OM(exam) - Core process a chain of activities that delivers...

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Core process – a chain of activities that delivers value to external customers The term operations management refers to the systematic design, direction and control of the processes that transform inputs into product or services for internal as well as external customers Operations area manages the processes that produce the primary services or products for the external and internal customers but is closely involved with other areas of the firm In managing operations both strategic and tactical decisions are involved Strategic decisions – long term in nature, focuses on entire organization cutting across departments Tactical decisions – short term in nature, focuses on departments, teams, and tasks Types of OM decisions Strategic choices – company’s global strategies and competitive priorities – competitive priorities – cost, quality, time, and flexibility Process – types of work to be done in-house, amount of automation to use, manage processes for one-time projects, technologies to pursue and ways to provide leadership in technological change Quality – establish quality objectives and seek ways to improve quality Capacity, location, and layout – long term commitments – system’s capacity, location of new facilities, organization of physical facilities Operating decisions – maintaining internal and external supply chain, forecasting demand, management of inventory, controlling staffing and output levels, scheduling production, shop floor control……. Operations Management as a function Manufacturing and Services Differences Manufacturing Services Physical, durable product Intangible, perishable product Output can be inventoried Output cannot be inventoried Low customer contact High customer contact Long response time Short response time Large facilities Small facilities Capital intensive Labor intensive Quality easily measured Quality not easily measured Regional, national or international markets Local markets Similarities Both must have processes that should be designed and managed effectively Some type of technology, manual or automated, must be used Both are concerned about quality, customer service, and productivity Both must make capacity, location, and layout decisions Operations Strategy -operations implement the firm’s corporate strategy -Links long and short term operations decisions to corporate strategy. Developing a customer driven operations strategy begins with corporate strategy, which coordinates the firm’s overall goals with its core competencies Corporate strategy – which customers will serve, which new products/services it will produce, which responses it will take to changes in its business and socio- economic environment, which strategy it will employ in international markets Market analysis – categorizes the firm’s customers, identifies their needs, and assesses competitor’s strengths Competitive priorities –CQTF operating advantages that a firm’s processes must possess to outperform its competitors – critical dimensions that a process must
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This note was uploaded on 04/27/2010 for the course GSM 5660 taught by Professor Ahmad during the Fall '10 term at Zhejiang University.

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OM(exam) - Core process a chain of activities that delivers...

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