operations management - presentation

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Slide 1: 

- The management of systems or processes that create goods and/or provide services. OPERATIONS MANAGEMENT

THE THREE BASIC FUNCTIONS OF BUSINESS ORGANIZATIONS : 

THE THREE BASIC FUNCTIONS OF BUSINESS ORGANIZATIONS

Production Systems – use resources to transform inputs into some desired output. : 

Production Systems – use resources to transform inputs into some desired output.

INPUTS : 

INPUTS Raw Materials Customer Finished product from another system

TRANSFORMATION PROCESSES : 

TRANSFORMATION PROCESSES Physical (As in Manufacturing) Location (Transportation) Exchange (Retailing) Storage (Warehousing)

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Physiological (Healthcare) Informational (Telecommunications) Psychological (Entertainment)

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The essence of the operations function is to add value during the transformation process. Value Added – the term used to describe the difference between the cost of inputs and the value or price of outputs.

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VALUE ADDED INPUTS Land Labor Capital Information Transformation/ Conversion Process Outputs Goods Services CONTROL

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In operations management, we must ensure that the transformation process is performed efficiently and that the output is of greater value than the sum of the input. Operations management is concerned with the design and implementation of system and process for getting work done.

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Operating management examines the objective of the firm and work within the constraints of the system to operate most effectively and efficiently.

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TYPICAL DIFFERENCES BETWEEN GOODS AND SERVICES

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CHARACTERISTICS GOODS SERVICE Customer Contract Low High Uniformity of Input High Low Labor Content Low High Uniformity of Output High Low Output Tangible Intangible Measurement of Productivity Easy Difficult Opportunity to correct High Low quality problems before delivery Inventory Much Little Evaluation Easier More Difficult Patentable Usually Not Usually

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SCOPE OF OPERATIONS MANAGEMENT

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1. Product and service design 2. Process selection 3. Selection of Management of Technology 4. Design of work systems 5. Location planning 6. Facilities planning 7. Quality improvement of the organization’s products and services