OPMT CH 1

Many service jobs are closely related to operations

Financial services Marketing services Accounting services Information services

scientific mgmt: henry ford did

mass production moving assembly line

better benefits, better pay

maunfacturing

scientific mgmt emphasis was on - output

max

supply < demand

opportunity loss, customer dissatisfaction

The Need for Supply Chain Management: what happens to inventory levels

oscillating

The Decline in Manufacturing Employment: Some manufacturing work has been --- to more productive companies

outsourced

Supply Chain Issues: inc levels of - inc - costs increase - increase importance of

outsourcing transportation globalication e-business

Managing the supply chain has become more important as a result of firms increasing their levels of: promotions. shipping. outsourcing. marketing. overtime.

outsourcing.

Environmental Concerns: Using resources in ways that do not harm ecological systems that support human existence

sustainability

Employee - is high in services, especially in low-skill jobs

turnover

Three Categories of Business Processes:

upper-mgmt operational supporting

These govern the operation of the entire organization.

upper-mgmt process

Elements of Supply Chain Management: matching supply and demand

capactiy planning

cotton gin and interchangable parts

eli whitney

where did the industrial revolution begin

england

parts of a supply chain provide raw materials, parts, equipment, supplies, and/or other inputs to the organization, and they deliver outputs that are goods to the organization's customers

external

TEST QUESTION: measurements taken at various points in the transformation process

feedback

end of supply chain

final customer

The Decline in Manufacturing Employment: Manufacturers are increasingly using contract and temporary labor which no longer show up in the statistics as

manufacturing employment

What is credited with gains in industrial productivity, increased standards of living, and affordable products? the Internet multilevel marketing mass production mass transportation personal computers

mass production

manufacturing VS service: higher measurement of productivity

manufacturing

manufacturing VS service: more uniformity of input

manufacturing

manufacturing VS service: who has more uniformity of output

manufacturing

measurement and feedback are part of what

transformation process

Decision Models & Management Science: - mathematical model for inventory management

F.W. Harris

Believed in a --- based on observation, measurement, analysis and improvement of work methods, and economic incentives

"science of management"

2 main reasons for decline in manufacturering

- increase in faster production - outsource jobs

is the term used to describe the difference between the cost of inputs and the value or price of outputs.

: Value-added

Human Relations Movement: - motivation theory, hierarchy of needs,

Abraham Maslow

who did the division of labor

Adam Smith

uses descriptive and predictive models to obtain insight from data and then uses that insight to recommend action or to guide decision making.

Analytics

Assembly lines achieved productivity but at the expense of standard of living. True False

F

Decision Models & Management Science: - statistical procedures for sampling and quality control

Dodge, Romig, and Shewart

Why Manufacturing Matters: is eroded with the loss of manufacturing jobs

Domestic intellectual capital (human capital)

Human Relations Movement: - Theory X and Theory Y

Douglas McGregor

These theories represented the two ends of the spectrum of how employees view work.

Douglas McGregor added Theory X and Theory Y

Human Relations Movement: - Hawthorne studies on worker motivation,

Elton Mayo

"Value added" by definition is always a positive number since "added" implies increases. True False

F

Service operations require additional inventory because of the unpredictability of consumer demand. True False

False

The operations manager has primary responsibility for making operations system design decisions, such as system capacity and location of facilities. True False

False

Among ---many contributions was the introduction of mass production to the automotive industry, a system of production in which large volumes of standardized goods are produced by low-skilled or semiskilled workers using highly specialized, and often costly, equipment.

Ford's

was an industrial engineer who is often referred to as the father of motion study. He developed principles of motion economy that could be applied to incredibly small portions of a task.

Frank Gilbreth

Human Relations Movement: - Two Factor Theory

Frederick Hertzberg

Decision Models & Management Science: - linear programming

George Dantzig

applied Taylor's ideas to organization structure and encouraged the use of experts to improve organizational efficiency. He testified in a congressional hearing that railroads could save a million dollars a day by applying principles of scientific management.

Harrington Emerson

scientific mgmt: - applied Taylor's ideas to organization structure

Harrington Emerson

, the great industrialist, employed scientific management techniques in his factories.

Henry Ford

scientific mgmt: - employed scientific management techniques to his factories

Henry Ford

recognized the value of nonmonetary rewards to motivate workers, and developed a widely used system for scheduling

Henry Gantt

models are widely used to control inventories.

Inventory

Economic conditions Innovating Quality problems Risk management Competing in a global economy

Key Issues for Operations Managers Today

and related mathematical techniques are widely used for optimum allocation of scarce resources.

Linear programming

scientific mgmt: is responsible for planning, carefully selecting and training workers, finding the best way to perform each job, achieving cooperate between management and workers, and separating management activities from work activities

Management

models are the most abstract: They do not look at all like their real-life counterparts. Examples include numbers, formulas, and symbols. These models are usually the easiest to manipulate, and they are important forms of inputs for computers and calculators.

Mathematical

Decision Models & Management Science: - OR applications in warfare

Operations Research (OR) Groups

people are involved in product and service design, process selection, selection and management of technology, design of work systems, location planning, facilities planning, and quality improvement of the organization's products or services.

Operations management

----spend more time on system operation decision than any other decision area

Operations managers

Project models such as ---are useful for planning, coordinating, and controlling large-scale projects. Forecasting techniques are widely used in planning and scheduling. Statistical models are currently used in many areas of decision making.

PERT (program evaluation and review technique) and CPM (critical path method)

A few factors account for a high percentage of the occurrence of some event(s).

Pareto phenomenon.

The fact that a few improvements in a few key areas of operations will have more impact than many improvements in many other areas is consistent with the: Adam Smith phenomenon. Stevenson phenomenon. Tellier phenomenon. Pareto phenomenon. Irwin phenomenon.

Pareto phenomenon.

models look like their real-life counterparts. Examples include miniature cars, trucks, airplanes, toy animals and trains, and scale-model buildings. The advantage of these models is their visual correspondence with reality.

Physical

- one or more actions that transform inputs into outputs

Process

to problem solving often embody an attempt to obtain mathematically optimal solutions to managerial problems.

Quantitative approaches

are useful for analyzing situations in which waiting lines form.

Queuing techniques

models are more abstract than their physical counterparts; that is, they have less resemblance to the physical reality. Examples include graphs and charts, blueprints, pictures, and drawings. The advantage of schematic models is that they are often relatively simple to construct and change. Moreover, they have some degree of visual correspondence.

Schematic

- performance can be adversely affected by many factors outside of the manager's control

Service

Environmental Concerns: measures often go beyond traditional environmental and economic measures to include measures that incorporate social criteria in decision making

Sustainability

involves decisions that relate to system capacity, the geographic location of facilities, arrangement of departments and placement of equipment within physical structures, product and service planning, and acquisition of equipment

System design

Lean production systems incorporate the advantages of both mass production and craft production. True False

T

Decision Models & Management Science: - statistical sampling theory

Tippett

Among Ford's many contributions was the introduction of mass production, using the concepts of interchangeable parts and division of labor. True False

True

Prior to the Industrial Revolution, goods were produced primarily by craftsmen or their apprentices using custom-made parts. True False

True

can be disruptive to operations and supply chain processes. They may result in additional costs, delays and shortages, poor quality, and inefficient work systems

Variations

Human Relations Movement: Theory

William Ouchi

which combined the Japanese approach with such features as lifetime employment, employee problem solving, and consensus building, and the traditional Western approach that features short-term employment, specialists, and individual decision making and responsibility.

William Ouchi added Theory Z,

Theory -, on the negative end, assumed that workers do not like to work, and have to be controlled—rewarded and punished—to get them to do good work.

X

Theory -, on the other end of the spectrum, assumed that workers enjoy the physical and mental aspects of work and become committed to work.

Y

A "product package" consists of: customer relations if a service organization. the shipping container. the exterior wrapping. goods if a manufacturing organization. a combination of goods and services.

a combination of goods and services.

similarities between managing the production of products and managing services

a. Forecasting and capacity planning to match supply and demand. b. Process management. c. Managing variations. d. Monitoring and controlling costs and productivity. e. Supply chain management. f. Location planning, inventory management, quality control, and scheduling.

All other functions——support the two line functions

accounting, finance, marketing, IT, and so on

Which of the following is not a type of operations? storage/transportation goods production advertising

advertising

Process Variation: Variation that has identifiable sources. This type of variation can be reduced, or eliminated, by analysis and corrective action

assignable variation

are supply chains intrinsic or external to org

both

Supply Chain Issues: what kind of pressures

competititve

TEST QUESTION transformation process: outputs lead to

control

TEST QUESTION transformation process: transformation/ conversion process leads to what

control

TEST QUESTION: The comparison of feedback against previously established standards to determine if corrective action is needed.

control

System in which highly skilled workers use simple, flexible tools to produce small quantities of customized goods.

craft production

System in which highly skilled workers use simple, flexible tools to produce small quantities of customized goods

craft productiono

Elements of Supply Chain Management: what products/services do customers want

customers

Historical Evolution of OM: - models and - science

decision mgmt

A primary function of an operations manager is to guide the system by

decision making

The management of systems or processes that create goods and/or provide services

define operations management

The Need for Supply Chain Management: lead to late

deliveries to final customers

Elements of Supply Chain Management: incorporating customer wants, manufacturability, and time to market

design

The research and development activity which starts after positive research results are available and attempts to turn these results into useful commercial applications is: applied research. development. redesign. basic research. commercial research.

development

lean production lead to

flat org

Elements of Supply Chain Management: predicting timing and volume of customer demand

forecasting

scientific mgmt: father of motion studies

frank gilbreth

the greater the value-added, the greater the amount of ---available for these purposes.

funds

ex: computer repair, resturant meal

good/service

Production of ---results in a tangible output

goods

The management of systems or processes that create goods and/or provide services

goods

examples of: Automobile Computer Oven Shampoo

goods

uniformity of input and outputs is for goods or services

goods

Process Variation: The greater the variety of--- offered, the greater the variation in production or service requirements.

goods and services

scientific mgmt: developed the Gantt chart scheduling system and recognized the value of non-monetary rewards for motivating employees

henry gantt

Input variability tends to be - in many service environments than in manufacturing

higher

when manufacturers shut down what do you loose, what becomes eroided

human capital

Historical Evolution of OM: what type of movement

human relations

The - movement emphasized the importance of the human element in job design

human relations

supply = demand

ideal

Refined and developed management practices that increased productivity Credited with fueling the "quality revolution" Just-in-Time production

influence of Jap manufacturers

TEST QUESTION transformation process: what do you control

inputs and transformation/ conversion process

TEST QUESTION: transformation process steps

inputs, transformation/ conversion process, and outputs

The ---parts of a supply chain are part of the operations function itself, supplying operations with parts and materials, performing work on products, and/or performing services.

internal

Operations and supply chains are ---linked, and no business organization could exist without both

intrinsically

Supply Chain Issues: need to manage

inventories

Elements of Supply Chain Management: - meeting demand requirements while managing costs

inventory

Which of the following does not relate to system design? location of facilities inventory management altering the system capacity physical arrangement of departments selection and acquisition of equipment

inventory management

supply chain: no org stands in

isolation

Historical Evolution of OM: influence of

japanese manufactrers

One important piece of information marketing needs from operations is the manufacturing or service ---time in order to give customers realistic estimates of how long it will take to fill their orders.

lead

Marketing depends on operations for information regarding: cash flow. budgeting. lead time. corporate intelligence. productivity.

lead time.

Marketing depends on operations for information regarding: cash flow. corporate intelligence. lead time. budgeting. productivity.

lead time.

with an emphasis on quality, flexibility, time reduction, and teamwork

lean production

System that uses minimal amounts of resources to produce a high volume of high-quality goods with some variety.

lean systems

Jobs in services are often - structured than in manufacturing

less

Operations and sales are the two --functions in a business organization

line

Elements of Supply Chain Management: determining the location of facilities

location

Elements of Supply Chain Management: - deciding how to best move information and materials

logistics

System Design Decisions are strategic decisions that usually require --- commitment of resources

long-term

In many services, worker skill levels are - compared to those of manufacturing employees

low

pure manufacturing goods are going to be - customer contact

low

Services are adding many new workers in - positions

low-skill, entry-level

ex: automobile assembly, steelmaking

mainly good

Example: surgery, teaching

mainly service

Why Manufacturing Matters: Average full-time compensation tends to be higher for ---jobs

manufacturing

goods-oriented

manufacturing

manufacturing VS service: higher ability to patent design

manufacturing

TEST QUESTION transformation process: as you're leading to control what are you doing

measurement/feedback

All managers use --to manage and control operations

metrics

back in the day which was employeed more? services or manufacturers

mfg

3 basic functions of the business org

mktg, operations, fin

A --is an abstraction of reality, a simplified representation of something.

model

are there uniformity of inputs with services

no

did mgmt theory and practice advance during the industrial revolution

no

are things normally PURELY goods or services

no, normally a mix

farming and restaurants produce ---goods

nonmanufactured

Farming is an example of: customized manufacturing. a virtual organization. nonmanufactured goods. a growth industry. an obsolete activity.

nonmanufactured goods.

outsourcing becomes

offshoring

These are core processes that make up the value stream.

operational process

Every aspect of business affects or is affected by

operations

Supply Chain Issues: need to imrpove

operations

The part of a business organization that is responsible for producing goods or services

operations

This is because every aspect of business affects or is affected by .

operations

The--- includes many interrelated activities, such as forecasting, capacity planning, scheduling, managing inventories, assuring quality, motivating employees, deciding where to locate facilities, and more.

operations function

consists of all activities directly related to producing goods or providing services.

operations function

A primary function of the ---- is to guide the system by decision making

operations manager

The --- is the key figure in the system: He or she has the ultimate responsibility for the creation of goods or provision of services.

operations manager

The chief role of an --- is that of planner/decision maker.

operations manager

the --- exerts considerable influence over the degree to which the goals and objectives of the organization are realized

operations manager

the --- is more involved in day-to-day operating decisions than with decisions relating to system design.

operations manager

the --- has a vital stake in system design because system design essentially determines many of the parameters of ---

operations manager system operation

An --- daily concerns include costs (budget), quality, and schedules (time).

operations manager's

who decides this: What: What resources will be needed, and in what amounts? When: When will each resource be needed? When should the work be scheduled? When should materials and other supplies be ordered? When is corrective action needed? Where: Where will the work be done? How: How will the product or service be designed? How will the work be done (organization, methods, equipment)? How will resources be allocated? Who: Who will do the work?

operations mgr

Historical Evolution of OM: what kind of mgmt

scientific

Historical Evolution of OM: what revolution

scientific

craft production was during what

pre-industrial revolution

Two basic aspects of this for operations and supply chain management are managing --to meet demand and dealing with process --.

processes variability

Elements of Supply Chain Management: controlling quality, scheduling work

processing

The Decline in Manufacturing Employment: Increasing ---allows companies to maintain or increase their output using fewer workers

productivity

Elements of Supply Chain Management: - evaluating potential suppliers, supporting the needs of operations on purchased goods and services

purchasing

The Need for Supply Chain Management: issues in

quality

Process Variation: Natural variation that is present in all processes. Generally, it cannot be influenced by managers.

random variation

Dealing with the fact that certain aspects of any management situation are more important than others is called: analysis of variance. decision table analysis. analysis of trade-offs. recognition of priorities. sensitivity analysis.

recognition of priorities.

Dealing with the fact that certain aspects of any management situation are more important than others is called: decision table analysis. analysis of trade-offs. sensitivity analysis. recognition of priorities. analysis of variance.

recognition of priorities.

Some companies attempt to maximize the revenue they receive from fixed operating capacity by influencing demands through price manipulation. This is an example of: collusion. outsourcing. illegal price discrimination. revenue management. volume analysis.

revenue management.

Management is responsible for planning, carefully selecting and training workers, finding the best way to perform each job, achieving cooperate between management and workers, and separating management activities from work activities

scientific mgmt

this movement was led by efficiency engineer, Frederick Winslow Taylor

scientific mgmt

The -of operations management ranges across the organization.

scope

examples of: Forecasting Capacity planning Facilities and layout Scheduling Managing inventories Assuring quality Motivating employees Deciding where to locate facilities

scope of operation functions

The --sector now accounts for more than 70 percent of jobs in the United States

service

The U.S. economy is becoming more and more -based.

service

Why Manufacturing Matters: Losses in manufacturing job leads to losses in --- jobs as well

service

act-oriented

service

ex: songwriting, software development

service

manufacturing VS service: who has more customer contact

service

Customer contact is generally much higher in ---

services

are activities that provide some combination of time, location, form or psychological value.

services

examples of: Air travel Education Haircut Legal counsel

services

nowadays, which employs more? services or manufacturing

services

Which one of the following would not generally be classified under the heading of transformation? assembling staffing farming teaching consulting

staffing

The Need for Supply Chain Management: lead to inventory

stockouts

Operations and sales are the two ________ functions in businesses. line tactical strategic support value-adding

strategic

Process Variation: These are generally predictable. They are important for capacity planning.

structural variation in demand

Elements of Supply Chain Management: - monitoring supplier quality, on-time delivery, and flexibility; maintaining supplier relations

suppliers

downstream supply chain

supplliers' suppliers - direct suppliers - producer - distributor - final customer

Functions and activities include forecasting, purchasing, inventory management, information management, quality assurance, scheduling, production, distribution, delivery, and customer service.

supply chain

In the past, organizations did little to manage the --- beyond their own operations and immediate suppliers which led to numerous problems:

supply chain

a sequence of activities and organizations involved in producing and delivering a good or service

supply chain

Environmental Concerns: require less physical space, change packaging

supply chain waste mgmt

Business organizations consist of three major functions which, ideally: do not interface with each other. support one another. exist independently of each other. function independently of each other. are mutually exclusive.

support one another.

These support the core processes.

supporting processes

Environmental Concerns: Product and service design Consumer education programs Disaster preparation and response Supply chain waste management Outsourcing decisions

sustainability

Taking a systems viewpoint with regard to operations in today's environment increasingly leads decision makers to consider ______________ in response to the ___________. forecasting; stabilization of demand flexibility; pressure to be more efficient sustainability; threat of global warming offshoring; need to promote domestic production technology; impact of random variation

sustainability; threat of global warming

Product design and process selection are examples of _______ decisions. financial system operation forecasting system design tactical

system design

Product design and process selection are examples of _______ decisions. forecasting system operation tactical financial system design

system design

Operations managers spend more time on ---- decision than any other decision area

system operation

System Design Decisions are strategic decisions determine parameters of

system operation

who still has a vital stake in the system design

system operation managers

A --viewpoint is almost always beneficial in decision making

systems

The --approach emphasizes interrelationships among subsystems, but its main theme is that the whole is greater than the sum of its individual parts

systems

These decisions usually, but not always, require long-term commitments. Moreover, they are typically strategic decisions.

systems design

what kind of decisions are these: Capacity Facility location Facility layout Product and service planning Acquisition and placement of equipment

systems design decisions

System operation involves management of personnel, inventory planning and control, scheduling, project management, and quality assurance.

systems operation

These are generally tactical and operational decisions

systems operation

These are generally tactical and operational decisions. Feedback on these decisions involves measurement and control

systems operation

short term descisions, more tactical, managing inventory, quality assurance, require bulk of time bc they're day to day

systems operation

what kind of decisions are these: Management of personnel Inventory management and control Scheduling Project management Quality assurance

systems operation

the output and objectives of the organization as a whole take precedence over those of any one subsystem.

systems viewpoint

Often, the collective success or failure of companies' operations functions will impact the ability of a nation to compete with other nations. True False

t

Why Manufacturing Matters: The loss of manufacturing jobs results in a decreased

tax base (due to loss of taxable income and physical capital)

Why Manufacturing Matters: For each manufacturing job lost, up to --- service jobs are lost

three

The essence of the operations function is to add --during the transformation process

value

supply chain: must have trading partners to create

value

Process Variation: 4 sources of variation

variety of goods and services being offered, structural variation in demand, random variation, assignable variation

if supply > demand

wasteful and costly

Supply Chain Issues: is it complex

yes

do diff functional areas interact and collaborate

yes