Operations and Productivity
The text suggests four reasons to study OM. We want to under-
stand (1) how people organize themselves for productive enterprise,
(2) how goods and services are produced, (3) what operations
managers do, and (4) this costly part of our economy and most
Possible responses include: Adam Smith (work specializa-
tion/division of labor), Charles Babbage (work specialization/
division of labor), Frederick W. Taylor (scientific management),
Walter Shewart (statistical sampling and quality control), Henry
Ford (moving assembly line), Charles Sorensen (moving assem-
bly line), Frank and Lillian Gilbreth (motion study), Eli
See references in the answer to question 2.
The actual charts will differ depending on the specific organi-
zation the student chooses to describe. The important thing is for
students to recognize that all organizations require, to a greater
or lesser extent, (a) the three primary functions of operations,
finance/accounting, and marketing; and (b) that the emphasis or
detailed breakdown of these functions is dependent on the spe-
cific competitive strategy employed by the firm.
The answer to this question may be similar to that for question 4.
Here, however, the student should be encouraged to utilize a more
detailed knowledge of a past employer and indicate on the chart
additional information such as the number of persons employed to
perform the various functions and, perhaps, the position of the
functional areas within the overall organization hierarchy.
The basic functions of a firm are Marketing, Accounting/
Finance, and Operations. An interesting class discussion: “Do all
firms/organizations (Private, Government, Not-for-profit) perform
these three functions?” The authors’ hypothesis is yes, they do.
The ten decisions of operations management are: Product De-
sign, Quality, Process, Location, Layout, Human Resources, Sup-
ply Chain Management, Inventory, Planning (aggregate and short
term), Maintenance. We find this structure an excellent way to