HISTORICAL EVOLUTION OF OM

INTRODUCTION
 operations management is the management of
systems or processes that create goods or provide
services.
EVOLUTION
Industrial Revolution
 Began in the 1770s in England and spread
to the rest of Europe and to the United
States during the 19th century.
 Substituted machine power for human
power.
 Most significant machine was steam engine.
What did take place
 Production became fast and low costly one

 Economies of scale

 Development of standard gauging system

 Factories grew rapidly

 Provided countless jobs

SCIENTIFIC MANAGEMENT
 Widely changed the management of factories.
 Developed by Frederick Winslow Taylor, the
father of scientific management.
 Based on observation, measurement,
analysis and improvement of work methods
and economic incentives.
 Studied to identify the best method for doing
each job.
Cont….
 Henry Ford practically adopted the scientific management
principles for Taylor.
 Introduced the moving assembly line, which affected to
many industries.
 Introduced mass production to the automotive industry.
 The concept of “Interchangeable Parts” was applied by Eli
Whitney, an American inventor.
 The basis for interchangeable parts was to standardize
parts.
 Any part in a batch of parts would fit any automobile coming
down the assembly line.
 Result was a high decrease in assembly time and cost.
 Concept of division of labor, which Adam Smith wrote
about in the wealth of Nations (1776) was used by Ford.
 An operation is divided up in to a series of many small
tasks, individual workers are assigned to one of those
tasks.
PIONEERS WHO CONTRIBUTED
 Frank Gilbreth - was an industrial engineer
who is often referred to as the father of
motion study. He developed principles of
motion economy that could be applied to
incredibly small portions of a task.
Henry Gantt - recognized the value of nonmonetary
rewards to motivate workers, and developed a
widely used system for scheduling, called Gantt
charts.
 Harrington Emerson - applied Taylor’s ideas to
organization structure and encouraged the use of
experts to improve organizational efficiency. He
testified in a congressional hearing that railroads
could save a million dollars a day by applying
principles of scientific management.
 Henry Ford - the great industrialist, employed
scientific management techniques in his factories.
DECISION MODELS AND MANAGEMENT
SCIENCE
Accompanied by the development of several
quantitative techniques.
 F.W. Harris developed a mathematical model for
inventory order size in 1915.
 H.F. Dodge, H.G. Romig and W. Shewhart
developed statistical procedures for sampling and
quality control in 1930.
 L.H.C. Tippott conducted studies that provided the
groundwork for statistical sampling theory In 1935.
 Those qualitative models were widely used in world war
2.
 These decision models were also used for forecasting,
inventory management, project management and other
areas of operations management
THE INFLUENCE OF JAPANESE
MANUFACTURERS
 Japanese manufactures developed management
practices that increased the productivity and quality.
 Companies which were outside Japan was
interested in their approaches.
 The influence of Japanese companies is continuing
for the foreseeable future.
OPERATIONS TODAY…
 Advances in information technology and global
competition have had a major influence.
 E – business is receiving increased attention from
business owners and managers in developing
strategies, planning and decision making.
 Technology refers to the application of scientific
discoveries to the development and improvement of
goods and services.
 Operations management is concerned with product and
service technology, process technology and information
technology.
 Created by;

 Shakthi Fernando

 Sandun Ulpathakumbura

 BSc. Financial management(Special)-Undergraduates

Sabaragamuwa University of Sri Lanka