUNCTION<br />Accounting and finance<br />Product development<br />Operations<br />Marketing<br />Call on <br />Manage <br />Retranslate <br />Conduct <br />Church<br />newcomers<br />appeals<br />scriptures<br />weddings<br />Fast food chain<br />Advertise on <br />Pay <br />Design <br />Make <br />television<br />suppliers<br />hamburgers<br />hamburgers<br />Furniture manufacturer<br />Sell to <br />D<br />esign new <br />Assemble <br />Pay staff<br />stores<br />furniture<br />furniture<br />Process perspective<br />Identify <br />Raise <br />D<br />evelop <br />Make and <br />needs<br />capital<br />product<br />distribute<br />
  13. 13. 13<br />The best way to start understanding the nature of “Operations” is to look around you<br />Everything you can see around you (except the flesh and blood) has been processedby an operation<br />Every service you consumed today (radio station, bus service, lecture, etc.) has also been producedby an operation<br />Operations Managers create everything you buy, sit on, wear, eat, throw at people, and throw away<br />
  14. 14. 14<br />IKEA STORE<br />OPERATIONS MANAGEMENT ACTIVITIES<br />SOME OPERATIONS MANAGEMENT ACTIVITIES AT IKEA<br />Design a store layout which gives smooth and effective flow<br />Ensure that the jobs of all staff encourage their contribution to business success<br />Design elegant products which can be flat-packed efficiently<br />Site selection for stores of an appropriate size in the most effective locations<br />Continually examine and improve operations practice<br />Maintain cleanliness and safety of storage area<br />Monitor and enhance quality of service to customers<br />Arrange for fast replenishment of products<br />
  15. 15. 15<br />TRANSFORMED RESOURCES<br />MATERIALS INFORMATION CUSTOMERS<br />FACILITIES STAFF<br />TRANSFORMING RESOURCES<br />THE TRANSFORMATION PROCESSES<br />ALL OPERATIONS ARE TRANSFORMATION PROCESSES<br />ENVIRONMENT<br />GOODS AND SERVICES<br />TRANSFORMATION PROCESS<br />INPUT<br />OUTPUT<br />ENVIRONMENT<br />
  16. 16. 16<br />OPERATIONS MANAGEMENT – BASIC PRINCIPLES<br />Operations management is concerned with producing and delivering products and services<br />Materials<br />Products and services<br />Information<br />Customers<br />All types of enterprise have an operations function, even if it isn’t called ‘operations.<br />Most operations produce both products and services.<br />
  17. 17. 17<br />GOODS VS. SERVICES: THE CONTINUUM<br />THE OUTPUT FROM MOST TYPES OF OPERATION IS A MIXTURE OF GOODS AND SERVICES<br />Pure goods<br />Tangible<br />Can be stored<br />Production precedes consumption<br />Low customer contact<br />Can be transported<br />Quality is evident<br />Crude oil production<br />Aluminium smelting<br />Specialist machine tool manufacturer<br />Restaurant<br />Intangible<br />Cannot be stored<br />Production and consumption are simultaneous<br />High customer contact<br />Cannot be transported<br />Quality difficult to judge<br />Computer systems services<br />Management consultancy<br />Psychotherapy clinic<br />Pure services<br />
  18. 18. 18<br />OPERATIONS STRATEGIC OBJECTIVES<br />INPUT TRANSFORMED RESOURCES<br />OPERATIONS STRATEGY<br />THE OPERATIONS COMPETITIVE ROLE AND POSITION<br />MATERIALS INFORMATION CUSTOMERS<br />Operations strategy<br />IMPROVEMENT<br />DESIGN<br />Operations management<br />PLANNING AND CONTROL<br />FACILITIES STAFF<br />INPUT TRANSFORMED RESOURCES<br />THE OPERATIONS MANAGEMENT FRAMEWORK REVISITED<br />ENVIRONMENT<br />GOODS AND SERVICES<br />INPUT<br />OUTPUT<br />ENVIRONMENT<br />
  19. 19. 19<br />Design<br />Planning & Control<br />Improvement<br />OPERATIONS ACTIVITIES AS FEEDBACK LOOPS<br />Design activities set the basic configuration<br />Planning & control activities guide short/medium term changes<br />Improvement activities guide longer term changes<br />
  20. 20. 20<br />HISTORICAL DEVELOPMENT OF OPERATIONS MANAGEMENT<br />JIT, TQC and factory automation ( Kanban, Poka Yokes, CIM, FMS, CAD/CAM, Robots etc.)<br />Manufacturing Strategy Paradigm (Manufacturing as a competitive weapon)<br />Synchronous Manufacturing (Bottleneck analysis, OPT, Theory of constraints)<br />Service Quality and Productivity (Mass production in the service sector)<br />Total Quality Management and Quality Certification (ISO 9000 etc.)<br />Business Process Reengineering (Radical change paradigm)<br />Supply Chain Management (Supply Network optimization as opposed to optimization at individual firm level) <br />Electronic Commerce (Internet)<br />
  21. 21. References: 1) ‘Operations Management’ By Nigel Slack et al. 2e2) ‘Operations Management for Competitive Advantage’ By Chase, Jacobs & Aquilano, 10e<br />HOPE YOU ENJOYED THE CLASS. QUESTIONS PLEASE<br />THANK YOU<br />

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