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introduction to operations management (goods vs services, services are…
introduction to operations management
definition
: activities that relate to
creation of goods & services
through
transformation of inputs to outputs
goods
vs
services
, services are
intangible
produced & consumed simultaneously
unique (unlike anyone else's)
high customer interaction, demands uniqueness
inconsistent product definition
knowledge-based (educational, medical)
dispersed, brought to customer
production
vs
productivity
production
: creation of goods and services through transformation
productivity
: ratio of outputs divided by one/more inputs
efficiency
(doing the job well with min resources) vs
effective
(doing the right things). to reach efficiency, you need to be effective
single-factor productivity
outputs divided by
one
input
productivity = units produced/labor hours = 1.000/250 = 4 units per labor hour
multifactor productivity
outputs to
many
inputs
productivity = output/(labor + material + energy + capital + misc)
productivity improvement
. factors critical to improved productivity
labor
. education, diet, social overhead (transport, sanitation)
capital
. humans are tool users, capital provides these tools
management
ensures labor and capital are effectively used to increase productivity