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Production and Operations Management (Operations Management Planning…
Production and Operations Management
From Production to Operations Management
Production: Creation of finished goods and services using the factors of production: land, labor, capital, entrepreneurship, and knowledge.
Production Management: All the activities managers do to help their firms create goods.
Operations management: Area in management that converts or transforms resources (including human resources) into goods and services.
Operations management in the service industry is all about creating a good experience for those who use the service.
Production Process
Form utility: The value producers add to materials in the creation of finished goods and services.
Process manufacturing: That part of the production process that physically or chemically changes materials.
Assembly process: That part of the production process that puts together components.
Continuous process: A production process in which long production runs turn out finished goods over time.
Intermittent process: A production process in which the production run is short and the machines are changed frequently to make different products.
Computer-aided design (CAD): The use of computers in the design of products.
Computer-aided manufacturing (CAM): The use of computers in the manufacturing of products.
Computer-integrated manufacturing (CIM): The uniting of computer-aided design with computer-aided manufacturing.
Flexible manufacturing: Designing machines to do multiple tasks so that they can produce a variety of products.
Lean manufacturing: The production of goods using less of everything compared to mass production.
Mass customization: Tailoring products to meet the needs of individual customers.
Operations Management Planning
Facility location: The process of selecting a geographic location for a company’s operations.
Facility layout: The physical arrangement of resources (including people) in the production process.
Telecommuting: Working from home via computer.
Materials requirement planning (MRP): A computer-based operations management system that uses sales forecasts to make sure that needed parts and materials are available at the right time and place.
Enterprise resource planning (ERP): Newer version of MRP that combines the computerized functions of all the divisions and subsidiaries of the firm—such as finance, human resources, and order fulfillment—into a single integrated software program that uses a single database.
Purchasing: The function in a firm that searches for high-quality material resources, finds the best suppliers, and negotiates the best price for goods and services.
Just-in-time (JIT) inventory control: Production process in which a minimum of inventory is kept on the premises and parts, supplies and other needs are delivered just in time to go on the assembly line.
Quality: Consistently producing what the customer wants while reducing errors before and after delivery to the customer.
Six Sigma quality: A quality measure that allows only 3.4 defects per million opportunities.
Statistical quality control (SQC): Process some managers use to continually monitor all phases of the production process to ensure that quality is being built into the product from the beginning.
Statistical process control (SPC): Process of testing statistical samples of product components at each stage of the production process and plotting those results on a graph. Any errors in quality can be corrected if beyond the set standards.
Control Procedures: Pert
And Gantt Charts
Program evaluation and review technique (PERT): A method for analyzing the tasks involved in completing a given project, estimating the time needed to complete each task, and identifying the minimum time needed to complete the total project.
Critical path: In a PERT network, the sequence of tasks that takes the longest time to complete.
Gantt chart: Bar graph showing production managers what projects are being worked on and what stage they are in at any given time.