Sunil Chopra

Kellog School of Management, Northwestern University, Evanston Illinois 60208,

William Lovejoy
School of Business,, University of Michigan, Ann Arbor, Michigan 48109,
Candace Yano
IEOR Department and the Haas School of Buisness, University of California, Berkle,
California 94720,

FIVE DECADES OF OPERATIONS MANAGEMENT AND THE

PROSPECTS AHEAD
Vol. 50, January 2004, pp. 8-14
INTRODUCTION
The design, execution and control of operations that convert resources into desired
good and services and implement a companys business strategy is Operations Management.
The importance of this subject in addition to the challenges faced and future opportunities are
highlighted in this paper.
RESEARCH METHODOLOGY
Data in this paper has been collected from literature reviews, publications, researchers
work, periodic survey of firms, case studies, panel discussions of experts etc.
HISTORY
Although the origin of operations management was before the Second World War, the
subject gained practical importance only after the war and was more into effect after the
industrial revolution. The management problems in the area of operation management
comprise of quantitative, social, technical issues and their complex mixtures. Line balancing,
schedule, production planning, inventory control, lot sizing, automation, critical path
analysis, outsourcing, etc. are some of the issues.

CHALLENGES
Technology, scientific computing, business trends, practises and education brought
numerous changes in the operations management field. The challenges faced in Operations
Research were:

The 1950s and 1960s provided a glimpse of the promise of management

science to industry, the next two decades saw less success in delivering on the

promise they had made to the industry..

The academic research in operations research along with operations
management became less focussed in problems arising in a broad range of
functional areas and more on problems that were internal to the theory
developed in the field. At the same time, trends such as the introduction of
material requirements planning (MRP) systems, just-in-time (JIT), the Toyota
production system (TPS), and total quality management (TQM) started to set
in that had wide range impact on businesses.

The research was valuable because it brought the attention of the field back to issues that
were of concern to practising managers.
As a result of this research there were two major results.
1. A move back toward interdisciplinary research.
2. An explicit recognition of decentralized loci of control and local incentives and
hence the re-emergence of economic equilibrium in addition to sole owner
optimality as criteria of central interest to our community.
A few ideas were put forward like, business practise called the existing research paradigm
into questions. Second, addressing the new problems in some cases required the importance
of technology developed elsewhere and third, the research focus became more managerial
and less on tactical execution.

FUTURE TREND
This research will by necessity become more cross-functional in scope, which will
require facility with the tools and concepts that have been developed in other research
disciplines like

Supply chains: Supply chain is the management of all aspects of providing goods

to consume, from extraction of raw materials to end-of-life disposal.

OM-Marketing interface: Marketing is the key information gatekeeper between
operations and the product markets. Interdisciplinary research involving

operations and marketing decisions goes back many decades.

OM-Finance interface: Companies have long recognized the role and impact of
these assets in their financial decision making, but it is only recently that

operations management researchers have started to relate financial models.

OM-Organizations interface: Operations management models have been
historically invoked oversimplified models of motivation, learning, creativity and
other aspects of human behaviour that are vital to the success of management

policies in practise.
Service operations: Operations management academics have struggled with a

clear definition of what services are and what research challenges they pose.
Operations Strategy: There is a large literature on firm strategies and less

literature on the functional strategies and how they interact with each other.
Process Design and Improvements: Many quality programs have process
improvement as their chore scheme and key applied tactic is managing innovation.

FINDINGS AND CONCLUSION

Operations management face lot of problems both in private & public sectors at the
organisation level. Most important problems are e-business, SCM, production planning,
scheduling, production develop, decision support system, information based strategy, risk of
environment management, systems develop and implementation. Operations management is
key process in any organisation, whether it is service-based or product based company,
operation may principles & concepts changes from one industry to another.OM will be an
integral business process in all industries in changing times.
SUGGESTIONS

1
2
3
4
5
6

Increase the usage of ERP & SCM.

Strengthen the product lines by forming cross-border alliances with enterprises.
Benchmarking for smaller business to join supply network.
Get update to information technology for integration of business.
Develop new product/service according to customer needs and preferences
Development of flexible supply chain to enable mass customization of products and
services.
Winter Nie And Deborah L.Kellogg,
How Professors Of Operations Management View Service Operations,
Production And Operations Management,
VOL 8, Issue 3, September 1999

INTRODUCTION
Operations management began to consider service arena distinct from the manufacturing
arena in the mid-70. Researchers like Thomas (1978) and McColgan (1997) suggested service
operations be managed differently. Although James Fitzsimmons felt this research(1997) is
decades overdue, there are various reasons to pursue it now because of the evidences
suggested, stating of basic assumptions and surveying technique use. In order to stress the
importance of service operations in operations management factors its six unique
characteristics are considered. This research paper specifies that Intangibility is citied as the
fundamental difference between goods and services. As strategic decisions are involved in an
organization, service characteristics limits strategic choices and tactical decisions.
RESEARCH METHODOLOGY
The primary objective of this research study was to find how the service characteristics rank
and its impact on key operational issues. The secondary objective is to determine in which
areas service OM research is needed. The research methodology used here is Survey. This
was decided on the basis of a literature review. A pre-test suggested that many respondents
who were not familiar with service OM did not complete the survey. The population size was
720 of which the actual population was shortened to 700 because of incorrect addresses and
other factors.

MAJOR FINDINGS AND RESULTS

From the actual population of 700 only 167 usable surveys returned (24% response
rate). The survey was carried out to measure the respondents view in areas like Respondents
service/manufacturing focus, manufacturing and service om approaches, importance of
service characteristics, research directions. Likert scale, chi square study, anova test,
posteriori contrast analysis, box plot determination etc were the techniques used to analyze
the information of the respondents.
The responses clearly gave the view that people whose research orientation is in
service operations management gave a positive response to services whereas the people in
manufacturing research didnt even respond to the service sector. The study also revealed that
90% b-school graduates will work in service settings either in service firms or in service
function within manufacturing businesses. It was also found that 26% of all respondents
never covered service topics. It also said that OM academicians research focus was on
manufacturing based. When considering service characteristics, customer influence had a
large impact on four of the OM decision areas. Even though characteristics are different in
terms of their impact in OM decisions, customer influence dominates when viewed broadly.
This research was motivated by an increasing frustration in the service OM research
area. All respondents rated the importance of service OM characteristics in similar way.
Customer influence dominates all other characteristics where labour intensity as least
influential in the impact of operations decisions.
CRITICISM
This research study was carried out because of the fact that service OM was considered to be
distinct from manufacturing area. The outcome of the survey gave a clear fact that population
selected had people from manufacturing and service management alone. The survey method
used also had a major problem as the respondents likely responded only to the area in which
they belong to. As a result there was lack of agreement on service OM.
Manufacturing oriented academicians were unwilling to support the service OM must be
studied using different theories, skills, competencies.,etc. Service OM researchers must
develop a new paradigm and service oriented academics must perform a better job in

articulating and demonstrating why the service operations should be managed differently with
its unique six characteristics.
-Janani Sreedharan
-1420246
-III MBA, Section C