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Global Management Studies
GMS 401
Robert Meiklejohn

CHAPTER 1: INTRODUCTION TO OPERATIONS MANAGEMENT Operations Management: the management of processes or systems that create goods and or provide services. Process: A series of linked actions, changes, or functions bringing about a result. Efficiency: operating at minimum cost and time. Effectiveness: Achieving quality and responsiveness. Value Added: The difference between the cost of inputs and the value or price of outputs. Increase production, may be used for R&D, investments and profits. Lead Time: the time between ordering a good or service and receiving it. 1. Operations: create goods and services 2. Finance: provide funds and the economic analysis of investment proposals 3. Marketing: assess customer wants and needs and communicate them to others Model: An abstraction of reality; a simplified representation of something. System: A set of interrelated parts that must work together. •capacity, Designing •location, Decisions •equipment Operating •planning •execution Decisions •controlling Pareto Phenomenon: A few factors that account for a high percentage of results achieved. • 80/20 Rule - 80% of problems are caused by 20% of the activities. Craft Production: System in which highly skilled workers use simple, flexible tools to produce small quantities of customized goods. Division of Labour: Breaking up a production process into small tasks so that each worker performs a small portion of the overall job. Interchangeable Parts: Parts of a product made to such precision that they do not have to be custom fitted. Mass Production: System in which lower-skilled workers use specialized machinery to produce high volumes of standardized goods. Total Quality Management: Involving every employee in a continual effort to improve quality and satisfy the customers. Lean Production: System that uses minimal amounts of resources to produce a high volume of high-quality goods with some variety. E-commerce: Use of the internet and other electronic networks to buy and sell goods and services. Supply Chain: A sequence of activities and organizations involved in producing and delivering a good or service. TYPES OF OPERATIONS HISTORICAL EVOLUTION OF OM EARLIEST INDUSTRIAL HUMAN DECISION JAPANESE DAYS REVOLUTION RELATIONS MODELS & MANUFACTURES MOVEMENT COMPUTER (1980+) (1960+) Craft Interchangeable Improve Management TQM Revolution production, no parts ( Eli, Productivity ( Science economies of Whitney, 1700) Elton Mayo, scale 1930) Mercantilism Division of Motivational EDI Lean Production Labour (Adam Theories ( Smith, 1776) Abraham Maslow, 1940s) Scientific Employee ERP Management, Problem 1920s, ( Frederick Solving Taylor, Frank& (William, lillian Gilbreth, Ouchi, 1970s) Henry Gantt, Henry Ford) CHAPTER 2: COMPETITIVNESS, STRATEGIC PLANNING, AND PRODUCTIVITY Competitiveness: Ability and performance of an organization in the marketplace compared to other organizations that offer similar goods or services. Strategy: The long-term plans that determine the direction an organization takes to become competitive. Strategic Planning: The managerial process that determines a strategy for the organization. Key Purchasing Criteria: The major elements influencing a purchase: price, quality, variety, and timeliness. Order Qualifiers: Purchasing criteria that customers perceive as minimum standards of acceptability to be considered for purchase. Order Winners: Purchasing criteria that cause the organization to be perceived as better than the competition. Businesses Compete Using Operations 1. COST : All other factors being equal, a customer will choose the lowest price  Firms that compete on price alone may settle for lower profit margins  Most firms focus on lowering their costs of delivering goods and/or services to their customers. 2. QUALITY: Materials, workmanship, design. from an organization’s perspect
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