Production：The creation of goods, services and “outcomes” (i.e., OUTPUTS), using SYSTEMS & PROCESSES that TRANSFORM materials, labour and technology (i.e., INPUTS) OM:Managing all activities that must create/add value throughout the systems and processes that ensure the transformation of inputs to outputs.
Operations Management is a major function of ANY organization:OM is the essential function that ensures the adequate and timely design of “products”, i.e., goods and services!OM is concerned with the design, management and improvement of the right processes!OM has the role and the tools to determine the production of quality outputs at a competitive cost structure! originate, improve or decline:Productivity,Quality,Cost,Timeliness, convenience, availability,Customer Service.

BASIC FORECASTING APPROACHES: Qualitative (Judgmental) Methods: Intuition, emotions, experience, expertise, value system. No data available, vague situations: new product or technology. Jury of Executive Opinion, Delphi Method, Sales force composite, Consumer market surveys.; Quantitative (Statistical) Methods: Mathematical models, historical data, causality. Data available, stable situations: Existing products, technology. Time-series Models: Naïve approach, Moving averages, Exponential smoothing. Associative (regression) Methods: Simple regression (trend projection if x=t) ,Multiple regression.

Average completion time: Total flow time/Number of jobs/Utilization =Total job work time/Total flow time
Average number of jobs in the system=Total flow time/Total job work time/Average job lateness =Total late days/Number of jobs
CR=Time remaining to due date/Shop time remaining/SRO=(Time remaining to due date – Shop time remaining)/Number of operations remaining

Tools for Service Design :Service encounter design,Service guarantee,Service blueprinting,Documents for service design,Servicescapes (layout),Quantitative techniques.)

GOOD VS SERVICE:Can be resold,Can be stocked,Most aspects of quality,programs – prepackaged ,Selling & production: distinct.,Delivery & production: separate. Reselling unusual/impossible,Difficult or impossible to stock,Quality programs – must be customized,Selling often part of the service,Service inseparable from delivery

EARNED VALUE (EV) – budgeted cost of all work completed/ACTUAL COST (AC) – actual cost of all work completed/PLANNED COST (PC) – budgeted cost of the work that should have been completed.Measures of performance:COST PERFORMANCE INDEX (CPI = EV/AC) – should not be less than 1/SCHEDULE PERFORMANCE INDEX (SPI = EV/PC) – should not be less than 1

TYPE OF INVENTORY:Raw materials, parts, finished product for resale:Purchased but not processed,Work-in-process:The raw materials and parts during the “transformation” phase,Maintenance/repair/operating (MRO):Used to maintain/repair/operate equipment,Finished goods:Completed product awaiting shipment or sale.

High inventory:CUSTOMER SERVICE,ORDERING/SETUP COST,CAPACITY UTILIZATION,TRANSPORTATION COST ,QUANTITY DISCOUNTS