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International
Operations
Introduction to Operations
Management
Newtons Law of Manufacturing
For every expert with a perfect solution there is an
equal and opposite expert with a perfect
solution
So it is impossible to come up with one perfect
way to run an international facility
This course will be a starting point in discovering
what production and operations management is
all about in the international setting
Introduction to Operations
Management
First step is to get the basics right
For example, MRP ( Materials
Introduction to Operations
Management
Understanding international operations setting
Introduction to Operations
Management
The business universe is being
Introduction to Operations
Management
Three eCommerce generated events are
shaping this change:
1.
Enterprises are becoming smaller, focusing
on their core competencies
2.
Enterprises are forming partnerships to
manage their non-competencies
3.
The emergence of eBusiness empowered
information exchange
The result of this is that enterprises will no longer
compete against enterprises
Introduction to Operations
Management
We now have the emergence of network of
Introduction to Operations
Management
Supply chain management integrates
Introduction to Operations
Management
1.
2.
3.
1.
2.
3.
1.
2.
3.
evaluates capacities
Manages an organisations resources in
order to produce products that will satisfy
the demands generated by the
marketing function
1.
2.
3.
A little history
Operations management goes back to the
beginning of man
But the most dramatic changes have taken
place over the last few years of history
The first seems to be world war II
Prior to WW II the operations
methodologies were primarily manual
Tools like EOQ, LP and 2 bin system were
considered state of the art
A little history
Shortly after WW II the computer
became available
Which created computationally overburdened systems like MRP and PERT/
CPM feasible
MRP: Materials requirement planning
PERT: Project evaluation and review
technology
CPM: Critical path methodology
A little history
Also, after this war, the Japanese were going
A little history
Israel at the same time decided to develop their
Operations Managementfuture
The future of operations management will find
Measurement in Operations
Management
Critical to any processing cycle is the creation
of a feedback mechanism that reviews and
reports on the performance of all resources in
the system
The key areas of performance measurement
in operations management are:
1. Quality
2. Productivity
3. Efficiency
4. Financial Measures
5. Bench Marking
Measurement in Operations
Management
1.
2.
3.
4.
5.
6.
Measurement in Operations
Management- quality
Quality Is a very confusing term and does not have a
single definition
In the US and Europe quality is defined as meeting
engineering standards
It means that if a product is built to specifications, exactly
the way it is designed, it is considered to be a quality
product
Unfortunately this does not focus on the customer
This definition of quality is formalised by quality systems
like ISO ( the European developed quality standard that
has found international acceptance) or QS ( the American
automotive quality standard)
Measurement in Operations
Management-quality
In Japan the definition of quality is, that a
Measurement in Operations
Management-productivity
Productivity is another measure that permits an
Measurement in Operations
Management-productivity
Input can be varied so much so that any
Measurement in Operations
Management-productivity
In western countries productivity almost always
Measurement in Operations
Management-productivity
In Japan we find several productivity measures,
Measurement in Operations
Management-efficiency
Efficiency is a minor measure and is
Measurement in Operations
Management-financial measures
Financial measures of performance include P&L
Measurement in Operations
Management-benchmarking
Benchmarking is a modern buzzword
Measurement in Operations
Management-other operational ratios
Throughput is a measure of quality units shipped to the
Measurement in Operations
Management-other operational ratios
Integration is a measure of internal
performance. It is a measure of how
effective the communication channels
work within an organisation
The measures used can be:
1. Number of cross-functional teams
2. Level of integration within teams
3. Number of team implemented
innovations
Measurement in Operations
Management-other operational ratios
Cycle time is a measure of the amount of time it