Chapter 1 INTRODUCTION TO OPERATIONS MANAGEMENT. Profit 5%. OM Cost 21%. Marketing Cost 26%. Manufacturing Cost 48%. Operations Management = OM. Management of ANY activities/process that create goods and provide services Exemplary Activities: Forecasting, Scheduling, Quality management
Operations Management = OM
The management of systems or processes that create goods and/or provide services
Operations example in service:
“The whole is greater than the sum of the parts.”
Value added: The difference between cost of inputs and price (??) of outputs.
Is this definition right? Should value added include profit?
Value added: The difference between the cost of inputsand the (market or fair) value or price of outputs.
Steel productionAutomobile fabrication
Home remodelingRetail sales
Manual car wash
High percentage goods
Low percentage service
Low percentage goods
High percentage service
Do not use “thing” or “something” in a definition.
– Monte Carlo Simulation
– Linear programming
– Statistics, Forecasting, data mining
Other classes to learn the rest.
How do we identify the vital few?
Simple Product Supply Chain
Supply Chain: A sequence of activities and organizations involved in producing and delivering a good or service