SESSION 2

Elements of
Operations Management

Dr Sandeep K. Gupta (PhD, MBA, M.Tech)

Assistant Professor, SME, SNU
 SIGNIFICANT EVENTS IN OPERATIONS
MANAGEMENT

Source: Heizer, Jay H._ Munson, Chuck_ Render, Barry-Principles of operations management sustainability and supply chain management-Pearson Education
Limited (2017) Page No. 48.
 PIONEERS/TORCHBEARERS OF OPERATIONS
MANAGEMENT
The Industrial Revolution (1760s
to early 1800s) ushered in the
foundations of division of labor
and interchangeable parts, keys to
efficient production.
Eli Whitney, inventor of the
cotton gin, also manufactured
10,000 muskets by using the
concept of interchangeable parts.
In 1883, Frederick Winslow In about 1912, Frank and Lillian In post-WW II Japan, Taiichi
Taylor used the stopwatch Gilbreth laid the foundation for In 1913, Henry Ford’s first Ohno developed just-in-time
method to time tasks for complex predetermined motion time moving assembly line started production (JIT), later called the
jobs. This became key for systems (PMTS), which predict rolling, cutting production time Toyota Production System. The
studying efficiency and the time it takes to complete for a car from 12 hrs to < 3 hrs. company designed it to eliminate
productivity. tasks. waste and increase productivity
and quality.
 OPERATIONS MANAGEMENT AT
HARD ROCK CAFE

Source: Heizer, Jay H._ Munson, Chuck_ Render, Barry-Principles of operations management sustainability and supply chain management-
Pearson Education Limited (2017) Page No. 40
 WHY LEARN ABOUT OPERATIONS
MANAGEMENT?

• Operations and sales are the two line /core

functions in a business organization.
• All other functions—accounting, finance,
marketing, IT, and so on—support the two
line functions.
BUSINESS INFORMATION FLOW
 BOEING’S GLOBAL
SUPPLY-CHAIN

Source: Heizer, Jay H._ Munson, Chuck_ Render, Barry-Principles of operations management sustainability and supply chain management-Pearson
Education Limited (2017) Page No. 67
FORD’S GLOBAL NETWORK (SOURCING) TO SUPPORT
THE MANUFACTURING OF THE ESCORT
 OM’S TRANSFORMATION ROLE

• To add value
• Increase product value at each stage

• Value added is the net increase between output product value and input material
value

• Provide an efficient transformation

• Efficiency – means performing activities well for least possible cost
9
OPTIONS FOR INCREASING
CONTRIBUTION
 GOODS & SERVICES
Manufacturing Services
• Tangible product • Intangible product

• Product can be inventoried • Product cannot be inventoried

• Low customer contact • High customer contact

• Longer response time • Short response time

• Capital intensive • Labor intensive

11
 ON THE OTHER HAND…
• Both use technology
• Both have quality, productivity, &
response issues
• Both must forecast demand
• Both will have capacity, layout, and
location issues
• Both have customers, suppliers,
scheduling and staffing issues
• Manufacturing often provides
services
• Services often provides tangible
goods 12
 HYBRID ORGANIZATIONS

• Some organizations are a blend of

service/manufacturing/quasi-manufacturing Quasi-
Manufacturing (QM) organizations

• QM characteristics include
• Low customer contact & Capital Intensive

13
 Activity

WHAT ARE EXAMPLES OF QM???

LIST OUT THE PRODUCT AND
SERVICE COMPONENTS OF A
COMPANY.
 Customized vs Mass Products ??? Operations Implications…

‘FOUR VS’ OF PROCESSES/OPERATIONS

FOUR VS ANALYSIS OF SOME RETAIL BANKING
OPERATIONS
(FOR VARIOUS SERVICE OUTLETS)
 CASE STUDY DISCUSSION

AAF Rotterdam
• Nigel Slack, Stuart Chambers, Robert Johnston, Alan Betts-Operations and Process
Management_ Principles and Practice for Strategic Impact (2nd Edition) -Prentice
Hall (2008), Page No. 55/28

• What contribution does he seem to expect from his operations?

• What are the major processes within AAF, and how do they relate
to each other?
 OPERATIONS JOB PROFILE

Source: Heizer, Jay H._ Munson, Chuck_ Render, Barry-Principles of operations management sustainability a
chain management-Pearson Education Limited (2017) Page No. 47
PROCESS OF OPERATIONS EXCELLENCE !!!
QUERY ???