Business Services – Operations Management

1 Business Services Operations Management Session 1 Introduction & Overview Business Services . Operations Management Session 1 Introduction &. Overview Facilitator: Dr. Jonathan Farrell 1. This Evening's Program Introductions Unit outline Lecture - Introduction to Operations Management Case Studies Concept Design Services , Central Evaluation Unit - class discussion Little'. Little's Law 2. 1. Business Services Operations Management Session 1 Introduction & Overview Plagiarism Plagiarism: using the work of another person and presenting it as your own . If you use any source material from another source ( text graphics, charts, diagrams, etc.) you must acknowledge that source Contrary to popular belief, Plagiarism is easy to detect Your assignments will be checked for plagiarism, both manually and electronically For more information, go to 3. Introductions (1 minute maximum). Name Organisation Position Type of operation Why are you here? 4. 2. Business Services Operations Management Session 1 Introduction & Overview Course Objectives Gain an appreciation of technologies available, and how they are applied to Operations .

2 Develop an ability to integrate these technologies with corporate and Operations strategies. Recognis Recognise how successful Operations Operations Management can lead to sustainable competitive advantage. dvantage. Understand the dynamics of change Management and the effects of changes on organisation culture. 5. The Operations function is fashionable! The consultancy Services market % of world revenues of 40 largest firms Financial Marketing/sales 6 2. Organizational design 11. Operations and process Management 31. Benefits/Actuarial 16. IT strategy Corporate strategy 17 17. 6. 3. Business Services Operations Management Session 1 Introduction & Overview Back office Kitchen unit operation in a manufacturing bank operation They are all Operations Take-out /. Retail restaurant operation operation 7. A general model of Operations Management Operation's ENVIRONMENT strategic objectives Operations The operation's strategy competitive role and position Input transformed resources Materials Design Improvement Information Customers Output products Input resources and Services Customers Facilities Staff Planning and control Input transforming resources ENVIRONMENT.

3 8. 4. Business Services Operations Management Session 1 Introduction & Overview Where does the Business get its competitive advantage? The technological . technological . specification of its product/service? Product/. Service Technology The way it produces its goods and Marketing Operations Services ? The way it positions itself in its market? 9. The three functions working together .. eg. Swatch Further innovations Innovative plastic design which with few parts gives which funds Product/ which allows service funds etc. design Standardise, Marketing Operations easy to make Mass fashion product at high orientation volume so low Extended cost range but Increased variety also does not increase costs but because volume is high 10. 5. Business Services Operations Management Session 1 Introduction & Overview Core and support functions Core functions Engineering/. technical function Support functions Accounting and finance Product/ Services function development function Others Operations Marketing function function Human resources function Information/.

4 Technical (IT) A broad definition of function Operations Management 11. The position of the Operations function Accounting Product Marketing Operations and finance development Call on Manage Retranslate Conduct Church newcomers appeals scriptures weddings Fast food Advertise on Pay Design Make chain television suppliers hamburgers hamburgers Furniture Sell to D esign new Assemble stores Pay staff furniture furniture manufacturer Process Identify Raise D evelop Make and perspective needs capital product distribute 12. 6. Business Services Operations Management Session 1 Introduction & Overview The best way to start understanding the nature of Operations is to look around you Everything you can see around you (except the flesh and blood) has been processed by an operation Every service you consumed today (radio station, bus service, lecture, etc.) has also been produced by an operation Operations Managers create everything you buy, sit on, wear, eat, throw at people, and throw away We will start by examining a high street operation 13.

5 Some Operations Management activities at IKEA. Design a store layout which gives smooth and Ensure that the jobs of all Design elegant products effective flow staff encourage their which can be flat-packed efficiently contribution to Business success Site stores of an IKEA STORE. Continually examine appropriate size in and improve Operations the most effective practice locations Maintain cleanliness Monitor and enhance and safety of storage quality of service to area customers Arrange for fast replenishment of products 14. 7. Business Services Operations Management Session 1 Introduction & Overview Pret a Manger High-end sandwich and snack retailer Use only wholesome ingredients All shops have own kitchens which make fresh sandwiches every day Fresh ingredients delivered early every morning Same staff who serve you at lunch made the sandwiches that morning We don't work nights, we wear jeans, we party . 15. The three basic functions at Pret a Manger Nutritional mechanical and aesthetic design of the sandwiches and snacks Product/.

6 Service Technology Marketing Operations Design, location and Management of stores and Promotional activities, in-store processes and the market research, etc. network that supplies them 16. 8. Business Services Operations Management Session 1 Introduction & Overview All Operations are transformation processes TRANSFORMED. ENVIRONMENT. RESOURCES. MATERIALS. INFORMATION. CUSTOMERS. TRANSFORMATION GOODS. INPUT OUTPUT AND. PROCESS. Services . FACILITIES STAFF. TRANSFORMING. RESOURCES. ENVIRONMENT. 17. At Pret a Manger TRANSFORMED. RESOURCES ENVIRONMENT. Food ingredients Packaging Customers CUSTOMERS. TRANSFORMATION ASSEMBLED . INPUT OUTPUT. PROCESS TO SNACKS. Kitchen equipment Shop fittings, Staff TRANSFORMING. RESOURCES ENVIRONMENT. 18. 9. Business Services Operations Management Session 1 Introduction & Overview Operations Management Basic Principles Materials Operations Management is Information concerned with Products and producing and Services Customers delivering products and Services All types of enterprise have an Operations function, even if it isn't called Operations .

7 Most Operations produce both products and Services . 19. Television programme and video production company Wood, steel Information plastic etc. Market Set and props Scenery from customers manufacture forecasts, Carpenters and props Computer Marketing and sales Machines systems sales proposals Surveys and and plans analysis staff Broadcasting and programme making equipment Adapted, Engineering maintained Test and repair and repaired equipment equipment Staff 20. 10. Business Services Operations Management Session 1 Introduction & Overview The two main processes at a Pret a Manger store INPUT TRANSFORMATION OUTPUT. PROCESS. Bread, mayo, fillings, packing, Sandwich Packed, fresh etc. production sandwiches Staff Packed, fresh sandwiches Satisfied Sandwich customers Staff production assembled to sandwiches Customers 21. The three core functions as transformation process Operations '. Operations '. Producing Designers effective new Appropriate Design designs as products and promised and software Services to budget Product/.

8 Services development function Operations Marketing function function Transformed/ Producing Products transforming service value for and Services resources customers Sales people Orders Marketeers Producing Marketing plans sales and as promised Market and to budget information market plans 22. 11. Business Services Operations Management Session 1 Introduction & Overview The output from most types of operation is a mixture of goods and Services Pure goods Crude oil production Tangible Aluminium smelting Can be stored Production precedes Specialist machine tool consumption Low customer contact manufacturer Can be transported Quality is evident Restaurant Computer systems Services Intangible Management Psychotherapy clinic consultancy Cannot be stored Production and consumption are simultaneous High customer contact Cannot be transported Quality difficult to judge Pure Services 23. The output from most Operations is a mixture of goods and Services PURE GOODS. Tangible CRUDE OIL PRODUCTION.

9 Can be stored ALUMINIUM SMELTING. Production precedes SPECIALIST MACHINE TOOL. consumption MANUFACTURER. Low customer contact Pret a Manger Can be transported RESTAURANT. COMPUTER SYSTEMS. Quality is evident Intangible Services . PSYCHOTHERAPY CLINIC. CONSULTANCY. Management . Cannot be stored Production and consumption are simultaneous High customer contact Cannot be transported Quality difficult to judge PURE Services . 24. 12. Business Services Operations Management Session 1 Introduction & Overview A Typology of Operations IMPLICATIONS IMPLICATIONS. Low repetition High repeatability Each staff member performs Low Volume High Specialisation more of job Systemisation Less systemisation Capital intensive High unit costs Low unit cost Well defined Flexible Routine Complex High Variety Low Standardised Match customer needs Regular High unit cost Low unit costs Changing capacity Stable Anticipation Routine Flexibility High Variation in demand Low Predictable In touch with demand High utilisation High unit cost Low unit costs Short waiting tolerance Time lag between production and consumption Satisfaction governed by Standardised customer perception Low contact skills Customer contact skills needed High Visibility Low High staff utilisation Received variety is high Centralization High unit cost Low unit costs 25.

10 Some configurations of Formule 1. pre- pre-manufactured room units 26. 13. Business Services Operations Management Session 1 Introduction & Overview Profile of two Operations Low Volume High High Variety Low High Variation Low High Visibility Low Island Resort Formule 1. 27. Low Volume High High Variety Low High Variation Low High Visibility Low Island Formule Resort 1 type Hotel Hotel Important to understand how different Operations are positioned on the 4 V's. Is their position where they want to be? Do they understand the strategic implications? 28. 14. Business Services Operations Management Session 1 Introduction & Overview Pret a Manger and IKEA. 4 V's analysis Low Volume High High Variety Low High Variation Low High Visibility Low Pret a IKEA. Manger 29. The activities of Operations Management Operations . STRATEGIC. ENVIRONMENT. OBJECTIVES. THE. INPUT Operations . TRANSFORMED Operations Operations COMPETITIVE. RESOURCES STRATEGY strategy ROLE AND. MATERIALS POSITION.