McGraw-Hill/Irwin Copyright © 2009 by The McGraw-Hill Companies, Inc. All rights reserved.

Chapter 1 Introduction to the Field

What is Operations and Supply Management? Why Study Operations Management? Transformation Processes Defined Differences between Services and Goods The Importance of Operations Management Historical Development of OM Current Issues in OM OBJECTIVES 1-3

What is Operations and Supply Management? Operations and Supply Management (OM) is defined as the design, operation, and improvement of the systems that create and deliver the firm’s primary products and services 1-4

Why Study Operations Management? Business Education Systematic Approach to Org. Processes Career Opportunities Cross-Functional Applications Operations Management 1-5

What is a Transformation Process? Defined A transformation process is defined as a user of resources to transform inputs into some desired outputs 1-6

Transformations Physical--manufacturing Locational--transportation Exchange--retailing Storage--warehousing Physiological--health care Informational--telecommunications 1-7

Operations and Supply Management Supply Chain Processes Sourcing Processes Manufacturing Processes Service Processes Distribution Processes Logistics Processes Logistics Processes 1-8

What is a Service and What is a Good? “If you drop it on your foot, it won’t hurt you.” (Good or service?) “Services never include goods and goods never include services.” (True or false?) 1-9

The Goods-Services Continuum 1-10

OM in the Organization Chart Operations Plant Manager Operations Manager Operations Manager Director Manufacturing, Production control, Quality assurance, Engineering, Purchasing, Maintenance, etc FinanceMarketing

Core services are basic things that customers want from products they purchase Core Services Defined

Core Services Performance Objectives Operations Management Flexibility Quality Speed Cost

Value-added services differentiate the organization from competitors and build relationships that bind customers to the firm in a positive way Value-Added Services Defined

Value-Added Service Categories Operations Management Information Problem Solving Sales Support Field Support

如何創造附加價值的服務？ 如何創造附加價值的服務？Information Problem solving Sales support Field support 舉例就以上四類說明。 舉例就以上四類說明。

Significant Events in OM Figure 1.3

Historical Development of OM JIT and TQC Manufacturing Strategy Paradigm Service Quality and Productivity Total Quality Management and Quality Certification 1-18

Historical Development of OM (cont’d) Business Process Reengineering Six-Sigma Quality Supply Chain Management Electronic Commerce Service Science 1-19

Current Issues in OM Coordinate the relationships between mutually supportive but separate organizations. Optimizing global supplier, production, and distribution networks. Increased co-production of goods and services 1-20

Current Issues in OM (cont’d) Managing the customers experience during the service encounter Raising the awareness of operations as a significant competitive weapon 1-21

New Trends in OM Local or national focus Low-cost, reliable worldwide communication and transportation networks Global focus Batch (large) shipments Short product life cycles and cost of capital put pressure on reducing inventory Just-in-time shipments Low-bid purchasing Quality emphasis requires that suppliers be engaged in product improvement Supply-chain partners, Enterprise Resource Planning, e-commerce PastCausesFuture

New Trends in OM Lengthy product development Shorter life cycles, Internet, rapid international communication, computer- aided design, and international collaboration Rapid product development, alliances, collaborative designs Standardized products Affluence and worldwide markets; increasingly flexible production processes Mass customization with added emphasis on quality Job specialization Changing socioculture milieu; increasingly a knowledge and information society Empowered employees, teams, and lean production PastCausesFuture

New Trends in OM Low-cost focus Environmental issues, ISO 14000, increasing disposal costs Environmentally sensitive production, green manufacturing, recycled materials, remanufacturing PastCausesFuture

Question Bowl A major objective of this book is to show how smart managers can do which of the following? a.Improve efficiency by lowering costs b.Improve effectiveness by creating value c.Increasing value by reducing prices d.Serving customers well e.All of the above Answer: e. All of the above 1-25

Question Bowl In the Input-Transformation-Output Relationship, a typical “input” for a Department Store is which of the following? a.Displays b.Stocks of goods c.Sales clerks d.All of the above e.None of the above Answer: e. None of the above (The above are considered “Resources” of a department store. The correct answer is “Shoppers”.) 1-26

Question Bowl In which of the following decades did the concept of quality control originate? a.1920’s b.1930’s c.1940’s d.1950’s e.1970’s Answer: b. 1930’s (Tools such as sampling inspection and statistical tables where first developed by Walter Shewhart, H. F. Dodge, and H. G. Romig.) 1-27

What is Value ? What is Value ? V = F / C (Function / Cost) V = Q / P (Quality / Price)

End of Chapter