pm lecture 1.pdf

7/27/2019 PM lecture 1.pdf

http://slidepdf.com/reader/full/pm-lecture-1pdf 1/12

Production/OperationsManagement



“ Course Introduction”

the course overview:

Design Improvement

Planning

and Control

Input

resources

Output

products andservices

Customers

Operations

Strategic

Objectives

Operations

Competitive Role

and Position

Operations

Strategy

Environment

Environment

Transforming

Resources

Transformed

Resources

of 2



Chapter 1 – “ Operations

Management”

there are 3 core functions of an organisation

marketing

communicating the organisation’s products and services to the market

product/service development

creating new and modified products and services

operations(production) fulfilling customer requests for service and products

there are also support functions in an organisation

accounting and finance

human resource

engineering and technical

information/technical (IT)

Page 1 of 8



1 – Operations Management

operations processes take in a set of input resources which are then

used to transform something, or are transformed themselves, into outputs

of goods and services which satisfy customer needs

the inputs of operation are:

transformed resources (ie. materials, information, customers)

transforming resources (ie. machines, facilities, staff)

Transformation

ProcessCustomer

inputs outputs

Page 2 of 8




transformation process includes:

materials processing:

manufacturing – change physically

delivery – change location

retail – change possession

warehouse – store materials

information processing:

accountant – change form

market research – change possession

library – store information

telecommunication – location of information

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customer processing:

hairdresser – change physically

hotels – store

airlines – change location

outputs from the transformation process are “products” and “services”,

which are seen as being different in several ways:

tangibility (products are, services are not)

storability

transportability

simultaneity (products produced beforehand, services spontaneously)

customer contact

quality (of process, or output itself)

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the overall operation function can be viewed as a network of micro

operations (internal customers and suppliers)

by treating internal customers with care, the whole operation can beimproved

to minimise effects of environmental disruption, operation managers put

into place:

physical buffering (at input or output)

organisational buffering (ie. supporting functions are a barrier againstenvironment)

buffering can be negative, as it shelters the operations from the outsidewhich can eventually lead to customer dissatisfaction

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all operations differ in 4 important respects:

volume of output:

high volume enables repeatability, specialisation, systemisation, low unit cost

variety of output:

lack of change and disruption in operations results in lower costs

variation in demand for output: ie. summer holiday resorts, as opposed to a hotel near tourist attraction

degree of visibility:

customer processing is more visible to customers than materials processing front office

back office

high volume, low variety, low variation and low visibility help reducecosts

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activities of operations management include:

direct responsibility:

developing clear vision of long term goals

decision making towards goals determining design of products and processes

planning and controlling resources

improving performance

indirect responsibility:

working together with other parts of the organisation

broad responsibility: globalisation

environmental protection

social responsibility

technological awareness knowledge management

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operations management is:

the systematic design, direction, and control of

processes that transform inputs into services andproducts for internal, as well as external, customers

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1 – Operations Management – “ Supplement”

special points about managing operations:

”operations” account for largest budget within and organisation (usually)

business sustained if budgets and output of operations are met

applies pressure

critical to manage operations in short-term

continuity of production is necessary

fix problems as they come

make as good decisions as possible

operations manager should assess the impact of new technology on

operations performance, rather than having large knowledge about the

technology itself

to buy or not to buy decisions

Page 1 of 2



1 – Operations Management – “ Supplement”

dependence on supporting functions to keep production running

ie. maintenance, IT

support functions sometimes need to be motivated to deliver required

performance

addressing development and career expectations of employees

human needs

operations function ”translates strategy into action”

it is the interface between the thinking end (strategy) and doing end (meet

customer needs) of a business

complexity of management role due to contrasts:

short-term, day-to-day issues

long-term goals to be secured

Page 2 of 2

pm lecture 1.pdf

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