After studying this chapter you will be able to: Define the term operations management, explain operations management role in business, describe the correlation between operations management and information technology, describe the five characteristics of competitive priorities. | BUSINESS PLUG-IN B16 Operations Management LEARNING OUTCOMES Define the term operations management Explain operations management role in business LEARNING OUTCOMES Describe the correlation between operations management and information technology Describe the five characteristics of competitive priorities OM FUNDAMENTALS Production - is the creation of goods and services using the factors of production Production management - describes all the activities managers do to help companies create goods Operations management (OM) - the management of systems or processes that convert or transform resources into goods and services OM FUNDAMENTALS Transformation process - the actual conversion of inputs to outputs OM FUNDAMENTALS OM FUNDAMENTALS Value-added - the term used to describe the difference between the cost of inputs and the value of price of outputs OM IN BUSINESS How does an airline service organization’s OM team adds value? Forecasting Capacity planning . | BUSINESS PLUG-IN B16 Operations Management LEARNING OUTCOMES Define the term operations management Explain operations management role in business LEARNING OUTCOMES Describe the correlation between operations management and information technology Describe the five characteristics of competitive priorities OM FUNDAMENTALS Production - is the creation of goods and services using the factors of production Production management - describes all the activities managers do to help companies create goods Operations management (OM) - the management of systems or processes that convert or transform resources into goods and services OM FUNDAMENTALS Transformation process - the actual conversion of inputs to outputs OM FUNDAMENTALS OM FUNDAMENTALS Value-added - the term used to describe the difference between the cost of inputs and the value of price of outputs OM IN BUSINESS How does an airline service organization’s OM team adds value? Forecasting Capacity planning Scheduling Managing inventory Assuring quality Motivating and training employees Locating facilities IT’S ROLE IN OM Managers use IT to heavily influence OM decisions including : What: What resources will be needed and in what amounts? When: When should the work be scheduled? Where: Where will the work be performed? How: How will the work be done? Who: Who will perform the work? OM Strategic Business Systems Operations strategy addresses broad questions about using major resources to achieve corporate objectives Major long-term issues addressed in operations strategy include: How big to make the facilities? Where to locate the facilities? When to build additional facilities? What type of process(es) to install to make the products? OM Strategic Business Systems Strategic planning - focuses on long range planning Strategic business units (SBUs) - consist of several stand-alone businesses Materials requirement planning (MRP) - use sales forecasts to make sure that needed parts
