Introduction ToOperations Management
POM 370Dr. Drew Rosen
Business Environment
Operations Financ
e
Economics
Management
Marketing
Information Systems
Accounting
• Improvement of organizational activities to ensure quality, customer satisfaction , and loyalty
•Investments•Capital•Stock Market
•Nceufhkurreffg •Org. Behavior•Policy•Strategy•Sit on their ass
•Sales•Promotion•Research Behavior•Fairy land
• The application of people, technologies, and procedures to solve business problems
•Bookkeeping•Pensions•Audits•The study of how the forces of supply and demand allocate scarce resources
Operations Management Designing Products and Sevices
Operations Management Facility Location and Layout
Operations Management Project Management
Operations Management Scheduling Operations
Operations Management Inventory Control
Operations Management Quality Management
Operations Management Quality Management
Operations Management is:The management of systems or processes
that create goods and/or provide services
Operations Management affects:– Companies’ ability to compete– Nation’s ability to compete internationally
Operations Management
Where to locate your business?
OM Decisions
What type of process to use?
OM Decisions
Number of workers to employ?
OM Decisions
Number of workers scheduled at each station?
Forecasting park demands
Reducing wait times
Managing projects
More than just McDonalds…
Operations is AboutMaking Business Run Better
• More Efficiently
– More Abundantly
• With Higher Customer Satisfaction
The Goal of Operationsand business!
Quality
Customer Satisfaction
LoyaltyLoyalty
1 2 3 4 5
20%
40%
60%
80%
100%
Verydissatisfied
Dissatisfied Neutral Satisfied Very satisfied
Loyalt
y (
Rete
nti
on
)
Satisfaction
zone of defection
zone of indifference
zone of affection
Satisfaction and Loyalty
terrorist
apostle
1. Inseparability2. Intangibility3. Perishability4. Heterogeneity5. Site Location6. Labor Intensity7. Difficulty of Measuring Quality of Output
Goods Vs ServicesKey Differences:
Production of goods – tangible outputDelivery of services – an act
Transformations
Physical: manufacturingLocational: transportationExchange: retailing
Storage: warehousing Physiological: health care
Informational: telecommunications
Big Picture: OM
TransformationProcessINPUTS OUTPUTS
Three Basic Ways to Arrange the Transformation Process Job Shop
– Variety of outputs in small batches– Customized output– General purpose machinery– Highly skilled workers
Flow Shop– High Volume– Standardized output– Special purpose equipment– Lower skilled workers
Profits are the result of attention to quality and customer satisfaction, while the reverse is rarely true.
Edwards Deming