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Slide 11
Chapter 1
Introduction toProduction & OperationManagement
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Production & Operations ManagementWhy Study POM?
Transformation Processes Defined
Operations as a Service
The Importance of OperationsManagement
Historical Development of OM
Current Issues in OM
OBJECTIVES
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What is Operations Management?Defined
Operations management (OM) is defined as thedesign, operation,
and improvement of the systemsthat create and deliver the firms
primary productsand services
Production & Operations Management
Production management is the process of planning ,
organizing, directing and controlling the activities of
the production function. Production functions are the
conversion of raw materials into finished products
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What is Operations Management?Defined
Production & Operations Management
Production management is concerned with those
processes which convert the inputs into outputs.
The inputs are various resources like raw materials,men ,
machines etc. and the outputs are goods andservices.
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Production System
Inputs:
Men
Material
Machine
Information
Capital
Transformation Process:
Product Design
Process Planning
Production Control
Maintenance
Output:
Product
Service
Continuous Feedback:
Inventory
Quality
Cost
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Production & Operations Management
Production management is concerned with those
processes which convert the inputs into outputs.
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Input
Materials
Labour
Machines
Energy
Process
Transformation
Output
Products
Services
Information
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Production & Operations Management
Objectives of production management
Objectives of production management are
classified as under :
(1) Ultimate Objectives
(2) Intermediate Objectives
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Production & Operations Management
(1) Ultimate ObjectivesThe primary or ultimateobjective of the
manufacturing
activity is to produce a product at a
pre-establishedcost,according to the specified qualityand within
thestipulatedtimeschedule.
(2) Intermediate Objectives
Control
Information
Social Responsibili ty
Services
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Why Study Operations Management?
Business Education
Systematic Approachto Org. Processes
Career Opportunities
Cross-FunctionalApplications
OperationsManagement
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What is a Transformation Process?
Defined
Atransformation processis defined as a userof resources to
transform inputs into somedesired 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 hurtyou.(Good or
service?)
Services never include goods and goodsnever include services.
(True or false?)
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POM in the Organization Chart
Operations
Plant
Manager
Operations
Manager
Director
Manufacturing, Production control,
Quality assurance, Engineering,
Purchasing, Maintenance, et c
Finance Marketing
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Core services are basic things
that customers want from
products they purchase
Core Services
Defined
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Core Services Performance Objectives
Operations
ManagementFlexibility
Quality
Speed
Price (costReduction)
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Value-added services
differentiate the organization
from competitors and build
relationships that bind
customers to the firm in apositive way
Value-Added Services
Defined
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Value-Added Service Categories
OperationsManagement
Information
Problem Solving
Sales Support
Field Support
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The Importance of Production & OperationsManagement
Synergiesmust exist with otherfunctional areas of
theorganization
Operations account for 60-80%of the direct expenses that
burden a firms profit.
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Historical Development of OMJIT and TQC
Manufacturing Strategy Paradigm
Service Quality and Productivity
Total Quality Management and QualityCertification
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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
Coordinate the relationships betweenmutually supportive but
separateorganizations.
Optimizing global supplier, production,and distribution
networks.
Increased co-production of goods andservices
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Current Issues in OM (contd)
Managing the customers experience duringthe service
encounter
Raising the awareness of operations as asignificant competitive
weapon
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