Week 9 Questions

Operations Management and Supply Chain


1. Define the term operatios management

Operations Management (OM) is the management of systems or processes that convert or transform reources into goods and services. Operations management is responsible for managing the core processes use to manufacture goods and produce services. Operations involves the conversion of inputs to outputs.

The conversions on inputs to outputs

2. Explain operations management's role in business

The scope of OM ranges accross the organisation and includes many interrelated activities, such as forecasting, capacity planning, scheduling, managing inventories, assuring quality, motivating employees, deciding where to locate families and more. Typical OM activities (using the example of an airline company) include:

• Forcasting: estimating seat demands for flights, weather, and landing conditions and growth or decline of the industry
• Capacity planning: key essential metric for the airline to maintain cash flow  and increase revenues
• Scheduling: airline operates on tight schedules that must be maintained including flights, pilots, baggage, ground crews etc
• Managing Inventory: items such as food, beverages, first aid equipment, pillows etc are essential for the airline
• Assuring Quality: safety is the highest priority - high quality service during check in, ticketing, in-flight service and courtesy
• Motivating and training employees: employees must be highly trained, continually motiviated in order to deal with frustrated customers etc
• Location facilities: which cities to offer to, where to host maintenance facilities, where to loacte minor and major hubs

3. Descirbe the correlation between operations management and information technology

Managers can use IT to heavily influence OM decisions including productivity, costs, flexibility, quality and customer satisfaction. One of the greatest benefits of IT on OM is in making operational decisions because OM exerts considerable influence over the degree to which the goals and objectives of the organisation are realised. Most OM decisions involve many possible alternatives that can have varying impcts on revenues and expenses. OM information systems are critical for managers to be able to make well-informed decisions.

4. Explain supply chain management and its role in a business

A supply chain consists of all parties involved, directly or indirectly, in the procurement of a product of raw material. Supply Chaim Management (SMC) involves the management of information flows between and among stages in a supply chain to maximise total supply chain effectiveness and profitability.

A Supply Chain

5. List and desribe the five componenets of a typical supply chain

The five basic components of supply chain management are:

1. Plan - the strategic portion of supply management. A company must have a plan for managing all the sources that fo toward meeting customer demand for products and services.
2. Source - companies must carefully choose reliable suppliers that will deliver goods and services required for making products. Companies must ald develip a set of pricing, delivery and payment processes with suppliers
3. Make - maufacturing products or services, including scheduling the activities necessary for production, testing, packaging and preparing for delivery
4. Deliver - commonly referred to as logistics - the set of processes that plans for and controls the efficient and effective transportation and storage of suppliers from supplier to customers
5. Return - typically the most problematic step in the supply chain as companies must creat a network for receiving defective and excess products and support customers who have problems with delivered products

6. Define the relationship between information technology and the supply chain.

Information technology's primary rold in Supply Chain Management is creating the integrations or tight process and information linkages between fuctions with a firm - such as marketing, sales, finance, manufacturingand distribution - and between firms, which allow the smooth, synchronised flow of both information and product between customers, suppliers and transportation providers accross the supply chain. IT integrates planning, decisio-making processes, business operating processes and information sharing for business performance management. Considerable evidence shows that this type of supply chain integration results in superior supply chain capabilities and profits.