Scribd
Upload
148 views

Chapter 9. Production and Operations Management Pslides

Uploaded by

Sameer Kumar
Copyright
© © All Rights Reserved
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
148 views

Chapter 9. Production and Operations Management Pslides

Uploaded by

Sameer Kumar
Copyright
© © All Rights Reserved
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
You are on page 1/ 29

Please be reminded that student lecture slides contain blanks that are to be

filled in by the student during the lecture.


Take notes.

1 Introduction to Business Administration Copyright D. Andrews 2018


Production and
Operations Ch 7

Management
Chapter 9
Chs
7&10

Chs
8&9

Ch 7

2
Introduction to Business Administration Copyright D. Andrews 2018
Topics
• Production Overview
• PRODUCTS: Good, Services, Hybrids
• Supply Chain Management
• Facilities Layouts
• Scheduling

3 Introduction to Business Administration Copyright D. Andrews 2018


Production
Chapter 9

4
Introduction to Business Administration Copyright D. Andrews 2018
Production Management vs. Operations Management
• Production is the process of transforming (converting) resources into useful goods and
services.
• Production Management: All activities that help create goods
• Operations Management: Specifically focuses on conversion/transformation of resources
into products, i.e., goods and services

labor knowledge
entrepreneurship

land capital

5 Introduction to Business Administration Copyright D. Andrews 2018


Manufacturing (production of goods) in the U.S.
Number of Americans employed
in the manufacturing sector has
decreased due to outsourcing of
production to offshore locations

U.S. manufacturers produce


approx. 20% of total global
manufacturing output

Source: National Institute of Standards and Technology,


part of the U.S. Department of Commerce. Date: February
6 2017
Andrews x100 x105 Lecture Lesson 8
Services Contribute most to the U.S. GDP

80% of U.S. jobs are now in the


service sector.

7 Andrews x100 x105 Lecture Lesson 8


Products: Goods, Services, Hybrids

8
Introduction to Business Administration Copyright D. Andrews 2018
Products: Goods vs. Services
Goods Services

• Tangible: can be seen/touched • Intangible

• Can be stored • Cannot be stored (“consumed” as


delivered)

• Easier to evaluate before purchase


• Difficult to evaluate before purchase

9 Andrews x100 x105 Lecture Lesson 8


copyright D. Andrews 2018
Products (cont.): Hybrids
Good + Service

• Brake Replacement
• Good: Brakes
• Service: Installation

10 Andrews x100 x105 Lecture Lesson 8


copyright D. Andrews 2018
Differences in Resource Use in Operations Management
Goods Services

11

Andrews x100 x105 Lecture Lesson 8


What is being produced? Good or Service?
Activity Categorization

Professor is giving a lecture to a class of students. Service

Surgeon conducting an operation Service

Auto production line Good

Life guard rescuing a stranded swimmer Service

Technology production line Good

12 Andrews x100 x105 Lecture Lesson 8


copyright D. Andrews 2018
Utility and Processes Example
Good + Service
• Custom Cake Which type of utility is added by
• Good: Baked and Frosted Cake bakers when they transform raw
ingredients into special cakes?
• Services: Planning, purchasing, Form Utility
baking, decorating, delivery
Is process manufacturing present
when a baker bakes a cake?
Could be

Is an assembly process employed


when a baker bakes a cake?
Could be

13 Andrews x100 x105 Lecture Lesson 8


copyright D. Andrews 2018
Advances that Make US Companies More Competitive
• Computer-aided design and manufacturing
• Flexible manufacturing
• Lean manufacturing
• Mass customization
• Robotics
• 3D printing

14 Introduction to Business Administration Copyright D. Andrews 2018


Operations
Management
Planning

15
Introduction to Business Administration Copyright D. Andrews 2018
Facility Location
• Facility location — The process of selecting a geographic location for a company’s
operations

_______________ remains the key reason manufacturers move their plants, even
though labor cost is becoming a smaller portion of total production costs.

• Many considerations for moving facilities to a new location:


• Labor costs
• Availability of inexpensive resources
• Lesser need to train or retrain local workforce
• Access to transportation (to reduce time to market)
• Proximity to suppliers and customers
• Low crime rates
• Good quality of life for employees
• Lower cost of living for employees
16 Introduction to Business Administration Copyright D. Andrews 2018
Facility Location: American Airlines Example
• Facility location — The process of selecting a geographic location for a company’s
operations

• Many considerations for moving facilities to a new location:


• Labor costs
• Availability of resources
• Access to transportation
• Proximity to suppliers and customers
• Crime rates
• Quality of life for employees
• Cost of living
• Need to train or retrain local workforce

17 Introduction to Business Administration Copyright D. Andrews 2018


Facility Location: American Airlines Example
• Facility location — The process of selecting a geographic location for a company’s
operations

• Many considerations for moving facilities to a new location:


• Labor costs
• Availability of resources
• Access to transportation
• Proximity to suppliers and customers
• Crime rates
• Quality of life for employees
• Cost of living
• Need to train or retrain local workforce

18 Introduction to Business Administration Copyright D. Andrews 2018


Facility Layout Example: Product

Product layout (____________) is used when all products


undergo the same operations in the same sequence.
Facility Layout Example: Process

Process layout is used when ________ of different products


are created or worked on in a different operating sequence
Facility Layout Example: Modular

Modular layout employs ______________ who come together


to produce more complex versions of the final product.
Facility Layout Example: Fixed-Position

Fixed-position layout is used in producing a product


that is ______________________
Process Management Quality Control
• Quality — Consistently producing what the customer wants while reducing errors before and
after delivery to the customer.
• Six Sigma quality — A quality measure that allows only 3.4 defects per million opportunities.
• ISO 9001 and ISO 14001 Standards

23 Introduction to Business Administration Copyright D. Andrews 2018


Process Management Quality Control
• Pert

• Gantt

24 Introduction to Business Administration Copyright D. Andrews 2018


A Glimpse into
Supply Chain
Management
(SCM)

25
Introduction to Business Administration Copyright D. Andrews 2018
Kelley Grads in Supply Chain Management
Video:
https://youtu.be/XClENj
M8-dA

26 Andrews x100 x105 Lecture Lesson 8


Kelley can get
you there!
Click here for information on careers in
Operations and SCM.
https://kelley.iupui.edu/programs/under
graduate/academics/majors-minors-
certificates/supply-chain-
management.html

27
Introduction to Business Administration Copyright D. Andrews 2018
Additional Terms and Concepts you should know!
• Just-in-time inventory
• Purchasing

28 Introduction to Business Administration Copyright D. Andrews 2018


Key Takeaways
• In the old days, the term “products” referred to goods
• Now, it refers to what an organization offers in the marketplace: good, service, or hybrid

• Production management refers to creation of goods


• Operations management refers to creation of products, i.e., goods and services
• An important aspect of Operations Management is facility location
• A large number of factors should be considered

• Another important aspect of Operations Management is Facility Layout


• Decisions in this area depend on the type of product being produced and customer need

• Operations Management must be concerned producing high quality products, consistently


• Supply Chain Management (SCM) is concerned with managing the flow of goods and services
into an organization and through the production process to produce the final product

29 Introduction to Business Administration Copyright D. Andrews 2018

You might also like