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Producing quality goods and services - Coggle Diagram
Producing quality goods and services
Careers in operations management
Analytical process:
a process in operations management in which raw materials are broken into different component parts. eg. A barrel of crude oil refined by an oil company can be broken down into petrol, oil, lubricants, and many other petroleum by-products
Synthetic process:
a process in operations management in which raw materials are combined to create a finished product. eg. Black & Decker uses a synthetic process when it combines plastic, steel, rechargeable batteries and other components to produce a cordless drill.
Mass production:
a manufacturing process that lowers the cost required to produce a large number of identical or similar products over a long period of time
Difference between the production of services and production of manufactured goods
Services are provided when and where the customer desires the service.
Services are consumed immediately and cannot be stored
Services are usually labour-intensive
Customers are much more involved in obtaining the service they want or need.
Services are intangible, and it is therefore more difficult to evaluate customer satisfaction.
Operations management:
all the activities required to produce goods and services
Steps in operational planning
Step 1: selecting a planning horizon
Planning horizon
: The period which operational plan will be in effect; usually a year
Step 4: adjusting products or services to meet demand
Options for when capacity exceeds market demand
Sell unused manufacturing facilities
Operate on a short work week
Lay off workers
Options for when market demand exceeds capacity
Expand the current facility or build another facility
start a 2nd or 3rd work shift
Step 3: Comparing market demand with capacity
Market demand and capacity are not equal, adjustments must be made
market demand = capacity, the facility should operate at full capacity
Step 2: Estimating market demand
Market demand
: The quantity of a product that customers will purchase at the going price