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Introduction To OM

This document provides an introduction to operations management. It defines OM as the business function responsible for planning, coordinating, and controlling resources to produce products and services. The document outlines the key learning objectives of OM, including defining OM, understanding the role and decisions of OM, and differences between service and manufacturing operations. It provides a brief history of OM developments and current trends, and describes how OM interacts and shares information with other business functions.

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ankitha
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30 views15 pages

Introduction To OM

This document provides an introduction to operations management. It defines OM as the business function responsible for planning, coordinating, and controlling resources to produce products and services. The document outlines the key learning objectives of OM, including defining OM, understanding the role and decisions of OM, and differences between service and manufacturing operations. It provides a brief history of OM developments and current trends, and describes how OM interacts and shares information with other business functions.

Uploaded by

ankitha
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPT, PDF, TXT or read online on Scribd
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Introduction to

Operations Management

1
Learning Objectives

 Define OM
 Role of OM in business
 Decisions that operations managers make
 OM differences between service and mfg.
 Major historical developments in OM
 Identify current trends in OM
 Define information flow between OM and other
business functions

2
What is Operations Management?

The business function responsible for planning,


coordinating, and controlling the resources needed to
produce a company’s products and services.
 It is a management function.
 Organization’s core function.
 Every organization has the OM function
 Manufacturing or Service
 For Profit or Not For Profit

3
Typical Organization Chart

4
Systems Concept

inputs outputs mission


land transformations goods goals
labor services objectives
capital
•facilities SYSTEM
•equipment
Physical
•tools
energy Locational
O
materials Exchange
I
data Storage
productivity
Physiological
Informational
5
Why OM?

 “In business today, the emphasis is not so much


on what you make, but on how you do
business. Dell makes computers just like every
other PC manufacturer.” Quote: KT CEO on
CNBC 4/99

 The resurgence of American business in the


1990’s capitalized on improved operations.

6
Differences between Manufacturers and
Service Organizations

 Services:  Manufacturers:
 Intangible product  Tangible product
 Product cannot be  Product can be inventoried
inventoried  Low customer contact
 High customer contact  Longer response time
 Short response time  Capital intensive
 Labor intensive

7
Similarities-Service/Manufacturers

 All use technology


 Both have quality, productivity, & response issues
 All must forecast demand
 Each will have capacity, layout, and location issues
 All have customers and suppliers
 All have scheduling and staffing issues

8
Trends in OM
 Service sector growing to 80%
of non-farm jobs- See Figure 1-
4
 Global competitiveness
 Demands for higher quality
 Huge technology changes
 Time based competition
 Work force diversity

9
OM Decisions

10
Types of OM Decisions

11
Historical Development of OM
 Industrial revolution Late 1700’s
 Scientific management Early 1900’s
 Human relations movement 1930’s to 1960’s
 Management science Mid-1900’s
 Computer age 1970’s
 Just-in-Time Systems (JIT) 1980’s
 Total quality management (TQM) 1980’s
 Reengineering 1990’s
 Flexibility 1990’s
 Time-Based Competition 1990’s
 Supply chain Management 1990’s
 Global Competition 1990’s
 Environmental Issues 1990’s
 Electronic Commerce Late 1990’s

12
Today’s OM Environment

 Customers demand better quality, faster


deliveries, and lower costs
 Increased cross-functional decision making
 Recognized need to better manage information
using ERP and CRM systems
 Global competition

13
Business Information Flow

14
Highlights
 OM is the function that manages the resources that add value
 Its role is to transform inputs into products or services
 Decisions are many and vary from daily tactical to long-term strategic
 Key differences between mfg. and service companies are tangibility of
product and degree of customer contact
 Historical milestones range from 1700s Industrial Revolution to the
modern Electronic Commerce age
 OM must understand and implement major process changes like JIT,
TQM, supply chain management, and environmental changes
 OM works closely with all other business functions

15

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