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Operation Management Kusdhianto Setiawan, SE, Siv.Øk Department of Management Faculty of Economics Gadjah Mada University.

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Presentation on theme: "Operation Management Kusdhianto Setiawan, SE, Siv.Øk Department of Management Faculty of Economics Gadjah Mada University."— Presentation transcript:

1 Operation Management Kusdhianto Setiawan, SE, Siv.Øk Department of Management Faculty of Economics Gadjah Mada University

2 OM: Some Basic Concepts Operation management: the design and operation of productive systems Operation management: the design and operation of productive systems Operation: a function or system that transform inputs into outputs of greater value Operation: a function or system that transform inputs into outputs of greater value Input could be…. Material, machines, labor, management, capital Input could be…. Material, machines, labor, management, capital Output …. Goods and services Output …. Goods and services

3 The Transformation Process Input Material Machines Labor Management Capital Input Material Machines Labor Management Capital Output Goods Services Output Goods Services Transformation Process Requirements & Feedback

4 Transformation Forms Physicalmanufacturing Operation Physicalmanufacturing Operation Locationaltransportation, warehouse operation Locationaltransportation, warehouse operation Exchangeretail operation Exchangeretail operation Physiologicalhealth care Physiologicalhealth care Pshycologicalentertaintment Pshycologicalentertaintment InformationalCommunication InformationalCommunication

5 Operation and Other Functional Management Area Operation (produces goods & services) Finance (capital) Marketing (demand)

6 Operation: The Technical Core Operation Finance Marketing Customers Capital Market Purchasing Suppliers Personel Labor Forces

7 The Hystory of OM EraEvents/ConceptsDatesOriginator Industrial Revolution Steam Engine 1769 James Watt Division of Labor 1776 Adam Smith Interchangeable partd 1790 Eli Whitney Scientific Management Principle of Scientific Management 1911 Frederick W. Taylor Time and Motion Studies 1911 Frank and Lillian Gilbreth Activity Schedulling Chart Henry Gantt Moving Assembly Line Henry Ford

8 EraEvents/ConceptsDatesOriginator Human Relation Hawthorne Studies 1930 Elton Mayo Motivation Theories 1940s1950s1960s Abraham Maslow Frederik Hezberg Douglas McGregor Management Science Linear Programming 1947 George Dantzig Digital Computer 1951 Remington Rand Simulation, waiting line theory, decision theory, PERT/CPM, MRP1950s1960s Operation Research Groups Joseph Orlicky, IBM The Hystory of OM

9 EraEvents/ConceptsDatesOriginator Quality Revolution Just-in-Time (JIT) Total Quality Management (TQM) Strategy & Operations Business Process Reengineering 1970s1980s1990s Taiichi Ohno (Toyota) W. Edward Deming, Joseph Juran Wickham Skinner, Robert Hayes Michael Hammer, Jamees Champi

10 Information Age EDI, EFT CIM (computer- integrated manufacturing), PCs, Internet, WWW. 1970s1980s1990s Numerous Individuals and Companies Tim Berners-Lee Globalization Worldwide markets & operations Supply Chain Management E-Commerce Mass Customization 1990s Numerous Companies and Nations The Hystory of OM

11 Some Important Issues Globalization Globalization Services Services Competitiveness Competitiveness –Productivity as a measure of competitiveness Competitive Industries Competitive Industries –Barriers to entry? Economies of Scale? Competitive Firms Competitive Firms –Market share, eps, revenues growth, profit margin, EVA Importance of Strategy Importance of Strategy Product variety and mass customization Product variety and mass customization

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