operations management busn 6110 sp2, 2011. syllabus class 1 (mar 10): chap 1; chap 2, case study...
TRANSCRIPT
![Page 1: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/1.jpg)
Operations ManagementOperations Management
BUSN 6110BUSN 6110
SP2, 2011SP2, 2011
![Page 2: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/2.jpg)
SyllabusSyllabus• Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)• No Class Mar 17 – Webster Spring Break, No Class Mar 24 – out of townNo Class Mar 17 – Webster Spring Break, No Class Mar 24 – out of town• Class 2: (March 31):Decision Making, Chap 6, Chap 8 (Product and Service Class 2: (March 31):Decision Making, Chap 6, Chap 8 (Product and Service
Design; Processes and Technologies)Design; Processes and Technologies)• Class 3: (Apr 7): chap 10, chap 11, Chap 17(Take home exam) (Facility Class 3: (Apr 7): chap 10, chap 11, Chap 17(Take home exam) (Facility
Planning, Project Management)Planning, Project Management)• Class 4: (Apr 14): Chap 9, Chap 12 (Capacity and Aggregate Planning, Class 4: (Apr 14): Chap 9, Chap 12 (Capacity and Aggregate Planning,
Inventory Management)Inventory Management)• Class 5: (Apr 21): Chap 5, Chap 7 (Supply Chain Management and Class 5: (Apr 21): Chap 5, Chap 7 (Supply Chain Management and
Forecasting); Chap 15, Reverse Logistics – need “The Forklifts Have Nothing Forecasting); Chap 15, Reverse Logistics – need “The Forklifts Have Nothing To Do!” Available in the Lewis and Clark BookstoreTo Do!” Available in the Lewis and Clark Bookstore
• Class 6: (Apr 28): Chap 13; Chap 16, Chap 4 (Resource planning, scheduling, Class 6: (Apr 28): Chap 13; Chap 16, Chap 4 (Resource planning, scheduling, quality) quality)
• Class 7: (May 5) Supply Chain Security; Group PresentationsClass 7: (May 5) Supply Chain Security; Group Presentations• Class 8: (May 12) final exam and end of course critiqueClass 8: (May 12) final exam and end of course critique
• Other requirements: Other requirements: →→visit Harley-Davidson Plant in Kansas City to see operations visit Harley-Davidson Plant in Kansas City to see operations
management in practice and write a 3-5 page paper comparing the class management in practice and write a 3-5 page paper comparing the class slides and readings to the Harley operationsslides and readings to the Harley operations
→ → Group Presentation – analysis of a companyGroup Presentation – analysis of a company
![Page 3: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/3.jpg)
Additional Text Additional Text
The # 2 SellingWarehousingand Distribution Bookand #1Non-text book Warehousing Book Book on of Sep 1, 2010
![Page 4: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/4.jpg)
GradesGrades
• Group Presentation – 10%Group Presentation – 10%
• Mid Term – 40%Mid Term – 40%
• Final Exam – 45%Final Exam – 45%
• Harley Paper – 5%Harley Paper – 5%
![Page 5: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/5.jpg)
Contact InformationContact Information
• [email protected]• (760) 447-3651(760) 447-3651• Personal backgroundPersonal background
![Page 6: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/6.jpg)
Class Slides and Class Slides and InformationInformation
• www.supplychainresearch.com
• Slides will be posted/updated week Slides will be posted/updated week prior to class – therefore the slides prior to class – therefore the slides currently on the website may change currently on the website may change as new materials come availableas new materials come available
![Page 7: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/7.jpg)
Chapter 1Chapter 1
Introduction to Introduction to Operations Operations ManagementManagement
![Page 8: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/8.jpg)
Operations as a transformation Operations as a transformation processprocess
Operations as a Operations as a basic functionbasic function
Operations as the Operations as the technical coretechnical core
The Operations The Operations FunctionFunction
![Page 9: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/9.jpg)
Operations as a Operations as a Transformation ProcessTransformation Process
INPUT MaterialMachinesLaborManagementCapital
![Page 10: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/10.jpg)
Operations as a Operations as a Transformation ProcessTransformation Process
INPUT MaterialMachinesLaborManagementCapital
TRANSFORMATIONPROCESS
![Page 11: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/11.jpg)
Operations as a Operations as a Transformation ProcessTransformation Process
INPUT MaterialMachinesLaborManagementCapital
OUTPUT GoodsServices
TRANSFORMATIONPROCESS
![Page 12: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/12.jpg)
Operations as a Operations as a Transformation ProcessTransformation Process
FeedbackFeedback
INPUT MaterialMachinesLaborManagementCapital
OUTPUT GoodsServices
TRANSFORMATIONPROCESS
![Page 13: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/13.jpg)
Transformation Transformation ProcessesProcesses
PhysicalPhysical ((manufacturingmanufacturing))LocationalLocational (transportation/ (transportation/
warehouse) warehouse)ExchangeExchange (retail)(retail)PhysiologicalPhysiological (health care)(health care)PsychologicalPsychological (entertainment)(entertainment)InformationalInformational (communications)(communications)
![Page 14: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/14.jpg)
Impacts on Operations Impacts on Operations Management Management
Industrial RevolutionIndustrial Revolution Scientific ManagementScientific Management Human Relations or the lack thereofHuman Relations or the lack thereof Advent of Management ScienceAdvent of Management Science Quality EmphasisQuality Emphasis Globalization of Supply ChainsGlobalization of Supply Chains Information Age/Internet RevolutionInformation Age/Internet Revolution
![Page 15: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/15.jpg)
Key EventsKey EventsIndustrial RevolutionIndustrial Revolution
Steam engineSteam engine 17691769 James WattJames WattDivision of laborDivision of labor 17761776 Adam SmithAdam SmithInterchangeable partsInterchangeable parts 17901790 Eli WhitneyEli Whitney
Scientific ManagementScientific ManagementPrinciples Frederick W. Taylor 1911Principles Frederick W. Taylor 1911Activity scheduling chart Henry Gantt 1912Activity scheduling chart Henry Gantt 1912Moving assembly lineMoving assembly line Henry Ford 1913Henry Ford 1913
![Page 16: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/16.jpg)
Human RelationsHuman RelationsHawthorne studiesHawthorne studies 19301930 Elton MayoElton MayoMotivation theoriesMotivation theories 1940s1940s Abraham MaslowAbraham Maslow
1950s1950s Frederick HertzbergFrederick Hertzberg1960s1960s Douglas McGregorDouglas McGregor
Management ScienceManagement ScienceLinear programmingLinear programming 19471947 George DantzigGeorge DantzigDigital computerDigital computer 19511951 Remington RandRemington RandSimulation, PERT/CPM, Simulation, PERT/CPM, 1950s1950s Operations researchOperations researchWaiting line theoryWaiting line theory groupsgroupsMRPMRP 1960s1960s Joseph Orlicky, IBMJoseph Orlicky, IBM
Key EventsKey Events
![Page 17: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/17.jpg)
Quality EmphasisQuality EmphasisJITJIT 1970s1970s Taiichi Ohno, ToyotaTaiichi Ohno, ToyotaTQMTQM 1980s1980s W. Edwards Deming,W. Edwards Deming,
Joseph Juran, et. al.Joseph Juran, et. al.Strategy and operationsStrategy and operations Skinner, HayesSkinner, HayesReengineeringReengineering 1990s1990s Hammer, ChampyHammer, ChampyWorld Trade OrganizationWorld Trade Organization 1990s1990s Numerous countriesNumerous countries
and companiesand companies
GlobalizationGlobalizationEuropean Union andEuropean Union and 1970s1970s IBM and othersIBM and othersother trade agreementsother trade agreementsEDI, EFT, CIMEDI, EFT, CIM 1980s1980s
Key EventsKey Events
![Page 18: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/18.jpg)
Information Age/Information Age/Internet RevolutionInternet Revolution
Internet, WWW, ERPInternet, WWW, ERP 1990s1990sSupply chainSupply chain SAP, i2 SAP, i2 management,management, Technologies, Technologies,
ORACLE,ORACLE,E-commerceE-commerce PeopleSoft, Amazon,PeopleSoft, Amazon,
Yahoo, eBay,Yahoo, eBay,and othersand others
Key EventsKey Events
![Page 19: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/19.jpg)
Categories of Categories of E-CommerceE-Commerce
BusinessBusiness
ConsumerConsumer
BusinessBusiness ConsumerConsumer
B2BCommerceone.com
B2CAmazon.com
C2BPriceline.com
C2CeBay.com
![Page 20: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/20.jpg)
Types of B2B TransactionsTypes of B2B Transactions
Buyer Seller
Buyers
Sellers
Buyer
Sellers Buyers Sellers
(a) Electronic Storefront(a) Electronic Storefront (b) Seller’s Auction(b) Seller’s Auction
(c) Buyer’s Auction(c) Buyer’s Auction (d) Exchange or E-Marketplace(d) Exchange or E-Marketplace
![Page 21: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/21.jpg)
E-Business Promotes:E-Business Promotes:
Better customer relationsBetter customer relationsMore efficient processesMore efficient processesLower cost of materialsLower cost of materialsInformation technology synergyInformation technology synergyBetter and faster decision makingBetter and faster decision making
![Page 22: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/22.jpg)
E-Business Promotes:E-Business Promotes:
New forms of organizationsNew forms of organizationsExpanded supply chainExpanded supply chainHigher customer expectationsHigher customer expectationsNew ways of doing businessNew ways of doing businessGlobalizationGlobalization
![Page 23: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/23.jpg)
CompetitivenessCompetitiveness
The degree to which a nation can The degree to which a nation can produce goods and services that produce goods and services that meet the test of international meet the test of international markets while simultaneously markets while simultaneously maintaining or expanding the real maintaining or expanding the real incomes of its citizens.incomes of its citizens.
![Page 24: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/24.jpg)
ProductivityProductivity
Productivity =Productivity =OutputOutput
InputInput
![Page 25: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/25.jpg)
ProductivityProductivity
Become more efficientBecome more efficient DownsizeDownsize ExpandExpand Retrench Retrench Achieve breakthroughsAchieve breakthroughs
Productivity =Productivity =OutputOutput
InputInput
Productivity improves when firms:Productivity improves when firms:
![Page 26: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/26.jpg)
Measures of Measures of CompetitivenessCompetitiveness
ProductivityProductivity GDP (Gross domestic product) growthGDP (Gross domestic product) growth Market capitalizationMarket capitalization Technological infrastructureTechnological infrastructure Quality of educationQuality of education Efficiency of governmentEfficiency of government
![Page 27: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/27.jpg)
Barriers to EntryBarriers to Entry
Economies of scaleEconomies of scaleCapital investmentCapital investmentAccess to supply and distribution Access to supply and distribution
channelschannelsLearning curvesLearning curves
![Page 28: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/28.jpg)
Competition Within Competition Within Industries Increases WhenIndustries Increases When
Firms are relatively equal in size Firms are relatively equal in size and resourcesand resources
Products and services are Products and services are standardizedstandardized
Industry growth is slow or Industry growth is slow or exponentialexponential
![Page 29: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/29.jpg)
Chapter 2Chapter 2
Operations Operations StrategyStrategy
To Accompany Russell and Taylor, Operations Management, 4th Edition, 2003 Prentice-Hall, Inc. All rights reserved.
![Page 30: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/30.jpg)
The Importance of Clearly The Importance of Clearly Stated Missions/VisionsStated Missions/Visions
‘ ‘The Grand Duke said “one who is The Grand Duke said “one who is confused in purpose cannot respond confused in purpose cannot respond to his enemy” Sun Tzu, to his enemy” Sun Tzu, The Art of WarThe Art of War
• To know the purpose – there must be a To know the purpose – there must be a
clearly stated mission and vision.clearly stated mission and vision.
![Page 31: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/31.jpg)
Clearly Stated Mission???Clearly Stated Mission???
““When you come to a fork in the When you come to a fork in the road, take it.”road, take it.”
![Page 32: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/32.jpg)
Example of A Clearly Example of A Clearly Understood MissionUnderstood Mission
COL Rusling on General Grant: COL Rusling on General Grant: “He made certain his “He made certain his subordinates knew exactly what subordinates knew exactly what he wanted, and why and when he he wanted, and why and when he wanted it.”wanted it.”
![Page 33: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/33.jpg)
Example of A Clearly Example of A Clearly Understood MissionUnderstood Mission
““We endeavor to go to the moon and We endeavor to go to the moon and return safely before the end of this return safely before the end of this decade.”decade.”
- John F. Kennedy- John F. Kennedy
![Page 34: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/34.jpg)
VISIONVISION®®
• Vital to the OrganizationVital to the Organization• Integrated throughout the OrganizationIntegrated throughout the Organization• Sustainable and AchievableSustainable and Achievable• Important from the viewpoint of the Important from the viewpoint of the
employeesemployees• Organization GoalsOrganization Goals• Not necessarily a one size fits all visionNot necessarily a one size fits all vision
Velocity Management in Logistics and Distribution, 2005, Walden
![Page 35: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/35.jpg)
Strategy FormulationStrategy Formulation
• Define a primary taskDefine a primary task• Assess core Assess core
competenciescompetencies• Determine order Determine order
winners & order qualifierswinners & order qualifiers• Positioning the firmPositioning the firm
![Page 36: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/36.jpg)
Core CompetenciesCore Competencies
• Also known as core capabilitiesAlso known as core capabilities
• Skills that differentiate the service or Skills that differentiate the service or manufacturing firm from competitorsmanufacturing firm from competitors
• Those things that the company does Those things that the company does bestbest
![Page 37: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/37.jpg)
Strategy FormulationStrategy Formulation
• Define a primary taskDefine a primary task• Assess core Assess core
competenciescompetencies• Determine order Determine order
winners & order qualifierswinners & order qualifiers• Positioning the firmPositioning the firm
![Page 38: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/38.jpg)
Competing on CostCompeting on Cost
Eliminate all wasteEliminate all wasteInvest inInvest in
Updated facilities & equipmentUpdated facilities & equipment Streamlining operationsStreamlining operations Training & developmentTraining & development
![Page 39: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/39.jpg)
Competitive Competitive Priorities: CostPriorities: Cost
• Southwest AirlinesSouthwest Airlines– one type of airplane facilitates crew one type of airplane facilitates crew
changes, record-keeping, maintenance, changes, record-keeping, maintenance, and inventory costsand inventory costs
– direct flights mean no baggage direct flights mean no baggage transferstransfers
– $30 million annual savings in travel $30 million annual savings in travel agent commissions by requiring agent commissions by requiring customers to contact the airline directlycustomers to contact the airline directly
Copyright, 2006, John Wiley and Sons
![Page 40: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/40.jpg)
Competing on QualityCompeting on Quality
Please the customerPlease the customerUnderstand customer Understand customer
attitudes toward and attitudes toward and expectations of expectations of quality quality Example: Ritz Carlton
![Page 41: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/41.jpg)
Competing on Competing on FlexibilityFlexibility
Produce wide variety of Produce wide variety of productsproducts
Introduce new productsIntroduce new productsModify existing Modify existing
products quicklyproducts quicklyRespond to customer Respond to customer
needsneeds
![Page 42: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/42.jpg)
Competing on SpeedCompeting on Speed
Fast movesFast movesFast adaptationsFast adaptationsTight linkagesTight linkages
Example: FEDEX, UPS, DHL
![Page 43: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/43.jpg)
Operations Role in Operations Role in Corporate StrategyCorporate Strategy
Provide support for overall Provide support for overall strategy of a firmstrategy of a firm
Serve as firm’s distinctive Serve as firm’s distinctive competencecompetence
Must be consistentMust be consistentMust be consistent with overall Must be consistent with overall
strategystrategy
![Page 44: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/44.jpg)
Operations and Wall Operations and Wall StreetStreet
• Comparing operations at a firm with Comparing operations at a firm with competitorscompetitors
• ExampleExample
income per employeeincome per employee
revenue per employeerevenue per employee
inventory turnover inventory turnover
customer turnovercustomer turnover
![Page 45: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/45.jpg)
OperationsOperationsStrategy at Strategy at Wal-MartWal-Mart Provide value for our customersProvide value for our customers
Low prices, everydayLow prices, everyday
Low inventory levelsLow inventory levels
Linked communications between stores
Linked communications between stores
Short flow timesShort flow times
Fast transportation system
Fast transportation system
Cross-dockingCross-docking Focused locationsFocused locations
EDI/satellitesEDI/satellites
Wal-MartWal-Mart
MissionMission
Competitive Competitive PriorityPriority
Operations Operations StrategyStrategy
Operations Operations StructureStructure
Enabling Process Enabling Process and Technologiesand Technologies
![Page 46: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/46.jpg)
Strategy and the Strategy and the InternetInternet
Create a distinctive Create a distinctive business strategybusiness strategy
Strengthen existing Strengthen existing competitive advantagescompetitive advantages
Integrate new and Integrate new and traditional activitiestraditional activities
Must provide a unique Must provide a unique value to the customervalue to the customer
![Page 47: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/47.jpg)
Products & ServicesProducts & Services
Make-to-orderMake-to-orderMade to customer specifications Made to customer specifications
after order receivedafter order receivedMake-to-stockMake-to-stock
Made in anticipation of demandMade in anticipation of demandAssemble-to-orderAssemble-to-order
Add options according to Add options according to customer specificationcustomer specification
![Page 48: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/48.jpg)
Processes & TechnologyProcesses & Technology ProjectProject
One-time production of product to One-time production of product to customer ordercustomer order
Batch productionBatch production Process many jobs at same time in batchProcess many jobs at same time in batch
Mass productionMass production Produce large volumes of standard Produce large volumes of standard
product for mass marketproduct for mass market Continuous productionContinuous production
Very high volume commodity productVery high volume commodity product
![Page 49: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/49.jpg)
Capacity & FacilitiesCapacity & FacilitiesHow much capacity to provideHow much capacity to provideSize of capacity changesSize of capacity changesHandling excess demandHandling excess demandHiring/firing Hiring/firing
workersworkersNeed for new Need for new
facilitiesfacilities
![Page 50: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/50.jpg)
FacilitiesFacilities
Best size for facility?Best size for facility?Large or small facilitiesLarge or small facilitiesFacility focusFacility focusFacility locationFacility locationGlobal facilityGlobal facility
![Page 51: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/51.jpg)
Human ResourcesHuman Resources Skill levels requiredSkill levels required Degree of autonomyDegree of autonomy PoliciesPolicies Profit sharingProfit sharing Individual or team workIndividual or team work Supervision methodsSupervision methods Levels of managementLevels of management TrainingTraining
![Page 52: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/52.jpg)
QualityQuality Target levelTarget level MeasurementMeasurement Employee involvementEmployee involvement TrainingTraining Systems needed to ensure qualitySystems needed to ensure quality Maintaining quality awarenessMaintaining quality awareness Evaluating quality effortsEvaluating quality efforts Determining customer perceptionsDetermining customer perceptions
![Page 53: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/53.jpg)
SourcingSourcingDegree of vertical integrationDegree of vertical integrationSupplier selectionSupplier selectionSupplier relationshipSupplier relationshipSupplier qualitySupplier qualitySupplier cooperationSupplier cooperation
![Page 54: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/54.jpg)
Operating SystemsOperating Systems Execute strategy dailyExecute strategy daily Information technology Information technology
supportsupport Effective planning & control Effective planning & control
systemssystems Alignment of inventory Alignment of inventory
levels, scheduling priorities, levels, scheduling priorities, & reward systems& reward systems
![Page 55: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/55.jpg)
Policy DeploymentPolicy Deployment
Focuses employees on common Focuses employees on common goals & prioritiesgoals & priorities
Translates strategy into Translates strategy into measurable objectivesmeasurable objectives
Aligns day-to-day decisions with Aligns day-to-day decisions with strategic planstrategic plan
![Page 56: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/56.jpg)
Balanced ScorecardBalanced Scorecard Finance — Finance — How should we look to our How should we look to our
shareholders?shareholders? Customer — Customer — How should we look to our How should we look to our
customers?customers? Processes — Processes — At which business At which business
processes must we excel?processes must we excel? Learning and Growing — Learning and Growing — How will we How will we
sustain our ability to change and sustain our ability to change and improve?improve?
![Page 57: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/57.jpg)
Issues and TrendsIssues and Trends
Global markets, Global markets, sourcing, sourcing, operationsoperations
Virtual companiesVirtual companies Greater choiceGreater choice Emphasis on Emphasis on
serviceservice Speed and Speed and
flexibilityflexibility
Supply chainsSupply chains CollaborationCollaboration Technological Technological
advancesadvances KnowledgeKnowledge Environment Environment
and social and social responsibilitiesresponsibilities
![Page 58: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/58.jpg)
The Dilbert (Dogbert) Solution – Change the Name of the Old Program
![Page 59: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/59.jpg)
Intro to Decision Intro to Decision MakingMaking
![Page 60: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/60.jpg)
Decision AnalysisDecision Analysis
• Payoff Table - craps tablesPayoff Table - craps tables• MaximaxMaximax - maximum of maximum payoffs - maximum of maximum payoffs
- optimistic - “hard ways”- optimistic - “hard ways”• MaximinMaximin - maximum of minimum payoffs - - maximum of minimum payoffs -
safe bets or even odds betssafe bets or even odds bets• Minimax regretMinimax regret - minimum of maximum - minimum of maximum
regrets or opportunity costsregrets or opportunity costs
![Page 61: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/61.jpg)
Decision TreesDecision Trees
• Graphical method of analyzing a Graphical method of analyzing a decision - similar to Theory of decision - similar to Theory of ConstraintsConstraints
• Payoff table can be translated to a Payoff table can be translated to a Decision TreeDecision Tree
![Page 62: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/62.jpg)
The Payoff TableThe Payoff Table
A method of organizing & illustrating A method of organizing & illustrating the payoffs from different decisions the payoffs from different decisions given various states of naturegiven various states of nature
A payoff is the outcome of the A payoff is the outcome of the decision – a Craps table pay off chart decision – a Craps table pay off chart is an example of a payoff chart is an example of a payoff chart
![Page 63: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/63.jpg)
Payoff TablePayoff Table
States Of NatureStates Of Nature(Alternatives)(Alternatives)
DecisionDecision aa bb11 Payoff 1/aPayoff 1/a Payoff 1/bPayoff 1/b22 Payoff 2/aPayoff 2/a Payoff 2/bPayoff 2/b
![Page 64: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/64.jpg)
STATES OF NATURESTATES OF NATURE
Good ForeignGood Foreign Poor ForeignPoor Foreign
DECISIONDECISION Competitive ConditionsCompetitive Conditions Competitive ConditionsCompetitive Conditions
ExpandExpand $ 800,000$ 800,000 $ 500,000$ 500,000Maintain status quoMaintain status quo 1,300,0001,300,000 -150,000-150,000Sell nowSell now 320,000320,000 320,000320,000
Maximums: 1,300,0001,300,000; 500,000
Minimums: 500,000; 320,000320,000; -150,000
![Page 65: Operations Management BUSN 6110 SP2, 2011. Syllabus Class 1 (Mar 10): chap 1; chap 2, case study (Introduction, Strategy)Class 1 (Mar 10): chap 1; chap](https://reader035.vdocuments.net/reader035/viewer/2022081418/5697c01e1a28abf838cd10ec/html5/thumbnails/65.jpg)
Homework Homework
• Motel 6 case study – one page Motel 6 case study – one page analysisanalysis
• Chap 6, 8 Chap 6, 8