ITM 102 Lecture Notes - Lecture 5: Backtracking, Strategic Planning, Demand Forecasting
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ITM102 - Business Driven Information Systems - Lecture 5: Operations Management
Operations management fundamentals
● Production management - all activities managers do to help companies create goods.
● Operations management - systems and processes that transform resources into goods
● Transformation process - technical core in manufacturing organization; conversion of
inputs to outputs.
● Information systems support for operations strategy depends on many internal and
○ Levels of available technology; skill level of workers; degree of integration; and
extent to which outside suppliers are used.
○ Strategic planning - collection of decisions focusing on making correct decisions.
○ MPR systems - using sales forecast to make sure materials available.
○ Global inventory management systems - tracking and locating materials and
components via a GPS.
○ Inventory management and control systems - deals with daily operations.
● Five key competitive factors in operations management: cost, quality, delivery, flexibility
● Supply chain - procurement of raw material.
○ Supply chain management - involves management of information between
supply chain stages.
○ Four components in a supply chain management: strategy, partners, operation
○ Common supply metrics include: back orders, inventory cycles and inventory
Supply chain trends
● Instrumentation - when data is machine generated and globally tracked.
● Interconnectedness - when every component from customers are linked back to the
material source (i.e. vehicles, containers and products can be tracked).
● Intelligence - data received from smart (tracked) objects within a supply chain. They are
tracked with analytics which is quantified to improved future supply prospects.
● Visibility - ability to view all areas within a supply chain.
○ Bullwhip effect: the process of seeing multiple supply chain operations, including
backtracking orders and tracing future supply chain prospects.
○ Demand planning: exchanging information to improve future metrics.
● There are many factors towards supply chain success.
○ Making sales to suppliers - successfully.
○ Weaning employees off traditional practices towards more progressive, efficient
methods of production.
○ Ensuring that supply chain management systems support organizational goals.
○ Deploy in incremental phases and measure communicated success.