Chase - Shankar - Jacobs

14e
Operations and
Supply Chain
Management
CHASE | SHANKAR | JACOBS
1–1
INTRODUCTION
Chapter One
McGraw-Hill/Irwin Copyright © 2014 by The McGraw-Hill Companies, Inc. All rights reserved.
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Copyright © 2014 by McGraw Hill Education (India) Private Limited. All rights reserved.
Learning Objectives
• LO1-1: Identify the elements of operations
and supply chain management.
• LO1-2: Know the potential career
opportunities in operations and supply chain
management.
• LO1-3: Recognize the major concepts that
define the operations and supply chain
management field.
• LO1-4: Evaluate the efficiency of a firm.
1–3
Strategy, Processes, and
Analytics
• Operations and supply chain management involves
– Product design
– Purchasing
– Manufacturing
– Service operations
– Logistics
– Distribution
• Success depends upon
– Strategy
– Processes to deliver products and services
– Analytics to support the decisions needed to manage the firm
1–4
What Is Operations and Supply
Chain Management?
• The design, operation, and improvement of
the systems that create and delivery the
firm’s primary products and services
• Operations and supply chain management

(OSCM) is
– A functional field of business
– Concerned with the management of the entire
production/delivery system
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Operations and Supply Chain
Processes
Operation Supply
s Chain
Manufacturing
and service Processes that
processes used to move information
transform and material to
resources into and from the firm
products
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Supplex Parkas
Process Steps for Men’s Nylon
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Accomplished?
Each Section of OSCM: What Is
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Processes
1–9
Process Activities
• Planning – processes needed to operate an existing
supply chain
• Sourcing – selection of suppliers that will deliver the
goods and services needed to create the firm’s product
• Making – producing the major product or service
• Delivering – logistics processes such as selecting carriers,
coordinating the movement of goods and information,
and collecting payments from customers
• Returning – receiving worn-out, excess, and/or defective
products back from customers
1–10
Goods versus Services
Pure Core Core Pure

Goods Goods Services Services
Tangible Intangible
Interaction with customer required
Less interaction with customers
Inherently heterogeneous
Often homogeneous Perishable/time dependent
Not perishable – can be Defined and evaluated as a
inventoried package of features
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Careers in Operations and
Supply Chain Management
Plant Hospital Branch Department
manager administrator manager store manager
Call center Supply chain Purchasing Quality control

manager manager manager manager
Business process Lean Project Production

improvement improvement
analyst manager manager control analyst
Facilities Chief operating

manager officer
1–12
Historical Development of
Management
Manufacturing strategy developed
Late 1970s
Just-in-time (JIT) production
Early 1980s pioneered by the Japanese
Mid 1980s Service quality and productivity
Total quality management Early 1990s
(TQM) and Quality Six-sigma quality
certification programs Mid 1990s Supply chain
Business process management (SCM)
Late 1990s
reengineering (BPR)
Electronic commerce
Early 2000s Service science
Mid 2010s
Business analytics
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Current Issues in OSCM
• Coordinating relationships between
members of SC
• Optimizing global network of suppliers,
producers, and distributors
• Managing customer touch points
• Raising awareness of OSCM as a
competitive weapon
• Sustainability and triple bottom line
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Efficiency, Effectiveness, and
Value
Efficiency
●
● Doing something at the lowest possible cost
Effectiveness
●
● Doing the right things to create the most value for your customer
Value
●
● The attractiveness of a product relative to its cost
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Efficiency and Wall Street
• Comparison of firms is important to investors
– From an operations and supply chain perspective, the
relative cost of providing a good or service is closely
related to earnings growth
• Management efficiency ratios
– Labor productivity
 Net income per employee
 Revenue (or sales) per employee
– Asset productivity
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14e

• Operations and supply chain management

Pure Core Core Pure

Call center Supply chain Purchasing Quality control

Business process Lean Project Production

Facilities Chief operating

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