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Operations Management

The process of managing the resources that are

needed to produce an organizations goods and

services.

Operations managers focus on managing the five

Ps of the firms operations:

People, plants, parts, processes, and planning andcontrol systems.

The Basics Of Operations Management

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Input

A resource required for the manufacture of a product orservice.

Conversion System

A production system that converts inputs (material andhuman resources) into outputs (products or services); alsothe production process or technology.

Output

A direct outcome (actual product or service) or indirectoutcome (taxes, wages, salaries) of a production system.

The Production System

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The Basic Production System

FIGURE 151

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Production System Components

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Intermittent Production System

Production is performed on a start-and-stop basis,

such as for the manufacture of made-to-order

products.

Mass Production

A special type of intermittent production process

using standardized methods and single-usemachines to produce long runs of standardized

items.

Basic Types of Production Processes

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Mass Customization

Designing, producing, and delivering customized

products to customers for at or near the cost andconvenience of mass-produced items.

Mass customization combines high production volume

with high product variety.

Elements of mass customization: Modular product design

Modular process design

Agile supply networks

Basic Types of Production Processes

(contd)

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Continuous Production Processes

A production process, such as those used by chemical

plants or refineries, that runs for very long periods

without the start-and-stop behavior associated with

intermittent production.

Enormous capital investments are required for highly

automated facilities that use special-purpose

equipment designed for high volumes of production

and little or no variation in the type of outputs.

Basic Types of Production Processes

(contd)

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Decision Factors:

Customer convenience

Transportation costs

Labor costs and availability

Sources of supplies and raw materials

Owner preferences for specific locations

Government policies, rules, regulations andincentives

Site cost and availability

The Facility Location Decision

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Facility Layout

The configuration of all the machines, employeeworkstations, storage areas, internal walls, and so

forth that constitute the facility used to create afirms product or service.

Product Layout

A production system design in which every item to

be produced follows the same sequence ofoperations from beginning to end, such as anassembly line.

Facility and Production Layout

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Product Layout for Carwash

FIGURE 152Source: Everett Adam Jr. and Ronald Ebert, Production and Operations Management

(Upper Saddle River, NJ: Prentice Hall, 1992), p. 254. G.Dessler, 2003

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Process Layout

A production system design in which similar machines or

functions are grouped together.

Fixed-Position Layout A production system arrangement in which the product

being built or produced stays at one location and the

machines, workers, and tools required to build the product

are brought to that location as needed, as for the buildingof ships or other bulky products.

Facility and Production Layout (contd)

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Process Layout

FIGURE 153Source: Everett Adam Jr. and Ronald Ebert, Production and Operations Management

(Upper Saddle River, NJ: Prentice Hall, 1992), p. 254.

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Cellular Manufacturing Layout

A combination of process and product layouts, in

which machines and personnel are grouped into

cells containing all the tools and operationsrequired to produce

a particular product

or family of products.

Facility and Production Layout

(contd)

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Improving Layouts by Moving to the

Cellular Manufacturing Concept

FIGURE 154Source: Source: Barry Render and Jay Heizer, Principles of Operations Management, 2nd ed.,

1997. Reprinted by permission of Prentice Hall, Inc., Upper Saddle River, NJ. G.Dessler, 2003