Embed Size (px)
Citation preview
© Fred Van Bennekom 2005 Slide 1
Introduction to Operations Management
© Fred Van Bennekom 2005 Slide 2
Operations Management
Create operational systems. Manage (plan, organize, staff, direct and
control) the activities relating to the production of goods and/or services with maximum efficiency (at the lowest cost) and effectiveness (in the eyes of the customer).
Improve those processes continuously to create competitive advantage.
© Fred Van Bennekom 2005 Slide 3
The Operations System
The operations system transforms inputs into desired goods and services.
OUTPUTSINPUTS PROCESS
EXTERNALFACTORS
FEEDBACK
Material flow
Information Flow
© Fred Van Bennekom 2005 Slide 4
OperationsManagemen
t~
The Context
Business Unit Strategy
MarketingStrategy
4 PsPlace
ProductPrice
Promotion
Competitive Priorities & PositioningCost, Quality, Time, Flexibility, Service
Customer Satisfaction (Internal & External)
Market ShareQuality Measures
Cost Measures
Performance Measures
Execution Processes
Operations Strategy
StructuralFacility Location
CapacityVertical IntegrationProcess Technology
InfrastructuralWorkforce
QualityPolicies/Procedures
Organizational Structure
Corporate Strategy
© Fred Van Bennekom 2005 Slide 5
Manage theProcessInputs Outputs
> > > >>Conversion
Improve theProcess
Operations Management
Create theProcess
New Product Development
Innovation
Quality Management
Planning & Control
Infrastructural Elements
Workforce
Organization
Technology
Vertical Integration
Structural Elements
Capacity
Facilities
CostQuality
Time FlexibilityService
Evaluate On
© Fred Van Bennekom 2005 Slide 6
Types of Conversions
Physical Chemical Locational Educational Entertained
© Fred Van Bennekom 2005 Slide 7
Competitive Priorities for the Operational Function
Price or Cost Quality
– Short Run: Conformance, Design (Fitness for Use)– Long Run: Continuous Improvement Thru the Learning
Organization Flexibility
– Product Mix: make various products and adjust mix– Handle volume Surge
Time - Dependability– Speed of Delivery (Lead Time)– Speed to Market (New Product Development Time)
Service– Delivering a comprehensive solution – products & augmenting
services – to the customer’s needs
© Fred Van Bennekom 2005 Slide 8
Theory of Slack Ropes
Quality
Flexibility Price
Service
Time
By pulling on one priority, the others tend to get pulled along with it.
Source: Duncan McDougall
© Fred Van Bennekom 2005 Slide 9
Interfunctional Strategies
Marketing
Strategy
Order QualifiersCharacteristics of the product-service bundle that gain entry to and maintain a company’s
position in a market.
Operations
StrategyOrder WinnersCharacteristics that win orders
in the marketplace:product design, new product
introduction speed, lead time, product quality, service.
Where does price fit in this scenario?
versus
© Fred Van Bennekom 2005 Slide 10
Process Choice, Design, & Analysis
Operational Design components– People… following
– Process and Procedures… applying
– Technologies and Resources
Drivers of design choice– Characteristics of the Product
– Characteristics of Demand
– Competitive Priorities driven by corporate strategic analysis
No one best way to deliver a product. Congruence about design elements is key.
© Fred Van Bennekom 2005 Slide 11
Process-Product Matrix
Project
Job Shop
Batch
Line Flow• Continuous
• DiscreteFlow
Patterns
Jumbled
Consistent
Product
Each Unique –
Wide Variety
Commodity– Little Variety
????
Opportunities for real
advantage
© Fred Van Bennekom 2005 Slide 12
Significant Developments
Division of Labor Standardized Parts Scientific Management
– Time and Motion Study
– Efficiency Improvement
– Wage Incentives
Assembly Lines Motivation and Behavioral Issues
© Fred Van Bennekom 2005 Slide 13
Significant Developments
Operations Research Computers and Information Technology
- Computer Aided Design (CAD)- Computer Aided Manufacture (CAM)- Computer Integrated Manufacture (CIM)
Flexible Manufacturing Systems (FMS) Cellular Manufacturing JIT, Lean Manufacturing Total Quality Management, Six Sigma Mass Customization
