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Chapter 1

Operations Management: Trends & Issues

Operations Management
Definition
 An operations system is defined as one in which
 several activities are performed  to transform a set of inputs into useful output  using a transformation process

 Operations Management is
 a systematic approach to  address all the issues pertaining to  the transformation process that converts some inputs into output that are useful, and  could fetch revenue to the operations system
Mahadevan (2010), “Operations Management: Theory & Practice”, 2nd Edition © Pearson Education

Operations Management (OM)
Salient Aspects
 OM is a systematic approach
 using scientific tools & techniques and solution methodologies to analyze problems

 OM is about addressing several issues
 varying in terms of time horizon, nature of decisions

 Transformation processes are central to Operations  Focusing on keeping costs to the minimum  Developing a set of measures to assess performance of the system
Mahadevan (2010), “Operations Management: Theory & Practice”, 2nd Edition © Pearson Education

Manufacturing Sector
Salient Aspects
Index of Industrial Production* 2003‐04 2004‐05 2005‐06 2006‐07 Average Manufacturing 9.20 9.10 12.50 10.27 Capital goods 13.60 13.90 15.80 18.20 15.38 Consumer goods 7.20 11.70 12.00 10.10 10.25 Intermediate goods 6.40 6.10 2.50 12.00 6.75 # Corporate Sector Performance Sales/Income: Manufacturing 13.30 20.50 18.30 23.10 18.80 Sales/Income: Services (other than financial) 27.00 21.40 15.70 22.60 21.68 ‐9.10 ‐66.10 ‐13.90 32.60 ‐14.13 Sales/Income: Financial services Wages and Salaries: Manufacturing 6.70 3.00 8.90 18.20 9.20 Wages and Salaries: Services (other than financial) 16.00 35.10 17.90 26.50 23.88 Wages and Salaries: Financial services 12.80 8.60 11.20 10.90 10.88 147.80 58.30 17.30 58.40 70.45 PAT: Manufacturing

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