Robbins mgmt14 PPT 18b

Management
Fourteenth Edition, Global Edition
Chapter 18B
Managing Operations
Module
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The Role of Operations Management
• Operations management: the transformation
process that converts resources into finished
goods and services
Copyright © 2018 Pearson Education, Ltd. All Rights Reserved

Exhibit MO-1
The Operations System
Exhibit MO-1 portrays the transformation process that converts resources into finished
goods and services in a simplified fashion.
Services and Manufacturing
• Manufacturing organizations: organizations that
produce physical goods
• Service organizations: organizations that
produce nonphysical products in the form of
services

Managing Productivity
• For countries, high productivity can lead to
economic growth and development.
• For individual organizations, increased
productivity gives them a more competitive cost
structure and the ability to offer more competitive
prices.

Strategic Role of Operations Management
• Today, successful organizations recognize the
crucial role that operations management plays as
part of the overall organizational strategy to
establish and maintain global leadership.

What is Value Chain Management? (1 of 2)
• Value: the performance characteristics, features,
and attributes, and any other aspects of goods
and services for which customers are willing to
give up resources
• Value chain: the entire series of organizational
work activities that add value at each step from
raw materials to finished product

What is Value Chain Management? (2 of 2)
• Value chain management: the process of
managing the sequence of activities and
information along the entire value chain

Goal of Value Chain Management
• The goal of value chain management is to create
a value chain strategy that meets and exceeds
customers’ needs and desires and allows for full
and seamless integration among all members of
the chain.

Benefits of Value Chain Management
• Four primary benefits:
– Improved procurement
– Improved logistics
– Improved product development
– Enhanced customer order management

Value Chain Strategy
• Six main requirements of a successful value chain
strategy:
– Coordination and collaboration
– Technology investment
– Organizational processes
– Leadership
– Employees
– Organizational culture and attitudes

Exhibit MO-2
Value Chain Strategy Requirements
Exhibit MO-2 shows the six main requirements of a successful value chain strategy.
Organizational Processes
• Organizational processes: the ways that
organizational work is done

Obstacles to Value Chain Management
• Organizational barriers
• Cultural attitudes
– Intellectual property: proprietary information
that’s critical to an organization’s efficient and
effective functioning and competitiveness
• Required capabilities
• People

Exhibit MO-3
Obstacles to Value Chain Management
Exhibit MO-3 shows the obstacles in managing value chain.

Technology’s Role in Operations
Management
• Smart companies are looking at ways to harness
technology to improve operations management.

Quality Initiatives
• Quality: the ability of a product or service to
reliably do what it’s supposed to do and to satisfy
customer expectations
• Quality initiatives:
– Planning for quality
– Organizing and leading for quality
– Controlling for quality

Quality Goals
• ISO 900: a series of international quality
management standards that set uniform
guidelines for processes to ensure products
conform to customer requirements
• Six Sigma: a quality program designed to reduce
defects and help lower costs, save time, and
improve customer satisfaction

Mass Customization and Lean Organization
• Mass customization: providing customers with a
product when, where, and how they want it
• Lean organization: an organization that
understands what customers want, identifies
customer value by analyzing all activities required
to produce products, and then optimizes the entire
process from the customer’s perspective

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Management

Fourteenth Edition, Global Edition

Copyright © 2018 Pearson Education, Ltd. All Rights Reserved

Copyright © 2018 Pearson Education, Ltd. All Rights Reserved

Copyright © 2018 Pearson Education, Ltd. All Rights Reserved

Copyright © 2018 Pearson Education, Ltd. All Rights Reserved

Copyright © 2018 Pearson Education, Ltd. All Rights Reserved

Copyright © 2018 Pearson Education, Ltd. All Rights Reserved

Copyright © 2018 Pearson Education, Ltd. All Rights Reserved

Copyright © 2018 Pearson Education, Ltd. All Rights Reserved

Copyright © 2018 Pearson Education, Ltd. All Rights Reserved

Copyright © 2018 Pearson Education, Ltd. All Rights Reserved

Copyright © 2018 Pearson Education, Ltd. All Rights Reserved

Exhibit MO-3 shows the obstacles in managing value chain.

Copyright © 2018 Pearson Education, Ltd. All Rights Reserved

Copyright © 2018 Pearson Education, Ltd. All Rights Reserved

Copyright © 2018 Pearson Education, Ltd. All Rights Reserved

Copyright © 2018 Pearson Education, Ltd. All Rights Reserved

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