- 1 organization chart- CEO over marketing, operations, finance- production= creation of goods and services- OM= set of activities that create value in form of g & s by turning o into i- study om? 1 of 3 functions of any orgzn,, we want and need to know how g & s produced, understand what OM mgrs due, = a costly part of organization- om decisions= strategic (broad/long term/encompassing) tactical (narrow/short term/ small issues)- om people…. plan, organize, lead control, staffing- OM JOB= implement an OM strategy, provide competitive advantage, & increase productivity- critical decisions= design of goods and servies, managing quality, process and capacity design, location strategy, layout strategy, human resources and job design, supply chain maintenance, inventory material planning JIT, intermediate/short trm scheduling, maintenance- services (intangible, not inventoried, high customer contact, short response time, labor intensive) manufacturing (tangible, inventories, low customer contact, long response time, capital intensive)- productivity= outputs/inputs …. labor r= units produced/ labor hrs used…. = output/labor+material+energy+capital+mis..- service productivity= labor intensive, focused on unique individual attributes, intellectual task, difficult to mechanize, difficult to evaluate for quality- 2 reasons to globalize (1 reduce costs- lower wage rates lower direct and indirect costs, 2 improve supply chain-locating facilities closer to unique resoures, 3 provide better g &s- ontime deliveries, cultural variables, improved cstmr service, 4 understand markets-new opportunities, 5 learn to improve operations-remain open to free flow ideas, 6 attract andretain global talent-offer better employment opportunities)- mission statement- tell orgzn where its going, strategy- tells the orgzn how to get there (foundation, design value, develop strategies)- factors affecting mission- environment, customer benefit to society, philosophies & values, profability & growth, public image- strategy- active plan to achieve mission, functional areas have strategies, exploit opportunities, strengths, neutralize threats, avoid weaknesses- competitive advantage strategies (1 differentiation= uniqueness(hard rock cafe, walt disney magic kingdom), 2 cost leadership= max value perceived by cstmr, not always low quality, 3 response=flexibility, reliability, and timeliness)- 10 OM strategic decisions= goals and service design, quality, process and capacity design, location selection, human resources & job design, suppy chain mgmt, inventory, scheduling, maintenance- operation strategy issues- resources view, value chain analysis, porters 5 forces model, operating in a system with many external factors, constant change- Strategy development- identify key success factors, build & staff the orgzn, integrate OM w/ other activities- 5 product decision- develop and implement a product strategy that meets the demands of the marketplace with a competitive advantage- product life cycle(introductory = fine tuning may warrant unusual expenses for research, product dvlpmt, process modification & enhancement, supplier dvlpmt, best period to increase mrkt share (growth= product design stablizes, effective forecasting of capacity, adding or enhancing capacity) (maturity phase= competitors, high volume, cost control)(decline= terminate)- QFD= (identify…customer wants and how g & s will satisfy wants, relationships b/w the firms hows, importance ratings, evaluate competing products, compare performance to desirable technical attributes)- issues for product development (robust design= small variations in productionor assembly, lower cost higher quality)(modular design= segmented components, flexibility to both production and marketing, ability to satisfy cstmr requirements)(CAD= shorter dvlpmt cycles lower cost improved accuracy)(CAM)(virtual reality tchnlgy)(value analysis)(environmentally friendly design)- acquiring technology- purchase firm, joint ventures, alliances- documents for production- (assembly drawing- shows view of product)(assembly chart- point of production where components flow into subassemblies and into final product)(route sheet- operations and times required to produce a component)(work order- instructions to produce a given quantity of item)(service design- direct interaction with customer, reduced productivity, increased opportunity for customization)- automated machines reduce- time, labor, interaction- ** spreadsheet modeling process- influence chart, sketch overall paln, develop the base case, test model using trial values, use model to perform the needed analysis, document model so others understand- profit=revenue- total cost // revenue=unit price x quantity made and sold // total cost= fixed + variable // variable cost=unit sold x quantity made & sold- goal seek- “what if” – goal seek, set cell as output cell (profit), to value (0), by changing cell= input cell (quantity made and sold)- 7 process strategies- how to produce a product or provide a service that meetsor exceeds customer requirements, and cost and managerial goals, has long term effects on efficiency and production flexibility, cost and quality- 1 process focus-organized around specific activities or processes, general equiptment but skilled personnel, high degree of product flexibility, high cost & low equipment utilization 2 repetitive focus- assembly lines, modules w/ parts, less flexibility, more efficient 3 product focus- organized by product, high volume but low variety of products, efficient processes, high fixed by low variable cost 4 mass customization- rapid, low cost production of g & s to satisfy unique customers, flexibility of process focus with efficiency of product focus, rapid design- process analysis and design- is the process acheive competitive advantage?addvalue? maximize customer value? win orders?- ^ flowcharts (shows movement of materials) time function map (shows flows and time frames) value stream mapping (flows & time & value added beyond the immediate organization) process charts (uses symbols to show key activities) service blueprinting (focuses on customer/provider interaction)- improving service processes (layout and human resources)- production technology (machine technology- increases precision productivity flexibility environmental impact)(AIS- improved data acquisition, reduced data entry errors, increased