This power point is about the introduction to operation management

1. Introduction to
Operations
Management

2. Objectives:
At the end of this lesson, students should be able to:
1. Define what is Operations Management.
2. Understand the historical development of Operations
Management.
3. Explain the importance of studying and learning
about operations management.
4. Appreciate the contributions of Operations
Management to an individual, to the business sectors
and to the society.

3. WHAT IS OPERATIONS MANAGEMENT?
The collection of people, technology,
and systems within a company that has
primary responsibility for providing the
organization’s products or services.

4. The management of the direct
recourses that are required to
produce and deliver an
organization’s goods and
services.

5. A discipline and profession that
studies and practices the process
of planning, designing, and
operating production systems and
subsystems to achieve the goals of
the organizations.

6. The business function
responsible for planning,
coordinating and controlling the
resources needed to produce a
company’s products and
services.

7. The management of the
conversion process that
transforms inputs into outputs
in the form of finished goods
and services.

8. It is concerned with converting
materials and labour into
goods and services as
efficiently as possible to
maximize the profit of an
organization.

9. Business Process
Technology
Finance
Operations Management

10. OPERATIONS IN THE ORGANIZATION
The operations function is central to the organization because it creates and
delivers the services and products, which is the reason for its existing.
The operations function is one of the three core functions of any
organizations. These are:
1. The marketing function (including sales)-responsible for communicating
the organization’s services and products to its markets in order to generate
customer requests.
2. The product/service function- responsible for coming up with new and
modified services and products in order to generate future customer
requests.
3. The operations function- responsible for the creation and delivery of
services and products based on customer request.

11. HISTORICAL DEVELOPMENT OF OPERATIONS
MANAGEMENT
INDUSTRIAL REVOLUTION- begins in the 1770s in
England and spread to the rest of Europe and USA
during the 19th century.
• Craft Production- system in which highly skilled
workers use simple, flexible tools to produce small
quantities of customized goods.
• The development of standard gauging system has
boost the industrial evolution, Factories begun to
sprung up and grow rapidly, providing jobs.

12. SCIENTIFIC MANAGEMENT – spearheaded by engineer and
inventor Frederick Winslow Taylor (father of scientific
management)
- Believed that scientific management based on
observation, measurement, analysis, and improvement
of work methods for doing each job. Believed that
management should be responsible for planning
carefully selecting and training workers, finding the best
way to perform each job achieving cooperation between
management and workers; emphasized on maximizing
output.

13. Some Contributor of Scientific Management Movement
1. Frank Gilbreth- Father of Motion Study. Develop principles of
motion economy that could be applied to incredibly small
portion of tasks.
2. Henry Gantt- recognized the value of nonmonetary rewards
to motivate workers and developed a widely used system of
scheduling, the Gantt Chart.
3. Harrington Emerson- applied Taylor’s ideas to organization
structure and encouraged the use of expert to improve
organizational efficiency.
4. Henry Ford- The great industrialist, employed scientific
management in his factory.

14. FORD’S CONTRIBUTION
MASS PRODUCTION- System of production in which large
volumes of standardized low-skilled or semi-skilled
workers using highly specialized, and often costly,
equipment.
INTERCHANGEABLE PARTS- parts of a product made to
such precision that they not have to be custom fitted. (Eli
Whitney).
DIVISION OF LABOR- The breaking of production process
into small task, so that each worker perform a small
portion of the overall job.

15. HUMAN RELATION MOVEMENT
Emphasized the importance of the human element in job
design.
Contributors:
1. Lilian Gilbreth- work on focusing on human factor in work
2. Elton Mayo- Work motivation is critical for improving
productivity
3. Abraham Maslow- Develop motivational theories ( Maslow’s
Hierarchy of Needs)
4. Douglas McGregor- Theory X and Theory Y

16. DECISION MODELS AND MANAGEMENT
SERVICES
Contributors:
1. F.W. Harris- develop the 1st quantitative technique,
a mathematical model for inventory size.
2. H.F. Dodge, H.G. Romig, and W. Shewhart-
developed statistical procedures for sampling and
quality control.
3. LHC Tippet- conducted studies that provide the
groundwork statistical sampling theories.

17. The Japanese Influence
 They have developed and refined management
practices that increased the productivity and quality of
their products due to the influence of W. Edward
Deming and Joseph Juran.
 The Japanese approaches emphasized on quality and
continual improvement, worker teams and
empowerment, and achieving customer satisfaction.
 They can be credited the birth of “quality control”.

18. OPERATIONS TODAY
INTERNET- offers great potential for business organizations.
E-BUSINESS- changing the way business organizations interact with their
customers and suppliers.
E-COMMERCE- consumer- business transactions such as buying online or
requesting information: has increase the attention of business in developing
their strategies and decision making.
TECHNOLOGY- refers to the application of scientific discoveries to the
development and improvement of goods and services.
HIGH TECHNOLOGY-refers to the most advanced and developed machines and
methods.
MANAGEMENT OF TECHNOLOGY- management must keep up with the new
trends and weigh its benefits and risks.

19. Operations Management is concern with three kinds of
technology:
1. Product and service technology- refers to the
discovery of new product and services. Done mainly by
researchers and engineers.
2. Process Technology- refers to the methods,
procedures, and equipment used to produces goods and
services.
3. Information Technology- refers to the science and
use of computers and other electronic equipment to
store, process and send information.

20. An organization that applies operations
management successfully should be able to
achieve the following objectives:
1. Fulfill Product/ Service Quality Standard
2. Improve Customer Satisfaction
3. Enhance Productivity
4. Enhance Efficiency
5. Revenue Growth

21. WHY OPERATIONS
MANAGEMENT IS
IMPORTANT?