MF F219

Operations Management

BITS Pilani Girish Kant Garg

1
 Learning Objectives

 Operations and Supply Chain Strategy (Chapter-1)

– Key factors contributing to the evolution of operations management

– Calculate productivity, used for measuring competitiveness

– Significance of operations management to a firm’s strategy

2
MF F219, Operations Management, Lecture-2, 13/1/24 BITS Pilani, Pilani Campus
 Operations Management
• What is Operations?
– a function or system that transforms inputs into outputs of greater
value
• What is a Value Chain?
– a series of activities from supplier to customer that add value to a
product or service

3
MF F219, Operations Management, Lecture-2, 13/1/24 BITS Pilani, Pilani Campus
Operations Function

• Suppliers
• Finance and
Accounting
• Marketing
• Human
Resources

4
MF F219, Operations Management, Lecture-2, 13/1/24 BITS Pilani, Pilani Campus
Key factors in evolution of
operations management

5
MF F219, Operations Management, Lecture-2, 13/1/24 BITS Pilani, Pilani Campus
Key factors in evolution of
operations management

6
MF F219, Operations Management, Lecture-2, 13/1/24 BITS Pilani, Pilani Campus
Key factors in evolution of
operations management

7
MF F219, Operations Management, Lecture-2, 13/1/24 BITS Pilani, Pilani Campus
Key factors in evolution of
operations management

8
MF F219, Operations Management, Lecture-2, 13/1/24 BITS Pilani, Pilani Campus
Key factors in evolution of
operations management
Supply chain management
– management of the flow of information, products, and services
across a network of customers, manufacturers, distributors, and
retailers.

9
MF F219, Operations Management, Lecture-2, 13/1/24 BITS Pilani, Pilani Campus
Globalization

 Why “go global”?

10
MF F219, Operations Management, Lecture-2, 13/1/24 BITS Pilani, Pilani Campus
Globalization

Hourly Compensation
11
MF F219, Operations Management, Lecture-2, 13/1/24 BITS Pilani, Pilani Campus
Globalization

Manufacturing Output

12
MF F219, Operations Management, Lecture-2, 13/1/24 BITS Pilani, Pilani Campus
Key factors in evolution of
operations management

13
MF F219, Operations Management, Lecture-2, 13/1/24 BITS Pilani, Pilani Campus
Productivity and Competitiveness
 Competitiveness
– degree to which a nation can produce goods and
services that meet the test of international markets
 Productivity
– ratio of output to input
 Output
– sales made, products produced, customers served,
meals delivered, or calls answered
 Input
– labor hours, investment in equipment, material usage,
or square footage
14
MF F219, Operations Management, Lecture-2, 13/1/24 BITS Pilani, Pilani Campus
Measures of Productivity

15
MF F219, Operations Management, Lecture-2, 13/1/24 BITS Pilani, Pilani Campus
Productivity
Osborne Industries is compiling the monthly productivity report for its Board of
Directors. From the following data, calculate (a) labor productivity, (b)
machine productivity, and (c) the multifactor productivity of dollars spent on
labor, machine, materials, and energy. The average labor rate is $15 an hour,
and the average machine usage rate is $10 an hour.

16
MF F219, Operations Management, Lecture-2, 13/1/24 BITS Pilani, Pilani Campus
Productivity

17
BITS Pilani, Pilani Campus
Productivity

Changes in Productivity
18
MF F219, Operations Management, Lecture-2, 13/1/24 BITS Pilani, Pilani Campus
Strategy Planning

Mission
and Vision

Corporate
Strategy

Marketing Operations Financial

19
MF F219, Operations Management, Lecture-2, 13/1/24 BITS Pilani, Pilani Campus
Strategy Formulation
1. Defining a primary task
– What is the firm in the business of doing?
2. Assessing core competencies
– What does the firm do better than anyone else?
3. Determining order winners and order qualifiers
– What qualifies an item to be considered for
purchase?
– What wins the order?
4. Positioning the firm
– How will the firm compete?
5. Deploying the strategy

20
MF F219, Operations Management, Lecture-2, 13/1/24 BITS Pilani, Pilani Campus
Order Winners
and Order Qualifiers

21
MF F219, Operations Management, Lecture-2, 13/1/24 BITS Pilani, Pilani Campus
Thanks

22
BITS Pilani, Pilani Campus