2. OPERATIONS MANAGEMENT STRATEGY 1. PRODUCT CHOICE 2. PROCESS CHOICE 3. FACILITIES CHOICE 4. QUALITY CHOICE

3.  Facilities are the plant (factories, offices etc) and equipment (trucks, computers etc) needed to carry out operations  The best available physical resources should be chosen. Variable that impact this; ▪ Location ……read through and discuss notes in text ▪ Cost of site ▪ Access & age of buildings ▪ Layout of buildings

4.  Resources must be chosen and arranged in the best way for the purpose of the producer  Organisations must carefully choose a location that will enable the design and layout of operations for efficient production

5.  IMPORTANT FOR YOUR ASSIGNMENT  Concept of ‘location’ depends on the type of business operation  The right location is crucial for a business  Discuss examples from text p251

6. Types of locations for different businesses  Online shopping = google results – location of business when internet searches are completed  Retail/some service = passing traffic and access to transport facilities  Service industry = central location near a major road

7.  Finding the right location can be a complex task  Must be easily accessible for customers  Must meet requirement of zoning laws ▪ Specify which types of businesses may be conducted on which blocks of land

8.  Owner of the business must also look at the region where the business will be conducted  Eg Amusement park would be suitable for a region that is filled with teenagers that have money to spend on recreation activities  A high end fashion store would be suitable in an area where women have lots of disposable income to spend on clothing

9.  Discuss as a class:  Areas where each of these businesses should be located ▪ Surf board manufacturer ▪ Expensive women's clothing shop ▪ Apple store (the technology products) ▪ Expensive car dealer ▪ Second hand clothing store

10.  Before deciding on a particular region or area for your business you must consider the following elements:  Demographics  Financial status of people  Planning considerations – any future developments that may affect the business  Zoning laws Must also consider whether it is a residential, commercial or industrial area and the laws that apply to these certain areas

11.  Must have a location that your business can afford  Income of business must be great enough to cover the costs of the site

12.  If business make sales by displaying goods – important to be located where people are passing by  Location sites where people are constantly passing by are the most valuable for most retail and service businesses  Businesses that reply on the customers who make appointments – accounting, lawyers  Parking facilities and public transport access are very important considerations

13.  Businesses that require shipments of large quantities of goods  Access to the site by large trucks essential  Proximity to railway and road transport depot are vital

14.  Some businesses need to be as far away as possible from competitors as they are likely to damage each others’ business  Two donut shops side by side  Two convinence stores side by side  However, sometimes a business will thrive more if they are surrounded by competitors  Car yards (often car companies are side by side)  Tourist information shops

15.  Need to decide if you are going to rent, lease, buy business premise  When checking suitability of a new site it is important to plan the actual layout that will be required by the business  Factories: suitability will relate to: ▪ The amount of lighting in each work area ▪ Availability of wide isles ▪ The safety of work stations and production areas ▪ The ability to allow logical workflow and movement of items and people

16. For retail stores suitability will be related to: ▪ Appropriate staff areas for downtime (meal breaks) ▪ Ability to allow customer movement ▪ Space for displaying stock to attract customers ▪ Safe and secure space for storage ▪ Appropriate staff areas for downtime (meal breaks)

17. In class:  Activities: Question 1 p.254  Stop & Think #1 p. 255 THIS IS A PRACTICE FOR YOUR ASSIGNMENT!!  Activities: Q1-8 p. 256-257 ……..complete for Home Work

18.  Read case study ‘ Banana Ply poised to power off commercial production line’ p. 259  Answer questions a - d

19.  http://www.youtube.com/watch?v=cbyzSp3j0jk http://www.youtube.com/watch?v=cbyzSp3j0jk  Definition of layout:  The physical arrangement of facilities (plant and equipment) and workstations (positioning of people) used in the creation of a product  Operations facilities are expensive and are constructed to be permanent and cannot be easily changed  Therefore the design and layout are critical to operational efficiency and to long term business success

20.  The importance of layout varies from business to business – variations limitless  Key aspects to be considering in deciding layout include:  Size of goods  Volume of production  Staff needs  Flexibility of use  Type of service  Security needs  Health and safety requirements

21. 1. Process oriented layout: 1. The facility is arranged so that equipment and workstations are grouped together according to their function 2. A process layout is best when there are a variety of products or variations on a single product 1.Eg. Warehouses/hospitals

22. 2. Product oriented layout  The facility is arranged so that equipment and workstations are in line to provide a sequence of specialised tasks  A product layout is best when one standardised product is being produced in large volumes ▪ Eg. Motor vehicle manufacturing

23. 3. Fixed Position Layout  The workers and equipment come to the product  It is used when it is not feasible to move the product (because of size, shape or dangerous composition)  Eg. Aircraft manufacturing

24.  Activities: Q 4 & 5 p. 263 Discuss as a class  Activities: Question 1,2,3 p.261 to 263 (complete for Home Work)