“Who’s Running this Operation?” 1,2

“Who’s Running this Operation?”1,2 Dr. Jake Simons Professor of Operations Management Department of Finance & Quantitative Analysis Georgia Southern University 1 Soli Deo Gloria 2 Funded by SU04 COBA Summer Research Grant

Overview • Background • Objectives • Significance • Methodology • Population vs. respondents • Survey results • Current conclusions

Background:The business need(?) • 35,125 businesses in 58-county region of southeast GA. (per 1999 Census) • Every business has some sort of operations (transformation of labor, capital, material, and information inputs into outputs that have value for customers). • Therefore, all 35,000 businesses must have someone to manage their operations.

Background:The educational response(?) • Few degree programs exist for operations management • In FY03, USG produced 5,751 bachelor’s degrees in business • 19.8% in marketing • 18.6% in finance • 12.4% in accounting • 0.28% (16) in operations management

Research Objectives • Motivating question: If not those educated in operations management, who’s running the operations of businesses in our region? • Overall purpose: Assess the type of educational preparation possessed and needed by managers of our region’s business operations. • Specific objectives: Determine… • the educational background of operations managers • the relative contribution of their degree in helping them to meet the challenges of their jobs

Significance • Supports AACSB emphasis on assessment • Our typical practice is to assess current students, graduates, and employers of graduates • This project assesses our market more broadly, i.e. it includes potential customers • Differs from prior studies of OM education • Most have focused on the content of existing OM degree programs’ curriculum, effectively ignoring the question of demand for the program itself (14 studies cited) • This project looks at the various educational backgrounds of the people who’ve currently been hired by businesses to manage their operations and then asks about the adequacy of those backgrounds

Methodology • Single-page survey (< 5 minutes to complete) • ReferenceUSA database: GA companies of size 100 or more in the manufacturing, retail, services, transportation, or wholesale sectors • Distributed via U.S. Mail, with cover letter, to facilitate/encourage forwarding to most appropriate respondent within company • Unit of analysis: the person most recently hired into an entry-level operations management position • Postage-paid return envelope, offer to share results • No follow-up to increase response rate • Data analysis: Chi-square (most data was nominal)

Population

Population vs. Respondents Note: After an initial review of responses, I chose to exclude those from the Education sector.

Q2. Highest Level of Education Over 80% had bachelor’s or higher. (Over 30% had higher.)

Q3. Type of Degree Over- and under- representation of engineers makes sense.

Q4. Academic Major Chi square test fails to recognize some predictable differences. However, there are also some similarities across sectors.

Q5. Type of Institution 62% of degrees were from out of state! (79% from public universities)

Q11c. Relative Value of Type of Degree Regardless of business sector, the type of degree possessed was generally ranked second or third most important. (Prior work experience was most often ranked first and the academic major competed for type of degree for second most important.) (See follow-up on next slide.)

Did the type of degree held by the respondent affect their perception of its value? • Respondents with liberal arts degrees ranked their degrees as fourth most important far more frequently than expected. • In general, those with education and liberal arts degrees ranked their degrees as less valuable than did other respondents.

Q11d. Value of a Particular Academic Major Although the differences from expected values were slight, the greatest deviations related to respondents in the manufacturing and wholesale sectors placing lower value on their particular majors. (See follow-up on next slide.)

How did responses to Q11d vary for those in manufacturing, based on their academic major? Makes I.E. appear very strong in Manufacturing, but seems somewhat counter to the more general results of Q3 vs. Q11c.

Across ALL sectors, is relative value dependent on academic major? Not that Chi square can detect, given numerous cells w/zero observations.

Q12. How Well Has Education Prepared You to Succeed? Irrespective of business sector, most respondents seemed satisfied. (See follow-up on next slide.)

Is Educational Preparation for Success Dependent on Type of Degree? Chi square borderline only due to small numbers.

Is Educational Preparation for Success Dependent on Academic Major? Chi square significant due only to small numbers.

Q13. How Valuable Would an OM Major Be in Your Position? • Might reflect a response bias. • However, respondents had previously indicated they found their current degrees to have prepared them well.

Is Value of an OM Major Dependent on Type of Degree? Apparently not.

Is Value of an OM Major Dependent on Academic Major? Chi square mostly significant due to small numbers. It's interesting that the IEs were MORE positive about an OM major than expected, given that their degree may be the closest to OM.

Method-Related Conclusions • Although postal surveys do still have some advantages, those are probably outweighed by their disadvantages (especially cost). • Survey briefness didn’t enhance response rate as much as I’d anticipated. • I should have excluded the Education (82) sector of the database. (Including it didn’t actually hurt anything, but it was a waste.)

Topic-Related Conclusions • USG producing very few OM graduates • GA businesses do not appear to be importing OM majors • Therefore, GA business ops are being run by non-OM majors • In manufacturing sector, engineers are prominent • Most common type of degree is business • Most common major is management • These factors support MM&L’s recent decision to require Service Operations course for MGNT majors

Topic-Related Conclusions(continued) • Most respondents got their degrees out-of-state • Their degrees were considered to be valuable in helping them succeed in their current jobs, second to prior work experience • However, almost two-thirds of respondents (regardless of their own educational background) said a major in OM would be very valuable for their current position. (Almost all the rest said it would be slightly valuable.)

Personal, Unscientific Conclusions • It’s amazing how inept survey respondents can be at following written instructions. • School principals must not have enough REAL work to do or not so many would have found time to respond to my survey. • BBRED is a wonderful resource for a project like this. • My nonparametric stats prof would be pleased to know that I finally had the need to use a Chi square test. • I’ll probably stick to math modeling research in the future.

“Who’s Running this Operation?” 1,2