session 1 introduction to operations management 3.0
TRANSCRIPT
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Production andOperationsManagement
Vishal Gupta, PMP
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Introduction to the
Field• Introduction to Production and Operations
Management
• Transformation Processes Defined
• Scope of Operations Management
• Servicing as a part of Operations
Management
OBJECTIVES
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Introduction to the
Field• Evolution of Operations Management
•
W! Stud! Operations Management"• Current Issues in POM
• POM#s future callenges
• Manufacturing trends in India
OBJECTIVES
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Operations Management at I$E%
IKEA has reduced its retail prices by a total of
about 20 percent during last four years.
Trofe MugRedesigned 3 times to fit in a pallet
!" to #20 to 202"Reduced shipping costs by !0$
A notch at the bottom that pre%ents &ater from
pooling at the base during dish&asher run
Refinements ha%e optimi'ed the speed at
&hich cup can pass through the machines
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Operations Management at I$E%
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Operations management & '%'O
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They are
all
operations
(ac) office operation
in a ban)Kitchen unit
manufacturing operation
Retail operation Ta)e*out + restaurant
operation
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Operations ManagementFunctions
Product Design & Development Forecasting
Process Design Production Planning and Control
Quality Management Supply Chain ManagementLocation and Layout of facilities Maintenance Management
Capacity Planning Continuous improvement of operations
Design of Operations Operational Control of Operations
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Wat is Operations Management"
Operations: refers to theprocesses that are used totransform the resources
employed by a rm into productsand services desired bycustomers
Operations management !OM" isdened as the design, operation,and improvement of the systems that create and deliver the rm#s
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$enition and %riteria
Production and operations management(POM) concerns itself with the conversion ofinputs into outputs using physical resourcesso as to meet its criteria of performance.
Criteria of Performance
Customer satisfaction
Eectiveness : oing the right thing tocreate most value
E!ciency : oing at the lowest possi"lecost
#alue
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$enition and %riteria
Criteria of Performance
#alue : $uality%Price
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(uestion Bo)l& ' ma(or ob(ective of POM is to
sho) ho) smart managers can do
)hich of the follo)ing*
a Improve e+ciency by lo)ering
costs
b Improve eectiveness by creating
valuec Increasing value by reducing
prices
d -erving customers )ell
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Wat is a Transformation Process
% transformation process is defined
as a user of resources to transform
inputs into some desired outputs
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OM as .ransformation process
Inputs / .ransformation /Outputs
I,-T/T-T/
-ER1RMA,E
MA,AEME,T
-RE//
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Transformations
4 Physical&&manufacturing
4 'ocational&&transportation
4 Echange&&retailing
4 torage&&warehousing
4 Physiological&&health care
4 *nformational&&telecommunications
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(uestion
& In the Input0.ransformation0Output 1elationship, a typical2input3 for a $epartment -tore is)hich of the follo)ing*
a. isplays". toc+s of goods
c. ales cler+sd. ,ll of the a"ovee. -one of the a"ove
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(uestion
& In the Input0.ransformation0Output 1elationship, a typical2input3 for an 'irline )hich ofthe follo)ing*
a. ,irplanes". ,irports
c. ic+eting ystemsd. ,ll of the a"ove
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Operations Management *OM+Salient Aspects
4 OM is a systematic approach 5 using scientifc tools & techniques and solution
methodologies to analyze problems
4 OM is a"out addressing several issues 5 varying in terms o time horizon, nature o
decisions
4 ransformation processes are central to
Operations4 /ocusing on +eeping costs to the minimum
4 eveloping a set of measures to assess
performance of the system
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Operations ManagementA systems Perspective
I NP !
" ! P !
Labour
Capital
Material
Goods
Services
Forecasting
Operations
Planning &
Control
Process &
ProductDesign
Material &
Capacity
Planning
F e e d b a c k
Purchasing &
InventoryControl
Maintenance
Manageent
Process
Iproveent
!uality
Manageent
P#"C$SSIN%
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Operations ManagementFunctions
Product Design & Development Forecasting
Process Design Production Planning and Control
Quality Management Supply Chain Management
Location and Layout of facilities Maintenance ManagementCapacity Planning Continuous improvement of operations
Design of Operations Operational Control of Operations
• 6esign issues in perations Management lay do&n o%erall
constraints under &hich the operations system functions
• perational ontrol issues focuses on optimi'ing the use of
a%ailable resources in the short*term &hile deli%ering goods
and ser%ices as per plan under the gi%en design constraints
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OperationsA key functional area in an Organisation
"perations
Finance
Mareting ' # M
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"perations"perations
Plant
Manager
PlantManager
"perations
Manager
"perationsManager
Director Director
Manufacturing( Production control(Quality assurance( $ngineering(
Purchasing( Maintenance( etc
Manufacturing( Production control(Quality assurance( $ngineering(
Purchasing( Maintenance( etc
1inance Mar)eting
OM in te Organi,ation Cart
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Interface )ith other functions
4 Operation Management 0 Mar+eting*nterface
4 Operation Management& /inance
*nterface4 Operation Management& esign
*nterface
4 Operation Management& 1uman2esource *nterface
4 Operation Management& *nformationystem *nterface
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4 2If you drop it on your foot, it)on#t hurt you3 !Good orservice*"
4 2-ervices never include goodsand goods never include
services3 !.rue or false*"
Wat is a Service and Wat is a -ood"
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Service Operations
4 angi"ility: ervices areperformances and actions ratherthan o"3ects4 therefore having poortangi"ility (Cannot "e patented)
4 1eterogeneity: 1igh varia"ility in theoperation system performance
4 imultaneous Production 5
Consumption: egree of customercontact is very high
4 Perisha"le: ervices cannot "e
inventoried as in the case of
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Service . Manufacturing Continuum
Pure Product Pure Service
"yurvedic #ealing $reatent
Legal%$a Consulting
Cyber Ca'( ) $elephone *ooths
+ergency Maintenance Services
Facilities Maintenance
#igh ,uality restaurant eal
Fast 'ood in a eat out -oint
Custoi.ed durable goods
Fast oving coodities
/ending Machines
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Manufacturing / ServiceManufacturing Organi4ations -ervice Organi4ations
$ierences
Physical durable product Intangible, perishable product
Output can be inventoried Output can#t be inventoried
5o) customer contact 6igh customer contact
5ong response time -hort response time
1egional, national, Intl
mar7ets 5ocal mar7ets5arge facilities -mall facilities
%apital intensive 5abour intensive
8uality easily measured 8uality not easily measured
-imilarities
Is concerned about 9uality, productivity timely response toits customers
Must ma7e choices about capacity, location, layout
6as suppliers to deal )ith
6as to plan its operations, schedules and resources
;alance capacity )ith demand by a careful choice of resources
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Indian ManufacturingExport Potential of Sectors
ector of *ndustryCurrentEports
PotentialEports
trengths 6ea+nesses
Electrical 5 Electronics 7 8.9 " 7 8 & 8; " esign 5Engineerings+ills4 vendor"ase
'ac+ of scale4'ow domesticdemand
,pparel Manufacturing 7
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Service Sector in IndiaGDP growth rate
ervice ectors 9==8&=9
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-ro)t in Services Sector
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%ase: OM in -nac7s'etBs say that you decided to go for
some snac+s with your friends. ,mongmany options4 you can go to aroadside cart4 a pia%"urger outlet4 or
a snac+ 3oint li+e a Ddipi restaurant(which serves many things includingfull meals).
6hile en3oying the delicious snac+s4 didyou o"serve the following from the
point of view of understanding
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8. 6here are they located 6hat +indof customers do they intend to
serve9. o they serve you while standing
or do they Frst seat you 1ow "ig is
their seating capacity>. 6hat is the process of
communicating yr orders to others
wor+ing in the outlet so that youcan "e served
?. ,re the items prepared after ta+ingyr order or are they alreadyre ared
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8. *dentify the type of Productionystem they followed.
9. Chec+ how Production ystem is
managed.>. /ind out the utiliation of the
resources namelyG manpower4
capacity 5 material.?. 1ow the customer service is
rendered (feed"ac+ system eist or
not)
OM in -nac7s :
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Business Education
S!stematic %pproac
to Org0 Processes
Career Opportunities
Cross12unctional
%pplications
OperationsManagement
W! Stud! Operations Management"
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><
6istory of POM
Individual e+ciency 6or+ study
%ollective e+ciency Production control4 ,ssem"ly line
8uality and materials tatistical Huality control4 *nventory control
3i t i l D l t f OM
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3istorical Development of OM
>ra >vents?%on @ear Originator
8. *nd. 2ev team Engine 8@ /ord
>. 1um 2el. 1awthorne tu. 8A>= Mayo
?. OP. 2es. 'inear Prog. 8A?@ antig
. $uality 2ev I*4 $M 8A@=48A;= Oho4eming
3istorical De elopment of OM
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3istorical Development of OM
>ra >vents?%on @ear Originator
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3istorical Development of OM
3i i l D l f OM
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3istorical Development of OM
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4 ynergies must eist withother functional areas of theorganiation
4 Operations account for
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4 .ypical (ob titles include: 5 ;usiness 'nalyst
5 ;usiness Process Improvement 'nalyst
5 Pro(ect Manager
5 Facilities Manager
5 ;ranch Manager !;an7"
5 $epartment -tore Manager
5 -upply %hain Manager
5 Production Planner 5 8uality 'nalyst?8uality %ontrol -pecialist
5 Materials Manager ?Purchasing Manager
Careers in Operations Management
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4 >=amples of public0 and private0
sector employers )ho hire operationsmanagement graduates include: 5 1etail establishments
5 6ospitals
5 ;an7s
5 Insurance companies
5 'irlines
5 Government agencies 5 Manufacturing companies
5 1esearch corporations
Careers in Operations Management
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4Competitive Pressures due to economicreforms
5 Tariff reduction has e7posed Indian companies
to global competition
5 Abolition licensing policies had enabled se%eralne& players to enter into business increasing
domestic competition and capacity build up
Callenges in Operations Management
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4Gro)ing customer e=pectations 5 Eamples: ari plans and options
provided "y mo"ile operators4 options inpassenger car
5 Customers tend to demand more andreFne their epectations
5 Manufacturing 5 ervice organiationsmust learn to respond to theseepectations
5 -eed to develop capa"ilities to "ringnewer products and services faster and
yet proFta"ly
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4 .oday#s businesses are constantly
challenged by the rapid technologicaladvancements
5 ,Ms 5 *nternet Lan+ing.
5 Luying a train tic+et. http:%%www.irctc.co.in%4 a
customer can accomplish all tas+s pertaining totic+et "oo+ing and cancellation at leisure.
5 Procurement of goods 5 services. ,manufacturing organiation can procure goods
5 services "y organiing a reverse auction onthe *nternet.
5 -ew Product evelopment. , team of designpersonnel from across dierent geographical
locations can participate in new product
Callenges in Operations Management
http://www.irctc.co.in/http://www.irctc.co.in/
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4 >nvironmental Issues
5 Jrowing industrialiation raises concernsregarding the depletion of natural resources
5 6aste generated from production systems andend&of&life products.
5 Jeneration of solid wastes. 5 Consumption of energy and water in countries
li+e *ndia is on the rise.
5 *ncreasingly4 Frms are under pressure to ta+e
responsi"ility of restoring4 sustaining4 andepanding the planetBs ecosystem instead ofmerely eploiting it.
4 OM practices must address
environmental concerns in order to
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