COM 341 FINAL REVIEW - Operations Management Is the set of...

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Operations Management Is the set of activities that creates goods and services by transforming inputs into outputs Production The creation of goods and services Why Study OM? 1. OM Contribution 2. To know how goods and services are produced 3. OM is a major function of organizations 4. OM is a costly part of an organization Productivity Ratio of outputs divided by one or more inputs - Productivity = Outputs produced / Input(s) used -Operations managers objective is to improve this ratio Single Factor Productivity Indicates the ratio of one resource to the good and services produced e.g. Output / Labour Multifactor Productivity Output / (Labour + Material + Energy + Capital + Miscellaneous) Task Time Time from start of work on a unit to the completion of that unit at a given task Cycle Time Cycle Time = f ( Processing Time at Bottleneck) Throughput Time Sum of processing times of all tasks (+ any wait time) Operations Strategy Setting broad policies and plans for using the production resources (operations function) to support the firm’s long term competitive strategy. - a pattern of decision making - reflected by competitive priorities & strategic and tactical decisions Achieving Competitive Advantage 1. Differentiation - experience differentiation 2. Cost 3. Response Competitive Priorities in Operations Strategy Cost Quality - Superior Quality - Consistent Quality Delivery - On time delivery - Delivery speed - Product development speed Input Output Transformation Process (Value Addition) Feedback Loop
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Flexibility - Customization - Variety Competitive Priorities Strategic Decisions Capacity Facilities Sourcing Technology Tactical Decisions Workforce Quality Systems Production Planning / Scheduling Distinctive Competencie s The special attributes or abilities that give an organization a competitive edge Critical Success Factors Activities or factors that are key to achieving competitive advantage Core Competencie s A set of skills, talents, and activities that a firm does particularly well Process Strategy Involves determining how to produce a product or provide a service. Process strategies follow a continuum. Within a given facility, several strategies may be used. Process Choice Firms must select a process that best matches the requirements of the identified competitive priorities Each major process type has its own strengths and drawbacks:
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- systems designed to provide wide varieties of outputs usually sacrifice speed and cost advantages - systems that have cost advantages through scale economies usually sacrifice variety and responsiveness Product/Proc ess Matrix Job Shop Batch Process Line Flow Continuous Flow Low standardization Low-volume or One of a kind M ultiple products Low volume Limited product range High volume Commodity products Very High volume PRODUCT STRUCTURE “Product-Process M atrix” PROCESS STRUCTURE Project Process Focus Repetitive Product Focus Flexibility (High) Unit Cost (High) Flexibility (Low) Unit Cost (Low) Project Process
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  • Fall '10
  • Franz
  • Management, Control Chart, Process capability

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