1. Operations management

2. Production
Production is the creation of goods and services using the factors of production, which, you should recall, are the inputs land, labor, capital, and enterpreneurship.
Thus, production management has been the term used to describe all the activities managers do to help their firms to create goods.

3. OPERATIONS MANAGEMENT
Production has historically been associated with manufacturing. But the nature of business has been changed significantly in the last 30 years or so.
The service sector, including Internet services, grown dramatically, and the manufacturing sector has not grown much at all.

4. OPERATIONS MANAGEMENT
To reflect the change of importance from manufacturing to services, the term production often has replaced by operations to reflect both goods and services production.
Operations management, then, is a specialized area in management that converts or transforms resources (induding human resources) into goods and services.
Operations management transforms raw materials. Human resources, parts, supplies, paints, tools, and other resources into automobiles

5. OPERATIONS MANAGEMENT
It does this through the processes of fabrication and assembly.
In a college, operations management takes inputs-such as information, professors, supplies, buildings, offices, computer systems-and creates services that transform students into educated people. it does this through a process called education.

6. OPERATIONS MANAGEMENT
Some organizations-such as factories, farms, and mines-produce mostly goods.
Others-such as hospitals, schools, and government agencies produce mostly services.
Still others produce a combination of goods and services. These are hybrid organizations.
For example, an automobile manufacturer not only makes cars but also provides services such as repairs, financing, and insurance.
And at McDonald's you get goods such as hamburgers and fries, but you also get services such as order taking, order filling, and clean up.

7. OPERATIONS MANAGEMENT IN THE MANUFACTURING SECTOR
Common sense and some experience have already taught you much of what you need to know about production processes.
You know what it takes to write in a term paper or prepare a dinner.
You need money to buy the materials, you need a place to work, and you need to be organized to get the task done.
The same is true of the production process in industry. It uses basic inputs to produce outputs

8. OPERATIONS MANAGEMENT IN THE MANUFACTURING SECTOR
Production adds value, or utility, to materials or processes.
Form utility is the value added by the creation of finished goods and services, such as the value added by taking silicon and making computer chips or putting services together to create a vacation package.
Form utility can Exist at retail level as well.For example, a baker can make a specific type of cake out of ingredients.

9. OPERATIONS MANAGEMENT IN THE MANUFACTURING SECTOR
To be competitive, manufacturers must keep the costs of inputs (the costs of workers, machinery, equipment) down.
Similarly, the amount of output must be relatively high.
The question today is: how can a producer keep costs low and still increase output?
This question will dominate thinking in the manufacturing and service sectors for years to come

10. Proess Planning
Process planning is choosing the best means for turning resources into useful goods and services.
Andrew S. Grove, chairman of computer chip manufacturer, uses es a great analogy to explain production:
To understand the principles of production, imagine that you 're a chef. ..and that your task is to serve a breakfast consisting of a three-minute soft boiled egg, buttered toast, and coffee. Your job is to prepare and deliver the three items sirnultaneously, each of them fresh and hot.

11. Producion system

12. Process Planning
Grove goes on to say that the task here encompasses the three basic requirements of production:
(1) to build and deliver products in response to the demands of the customer at a scheduled delivery time,
(2) to provide an acceptable quality level, and
(3) to provide everything at the lowest possible cost.

13. Process Planning
Process manufacturing: That part of the production process that physically or chemically changes materials. For example, boiling physically changes the egg. (Similarly, process manufacturing turns sand into glass or computer chips.)
Assembly process: That part of the production process that puts together components. (eggs, toast, and coffee) to make a product (breakfast). (Cars are made through an assembly process that puts together the frame, engine, and other parts.)

14. Process Planning
Continuous process: A production process in which long production runs turn out finished goods over time.
As the chef in our dinner, for example, you could have a conveyor belt that lowers eggs into boiling water for three minutes and then lifts them out on a continuous basis. A three-minute egg would be available whenever you wanted one. (A chemical plant or oil rafinery, for example, is run on a continuous process.)

15. Process Planning
Intermittent (with breaks) process: A production process in which the production run is short and the machines are changed frequently to make different products (Manufacturers of custom- designed furniture would use an intermittent process.)

16. Process Planning
Today most manufacturers use intermittent processes.
Computers, robots, and flexible manufacturing processes allow firms to make custom made goods almost as fast as mass-produced goods.

17. Process Planning Materials requirement planning (MRP):
A computer-based production management system that uses sales forecasts to make sure that needed parts and materials are available at the right time and place.
In a dinner, for example, we could feed the sales forecast into the computer, which would specify how many eggs or how much coffee to order and then print out the proper scheduling and routing sequence.
The same can be done with the seats and other parts of an automobile.

18. Process Planning
The newest version of MRP is enterprise resource planning (ERP).
ERP is a computer-based production and operations system that links multiple firms into one integrated production unit.
The software enables the monitoring of quality and customer satisfaction as it's happening.
ERP monitors processes in multiple firms at the same time. For example, it monitors inventory at the supplier as well as at the manufacturing plant.

19. Process Planning
ERP will link suppliers, manufacturers, and retailers in a completely integrated manufacturing and distribution system that will be constantly monitored for the smooth flow of goods from the time they're ordered to the time they reach the ultimate consumer

20. MODERN PRODUCTION TECHNIQUES
The ultimate goal of manufacturing and process management is to provide quality goods and services instantaneously in response to customer demand.
Traditional organizations simply not designed to be so responsive to the customer, Rather, they were designed to make goods efficiently.

21. MODERN PRODUCTION TECHNIQUES
Mass production: The process of making a large number of a limited variety of products at very low cost.
Over the years, low cost often came at the expense of quality and flexibility.
Furthermore, suppliers didn't always deliver when they said they would, so manufacturers had to carry large inventories of raw materials and components.
As a result better production techniques were searched.

22. MODERN PRODUCTION TECHNIQUES
As a result of global competition, companies today must make a wide variety of high-quality custom-designed products at very low cost.
Seven major developments have radically changed the production process in the United States:
(1) just-in-time inventory control,
(2) flexible manufacturing,
(4) lean manufacturing,
(5) mass customization,
(6) competing in time, and
(7) computer-aided design and manufacturing.

23. MODERN PRODUCTION TECHNIQUES
Just-in-time (JIT) inventory control: A production process in which a minimum of inventory is kept on the premises and parts, supplies, and other needs are delivered just in time to go on the assembly line.

24. MODERN PRODUCTION TECHNIQUES
Flexible manufacturing involves designing machines to do multiple tasks so that they can produce a variety of products.
Ford Motor Company, for example, uses flexible manufacturing at its plants. As many as six variations of V-8 and V-6 engines can be built from the same machinery.

25. MODERN PRODUCTION TECHNIQUES
**Lean manufacturing is the production of goods using less of everything compared to mass production: less human effort, less manufacturing space, less investment in tools, and less engineering time to develop a new product.
A company becomes lean by continuously increasing its capacity to produce high- quality goods while decreasing its need for resources.
Leading company in lean manufacturing is Toyota motor corporation.

26. MODERN PRODUCTION TECHNIQUES
A robot is a computer-controlled machine capable of performing many tasks requiring the use of materials and tools.
Robots usually are fast, efficient, and accurate. Robots and machinery perform routine, repetitive jobs quickly, efficiently, accurately.
This provides opportunities for workers to be more creative.

27. MODERN PRODUCTION TECHNIQUES
Mass customization: Tailoring products to meet the needs of individual customers.
To customize means to make a unique product or provide a specific service to an individual.
Although it once may have seemed impossible, mass customization is now practiced widely.

28. MODERN PRODUCTION TECHNIQUES
The National Bicycle company in Japan, for example, makes 18 bicycle models in more than 2 million combinations, with each combination designed to fit the needs of a specific customer.
The customer chooses the model,size, color, and design. The retailer takes various measurements from the buyer and faxes the data to the factory, where robots handle the bulk of the assembly.
Thus, flexible manufacturing as described above, is one of the factors that makes mass customization possible.

29. MODERN PRODUCTION TECHNIQUES
Competing in time: Being as fast or faster than competition in responding to consumer wants and needs.
Mass customization is coming to services as well.
For example, Health clubs now offer unique fitness programs for individuals, travel agencies provide vacation packages that vary according to individual choices, and some colleges allow students to design their own majors.

30. MODERN PRODUCTION TECHNIQUES
The one development in the recent past that appears to have changed production techniques and strategies more than any other has been the integration of computers into the design and manufacturing of products.

31. MODERN PRODUCTION TECHNIQUES
The first thing computers did was help in the design of products; this is called computer-aided design (CAD).
The latest CAD systems allow designers to work in three dimensions.
The next step was to involve computers directly in the production process; this is calIed computer-aided manufacturing (CAM).

32. MODERN PRODUCTION TECHNIQUES
CAD/CAM (the use of both computer-aided design and computer-aided manufacturing) made it possible to custom-design products to meet the needs of small markets with very little increase in cost.
A manufacturer programs the computer to make a simple design change, and that change can be incorporated directly into the production line.

33. MODERN PRODUCTION TECHNIQUES
Computer-aided design and manufacturing are very common in the clothing industry.
A computer program establishes a pattern and cuts the cloth automatically.
Today, a person’s dimensions can be programmed into the machines to create custom-cut clothing at little additional cost.

34. MODERN PRODUCTION TECHNIQUES
Computer-aided design has doubled productivity in many firms.
Today, software programs have been designed to unite CAD with CAM: the result is computer-integrated manufacturing (CIM).
The new software is expensive, but it cuts as much as 80 percent of the time needed to program machines to make parts, and it eliminates many errors.

35. OPERATIONS MANAGEMENT FUNCTIONS
Operations management in the service sector involves many of the same functions as operations management in the manufacturing sector.
Overlapping functions include facility location, facility layout, and quality control.
The resources used may be different, but the management functions are similar.

36. OPERATIONS MANAGEMENT FUNCTIONS
Facility Location is the process of selecting a geographic location for a company's operations.
One strategy is to make it easy for consumers to access your service.
Thus flower shops and banks are putting facilities in supermarkets so that their products and services are more accessible than they are in free standing facilities.
the most successful businesses are conveniently located.

37. OPERATIONS MANAGEMENT FUNCTIONS
Facility location for Manufacturers :
A major issue is shifting manufacturing organization from one country to another.
Such shifts sometimes result in pockets of unemployment in some geographic areas and lead to tremendous economic growth in others. .
Why would entrepreneurs spend millions of dollars to move their facilities from one location to another?
One major reason some businesses move is the availability of inexpensive labor or the right kind of skilled labor.

38. OPERATIONS MANAGEMENT FUNCTIONS
Inexpensive resources are another major reason for moving production facilities.
Companies usually need water, electricity, wood, coal, and other basic resources.
Getting closer to the major unsaturated markets is another reason for moving facilities elsewhere

39. OPERATIONS MANAGEMENT FUNCTIONS
Often the most important resource is people, so companies tend to cluster where smart and talented people are.
Access to various modes of transportation (i.e., highways, Rail lines, airports, and the like) is critical.
Information technology is also important to quick response, so many firms are seeking countries with the most advanced information systems.

40. OPERATIONS MANAGEMENT FUNCTIONS
Close to Markets: Many businesses are building factories in foreign countries to get closer to their international customers.
That's a major reason why the Japanese automaker Toyota builds cars in Sakarya/Turkey and the German company Mercedes builds trucks in Akşehir/Turkey

41. OPERATIONS MANAGEMENT FUNCTIONS
Businesses study the quality of life for workers and managers.
Quality-of-life questions include these:
Are there good schools nearby?
Is the weather nice?
Is the crime rate low?
Does the local community welcome new businesses?
Do the chief executive and other key managers want to live there?

42. OPERATIONS MANAGEMENT FUNCTIONS
One big incentive to locate or relocate in a particular city or state is the tax deduction and degree of government support.
Some local governments provides sites to investment to build factory.
Some provide free water or other forms of energy

43. OPERATIONS MANAGEMENT FUNCTIONS
Facility Layout is the physical arrangement of resources (including people) in the production process.
The idea is to have offices, machines, storage areas, and other items in the best possible position to enable workers to produce goods and provide services to their customers.
Facility layout depends greatly on the processes that are to be performed. For services, the layout is usually designed to help the consumer find and buy things.

44. OPERATIONS MANAGEMENT FUNCTIONS
Quality Control
Quality control is the measurement of products and services against set standards.
Earlier quality control was often done at the end of the production line. it was done by a quality control department.
Quality now means satisfying customers by building in and ensuring quality from product planning to production, purchasing, sales, and service.
Emphasis is placed on customer satisfaction, so quality is everyone's concern, not just the concern of the quality control people at the end of the assembly line.

45. OPERATIONS MANAGEMENT FUNCTIONS
For example, Holiday Inn authorized its hotel staff to do almost anything to satisfy an unhappy customer, from handing out gift certificates to eliminating charges for certain services.
Empowered managers and employees were given the authority to wave charges for the night's stay if the customer was still unhappy.