Subject:

Operations Management

Chapter I: Overview of Operations Management and Productivity

Overview and Concepts of Operations Management, Heritage of Operations Management. Operations in Service Sector, Concept of Productivity and Variables and its measurement. Objectives of production / operation management

 Production
Creation of goods and services

Operations Management

Operations management
Set of Activities that create value in the form of goods & services through the transformation of

inputs to outputs
Operations Management is:
The management of systems or processess that create goods and /or provide services

Operations Management Affects,

Companies ability to compete Nations ability to compete internationally

Organizations
Three basic functions

Operations

Finance

Marketing

Transformation
Value Added
INPUT
Land Labor Capital Information

OUTPUT
TRANSFORMATION Goods Services

Feedback
Control

Feedback

Feedback

Operations Interfaces
Industrial Engineering

Maintenance

MIS

Distribution

Operations

Public Relations

Purchasing

Personnel

Accounting

Transformations in different forms

Physical -- manufacturing Location- - transportation

Exchange -- retailing
Storage -- warehousing Physiological -- health care Informational -- telecommunications

Operation Functions in a Bank

Commercial Bank

Operations
Teller Scheduling Check Clearing Collection Transaction Processing Facilities design/layout Vault operation Maintenance Security

Finance
Investment Securities Real Estate

Marketing
Loans
Commercial Industrial Financial Personal Mortgage

Accounting
Auditing

Trust Department

Operations Functions in a Airline

Airline

Operations
Ground Support Equipment Maintenance Ground Operations Facility maintenance Catering Flight operations Crew Scheduling Flying Communications Dispatching

Finance/Accounting
Accounting Accounts payable Accounts Receivable General Ledger Finance Cash Control International exchange

Marketing
Traffic Administration
Reservation Schedules Tariffs(pricing) Sales Advertising

Manufacturing
Operations
Facility construction & maintenance Production & Inventory Control Scheduling, material control Quality assurance & control Supply-chain management Manufacturing Tooling, fabrication, assembly design. Product development & design Detailed product specifications Industrial engineering Efficient use of machines, space and personal Process Analysis Development & installation of production tools and equipment

Finance/Accounting
Disbursement/Credits Accounts payable Accounts Receivable General Ledger Fund Management Money Market International exchange Capital requirements Stock issue Bond issue & recall

Marketing
Sales Promotion
Sales Advertising Market Research

Input Process - Output

What do Operations Managers do?

What are operations jobs? and Where?

Types of Operations
Operations
Goods Producing Storage/Transportation

Examples
Farming, mining, construction, manufacturing, power generation Warehousing, trucking, mail service, moving, taxis, buses, hotels, airlines Retailing, wholesaling, banking, renting, leasing, library, loans Films, radio and television, concerts, recording Newspapers, radio and television newscasts, telephone, satellites

Exchange

Entertainment
Communication

Emerging Challenges in OM
From
Local or National focus Batch shipments

To
Global Focus Just in Time

Low bid purchasing

Lengthy product development Standard products Job specialization

Supply chain partnering

Rapid product development Mass customization Empowered employees, Teams

Concept of Productivity
Productivity is the ratio of outputs (goods or services) divided by the inputs (resources, such as labor and capital) Operations Managers job is to enhance this ration of outputs to inputs.
Reducing inputs while keeping output constant
OR

Increasing output while keeping inputs constant

Thank You