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Module 9 - Operations Management

This document provides an overview of operations management concepts including: 1) Operations management involves converting resources into goods and services through activities like production planning, production control, and quality control. 2) It discusses key aspects of operations management like the supply chain, value chain, different production processes, and service operations management. 3) The relevance for project managers and business owners is that operations management impacts how deliverables are produced efficiently and impacts costs, quality, and customer satisfaction.

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Ankit Agrawalla
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99 views

Module 9 - Operations Management

This document provides an overview of operations management concepts including: 1) Operations management involves converting resources into goods and services through activities like production planning, production control, and quality control. 2) It discusses key aspects of operations management like the supply chain, value chain, different production processes, and service operations management. 3) The relevance for project managers and business owners is that operations management impacts how deliverables are produced efficiently and impacts costs, quality, and customer satisfaction.

Uploaded by

Ankit Agrawalla
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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MGMT 6057

CONTEMPORARY
BUSINESS MANAGEMENT

MODULE 9: OPERATIONS
MANAGEMENT
AGENDA
• Operations management activities
• Supply chain and value chain
• Types of production processes
• Production operations management: planning,
production management
• Service operations management: planning,
service management
• Quality management
• Outsourcing
• Relevance for project managers and business
owners
OPERATIONS MANAGEMENT

Converting
resources into
goods or
services

What is Operations Management?


SUPPLY CHAIN AND VALUE CHAIN MANAGEMENT
• Supply chain (operations management perspective): the
integration of all activities involved in the process of
sourcing, procurement, conversion, logistics
• Starts with manufacturing of raw material, ends with the
product in the customer’s hands
• Goals are operational: to increase efficiency, integrate
supplier/producer processes, reduce waste, etc.

• Value chain (customer perspective): a series of business


operations in which utility is added to the goods and
services offered by a firm to enhance customer value
• Same supply chain actors/functions, but also includes activities
such as marketing and after-sales service
• Goal is to increase value to customer
OPERATIONS MANAGEMENT ACTIVITIES
• Production planning
• Where and how
• Production control
• Schedule and monitor
• Quality control
• Meet standards and expectations
TYPES OF PRODUCTION PROCESSES
• Made-to-order (e.g., custom shoes)
• Mass production (e.g., automobiles)
• Mass customization (e.g., personalized M&M’s)
PRODUCTION PLANNING:
SITE SELECTION CRITERIA
Locate close to…
• Customers
• Suppliers
• Labour
• Natural resources
• Transportation
• Quality of life
• Low cost
• Favourable government (e.g., tax credits)
PRODUCTION PLANNING:
FACILITIES SITE SELECTION

Where would you locate a(n):


• Paper mill?
• New software venture?
• Investment firm?
• Auto manufacturing facility?
PRODUCTION PLANNING:
CAPACITY PLANNING

• Forecast demand
• Calculate capacity requirements

How would you forecast the demand for: Electric cars?


Smart phones? Number of street snow plows needed by
the City of London? 12-year old Scotch whiskey? Flowers?
PRODUCTION MANAGEMENT
• Procurement
• Inventory control (e.g., just-in-time)
• Materials requirements planning (MRP)
• Convert sales forecast to master
production schedule
• Gantt and PERT charts
PRODUCTION MANAGEMENT:
TECHNOLOGY

• Computer-aided design (CAD)


• Computer-aided manufacturing (CAM)
• Computer-integrated manufacturing (CIM)
SERVICE OPERATIONS MANAGEMENT
Services:
• Intangible
• Often customized
• Have high customer contact

Some service businesses may also


produce made-to-order or
made-to-stock goods
SERVICE OPERATIONS: PLANNING
• Site selection
• Near customers
• Size and layout
• To be efficient
• To meet customer needs
• Capacity planning
• Number of customers
• When customers need service
• Time to service a customer
• Other factors, e.g. weather
SERVICE OPERATIONS : MANAGEMENT

• Scheduling: who works when


• Inventory control: similar to production
management

Video: Amazon order fulfillment


MANAGING QUALITY
Total Quality Management (TQM) elements:
• Customer Satisfaction
• Meet customer needs at every stage
• Get feedback and track
• Employee involvement
• Need commitment at every level
• Provide training
• Continuous process improvement

Tools include: statistical process


control, Six Sigma, etc.
OUTSOURCING

Note: not necessarily out of the country

• Manufacturing
• E.g., Apple uses Foxconn for manufacturing
• Services
• E.g., outsourcing payroll, call center
RELEVANCE FOR PROJECT MANAGERS
AND BUSINESS OWNERS
For Project Managers:
• How are your deliverables going to be
produced?
• Procurement, quality assurance, Gantt, PERT,
etc. are in PMBOK
For Business Owners:
• You need to decide where/how to produce
goods and services most efficiently
• Operations management mistakes cost money
and may result in unhappy customers

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