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Chapter 1 WHAT IS OPERATIONS MANAGEMENT? Operations Management (OM) : activities that relate to the creation of goods and services through the transformation of inputs to outputs Production: making the creation of goods and services 3 functions to create goods and services Marketing: take orders or generate the demand Production/Operations: create something Financing/Accounting: pay and collect bills All organization, including church volunteer organization, and school uses these functions. Q. Operations management is applicable to all firms, whether manufacturing or service 4 main reasons to study OM OM is one of three functions (how people organize themselves for productive enterprise) To know how Goods and Services are produced To understand what Operations managers to -> help career OM is such a costly part of organization (companies use much money for OM) Q. Reasons to study Operations Management include learning about all of the above Management process : consists of planning, organizing, staffing, leading, and controlling Q. The responsibilities of the operations manager include planning, organizing, staffing, leading and controlling Managers apply the process to the main 10 decisions area Design 6. Human resources and job design Managing quality 7. Supply-chain management Process and capacity design 8. Inventory, material, planning, Just-in time Location strategy 9. Intermediate and short-time schedule Layout strategy 10. Maintenance About 40% of all jobs are in OM Q. The Ten Critical Decisions of Operations Management include All of the above THE HERITAGE OF OM Cost focus -> quality focus -> customization focus Q. Henry Ford and Charles Sorensen were noted for their contributions to the quasi-assembly lines OPERATIONS IN THE SERVICE SECTOR Differences between Goods and Service Service: characteristics of services (Differences from goods) Intangible Produced and consumed simultaneously Unique High customer interaction
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Inconsistent product definition Knowledge based Dispersed Q. Which is not true regarding the differences between goods and services? A. Goods tend to have higher customer interaction than services. Q. A foundry produces 120 manhole covers in a 10 hour shift. If labor productivity is increased by 20%, how many covers would be produced per hour? A. 14.4 covers/hr Growth of Service Service sector : the segment of the economy that includes trade, financial, lodging, education, legal medical, and other professional occupations NEW TRENDS IN OM Ethics Global focus Rapid product development Environmentally sensitive production Mass customization Empowered employees Supply-chain partnering Just-in-time performance Q. New trends in operations management includes all of the following except all of the above are new trends THE PRODUCTIVITY CHALLENGE Productivity: ratio of output (goods and services) divided by one or more inputs (labor, capital, management)
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This note was uploaded on 11/30/2011 for the course MANA 4301 taught by Professor Stevencassidy during the Spring '11 term at Dallas Baptist.

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