TAB 1
OPERATIONS MANAGEMENT AND TQM
ANNE MARIE U. AGUSTIN - BSA2D
OPERATIONS MANAGEMENT OPERATION
- consists of all activities directly related
The management of systems or processes
to producing goods or providing
that creates goods and/or provides services
services
- Create operational systems
- the production of function exists both
- Manage the activities of relating to the
in manufacturing and services
production of goods and/or services
- input are used to obtain finished goods
with maximum efficiency and
or services using one or more
effectiveness
transformation process
- improve those processes continuously
to create competitive advantage
MARKETING
OPERATIONS MANAGER AND DUTIES
- Marketing consists of selling and/or
promoting the goods and services of
- Operations managers are officers that
an organization
are responsible for the daily tasks
- makes advertising and pricing
during the ordinary course of business
decisions
such as:
- is also responsible for assessing
● Human resource management
customer wants and needs, and for
● Marketing Strategies and
communicating those to operation and
enhancing customer
design people
satisfaction
● Inventory and cost management
Types of Operations
● Project management
● Total quality management , a 1. Project - a set of activities directed
company wide effort that aims towards a unique goal, usually large
to continuously improve and scale with a limited time frame
build upon the quality of goods 2. Job shop - an organization that renders
and services. unit or lot production or service with
vary specifications, according to
Kaizen Principle: “ encourages continuous
customer needs
improvement involving employees at all
3. Batch Processing - a system used to
levels of a company”
produce moderate volumes of similar
items
Responsibilities of Operations Manager 4. Continuous Processing - a system that
Planning: capacity, location, products and produces highly uniform products or
services, projects and scheduling continuous services
Organizing: Centralization, process selection
Controlling: Inventory, human resources, cost Operation Management includes
Staffing: Human resources, hiring and firing, ● Forecasting - the process of predicting
laying off, overtime future demand for products or services
Directing: incentives plans, work orders, job to ensure that the right amount of
assignment resources are available
● Capacity Planning - the process of
FINANCE determining the production capacity
- Function comprises activities related to needed by an organization to meet
securing resources at favorable prices changing demands for its products
- allocating those resources throughout ● Scheduling: the process of planning
the organization and controlling the production process
by assigning specific tasks to resources
at specific time
● Managing Inventories - the process of Quantitative Approach
overseeing the controlling the
ordering, storage and use of 1. Linear Programming (LP): Linear
components and finished products Programming is the mathematical
● Assuring quality - the process of technique specifically designed to find
ensuring that products or services the best possible solution (whether it's
meet certain standards of quality. maximizing profit, minimizing costs,
● Motivating Employees - the process of etc.) subject to constraints. It's widely
encouraging and inspiring employees used in decision-making for resource
to perform their best allocation, production scheduling, and
● Deciding where to locate facilities - the other optimization problems. So, it
process of selecting the optimal definitely fits as a quantitative
location for production facilities, approach to obtaining the
warehouses and other operations mathematically optimum solution.
● Supply chain management - the 2. Queuing Techniques: These are used
management of the flow of goods and to model and manage waiting lines or
services from the suppliers to queues, focusing on optimizing service
customers efficiency and reducing wait times.
While mathematical in nature, queuing
DECISION-MAKING techniques are more concerned with
There are some approaches to decision system performance rather than
making. Managers need to follow the optimizing a specific solution in a
approach to take. managerial context.
3. Inventory Models: These models are
Uses Model focused on managing inventory levels
1. Physical Model: This is a tangible, efficiently. They deal with determining
three-dimensional representation of optimal order quantities, reorder
something in the real world. Examples points, and stock levels. While these
include scale models of buildings, models are mathematical, they aim to
prototypes of products, or physical optimize inventory-related problems
mock-ups used in engineering and specifically, not necessarily a broad
architecture. Physical models provide a managerial decision problem.
visual or structural understanding of a 4. Project Models: Project management
concept or system. tools like PERT or CPM are used to
2. Schematic Model: These models use schedule and manage tasks in a
diagrams, charts, or other visual tools project. They help ensure that projects
to represent the relationships and are completed efficiently, but their
components of a system. They don't focus is more on task sequencing and
necessarily resemble the actual system resource allocation rather than
in a literal sense but instead focus on obtaining an optimum solution for a
illustrating how different parts of a broader managerial issue.
system interact or how a process 5. Statistical Models: These are used to
works. For example, flowcharts or analyze data, predict outcomes, and
network diagrams. support decision-making. They can be
3. Mathematical Model: These models part of a quantitative approach, but
use mathematical equations and data statistical models focus on analysis
to represent real-world phenomena. and forecasting rather than optimizing
Mathematical models are often used to a specific managerial solution.
predict behavior or outcomes in
complex systems. For instance,
formulas in economics, physics, or Analysis of Trade offs
engineering can model everything Trade offs refer to the need to balance
from population growth to competing priorities and make decisions that
supply-demand curves. involve giving up one benefit in favor of
another
Examples: breaches of trust, and potential harm
a. Cost vs. Quality to consumers.
b. Flexibility vs. Efficiency 5. Environment: Ethical responsibility
c. Speed vs. Cost extends to minimizing environmental
d. Inventory vs. Customer service harm. Companies should avoid
e. Centralization vs. practices that contribute to pollution,
Decentralization waste, or environmental degradation,
System Approach and take steps toward sustainability.
- Set of interrelated parts that must 6. Community: Businesses have an
work together ethical responsibility to support and
- Focuses on continuous improvement, contribute positively to the
customer satisfaction, and the communities where they operate. This
alignment of all activities towards includes considering the social and
common organizational goals economic impacts, such as fair wages,
- It emphasizes the integration and supporting local businesses, and
coordination of all functions and avoiding exploitation.
processes to achieve overall efficiency 7. Hiring/Firing Workers: Ethical issues
and effectiveness. in hiring and firing include avoiding
discrimination based on gender, race,
Ethical Issues or other biases, as well as ensuring fair
treatment of employees during layoffs,
Ethical issues in business often revolve promotions, or terminations
around balancing profit motives with 8. Closing Facilities: When businesses
responsibilities to various stakeholders, such decide to close down facilities, ethical
as employees, consumers, communities, and concerns arise around the impact on
the environment. Here’s a breakdown of the workers, their families, and local
ethical considerations in the areas you've economies. Companies should provide
mentioned: fair severance packages, support for
retraining, and consider the broader
1. Financial Statements: Ethical issues societal impacts
arise when companies manipulate 9. Worker’s Rights: Companies are
financial statements to mislead ethically responsible for respecting
investors, evade taxes, or misrepresent workers' rights, including fair wages,
the company's performance. the right to organize,
Transparency and honesty are key to non-discriminatory practices, and
maintaining trust with stakeholders ensuring that workers are treated with
2. Worker Safety: Companies are ethically dignity and respect.
obligated to ensure safe working
conditions to protect employees from
injury or harm. Ignoring safety HISTORICAL EVOLUTION
measures or cutting corners to save Ancient and Medieval Period
costs puts workers at significant risk Ancient Times
and is a serious ethical violation ● Large scale projects and constructions
3. Product Safety: Companies must that were present to this day required
ensure that the products they produce sophisticated planning and control of
or sell do not harm consumers. Ethical resources and labor
issues arise when companies ignore or Medieval Times
downplay safety risks, such as with ● Operations were primarily craft based.
defective products or when prioritizing Goods were produced by hand by
profits over consumer well-being skilled artisans. Production is typically
4. Quality: Maintaining high standards of slow and labor intensive
product and service quality is an
ethical obligation. Misleading Pre-industrial
customers about quality or knowingly Cottage Industry
selling subpar goods can lead to harm,
● productions and operations were ● Japan’s influence on the word has
mainly home-based, involving simple refined many management techniques.
tools and manual labor Notable contributions include the
● Same goods purchased on different Toyota Production System and the Just
vendors were inconsistent in Time Manufacturing. ther
● As systems of trade expanded, there techniques emphasized waste
was a need for standardized measures reduction and efficiency
of quality control
NOTE:
Industrial Revolution 1 (1760 -1840) ●
Introduction of Factories
● introduction of machinery such as the
steam engine shifted production form
manual labor to a mechanized process
Division of labor
● The concept of breaking down
production to several specialized task
Early Manufacturing Systems
● Different innovations like Whitney’s
concept of interchangeable parts
revolutionized manufacturing. his
system allowed the mass production of
products
Industrial Revolution 2 (Late 19th to early
20th Century
Scientific Management
● Taylor’s Introduction of Scientific
Management laid the foundation for
modern operation management
practices, focusing on efficiency, time
and motion studies, and organize a set
of standards for employees
Assembly Line Production
● An invention that revolutionized mass
production. By using conveyor belts
and specific tasks that drastically
reduced the cost and time
Quality Management
● Walter Shewhart, the grandfather of
TQM introduced statistical quality
techniques in the 1920s. His work on
control charts and models laid the
groundwork for quality management
practices
Mid-20th Century
Operations Rsearch
● Focused on applying mathematical
equations to solve operational
problems. Techniques were developed
during this period such as linear
programming and simulations
Post War Developments