1. Operations Management & Planning
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2. Role of the Operations Manager
Managers that are responsible for the activities involved in producing the goods & services for a company
Their activities include the following:
Choosing a process for producing the company’s goods or services
Selecting a production site
Laying out the production facility
Design production workers’ jobs
Planning day-to-day production operations
Controlling costs
Monitoring inventories
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3. Operating systems & activities
Operating system – consists of the processes and activities needed to produce goods or services.
Made up of people, materials, facilities, and information.
These inputs are combined to produce the company’s goods or services.
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4. Types of operating systems
Continuous-flow systems
Operating systems that function all the time regardless of customer orders
McDonald’s makes a certain # of products based on sales history & hopes people will buy them
Intermittent-flow systems
Operating systems that operate only when an order needs to be filled
Taco Bell does not produce anything until a customer places an order
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5. Continuous-Flow Systems
Used to produce standardized products that a business keeps in stock
Companies ship products to customers and store the remainder as inventory
Most large manufacturing companies use a continuous-flow system.
Allows them to keep their assembly line running all the time
Achieve maximum efficiency & high profits
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6. Intermittent-Flow Systems
Used to produce customized products & services
No finished-goods inventory because all products are immediately shipped to the customers who ordered them.
Most service companies use this type of system
These kinds of businesses operate only in response to specific requests by customers
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7. Computer technology for Operations Management
In many industries, computers have revolutionized the way businesses produce their products
Four Processes
Computer-Aided Design
Computer-Aided Engineering
Computer-Aided Manufacturing
Computer-Integrated Manufacturing
Help businesses streamline their operations.
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8. Computer-Aided Design
Designing products with the help of computers
Helps companies create better products because it allows them to try various product designs without actually manufacturing the product
Computer simulation helps businesses identify defects or problems at the design stage before they spend millions of dollars on production
CAD significantly reduced the time it takes companies to design new products
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9. Computer-Aided Engineering
Using computers to engineer products
Used to analyze the performance of a product under different conditions
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10. Computer-Aided Manufacturing
Computers are used to actually produce the products they make
Computers provide instructions to automated production equipment, such as robots
To use CAM, businesses collect and store data on how a process should be performed
The computer then programs equipment to perform particular tasks
Many of the tasks once performed by workers are now done by robots
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11. Computer-Integrated Manufacturing
Using computers to integrate all manufacturing operations into a single, smoothly operating manufacturing system
Every aspect of manufacturing a product is aided by computers, including
Conception
Design & development
Production
Marketing
Product support
Businesses use CIM because it lowers manufacturing costs & reduces production time. CIM also improves product quality
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12. Process Selection Selection of an operating system
Involves a wide range of decisions about the specific processes to use, the sequences in which to perform the processes, and the equipment to use
All operating processes require equipment. Managers must make decisions about purchasing or leasing equipment
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13. Factors to consider in selecting equipment
Availability of production workers able to operate equipment
Training required to be able to operate equipment
Availability of parts & services
Availability of supplier assistance in installation and debugging
Compatibility of equipment with existing equipment
Maintenance record
Flexibility of equipment in handling changes to product
Safety
Expected delivery date
Warranty coverage
Price
Choosing equipment for a company can be a difficult process.
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14. Site Selection Process of selecting a location for a business
Entrepreneurs may come up with excellent ideas for a business but locate the business in the wrong place.
Choosing a location that meets the needs of a business is a very important management decision
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15. Factors to consider in choosing a site
Labor costs (most impt)
Cost of land
Cost of plant construction
Location of competitors
Location of customers
Transportation costs
Cost of materials
Taxes
Availability of materials, supplies, & workers
Strength of labor unions
Community attitudes
Political situation
Laws
Climate
Living conditions
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16. When a company outgrows its facilities, managers face three options for obtaining more space. They can:
Expand the site
Move the entire operation to another site
Add another facility elsewhere
Many businesses first try to expand their current facilities in order to avoid the expense of moving or the inconvenience of operating more than one facility
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17. Facilities Layout
Process of planning the physical arrangement of a facility
Includes identifying where office space, meeting rooms, customer service areas, eating areas, production areas, equipment, storage space, bathrooms, hallways, and other areas will be located
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18. Materials handling
Network that receives, stores, & moves materials between processing points within a factory
Managers must closely coordinate the design & layout of their facilities with the design of the materials-handling system
Many factors, including the size, shape, weight, density, and flexibility of materials, affect a facility’s layout.
Some materials require special handling and storage
In designing the facilities layout, computer manufacturers must take these special factors into account
Operations managers also need to consider the equipment that will be needed to transport products. Ex. Companies that use forklifts must create wide aisles to accommodate them.
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19. Types of layouts
Product layout - Groups equipment & staff based on the various steps involved in producing a product. Such layouts are often set up as assembly lines. This layout is efficient
Process layout – groups together equipment and staff that perform similar functions
Fixed-position layout - product is too large to move and remains in one place. This layout is inefficient
The kind of layout a business chooses depends on the type of product or service it products
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20. Job design
Describes the work an individual or group of individuals is supposed to perform
Job designs can be described in terms of five key characteristics
Skill variety – refers to skills a worker needs to perform a job
Task identity – refers to the degree to which a job allows a worker to complete an entire task rather than just part of the task
Task significance- refers to the level of impact a job has on the whole organization
Autonomy- refers to the independence workers have to make decisions about how to perform their jobs
Feedback – involves the extent to which managers let workers know how they are performing
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21. Importance of Job Design
The Core Job Characteristics on the previous slide lead to the following work outcomes:
High level of work motivation
High quality work performance
High satisfaction with work
Low absenteeism and turnover
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22. Physical work environment
To attract and retain good workers, managers need to provide a satisfactory and pleasant physical work environment
Poor work environments may prevent employees from working efficiently
Ex. Too hot or cold, poorly ventilated, noisy, poorly lit, or crowded
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23. Day-to-Day Operations Planning
Managers need to carefully plan day-to-day operations to ensure that production proceeds smoothly and that costs are low
Production planning involves three components:
Aggregate production planning
Resource allocation
Activity scheduling
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24. Aggregate production planning
Uses an organization’s resources to produce enough goods or services to meet demand
Rely on company forecasts to make decisions about production planning
The number of workers & supplies needed can be estimated based on these forecasts
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25. Resource allocation
Allocation of people, materials, & equipment to meet the operating system requirements
Allocating these resources efficiently will keep company costs low while producing quality goods
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26. Activity scheduling Creating a detailed production timetable.
Involves loading (assigning a job to a factory or department) and dispatching (scheduling of each task that is performed in the factory).
Scheduling increases efficiency & ensures that all workers understand their role in the production process
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