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GMS 401 (203)
Chapter 1

Chapter 1.docx

5 Pages

Global Management Studies
Course Code
GMS 401
Carmen Schifellite

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Chapter 1: Introduction to Operations Management LO 1: Introduction Operations Management - mgmt process/ system create/ provide goods & services Process - linked actions, changes bring a result - Core/ operations - create good/ service - support - support core processes - managerial - govern system - ex: airline = service vs. bicycle = good → core: reservation, support: managing inventories, managerial: employee motivation - success of bus/ = planning Efficiency - operating at min cost & time Effectiveness - achieving quality & responsiveness Why Study Operations Management? - large % exp there, increase in profits - mgmt jobs - other areas of bus/ interrelated LO 2: Functions within Organizations Organizations - pursue, achieve goals of comp efficiently & effectively - produce/ provide good & services - 3 functions: operations, finance, mkting Operations - directly related to producing goods/ services --> assembly = restaurant, retail => core - inputs - obtain finished product - feedback - ensure outputs obtained - control - compared w/ stds if need corrective action - Goods and services occur jointly - painter + paint - Value added - diff b/ cost of inputs and val/ price of output o greater the value added = greater operation efficiency = greater amt fund avail for research, investment o more productive - make more output w/ same/ fewer inputs (reduce storage time = reduce transformation cost) - Supply Chain Management - suppliers and customers lead to productivity Finance - securing and allocating resources at favourable prices 1. provision of funds - cash flow, rev, sales 2. economic analysis of investment proposals - alt investments = input f/ FIN and operations Marketing - assess needs/ want of customers for feedback for operations about demand - mkting, design, production work together to make changes, new products - Lead Time - time b/ ordering good/service and receiving it - give customer estim of time Other Functions - accounting - overhead, F/S - mgmt info systems (MIS) - info to effectively manage - purchasing - correct quantity and timing of purchases - human resources - recruitment, training, health & safety - manufacturing engineering - design, purchase, electrical - maintenance - repaid, removal equip - product design - architects, chefs - logistics - transport raw material, storage LO 3: The Scope of Operations Management Primary function: d/m, planning, scheduling, executing, control System design - determine parameters of operations = d/ product, geo location, dept Operational activities - day to day d/ = inventory planning LO 4: Differentiating Production of Goods vs. Performance of Service Production of Goods - tangible output - see/ touch = building - 1) manufacturing, 2)construction, 3) agriculture, 4)forestry, 5)fishery, 6) mining, oil, gas - manufacturing - food, clothing, paper Service - act - finance, health care, edu, restaurant Goods vs. Service - same: what and how done= design, op d/ - sell good, compliment service - diff: 1. customer contract, inventory use o goods - separation b/ production and consumption, control of op, build up inv o service - sensitive to demand variability = supermkt and idle cashier 2. input uniformity o goods - control amt inputs o service - greater variability of inputs 3. job labour content o goods - more capital intensive o service - req higher labour content 4. output uniformity o goods - products w/ low variability = smooth and efficient o service - slow, output varies 5. measurement of productivity (outputs vs. inputs): o goods - uniformity = easy o service - demand intensity and job req = harder 6. quality assurance: o goods - errors corrected b4 customer re/ o service - harder b/c performance & consumption at same time LO 5: Operations Manager's Job Operations Manager - responsible for creation of good/ service - managerial - use resources through planning, organizing, directing, and controlling - req tech and behavioural competence - given targets for cost reduction and productivity improvement LO 6: Operations Managers and Decision Making Operations Manager - d/m goal of org Models - abstraction of reality; simplified rep - focus on important = increase opportunity to understand problem 1. find purpose of model 2. how used to generate results 3. how results interpreted/ used 4. what assumptions/ limits apply Quantitative Approaches - get best solution → solve equation - linear programming - allocate scarce resources - queuing techniques - analyzing situations - inventory techniques - control inventory - project scheduling techniques - planning, controlling projects - forecasting techniques - forecast demand - statistical techniques - quality control - heuristic approach - quick way to find good solution = practical Analysis of Tradeoffs - heurist
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