1.  Planning  Organizing  Staffing  Leading  Controlling © 2011 Pearson Education, Inc. publishing as Prentice Hall Basic Management Functions

2. © 2011 Pearson Education, Inc. publishing as Prentice Hall Ten Decision AreasChapter(s) 1.Design of goods and services5 2.Managing quality6, Supplement 6 3.Process and capacity 7, Supplement 7 design 4.Location strategy8 5.Layout strategy9 6.Human resources and 10 job design 7.Supply-chain 11, Supplement 11 management 8.Inventory, MRP, JIT12, 14, 16 9.Scheduling13, 15 10.Maintenance17 Table 1.2

3. 1. Design of goods and services  What good or service should we offer?  How should we design these products and services? 2. Managing quality  How do we define quality?  Who is responsible for quality? © 2011 Pearson Education, Inc. publishing as Prentice Hall Table 1.2 (cont.)

4. 3. Process and capacity design  What process and what capacity will these products require?  What equipment and technology is necessary for these processes? 4. Location strategy  Where should we put the facility?  On what criteria should we base the location decision? © 2011 Pearson Education, Inc. publishing as Prentice Hall Table 1.2 (cont.)

5. 5. Layout strategy  How should we arrange the facility?  How large must the facility be to meet our plan? 6. Human resources and job design  How do we provide a reasonable work environment?  How much can we expect our employees to produce? © 2011 Pearson Education, Inc. publishing as Prentice Hall Table 1.2 (cont.)

6. 7. Supply-chain management  Should we make or buy this component?  Who should be our suppliers and how can we integrate them into our strategy? 8. Inventory, material requirements planning, and JIT  How much inventory of each item should we have?  When do we re-order? © 2011 Pearson Education, Inc. publishing as Prentice Hall Table 1.2 (cont.)

7. 9. Intermediate and short–term scheduling  Are we better off keeping people on the payroll during slowdowns?  Which jobs do we perform next? 10. Maintenance  How do we build reliability into our processes?  Who is responsible for maintenance? © 2011 Pearson Education, Inc. publishing as Prentice Hall Table 1.2 (cont.)

8.  Technology/methods  Facilities/space utilization  Strategic issues  Response time  People/team development  Customer service  Quality  Cost reduction  Inventory reduction  Productivity improvement © 2011 Pearson Education, Inc. publishing as Prentice Hall

9.  APICS, the American Production and Inventory Control Society  American Society of Quality (ASQ)  Institute for Supply Management (ISM)  Project Management Institute (PMI)  Council of Supply Chain Management Professionals  Charter Institute of Purchasing and Supply (CIPS) © 2011 Pearson Education, Inc. publishing as Prentice Hall

11.  Tangible product  Consistent product definition  Production usually separate from consumption  Can be inventoried  Low customer interaction

12. © 2011 Pearson Education, Inc. publishing as Prentice Hall  Intangible product  Produced and consumed at same time  Often unique  High customer interaction  Inconsistent product definition  Often knowledge-based  Frequently dispersed

13. © 2011 Pearson Education, Inc. publishing as Prentice Hall Services Manufacturing Australia Canada China Czech Rep France Germany Hong Kong Japan Mexico Russian Fed South Africa Spain UK US 90 − 80 − 70 − 60 − 50 − 40 − 30 − 20 − 10 − 0 −

14. © 2011 Pearson Education, Inc. publishing as Prentice Hall Automobile Computer Installed carpeting Fast-food meal Restaurant meal/auto repair Hospital care Advertising agency/ investment management Consulting service/ teaching Counseling Percent of Product that is a GoodPercent of Product that is a Service 100%7550250255075100% |||||||||

15. © 2011 Pearson Education, Inc. publishing as Prentice Hall 120 – 100 – 80 – 60 – 40 – 20 – 0 – ||||||| 1950197019902010 (est) 196019802000 Employment (millions) Figure 1.4 (A) Manufacturing Service

16. © 2011 Pearson Education, Inc. publishing as Prentice Hall Figure 1.4 (B) 40 – 30 – 20 – 10 – 0 – ||||||| 1950197019902010 (est) 196019802000 150 – 150 125 – 125 100 – 100 75 – 75 50 – 50 25 – 25 0 – 0 Employment (millions) Index: 1997 = 100 Index: 1997 = 100 Manufacturing employment (left scale) Industrial production (right scale)

17. © 2011 Pearson Education, Inc. publishing as Prentice Hall Figure 1.4 (C) United States Canada France Italy Britain Japan W. Germany 19702010 (est) ||||| 4050607080 Percent

18. Service Sector Example % of all Jobs Education, Legal, Medical, other San Diego Zoo, Arnold Palmer Hospital 25.8 Trade (retail, wholesale) Walgreen’s, Wal-Mart, Nordstrom’s 14.9 Utilities, Transportation Pacific Gas & Electric, American Airlines 5.2 Professional and Business Services Snelling and Snelling, Waste Management, Inc. 10.7 © 2011 Pearson Education, Inc. publishing as Prentice Hall Table 1.3

19. Service Sector Example % of all Jobs Finance, Information, Real Estate Citicorp, American Express, Prudential, Aetna 9.6 Food, Lodging, Entertainment Olive Garden, Motel 6, Walt Disney 8.5 Public Administration U.S., State of Alabama, Cook County 4.6 Total78.8 © 2011 Pearson Education, Inc. publishing as Prentice Hall Table 1.3

20. Other Sectors Example % of all Jobs Manufacturing Sector General Electric, Ford, U.S. Steel, Intel 11.2 Construction Sector Bechtel, McDermott8.1 Agriculture Sector King Ranch1.4 Mining SectorHomestake Mining0.5 Total21.2 © 2011 Pearson Education, Inc. publishing as Prentice Hall Table 1.3

21. © 2011 Pearson Education, Inc. publishing as Prentice Hall Traditional Approach Reasons for Change Current Challenge Low cost production, with little concern for environment ; free resources (air, water) ignored Public sensitivity to environment; ISO 14000 standard; increasing disposal costs Environmentally sensitive production; green manufacturing; sustainability Low-cost standardize d products Rise of consumerism; increased affluence; individualism Mass customization Figure 1.5

22. © 2011 Pearson Education, Inc. publishing as Prentice Hall Traditional Approach Reasons for Change Current Challenge Emphasis on specialized, often manual tasks Recognition of the employee's total contribution; knowledge society Empowered employees; enriched jobs “In-house” production; low-bid purchasing Rapid technological change; increasing competitive forces Supply-chain partnering; joint ventures, alliances Large lot production Shorter product life cycles; increasing need to reduce inventory Just-In-Time performance; lean; continuous improvement Figure 1.5

23.  Ethics  Global focus  Environmentally sensitive production  Rapid product development  Environmentally sensitive production  Mass customization  Empowered employees  Supply-chain partnering  Just-in-time performance © 2011 Pearson Education, Inc. publishing as Prentice Hall