Chapter 1 Overview: Introduction to the Field

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Chapter 1Overview Introduction to the Field

• Operations Management
• Why Study Operations Management?
• Production System Defined
• Types of Transformations
• Objectives of Operations Management
• Goods Versus Services
• Plan of the Course
• OSCM Jobs
• OSCM Placement and Salary Statistics

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What is Operations Management?Formal Definition

• Operations management (OM)

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OM involves management of the entire system that
produces a good or service
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Why Study Operations Management?
Operations Management
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What is a Production System?Defined

• A production system uses resources to
  transform inputs into some desired outputs.

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Types of Transformations

• Physical--
• Locational--
• Exchange--
• Storage--
• Physiological--
• Informational--

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Core services basic things that customers want
from products they purchase.
The 4 Objectives of Operations Management
1. 2. 3. 4.
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Goods Versus Services - Continued
Goods
Service

• Tangible product
• Consistent product definition
• Production usually separate from consumption
• Can be inventoried
• Can be resold
• Some aspects of quality measurable

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Goods Versus Services
Goods
Service

• Low customer interaction
• Product is transportable
• Site of facility important for cost
• Often easy to automate

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Goods Contain Services Services Contain Goods
Automobile
Computer
Installed Carpeting
Fast-food Meal
Restaurant Meal
Auto Repair
Hospital Care
Advertising Agency
Investment Management
Consulting Service
Counseling
Percent of Product that is a Good
Percent of Product that is a Service
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Plan of This Course

• 1. Gaining a competitive advantage - strategy,
  project management
• 2. Product Design and Process Selection - goods,
  services, quality, analysis
• 3. Supply Chain design - JIT, ERP, electronic
  commerce, supply chain strategy, capacity
  management
• 4. Planning and controlling the supply chain -
  forecasting, aggregate planning, MRP, inventory
  management, TOC

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Where Are the OM Jobs?

• Technology/methods
• Facilities/space utilization
• Strategic issues
• Response time
• People/team development
• Customer service
• Quality
• Cost reduction
• Inventory reduction
• Productivity improvement
• Supply chain analyst/management