OPM 200 Lecture Notes - Lecture 3: Fixed Cost, Steinway & Sons, Operations Management
28 Sep 2016
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Today"s topics: process strategy, service processes, break-even analysis. Processes convert inputs into outputs and are at the core of operations management. The objective of process strategy is to create a process to produce products that meets customer requirements within cost and other managerial constraints and to achieve their competitive priorities. How to produce a product or provide a service: meets or exceeds customer requirements, meets cost and managerial goals. Has long-term impacts on: efficiency and production flexibility, costs and quality. The impact of the process strategy could go beyond operations. Steinway & sons: 2 plants: new york and hamburg, 2000 pianos/year, customers- People who truly appreciate the art of a piano. Yamaha: several plants in japan and china, 200,000 pianos/year, customers- Don"t pay attention to something like craftsmanship. Unit or lot production or service with varying specifications, according to customer needs. Product flows may vary considerably making planning and scheduling a challenge. Examples: machine repair shop, design project, emergency room.
