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Chapter 1
Overview: Introduction to the Field

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OBJECTIVES
Operations Management Why Study Operations Management? Production System Defined Operations as a Service Plan of This Book Historical Development of OM Current Issues in OM

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What is Operations Management? Defined


Operations management (OM) is defined as the design, operation, and improvement of the systems that create and deliver the firms primary products and services

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Why Study Operations Management?


Systematic Approach to Org. Processes

Business Education

Operations Management

Career Opportunities

Cross-Functional Applications
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What is a Production System? Defined


A production system is defined as a user of resources to transform inputs into some desired outputs

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Transformations
Physical--manufacturing Locational--transportation Exchange--retailing Storage--warehousing Physiological--health care Informational--telecommunications

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What is a Service and What is a Good?


If you drop it on your foot, it wont hurt you. (Good or service?)

Services never include goods and goods never include services. (True or false?)

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OM in the Organization Chart


Finance Operations Marketing

Plant Manager

Operations Manager

Director

Manufacturing, Production control, Quality assurance, Engineering, Purchasing, Maintenance, etc


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Core Services Defined


Core services are basic things that customers want from products they purchase

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Core Services Performance Objectives


Quality

Flexibility

Operations Management

Speed

Price (or cost Reduction)

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Value-Added Services Defined

Value-added services differentiate the organization from competitors and build relationships that bind customers to the firm in a positive way

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Value-Added Service Categories


Problem Solving

Information

Operations Management

Sales Support

Field Support

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Plan of This Book

I. Operations Strategy and Managing Change

1. Introduction to the Field 2. Operations Strategy and Competitiveness III. Supply Chain Design 3. Project Management 9. Supply Chain Strategy 11. Just-in-Time and Lean Systems

II. Product Design and Process Selection

4. Process Analysis 5. Product Design and Process Selection -Manufacturing 6. Product Design and Process Selection -Services

10. Strategic Capacity Management

IV. Planning and Controlling the Supply Chain

12. Forecasting and Demand Management

7. Quality Management

13. Aggregate Sales and Operations Planning 14. Inventory Control 15. Materials Requirements Planning 16. Operations Scheduling 17. Synchronous Manufacturing and Theory of Constraints
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8. Operations Consulting and Reengineering

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Historical Development of OM
JIT and TQC
Manufacturing Strategy Paradigm

Service Quality and Productivity


Total Quality Management and Quality Certification

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Historical Development of OM (contd)


Business Process Reengineering
Supply Chain Management Electronic Commerce

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Current Issues in OM
Effectively consolidating the operations resulting from mergers Developing flexible supply chains to enable mass customization of products and services Managing global supplier, production and distribution networks Increased commoditization of suppliers
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Current Issues in OM (contd)


Achieving the Service Factory

Enhancing value added services


Making efficient use of Internet technology Achieving good service from service firms
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End of Chapter 1

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