This document provides an overview of operations management, including its definition, scope, functions, evolution, and recent issues. It covers the transformation process that converts inputs into valuable outputs while emphasizing efficiency, quality, and customer satisfaction. Additionally, it discusses various production systems, strategic decision-making, and the importance of adapting to technological advancements and sustainability challenges.

1. OPERATIONS
MANAGEMENT

2. UNIT-1
INTRODUCTION
Contents
• Concept and scope of Operations Management
• Evolution of Operations Management
• Transformation process in Operations Management
• Types of Production System
• Operations Management and Decision Making
• Recent issues in Operation Management

3. Operation Management
Concept
Operation
An operation refers to any activity or series of activities that are carried out to achieve a
specific objective or produce a particular outcome. Operations are the core processes
that transform inputs (such as materials, labor, and information) into outputs (such as
goods and services) that provide value to customers.
Management
Management refers to the art of getting things done through people .
Operation Management
It involves managing resources efficiently to produce the desired output in a cost-
effective manner while ensuring high quality and customer satisfaction.

4. Functions of Operation Management
•Developing new products and services that meet market demands.
•Ensuring designs are cost-effective and feasible for production.
•Continuously improving processes to enhance productivity and quality.
•Ensuring the organization can meet customer demand without overproduction or
underproduction.
•Coordinating schedules to meet delivery deadlines.
•Streamlining processes to reduce waste and lower costs.
•Delivering high-quality products and services that meet or exceed customer
expectations.

5. Scope of Operation Management
1. Product and Service Design
 Developing new products and services that meet customer needs and
market demands.
 Ensuring designs are practical, cost-effective, and manufacturable.
 Collaborating with marketing, engineering, and research and
development teams.
2. Process Design and Management
 Designing processes that transform inputs into finished goods or
services.
 Identifying and implementing best practices to optimize production.
 Continuously improving processes to enhance efficiency and quality.

6. Scope of Operation Management
3. Capacity Planning
 Determining the production capacity required to meet changing
demands.
 Planning for long-term capacity needs and making decisions about
equipment, facilities, and workforce.
 Balancing capacity with demand to avoid overproduction or shortages.
4. Supply Chain Management
 Managing the flow of materials, information, and finances from suppliers
to customers.
 Coordinating with suppliers, manufacturers, and distributors.
 Ensuring timely delivery of raw materials and finished products.

7. Scope of Operation Management
5. Quality Management:
 Implementing quality control and quality assurance practices.
 Striving for continuous improvement to meet and exceed quality
standards.
6. Inventory Management:
 Managing inventory levels to balance costs with service levels.
 Ensuring that materials and products are available when needed without
excess stock.

8. Scope of Operation Management
7. Maintenance Management
 Keeping equipment and facilities in optimal working condition.
 Planning and performing regular maintenance to prevent breakdowns.
 Implementing reliability and preventive maintenance programs.
8. Project Management
 Planning, executing, and closing projects that relate to operations.
 Managing project timelines, budgets, and resources.
 Ensuring projects align with strategic goals and deliver expected
outcomes.

9. Evolution of Operation Management
The evolution of operations management reflects the development and
transformation of production and service delivery processes over time.
1.Craft Production Era (Pre-Industrial Revolution)
 Characteristics: Handcrafted goods, highly skilled artisans, customized products,
limited production scale.
 Challenges: Low productivity, high costs, inconsistent quality.
2.Industrial Revolution (Late 18th to 19th Century)
 Key Innovations: Introduction of machinery, steam power, and the factory system.
 Division of Labor: Adam Smith's concept improved efficiency and productivity.
 Impact: Increased production capacity, reduced costs, and standardized products.

10. Evolution of Operation Management
3. Scientific Management (Early 20th Century)
Pioneer: Frederick Winslow Taylor.
Principles:
 Time and motion studies to improve efficiency.
 Standardization of work practices.
 Differential piece-rate system to incentivize workers.
Outcome: Significant improvements in productivity and efficiency, but often criticized for dehumanizing
work.
4. Human Relations Movement (1930s-1950s)
Key Figures: Elton Mayo, Abraham Maslow, Douglas McGregor.
Focus: Recognizing the importance of human factors in productivity.
The Hawthorne Studies: Highlighted the impact of social relations and worker satisfaction on
productivity.
Theories:
 Maslow's Hierarchy of Needs.
 McGregor's Theory X and Theory Y.
Outcome: Emphasis on employee motivation, teamwork, and leadership.

11. Evolution of Operation Management
5. Modern Production Concepts (1950s-1970s)
Key Innovations:
Just-in-Time (JIT): Developed by Toyota to reduce inventory costs and improve efficiency.
Lean Manufacturing: Focuses on eliminating waste and continuous improvement.
Quality Management: Introduction of Total Quality Management (TQM) and Six Sigma.
Key Figures: W. Edwards Deming, Joseph Juran.
Impact: Improved quality, efficiency, and customer satisfaction.
6. Globalization and Supply Chain Management (1980s-Present)
Trends: Global sourcing, outsourcing, supply chain integration.
Technologies: Enterprise Resource Planning (ERP) systems, Supply Chain Management (SCM)
software.
Focus: Coordination and optimization of the entire supply chain, from raw materials to customer
delivery.
Impact: Enhanced global competitiveness and responsiveness to market changes.

12. Evolution of Operation Management
7. Service Operations and Information Technology (1990s-Present)
Shift: Increasing importance of service industries.
Concepts: Service quality, customer satisfaction, and service design.
Technologies: Information Technology (IT) and automation, such as e-commerce,
Customer Relationship Management (CRM), and data analytics.
Impact: Improved service delivery, customer interaction, and operational efficiency.
8. Sustainability and Resilience (21st Century)
Focus: Sustainable practices, environmental impact, and resilience.
Concepts: Circular economy, green manufacturing, Corporate Social Responsibility
(CSR).
Technologies: Renewable energy, sustainable materials, advanced manufacturing
technologies.
Impact: Balancing economic, environmental, and social goals in operations
management.

13. Transformation Process

14. Transformation Process

15. Transformation Process

16. Transformation Process
• For getting desired output , quality of inputs has to be monitored.
• The quality of actual output obtained also has continually compared with the
desired output.
• Feedback mechanisms are required to monitor the performance of the
transformation process.
• Random disturbance are unexpected and sometimes not planned for. They are
mostly due to external environment.

17. Types of Production System
Production systems can be classified into two types:
• Intermittent system
• Continuous system

18. Types of Production System
1. Intermittent Production System
In this system, the goods are manufactured specially to fulfill the orders
made by customers rather than stock.
Flexible to suit production varieties
Workloads are generally unbalanced.
Most products are produced in small quantity.
Machines and equipment are laid out by process.
Examples: Goldsmith, Tailor

19. Types of Production System
2. Continuous Production System
In this system the items are produced for the stocks and not for specific
orders.
High Volume Production
Standardized Products
Automated Processes
Flow Production
Specialized Equipment
Examples: Chemicals, petroleum, automotive

20. Operations Management and Decision Making
 Strategic Planning: Involves long-term decisions about the
overall direction of the company, such as product design, facility
location, and capacity planning. These decisions set the
foundation for operations.
 Process Design and Improvement: Focuses on designing
efficient processes for production and continuously improving
them to enhance productivity, reduce costs, and improve quality.

21. Operations Management and Decision Making
 Resource Allocation: Deals with allocating resources such as
labor, materials, and machinery effectively to meet production
goals and ensure optimal use of resources.
 Supply Chain Management: Involves managing the flow of
materials and information from suppliers to customers. Effective
supply chain management ensures timely delivery of products
and cost efficiency.

22. Operations Management and Decision Making
 Quality Management: Ensures that products meet customer
expectations and standards. This involves implementing quality
control and assurance practices to maintain consistency and
reduce defects.
 Decision-Making Tools: Utilizes various analytical and
decision-making tools such as forecasting, inventory
management, and optimization models to support and enhance
operational decisions, ensuring they are data-driven and effective.

23. Recents Issues in Operation Management
Advances in Technology
Supply Chain Disruptions
Sustainability and Environmental Impact
Digital Transformation
Workforce Management
Cybersecurity
 Customer-Centric Operations
 Innovation and Continuous Improvement