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Operations Management

An Overview

Need for Operation management Problems  Outdated technology  Underdeveloped Infrastructure  Inappropriate payment systems  Ineffective scheduling and control systems  Global competition .

Need for Operation management Perspectives  Reduce Manufacturing costs  Optimize productivity  Improve product quality Understanding  Automation  Optimization of scheduling  Inventory management system  TQM and Quality Control .

Decisions and activities of Operations Managers Planning  Organizing  Controlling  Directing  Motivating  Coordinating  Training and Developing Personnel  .

Planning        Plan product and service Mix Location and capacity planning Decide upon production methods to use for each item Plan procurement of wquipments Decide on the number of shifts and work hours Geanerate a master schedule of what product to make and when Organize changes by incorporating new processes and procedures .

or hybrid organization structure Establish work center assignments Assign responsibility for every activity Arrange supplier and subcontractor networks Establish maintenance policies. .Organizing       Centralize or decentralize operations Decide upon functions. products.

Controlling       Encourage pride in performing as expected Compare costs to budget Compare actual labor hours to standard Inspect the quality levels Compare work progress to schedule Compare inventory level to targets .

Directing  Establish provisions of union contracts  Establish personnel policies  Establish employment contracts  Issue job assignments and instructions .

Motivating  Provide challenges through leadership example. specific objectives. recognition. and goals  Encourage through praise. and other intangibles  Motivate through tangible reward system  Motivate employees by job enrichment and giving challenging assignments .

Coordinating      Coordinate through use of common forecast and master schedules Observe actual performance and recommend needed improvement Report. and maintenance activities Respond to customer inquiries about status of orders . design changes. inform and communicate Coordinate purchases. deliveries.

Training and Developing Personnel  Guide by informing correct work methods  Encourage employees to seek perfection in their tasks  Give more challenging job assignments  Support employees in training programs .

Market Shift Production driven System Product Market Driven System Services Operations .

controlling. organizing. directing and coordinating all the activities of production systems which convert resource input into products or services” .” “It involve planning. which are required to produce goods and services.Definition of Operations Management “Management of direct resources (machine. material and manpower).

Operations management deals with Design of product and processes  Acquisition of resources  Transformation of resource inputs into outputs  Distribution of goods and services  .

Operation Management Decisions designing and implementation of operations strategies Strategic decisions (5years or more) Tactical decisions (1 or 2 years) Operational decisions (less than a week) .


Strategic decisions .