Transcript
Chapter 10
producing world class goods and services
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Canada today
Canada is a large industrial country with many major industries.
We are one of the largest producers of forest products in the world, with plants in nearly all provinces turning out a vast array of wood, furniture, and paper products.
There are giant aluminum mills in Quebec and British Columbia, automotive-related manufacturing plants in Ontario and Quebec, and aircraft plants in Ontario, Quebec, and Manitoba.
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Research and development
Definition: work directed toward the innovation, introduction, and improvement of products and processes.
Through the adoption of newer, more advanced technologies and practices, industries can:
increase their production capabilities,
improve their productivity,
and expand their lines of new goods and services.
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Canada’s evolving manufacturing services base
The Manufacturing Service Sectors Base
Employs slightly over 87 percent of Canada’s working population
Manufacturers perform 75 percent of private-sector R&D
Operations management has become a challenging and vital element of Canadian business
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From production to operations management
Production is the creation of goods and services using the factors of production: land, labour, capital, entrepreneurship, and knowledge.
Production has historically been associated with manufacturing, but the nature of business has changed significantly.
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From production to operations management
Production management has been the term used to describe all of the activities that managers do to help their firms create goods.
To reflect the change in importance from manufacturing to services, the term production often has been replaced by operations to reflect both goods and services production.
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From production to operations management
Operations management is a specialized area in management that converts or transforms resources (including human resources) into goods and services.
It includes inventory management, quality control, production scheduling, follow-up services, and more.
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Operations Management in
the Services Sector
Productivity and quality are improving by use of computers and automation.
Service workers are losing jobs to automation.
Appropriate and ongoing education and training necessary to hold and maintain a good job in the service industry
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Operations management planning:
facility location
Facility location is the process of selecting a geographic location for a company’s operations.
One of the most common reasons for a business move is the availability of inexpensive labour or the right kind of skilled labour.
Reducing time to market, and overall transportation costs are other factors.
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outsourcing
Software development, call-centre jobs, and back-office jobs have been moving to developing countries for some time.
The range of jobs now shifting to these countries includes accounting, financial analysis, medicine, architecture, aircraft maintenance, law, film production, and banking activities.
Canadian companies are also benefiting from other countries’ outsourcing, Canada is one of the top IT outsourcing destinations in the world, especially for the United States.
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Operations management planning:
facility location in the future
Developments in information technology (computers, modems, email, voice mail, teleconferencing, etc.) are giving firms and employees more flexibility than ever before.
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Operations management planning:
facility layout
The physical arrangement of resources (including people) in the production process.
The idea is to have offices, machines, storage areas, and other items in the best possible position to enable workers to produce goods and provide services for customers.
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Operations management planning:
facility layout
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Operations management planning:
facility layout
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Operations management planning:
facility layout
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Manufacturing sector:
operations management
Materials requirement planning (MRP) is a computer-based operations management system that uses sales forecasts to ensure that needed parts and materials are available at the right time and place in a specific company.
The newest version of MRP is enterprise resource planning (ERP).
ERP is a computer application that enables multiple firms to manage all of their operations (finance, requirements planning, human resources, and order fulfillment) on the basis of a single, integrated set of corporate data.
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purchasing
Purchasing is the functional area in a firm that searches for quality material resources, finds the best suppliers, and negotiates the best price for quality goods and services.
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JIT: Just-in-Time Inventory control
JIT systems keep a minimum of inventory on the premises and parts, supplies, and other needs are delivered just in time to go on the assembly line.
To work effectively, however, the process requires excellent coordination with carefully selected suppliers.
JIT runs into problems when suppliers are farther away.
Shipments may also be delayed due to poor weather, worker strikes.
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Quality control
Quality is consistently producing what the customer wants while reducing errors before and after delivery to the customer.
Quality is not an outcome; it is a never-ending process of continually improving what a company produces.
Quality control should be part of the operations management planning process rather than simply an end-of-the-line inspection.
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Iso 9000 and iso 14000 standards
The International Organization for Standardization (ISO) is a worldwide federation of national standards bodies from more than 140 countries that set the global measures for the quality of individual products.
ISO is a non-governmental organization established to:
Promote the development of world standards to facilitate the international exchange of goods and services.
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Iso 9000 and iso 14000 standards
ISO 9000 is the common name given to quality management and assurance standards.
ISO 14000 is a collection of the best practices for managing an organization’s impact on the environment.
Certification in both ISO 9000 and ISO 14000 would show that a firm has a world-class management system in both quality and environmental standards.
What makes ISO 9000 so important is that the European Union (EU) is demanding that companies that want to do business with the EU be certified by ISO standards.
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Supply chain management
Logistics: those activities that focus on getting the right amount of the right products or services to the right place at the right time at the lowest possible cost.
Supply Chain: the sequence of firms that perform activities required to create and deliver a good or service to consumers or industrial users.
Supply Chain Management: the integration and organization of information and logistics activities across firms in a supply chain for the purpose of creating and delivering goods and services that provide value to customers.
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Manufacturing sector
operations management
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The Production & operations process
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{5C22544A-7EE6-4342-B048-85BDC9FD1C3A}INPUTS
CONVERSION PROCESS
OUTPUT
Manufacturing
Service
Manufacturing sector: operations management
Form Utility – the value producers add to materials in the creation of finished goods.
Manufacturing Processes
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.
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Flexible manufacturing
Flexible manufacturing involves designing machines to do multiple tasks so that they can produce a variety of products.
Flexible manufacturing (also known as flex) not only leads to improved productivity, but it may also result in cost savings.
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Lean manufacturing
Lean manufacturing is the production of goods using less of everything compared to mass production: less human effort, less manufacturing space, less investment in tools, and less engineering time to develop a new product.
A company becomes lean by continuously increasing its capacity to produce high-quality goods while decreasing its need for resources.
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Control procedures
Pert Charts
program evaluation and review technique (PERT)
Gantt Charts
Bar graph showing production managers what projects are being worked on and what stage they are in at any given time.
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