1. Transparency Masters to accompany Operations Management, 5E (Heizer & Render) 1-6 © 1998 by Prentice Hall, Inc. A Simon & Schuster Company Upper Saddle River, N.J. 07458 What is Operations Management? Production is the creation of goods and services Some will say that a service is delivered Also can have an experience! Operations management is the set of activities that creates goods and services through the transformation of inputs into outputs

2. Transparency Masters to accompany Operations Management, 5E (Heizer & Render) 1-6 © 1998 by Prentice Hall, Inc. A Simon & Schuster Company Upper Saddle River, N.J. 07458 Operations Management OM is often associated with a specific function – production or manufacturing OM consists of processes  Process – a set of tasks transforming inputs into outputs OM can also be associated with any function through a process focus.

3. Transparency Masters to accompany Operations Management, 5E (Heizer & Render) 1-35 © 1998 by Prentice Hall, Inc. A Simon & Schuster Company Upper Saddle River, N.J. 07458 The System Transforms Inputs to Outputs A set of activities transforms inputs to outputs; examples: assembly, mfg processes, transportation, selling, cooking, typing, reviewing; the list is endless. Land, Labor, Capital, Management Goods and Services Feedback loop InputsProcessOutputs

4. Transparency Masters to accompany Operations Management, 5E (Heizer & Render) 1-6 © 1998 by Prentice Hall, Inc. A Simon & Schuster Company Upper Saddle River, N.J. 07458 Process Management OM can also be associated with any function through a process focus.  Everything we do is a process  Therefore we should design processes  A process can be articulated  We can analyze the process  We can design or improve the process using OM tools and techniques

5. Transparency Masters to accompany Operations Management, 5E (Heizer & Render) 1-6 © 1998 by Prentice Hall, Inc. A Simon & Schuster Company Upper Saddle River, N.J. 07458 Examples HR – is hiring a process? Accounting – is auditing a process? Marketing – is developing a marketing strategy a process? Finance – is processing a loan application a process? Personal – what type of daily process do you do?

6. Transparency Masters to accompany Operations Management, 5E (Heizer & Render) 1-16 © 1998 by Prentice Hall, Inc. A Simon & Schuster Company Upper Saddle River, N.J. 07458 Why Study OM? zOM is one of three major functions (marketing, finance, and operations) of any organization. zWe want (and need) to know how goods and services are produced so you can do our job. zWe want to know what operations managers do since we may interact with them. zOM is a costly part of an organization (assets, costs)

7. Transparency Masters to accompany Operations Management, 5E (Heizer & Render) 1-29 © 1998 by Prentice Hall, Inc. A Simon & Schuster Company Upper Saddle River, N.J. 07458 Where are the OM Jobs? Project management Technology/methods Business Process Improvement Response time Quality Customer service Facilities/space utilization Inventory reduction Strategic issues People/team development Cost reduction Productivity improvement

8. Transparency Masters to accompany Operations Management, 5E (Heizer & Render) 1-30 © 1998 by Prentice Hall, Inc. A Simon & Schuster Company Upper Saddle River, N.J. 07458 New Challenges in OM Local or national focus Batch shipments Low bid purchasing Lengthy product development Standard products Job specialization Global focus Just-in-time Supply chain partnering Rapid product development Mass customization Empowered employees From To