Operations Management

GM - 4081

Designing operations

Dr. Abher RASHEED

© 2008 Prentice Hall, Inc. 5–1

 Introduction to OM …
► Part 2: Designing operations
 Chapter 5: Design of goods and services
 Page 172-185 (8th Edition)

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 Time-Based Competition

 Product life cycles are becoming

shorter and the rate of
technological change is
increasing
 Developing new products faster
can result in a competitive
advantage
3

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 Product Development
External Development Strategies
Figure 5.6
Alliances
Joint ventures
Purchase technology or expertise
by acquiring the developer

Internal Development Strategies

Enhancements to existing products
New internally developed products

Internal Cost of product development Shared

Slow Speed of product development Rapid
High Risk of Failure Low
4

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 Acquiring Technology
 By Purchasing a Firm
 Speeds development
 Issues concern the fit between the acquired
organization and product and the host
 Through Joint Ventures
 Both organizations learn
 Risks are shared
 Through Alliances
 Cooperative agreements between
independent organizations
5

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 Defining The Product

 First definition is in terms of

functions
 Products will have an engineering
drawing (Technical drawing)
 Shows dimensions, tolerances, and materials

 Bill of material (BOM) lists the

components of a product
 Lists components, quantities and where used

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 Engineering Drawings

Figure 5.8
7

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 Bills of Material

Figure 5.9 (a)

8

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 Continue …

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