BADM 410
Production & Operations
Management
“Operations” or “OM”
What is it?
Why study it?
Discuss
Course Requirements
Syllabus (tentative) and schedule
Questions
BADM 410
The Product Mix Problem (PQ)
(Handout)
What Is Operations Management?
Operations - Systematic activity focused on
production and deliver of products and/or services
to external customers. Operations is process
oriented, transforming inputs into outputs, with the
goal of creating value in the form of goods and
services.
Management - Systematic activity focused on
personal or organizational goal achievement.
Operations Management (OM) is the systematic set
of activities focused on achieving operational goals.
Operations Management is…
“The systematic design, direction and control
of processes that transform inputs into
services and products for internal, as well as
external, customers.”
Inputs
Transformation Processes
(Adding value)
Outputs
BADM 410
Processes and Systems
“Process”
What is it?
Why focus on processes?
Systems View
What does this mean?
What does it do for us?
Productivity
 Productivity is the value of outputs (services
and products) produced, divided by the value
of input resources(wages, costs of
equipment, etc.)
Productivity =
Output
Input
Example -FedEx
Why are they successful?
Fast
On-time deliveries
Relatively low cost
Technology in shipment tracking
Operations Management
as a Function
Operations Management
as a Function
 Essential functions:
 Marketing – generates demand
 Production/operations – creates and
delivers the product and/or service
 Finance/accounting – tracks how well
the organization is doing financially,
secures financing, pays bills, collects
the revenue
OM is Management and Decision Making
Applied to the Operations Function
Four Basic Decision-making Steps?
(1) Recognize and clearly define the problem.
(2) Collect the information needed to analyze
possible alternatives.
(3) Choose the most attractive alternative.
(4) Implement the chosen alternative.
Some Management and Decision
Making Areas in Operations
Tactical Decisions
Strategic Decisions





Development of new
capabilities
Maintenance of existing
capabilities
Design of new
processes
Development and
organization of value
chains
Key performance
measures





Process improvement
and performance
measures
Management and
planning of projects
Generation of production
and staffing plans
Inventory management
Resource scheduling
So Why Study OM?
 OM is a major function
 We want (and need) to know how goods
and services are produced
 We want to understand what operations
managers do
 OM is a costly part of the organization
BADM 410
The Product Mix Problem (PQ)
What answers did we get?
Things We Need To Do
 Check the course web page
 Visit the text companion web site
 Powerpoint Slides are here
 The self-test quizzes are here
 Locate our software
 Lab (Bond 251)
 Student CD
 Available freeware
 Review what you need to do for next class (see
next slide)
Important
For Next Class Meeting
Review the syllabus and schedule,
and bring any questions to class
Read chapter 1
Take the WebCT quiz for Chapter 1
before next class