chapter 1, the operations function
TRANSCRIPT
-
7/30/2019 Chapter 1, The Operations Function
1/19
The McGraw-Hill Companies, Inc. 2007, All Rights ReservedMcGraw-Hill/Irwin
INTRODUCTION
toOperations Management
Chapter 1, The Operations Function
-
7/30/2019 Chapter 1, The Operations Function
2/19
1-2
Chapter Outline
Definition of Operations Management
Decisions at Pizza U.S.A.
Operations Decisions - A FrameworkCross-Functional Decision Making
Operations as a System
Contemporary Operations Themes
-
7/30/2019 Chapter 1, The Operations Function
3/19
1-3
Definition ofOperations Management
Operations is responsible for supplying theproduct
orserviceof the organization.
Operations managers makedecisions regardingthe operations function and itsconnectionwith
otherfunctions.
Operations managersplanandcontroltheproductionprocess and its interfaces within the
organization and with the external environment.
-
7/30/2019 Chapter 1, The Operations Function
4/19
1-4
Key Points in OM Definition
Decisions the operations manager mustmake
Functions in the organization.
Process for producing goods and services
-
7/30/2019 Chapter 1, The Operations Function
5/19
1-5
MajorDecisions at Pizza USAA Framework for OM
Process How to produce & deliver
Quality Criteria, measurement & process for
achieving
Capacity
Physical facilities & laborInventory What, when & how much?
-
7/30/2019 Chapter 1, The Operations Function
6/19
1-6
Cross-FunctionalDecision Making
Operations as the primary function.
Other primary functions:
Marketing Finance
Supporting functions: all others
Major cross-functional decisions (SeeTable 1.1)
-
7/30/2019 Chapter 1, The Operations Function
7/19
1-7
Operations as a Process
Transformation
(Conversion)
Process
Input Output
-
7/30/2019 Chapter 1, The Operations Function
8/19
1-8
Operations as a Process
Transformation
Fabrication
Input OutputTransformation
Assembly
Fabrication: making the parts
Assembly: putting the parts together
-
7/30/2019 Chapter 1, The Operations Function
9/19
1-9
Operations as a Process(Figure 1.1)
Transformation
(Conversion)
Process
Energy
Materials
LaborCapital
Information
Goods orServices
Feedback information for
control of process inputs
and process technology
-
7/30/2019 Chapter 1, The Operations Function
10/19
1-10
Relation of Operations to itsEnvironment
(Figure 1.2)
Operations transformation systemSuppliers
Human
Resources
Marketing
Accounting Finance MIS
Engineering
SOCIETY
GOVERNMENT
External
Environment
CUSTOMERS
COMPETITORS
-
7/30/2019 Chapter 1, The Operations Function
11/19
1-11
Contemporary Operations Themes
Service and Manufacturing (differences andimplications)
Customer-Directed Operations
Time Reduction (Lean Operations)
Integration of Operations and Other Functions
Environmental Concerns
Supply Chain ManagementGlobalization of Operations
-
7/30/2019 Chapter 1, The Operations Function
12/19
1-12
Environmental Concerns
Volkswagen, Germanys biggest carmaker, was reported to be setting asideDM1 billion ($470m) to pay for
compliance with a European directivethat will come into force in 2007 forcingcar makers to pay for recycling their
vehicles. New cars will berequired to be 85% recyclable.
--The Economist, 15 February 2001
-
7/30/2019 Chapter 1, The Operations Function
13/19
1-13
Globalization: Who took my job?
Early 1990s
Small town near Charlotte, NC
Aluminum smelter closed after 50 yearsOnly significant industry in town
In many families, several generations had
worked there. Now all out of work.Who caused it to close?
-
7/30/2019 Chapter 1, The Operations Function
14/19
The McGraw-Hill Companies, Inc. 2007, All Rights ReservedMcGraw-Hill/Irwin
Mikls Nmeth
WHO!?!?!?
-
7/30/2019 Chapter 1, The Operations Function
15/19
1-15
U.S. production of aluminum dropped dramatically
in the early 1990s because the Russians dumped
aluminum on the world market. Why? The openingof the Hungarian border, 2 May 1989, led to the fall
of the Berlin Wall in November, 1989, which led to
the breakup of the Soviet Union in 1991, which
caused them to downsize their military, which gave
them overcapacity in aluminum production, which
caused them to dump in the world markets, which
led to the closing of U.S. smelters such as the onenear Charlotte, NC.
-
7/30/2019 Chapter 1, The Operations Function
16/19
The McGraw-Hill Companies, Inc. 2007, All Rights ReservedMcGraw-Hill/Irwin
Mikls NmethWas the Hungarian PrimeMinister who opened the
border on 2 May 1989.
-
7/30/2019 Chapter 1, The Operations Function
17/19
The McGraw-Hill Companies, Inc. 2007, All Rights ReservedMcGraw-Hill/Irwin
Moral of the StoryIn an age of globalization, you neverknow who will be the competition or
who is doing something that will affectyour job or your life.
The aluminum workers in NC hadnever heard of Mikls Nmeth, but he
ultimately cost them their jobs.
-
7/30/2019 Chapter 1, The Operations Function
18/19
1-18
Summary
Definition of Operations Management
Decisions at Pizza U.S.A.
Operations Decisions - A FrameworkCross-Functional Decision Making
Operations as a System
Contemporary Operations Themes
-
7/30/2019 Chapter 1, The Operations Function
19/19
1-19
End of Chapter One