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The business function responsible for

planning , coordinating , and controlling the

resources needed to produce a companys

products and services

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It is a management function

Organizations core function

Every organization has OM function

Service or Manufacturing

For profit or Not for profit

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OM Transforms inputs to outputs

Inputs are resources such as

People , Material , and Money

Outputs are goods and services

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To add value

Increase product value at each stage

Value added is the net increase between output productvalue and input material value

Provide an efficient transformation

Efficiency perform activities well at lowest possiblecost

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Se rvic esIntangible productProduct cannot beinventoriedHigh customer contactShort response timeLabor intensive

ManufacturingTangible productProduct can beinventoriedLow customer contactLonger response timeCapital intensive

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B oth u se t e chnologyB oth hav e quality, productivity, & r es pon se

iss u esB oth mu s t for e ca s t d e mandB oth will hav e capacity, layout, and locationiss u es

B oth hav e cu s tom e r s , s uppli e r s , s ch e duling ands taffing i ss u esManufacturing oft e n provid es se rvic esSe rvic es oft e n provid es tangibl e good s

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All organizations are based on decisionsDecisions follow a similar path

First decisions very broad Strategic decisions

Strategic Decisions set the direction for the entirecompany; they are broad in scope and long-term innature

Following decisions focus on specifics - Tacticaldecision

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Tactical decisions focus onSpecific day-to-day issues

Resource needs , schedules , & quantities to produce

Tactical decisions are very frequentStrategic decisions less frequentTactical decisions must align with strategicdecisions

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For long-run success companies mustplace much important on their operations

The 1950-1960 era was the U.S. golden era

where primary opportunities were marketingThe 1970-1980 U.S. companies experienced alarge decline in productivity growth international firms began to challenge in manymarkets

The 1970-1980 era saw U. S. firms laggingbehind in methods and processesThe resurgence of American business in the1990s capitalized on improved operations

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Industrial revolution Late 1700sScientific management Early 1900sHuman relations/Human Resources

1930s -Management science Mid-1900sComputer age 1970sEnvironmental Issues 1970s

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J ust-in-Time Systems ( JIT) 1980s

Total quality management (TQM) 1980sReengineering 1990s

Global competition 1980sFlexibility 1990s

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Time-Based Competition 1990s

Supply chain Management 1990s

Electronic Commerce 2000s

Outsourcing andflattening of the world 2000s

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OM has the most diverse organizationalfunctionManages the transformation process

OM has many faces and names such as;V. P. operations , Director of supply chains , Manufacturing managerPlant manger , Quality specialists , etc.

All business functions need informationfrom OM in order to perform their tasks

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Most businesses are supported by thefunctions of operations , marketing , andfinance

The major functional areas must interact toachieve the organization goals

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