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1、OutlineGlobal Company Profile:Hard Rock CafeWhat Is Operations Management?Organizing to Produce Goods and Services Why Study OM?What Operations Managers DoHow This Book Is OrganizedHow This Book Is Organized第1页/共73页Outline-ContinuedThe Heritage of Operations ManagementOperations in the Service Secto
2、rDifferences between Goods and Differences between Goods and ServicesServicesGrowth of ServicesGrowth of ServicesService PayService PayExciting New Trends in Operations Management第2页/共73页Outline-ContinuedThe Productivity ChallengeProductivity MeasurementProductivity VariablesProductivity and the Ser
3、vice Sector Ethics and Social Responsibility第3页/共73页Learning ObjectivesWhen you complete this chapter you should be able to:Define operations managementExplain the distinction between goods and servicesExplain the difference between production and productivity第4页/共73页Learning ObjectivesWhen you comp
4、lete this chapter you should be able to:Compute single-factor productivityCompute multifactor productivityIdentify the critical variables in enhancing productivity第5页/共73页The Hard Rock CafeFirst opened in 1971First opened in 1971Now 121 restaurants in over 40 countriesNow 121 restaurants in over 40
5、countriesRock music memorabiliaRock music memorabiliaCreates value in the form of good food Creates value in the form of good food and entertainmentand entertainment3,5003,500+custom meals per day in Orlando custom meals per day in OrlandoHow does an item get on the menu?How does an item get on the
6、menu?Role of the Operations ManagerRole of the Operations Manager第6页/共73页What Is Operations Management?Production is the creation of goods and servicesOperations management(OM)is the set of activities that creates value in the form of goods and services by transforming inputs into outputs第7页/共73页Org
7、anizing to Produce Goods and ServicesEssential functions:Marketing generates demandProduction/operations creates the productFinance/accounting tracks how well the organization is doing,pays bills,collects the money第8页/共73页Organizational ChartsOperationsTeller SchedulingCheck ClearingCollectionTransa
8、ction processingFacilities design/layoutVault operationsMaintenanceSecurityFinanceInvestmentsSecurityReal estateAccountingAuditingMarketingLoans Commercial Industrial Financial Personal MortgageTrust DepartmentCommercial BankFigure 1.1(A)Figure 1.1(A)第9页/共73页Organizational ChartsOperationsGround sup
9、port equipmentMaintenanceGround Operations Facility maintenance Catering Flight Operations Crew scheduling Flying Communications DispatchingManagement scienceFinance/accountingAccounting Payables Receivables General LedgerFinance Cash control International exchangeAirlineFigure 1.1(B)Figure 1.1(B)Ma
10、rketingTraffic administration Reservations Schedules Tariffs(pricing)SalesAdvertising第10页/共73页MarketingSales promotionAdvertisingSalesMarket researchOrganizational ChartsOperationsFacilities Construction;maintenanceProduction and inventory control Scheduling;materials controlQuality assurance and co
11、ntrolSupply chain managementManufacturing Tooling;fabrication;assemblyDesign Product development and design Detailed product specificationsIndustrial engineering Efficient use of machines,space,and personnelProcess analysis Development and installation of production tools and equipmentFinance/accoun
12、tingDisbursements/credits Receivables Payables General ledgerFunds Management Money market International exchangeCapital requirements Stock issue Bond issue and recallManufacturingFigure 1.1(C)Figure 1.1(C)第11页/共73页Why Study OM?OM is one of three major functions(marketing,finance,and operations)of a
13、ny organizationWe want(and need)to know how goods and services are producedWe want to understand what operations managers doOM is such a costly part of an organization第12页/共73页Options for Increasing ContributionSalesSales$100,000$100,000$150,000$150,000$100,000$100,000$100,000$100,000Cost of Goods C
14、ost of Goods 80,000 80,000 120,000 120,000 80,000 80,000 64,000 64,000Gross MarginGross Margin20,00020,00030,00030,00020,00020,00036,00036,000Finance CostsFinance Costs 6,000 6,000 6,000 6,000 3,000 3,000 6,000 6,000SubtotalSubtotal14,00014,00024,00024,00017,00017,00030,00030,000Taxes at 25%Taxes at
15、 25%3,500 3,500 6,000 6,000 4,250 4,250 7,500 7,500ContributionContribution$10,500$10,500$18,000$18,000$12,750$12,750$22,500$22,500Finance/Finance/MarketingMarketingAccountingAccountingOMOMOptionOptionOptionOptionOptionOptionIncreaseIncreaseReduceReduceReduceReduceSalesSalesFinanceFinanceProductionP
16、roductionCurrentCurrentRevenue 50%Revenue 50%Costs 50%Costs 50%Costs 20%Costs 20%第13页/共73页What Operations Managers DoPlanningOrganizingStaffingLeadingControllingBasic Management Functions第14页/共73页Ten Critical DecisionsTen Decision AreasTen Decision AreasChapter(s)Chapter(s)Design of goods and servic
17、esDesign of goods and services5 5Managing qualityManaging quality6,Supplement 66,Supplement 6Process and capacity Process and capacity 7,Supplement 77,Supplement 7 design design Location strategyLocation strategy8 8Layout strategyLayout strategy9 9Human resources and Human resources and 10,Supplemen
18、t 1010,Supplement 10 job design job design Supply chain Supply chain 11,Supplement 1111,Supplement 11 management managementInventory managementInventory management12,14,1612,14,16SchedulingScheduling13,1513,15MaintenanceMaintenance1717第15页/共73页The Critical DecisionsDesign of goods and servicesWhat g
19、ood or service should we offer?How should we design these products and services?Managing qualityHow do we define quality?Who is responsible for quality?Table 1.2(cont.)Table 1.2(cont.)第16页/共73页The Critical DecisionsProcess and capacity designWhat process and what capacity will these products require
20、?What equipment and technology is necessary for these processes?Location strategyWhere should we put the facility?On what criteria should we base the location decision?Table 1.2(cont.)Table 1.2(cont.)第17页/共73页The Critical DecisionsLayout strategyHow should we arrange the facility?How large must the
21、facility be to meet our plan?Human resources and job designHow do we provide a reasonable work environment?How much can we expect our employees to produce?Table 1.2(cont.)Table 1.2(cont.)第18页/共73页The Critical DecisionsSupply chain managementShould we make or buy this component?Who are our suppliers
22、and who can integrate into our e-commerce program?Inventory,material requirements planning,and JITHow much inventory of each item should we have?When do we re-order?Table 1.2(cont.)Table 1.2(cont.)第19页/共73页The Critical DecisionsIntermediate and shortterm schedulingAre we better off keeping people on
23、 the payroll during slowdowns?Which jobs do we perform next?MaintenanceWho is responsible for maintenance?When do we do maintenance?Table 1.2(cont.)Table 1.2(cont.)第20页/共73页Where are the OM Jobs?第21页/共73页Where are the OM Jobs?Technology/methodsFacilities/space utilizationStrategic issuesResponse tim
24、ePeople/team developmentCustomer serviceQualityCost reductionInventory reductionProductivity improvement第22页/共73页Significant Events in OM第23页/共73页The Heritage of OMDivision of labor(Adam Smith 1776;Charles Babbage 1852)Division of labor(Adam Smith 1776;Charles Babbage 1852)Standardized parts(Whitney
25、 1800)Standardized parts(Whitney 1800)Scientific Management(Taylor 1881)Scientific Management(Taylor 1881)Coordinated assembly line(Ford/Sorenson 1913)Coordinated assembly line(Ford/Sorenson 1913)Gantt charts(Gantt 1916)Gantt charts(Gantt 1916)Motion study(Frank and Lillian Gilbreth 1922)Motion stud
26、y(Frank and Lillian Gilbreth 1922)Quality control(Shewhart 1924;Deming 1950)Quality control(Shewhart 1924;Deming 1950)第24页/共73页The Heritage of OMComputer(Atanasoff 1938)Computer(Atanasoff 1938)CPM/PERT(DuPont 1957)CPM/PERT(DuPont 1957)Material requirements planning(Orlicky 1960)Material requirements
27、 planning(Orlicky 1960)Computer aided design(CAD 1970)Computer aided design(CAD 1970)Flexible manufacturing system(FMS 1975)Flexible manufacturing system(FMS 1975)Baldrige Quality Awards(1980)Baldrige Quality Awards(1980)Computer integrated manufacturing(1990)Computer integrated manufacturing(1990)G
28、lobalization(1992)Globalization(1992)Internet(1995)Internet(1995)第25页/共73页Eli WhitneyBorn 1765;died 1825In 1798,received government contract to make 10,000 musketsShowed that machine tools could make standardized parts to exact specificationsMusket parts could be used in any Musket parts could be us
29、ed in any musketmusket第26页/共73页Frederick W.TaylorBorn 1856;died 1915Known as father of scientific managementIn 1881,as chief engineer for Midvale Steel,studied how tasks were doneBegan first motion and time studiesBegan first motion and time studiesCreated efficiency principles第27页/共73页Taylors Princ
30、iplesMatching employees to right jobProviding the proper trainingProviding proper work methods and toolsEstablishing legitimate incentives for work to be accomplishedManagement Should Take More Responsibility for:第28页/共73页Frank&Lillian GilbrethFrank(1868-1924);Lillian(1878-1972)Husband-and-wife engi
31、neering teamFurther developed work measurement methodsApplied efficiency methods to their home and 12 children!Book&Movie:“Cheaper by the Dozen,”book:“Bells on Their Toes”第29页/共73页Born 1863;died 1947In 1903,created Ford Motor CompanyIn 1913,first used moving assembly line to make Model TUnfinished p
32、roduct moved by Unfinished product moved by conveyor past work stationconveyor past work stationPaid workers very well for 1911($5/day!)Henry Ford第30页/共73页W.Edwards DemingBorn 1900;died 1993Engineer and physicistCredited with teaching Japan quality control methods in post-WW2Used statistics to analy
33、ze processHis methods involve workers in decisions第31页/共73页Contributions FromHuman factorsIndustrial engineeringManagement scienceBiological sciencePhysical sciencesInformation technology 第32页/共73页New Challenges in OMGlobal focusGlobal focusJust-in-timeJust-in-timeSupply chain Supply chain partnerin
34、gpartneringRapid product Rapid product development,development,alliancesalliancesMass Mass customizationcustomizationEmpowered Empowered employees,teamsemployees,teamsToToFromFromLocal or national focusLocal or national focusBatch shipmentsBatch shipmentsLow bid purchasingLow bid purchasingLengthy p
35、roduct developmentLengthy product developmentStandard productsStandard productsJob specializationJob specialization第33页/共73页Characteristics of GoodsTangible productTangible productConsistent product Consistent product definitiondefinitionProduction usually Production usually separate from separate f
36、rom consumptionconsumptionCan be inventoriedCan be inventoriedLow customer Low customer interactioninteraction第34页/共73页Characteristics of ServiceIntangible productIntangible productProduced and Produced and consumed at same timeconsumed at same timeOften uniqueOften uniqueHigh customer High customer
37、 interactioninteractionInconsistent product Inconsistent product definitiondefinitionOften knowledge-basedOften knowledge-basedFrequently dispersedFrequently dispersed第35页/共73页Industry and Services as Percentage of GDPServicesServicesManufacturingManufacturingAustraliaAustraliaCanadaCanadaChinaChina
38、Czech RepCzech RepFranceFranceGermanyGermanyHong KongHong KongJapanJapanMexicoMexicoRussian FedRussian FedSouth AfricaSouth AfricaSpainSpainUKUKUSUS90 90 80 80 70 70 60 60 50 50 40 40 30 30 20 20 10 10 0 0 第36页/共73页Goods Versus ServicesCan be resoldCan be resoldCan be inventoriedCan be inventoriedSo
39、me aspects of quality Some aspects of quality measurablemeasurableSelling is distinct from Selling is distinct from productionproductionProduct is transportableProduct is transportableSite of facility important for costSite of facility important for costOften easy to automateOften easy to automateRe
40、venue generated primarily Revenue generated primarily from tangible productfrom tangible productAttributes of GoodsAttributes of Goods(Tangible Product)(Tangible Product)Attributes of ServicesAttributes of Services(Intangible Product)(Intangible Product)Reselling unusualReselling unusualDifficult to
41、 inventoryDifficult to inventoryQuality difficult to measureQuality difficult to measureSelling is part of service Selling is part of service Provider,not product,isProvider,not product,isoften transportableoften transportableSite of facility important forSite of facility important forcustomer conta
42、ctcustomer contactOften difficult to automateOften difficult to automateRevenue generated primarily Revenue generated primarily from the intangible servicefrom the intangible service第37页/共73页Goods and ServicesAutomobileComputerInstalled carpetingFast-food mealRestaurant meal/auto repairHospital care
43、Advertising agency/investment managementConsulting service/teachingCounselingPercent of Product that is a GoodPercent of Product that is a GoodPercent of Product that is a ServicePercent of Product that is a Service100%100%7575505025250 0252550507575100%100%|第38页/共73页120120 100 100 80 80 60 60 40 40
44、 20 20 0 0|1950195019701970199019902010(est)2010(est)196019601980198020002000Employment(millions)Employment(millions)Manufacturing and Service EmploymentFigure 1.5(A)Figure 1.5(A)ManufacturingManufacturingServiceService第39页/共73页Manufacturing Employment and ProductionFigure 1.5(B)Figure 1.5(B)40 40 3
45、0 30 20 20 10 10 0 0|1950195019701970199019902010(est)2010(est)196019601980198020002000 150150 125 125 100 100 75 75 50 50 25 25 0 0Employment(millions)Employment(millions)Index:1997=100 Index:1997=100Manufacturingemployment(left scale)Industrial Industrial productionproduction(right scale)(right sc
46、ale)第40页/共73页Development of the Service EconomyFigure 1.5(C)Figure 1.5(C)United StatesCanadaFranceItalyBritainJapanW.Germany19702008(est)|4050607080Percent第41页/共73页Organizations in Each SectorService SectorService SectorExampleExample%of all%of all JobsJobsEducation,Education,Legal,Medical,Legal,Med
47、ical,and otherand otherNotre Dame University,Notre Dame University,San Diego Zoo,Arnold San Diego Zoo,Arnold Palmer HospitalPalmer Hospital25.525.5Trade(retail,Trade(retail,wholesale)wholesale)Walgreens,Wal-Mart,Walgreens,Wal-Mart,NordstromsNordstroms15.115.1Utilities,Utilities,TransportationTranspo
48、rtationPacific Gas&Electric,Pacific Gas&Electric,American Airlines,Santa American Airlines,Santa Fe R.R.,Roadway Fe R.R.,Roadway ExpressExpress5.25.2第42页/共73页Organizations in Each SectorService SectorService SectorExampleExample%of all%of all JobsJobsProfessional Professional and Business and Busine
49、ss ServicesServicesSnelling and Snelling,Waste Snelling and Snelling,Waste Management,Pitney-BowesManagement,Pitney-Bowes10.110.1Finance,Finance,Information,Information,Real EstateReal EstateCiticorp,American Express,Citicorp,American Express,Prudential,Aetna,Trammel Prudential,Aetna,Trammel Crow,ED
50、S,IBMCrow,EDS,IBM9.69.6Food,Lodging,Food,Lodging,EntertainmentEntertainmentOlive Garden,Hard Rock Cafe,Olive Garden,Hard Rock Cafe,Motel 6,Hilton Hotels,Walt Motel 6,Hilton Hotels,Walt Disney,Paramount PicturesDisney,Paramount Pictures8.58.5Public Public AdministrationAdministrationU.S.,State of Ala