OM 374 Chapter 1 The productive system is a man made system a process a set of procedures activities tasks or operations that transform inputs resources into desired valuable outputs products or services Human resources or people include hourly workers supervisors managers directors staff personnel executives and professionals The capacity of the system is determined by how large a facility how much equipment labor capital and energy is available and how it is all utilized to generate the desired kind and amount of output The transformation process of a productive system may generate products services or both The top management of an organization sets long term objectives for the company called the corporate strategies Supply Chain Management SCM integrates the management of goods and services from supply to demand management within and across all companies involved Production to order suggests that one makes what one sells Production to stock assumes that one sells what one makes Continuous flow production is synonymous with production line flow shop or mass production Intermittent production is synonymous with batch production James Watt invented the steam engine in 1764 to power factories Adam Smith created the division of labor which increase production output and worker dexterity in 1776 Eli Whitney introduced the use of interchangeable parts in 1798 Charles Babbage suggested different pay scales for different types of labor Frederic Taylor considered the Father of Scientific Management from in 1832 1910 1914 1 Management must determine and employ the scientific method to do 2 Management must scientifically select train and help in the any type of work development of workers 3 Management is responsible for developing team spirit and hearty cooperation between workers and management 4 Management must ensure the division of work between workers and management