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OPERATIONS

MANAGEMENT

Presented by:
Michelle F. Go

TYPICAL ORGANIZATION
CHART

MAMAMIAS PIZZA
Small family-oriented restaurant
Seating capacity for about 30 customers
Provides delivery within a limited local area

3 Management Concerns:
1. Acquiring the capital to start and continue to run the businessthe finance function
2. Attracting customers, selling, and distributing the products the
manufacturing function
3. Making products and delivering services the production or operation
management

What is operations management?


Association for Operations Management (APICS)
the eld of study that focuses on the effective planning, scheduling, use and
control of a manufacturing or service organization through the study of
concepts from design engineering, industrial engineering, management
information systems, quality management, production management,
inventory management, accounting, and other functions as they affect the
organization (APICS Dictionary, 11th
edition).
OTHER DEFINITION
A field that is responsible for managing the production and delivery function of an
organizations products and services.

"... the systematic direction and control of the processes that transform inputs into
finished goods and services. The inputs are transformed at operations into
outputs."

Operations management is:


A management function
An organizations core function
In every organization whether Service or
Manufacturing , Profit or Not for profit

What is the role of operations


management(OM)?
OM transforms inputs to outputs
Inputs are resources such as
people , Material , and Money
Outputs are goods and services

Purpose of OM
- Deliver ever- improving value for customers through continuous improvement
of overall company and capabilities

Historical Development of OM
Industrial revolution
Scientific management
Hawthorne Effect
Human relations movement
Management science
Computer age
Environmental Issues
JIT & TQM*
Reengineering
Global competition
Flexibility
Time-Based Competition
Supply chain Management
Electronic Commerce
Outsourcing & flattening of world

Late 1700s
Early 1900s
1930s
1930s1940s1960s1970s1980s1990198019901990199020002000-

Role of operations manager


Operations managers' responsibilities include:
Human resource management

Asset management
Cost management

OM DECISIONS
STRATEGIC PLANNING AND
DECISIONS
Very broad
Long-term (3-5 yrs. , high degree of uncertainty and
risk)
Responsibilities of top managers
Examples includes:
1. organizations mission, vision and purpose
2. Choosing product lines
3. Distribution and marketing channels
4. Designing the performance and compensation
system

TACTICAL PLANNING AND DECISIONS

narrow in scope
Medium-term ( moderate degree of uncertainty and risk)
Middle managers
Examples includes:
1. Acquiring resources needed to produce products
( resource needs)
2. Designing production facilities
3. Determining work force and production levels
4. Implementing humans resource policies
5. Improving quality

OPERATIONAL PLANNING
AND DECISIONS
Short-term (very little uncertainty and risk)
Supervisors, factory workers, front-line service workers
Example includes:
1. Adjusting daily production
2. Managing materials and work in process
3. Controlling product quality
4. Managing customers relations

Goods & Services


Manufacturing
Tangible product
Product can be
inventoried
Low customer contact
Longer response time
Capital intensive

Services
Intangible product
Product cannot be
inventoried
High customer contact
Short response time
Labor intensive

MANUFACTORING VS. SERVICE


ORGANIZATION
Characteristic

Manufacturing

Service

Output

Tangible

Intangible

Customer contact

Low

High

Uniformity of output

High

Low

Labor content

Low

High

Uniformity of input

High

Low

Measurement of productivity

Easy

Difficult

Opportunity to correct quality problems

Easy

Difficult

THE GENERAL MODEL


OF OPERATIONS
MANAGEMENT

OMs Transformation Process

EXAMPLES
Inputs

Transformation

Outputs

Energy, Raw vegetables

Cleaning

Clean vegetables

Energy, Metal sheets

Cutting/Rolling/Welding

Cans

Energy, Vegetables

Cutting/Chopping

Cut vegetables

Energy, Water, Vegetables

Cooking

Boiled vegetables

Energy, Cans, Boiled vegetables

Placing

Can food

Operations in services:
Health care
Inputs
Doctors, nurses
Hospital
Medical Supplies
Equipment
Laboratories

Processes

Outputs

Examination
Surgery
Monitoring
Medication
Therapy

Healthy
patients

OMs Transformation Role


To add value
Increase product value at each stage
Value added is the net increase between output product value and
input material value

Provide an efficient transformation


Efficiency means performing activities well for least possible cost

Highlights
Inputs
transformed resources those that are transformed in some way by the operation to
produce the goods or services that are its outputs
materials the physical inputs to the process
information that is being processed or used in the process
customers the people who are transformed in some way.
transforming resources those that are used to perform the transformation process.
staff the people involved directly in the transformation process or
supporting it
facilities land, buildings, machines and equipment.

transformation process - is any activity or group of activities that takes one or more
inputs, transforms and adds value to them, and provides outputs for customers or
clients.

Thank you !!!

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