[pic]
MGMT 405 Operations and Production Management

Answer set 1

(Reference chapters 1 – William J. Stevenson-2007, ninth edition)
Discussion Questions 1. What do you understand by the term ‘Operations Management’? ANS: ✓ Operations Management is the management of that part of an organization that is responsible for producing goods and/or services. The management of systems or processes that create goods and/or provide services. i.e. Every book you read, every e-mail you send or every medical treatment you receive involves the operation function of one or more organizations

2. Identify the three major functional areas of business organizations and briefly describe how they interrelate.
ANS:
✓ Finance- is responsible for securing financial resources at favourable prices as well as analysing investment proposal and providing funds for marketing and operations. ✓ Marketing is responsible for assessing consumer needs or wants and selling and promoting the organization’s goods and services. ✓ Operations is responsible for producing the goods or providing the services offered by the organization.

3. Describe the nature of operations function.

✓ ANS: The operations function consists of all activities that directly related to producing goods or providing services. It is the core of most business organizations because it is responsible for the creation of organization’s goods or services. Its essence is to add value during the transformation process. The operations function involves the conversion of inputs into outputs. In other words, this process (value added) is the difference between the cost of inputs and the value or price of outputs.

4. List five important differences between goods production (Manufacturing) and service operation.
ANS:
1. The nature and consumption of output
2.