Study Guide exam 1

Study Guide exam 1 - Operations Management Study Guide Test...

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Operations Management – Study Guide Test 1 Power point 1 - Introduction Operations Management: planning and control of the process of producing and distributing goods and services. Production: the production process executes the supply plan to produce the service or product. The production process must be integrated with the processes that supply the inputs, establish the demands, and deliver the product to the customers. Operation = Production Operations (or production) Manufacturing Operations (or production) Logistics (but they “intersect” a lot) Operations Quantitative Methods for Business Production Function : process of transforming or converting inputs (resources) into higher- value outputs (product or services) for customers (internal or external). Resource Examples: Human, Financial, physical (plant & equipment), raw materials, knowledge/information Three Basic Functions Any Business must perform: - Marketing product, place, promotion and pricing - Accounting/Finance How to get money, use money, and keep track of where it went - Production you must actually make a product or provide a service (where we spend all out money) Why effective management of production is important? - Is it the “core” function of the business; without it, there would be no need for the business to exist. - Of all money businesses spend, about 75-90% is spent on production So what’s our goal in managing production? - To satisfy customers while spending as least as possible. - Products or services provided $ or resources spent doing it - The goal to get better products (numerator) at lower costs (denominator). - Managing production is not just about managing costs it’s all about productivity.
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- Understand that a positive NOPAT, or an increase in NOPAT, does not necessarily mean that we made (more) money. - Understand that we can make more money (higher EVA) by simply using fewer assets to operate the business. (Identify the time horizon of the problems / decisions typically addressed in this course) The four functions (or five) of management: Planning, Organizing, Leading, Controlling, Staffing (possible 5 th ) - Our operational decisions fall into the planning and control functions. Power point 2: Forecasting Independent Demand Forecast : Predicting the future events used for planning purposes. (The forecast is going to be wrong…just has to be better than competition) – Measure in
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Independent Demand Item : Item whose demand does not directly depend on the demand for another item that you must manage. (Need to forecast this item!!!) – (majority of all retail places are independent demand) Dependent Demand Item : Item whose demand does depend on the demand for another item that you must manage. (Do not need to forecast this item!)
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This note was uploaded on 03/29/2012 for the course MAN 3504 taught by Professor Staff during the Spring '11 term at UNF.

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Study Guide exam 1 - Operations Management Study Guide Test...

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