Operations Management p g Shin Ming Guo, Ph.D. Department of - PDF document

Operations Management p g 郭幸民 Shin ‐ Ming Guo, Ph.D. Department of Logistics Management office: C415, phone: 6011000 ext. 3216 e ‐ mail: smguo@nkfust.edu.tw web: www2.nkfust.edu.tw/~smguo/teaching/pom.htm Textbook Cachon and Terwiesch, “Matching Supply with Demand —An Introduction to Operations Management ”, 3rd edition, McGraw ‐ Hill. Reference Fitzsimmons and Fitzsimmons, “Service Management”, 8th edition, McGraw ‐ Hill . Reading N News and articles, available at my web site d ti l il bl t b it Software Excel 2 1

Course Outline I 1 Introduction 2 The Process View of the Organization 3 Evaluating Process Capacity Service Blueprinting and Service Encounter 4 Estimating and Reducing Labor Costs g g 5 The Link between Operations and Finance 3 Course Outline II 7 Variability and Waiting Times 8 The Impact of Variability on Throughput Losses Waiting Line Management 12 Forecasting and Betting on Uncertain Demand 14 Inventory Management: Service Levels y g 16 Revenue Management 4 2

Grading Homework 40% Report 20% Final Exam 30% Participation 10% No Plagiarism, No Cheating 5 Sample Topics for Team Report Loan Processing at Capital One — Wharton School g p Great Italian Cuisine without the Wait — HBS Taco Bell Corp. — HBR British Columbia NICU Bed Allocation — University of Western Ontario Which Products Should You Stock? Which Products Should You Stock? — HBR HBR The Morrison Company: redesigning the manufacturing process — HBR 6 3

Chapter 1 Introduction p  What is Operations Management?  Matching Supply with Demand  Matching Supply with Demand  What Can Operations Management Do? What is an Operation System? Transformation = Production = Service Physical: manufacturing Location: transportation Exchange: retailing Storage: warehousing Physiological: health care Informational: telecommunications 8 4

What is Service? Tangible or intangible? Tangible or intangible? Customer involvement? Standardization or customization? Human or machine processing? Inventory and leftover? 9 Differences between Manufacturing & Service Characteristic Manufacturing Service Product Product Tangible Tangible Tangible & Intangible Tangible & Intangible Customer involvement Low High Uniformity of input High Low Labor content Low High Uniformity of output High Low Performance Measurement Performance Measurement Easy Easy Difficult Difficult Quality Control High Low Inventory Much Little or Perishable 10 5

Focus: Matching Supply with Demand  Demand can vary and is unpredictable.  Supply is inflexible and maybe costly.  Demand < Supply  Impossible to stock service  Demand > Supply  Customers may not want  Demand > Supply  Customers may not want to wait 11 What About a Shortage of Vaccine? Nintendo 於 2006 年推出大受歡迎的 Wii 遊戲機，民 眾排隊搶購後立刻轉售以賺取數百美元差價 12 6

Who Cares About Inventory? Acer 在 2011 年出現有史以來第一次虧損，出清 過剩 PC 庫存導致一億五千萬美元的虧損。 13 Economic Consequences of Mismatch Air travel Emergency Room Retailing Supply Seats on specific Medical service Consumer flight fli h electronics l i Travel for specific Urgent need for Kids buying video Demand time & destination medical service games Supply Empty seat Doctors, nurses, High inventory Exceeds and infrastructure costs Demand are under ‐ utilized Demand Overbooking; Crowding and delays Foregone profit; Profit loss Exceeds in the ER, Deaths Consumer Supply dissatisfaction 14 7

How to Run a Successful Business?  Low Cost?  Low Cost?  Fast Delivery?  Quality Service?  Better Selection? 15 Four Dimensions of Performance Tradeoffs Quality Cost ▪ Product quality ▪ Efficiency ▪ Measured by: (how good?) (h d?) ▪ Process quality ‐ cost per unit (as good as promised?) ‐ utilization Time Time Variety Variety ▪ Responsiveness to demand ▪ Customer heterogeneity ▪ Measured by: ▪ Measured by: ‐ customer lead time ‐ number of options ‐ flow time ‐ flexibility / set ‐ ups 16 8

1st Use: Overcome Inefficiencies High Current frontier In the industry Competitor A Responsiveness Competitor C Eliminate inefficiencies Competitor B Low Low Labor Productivity High 17 It’s Details that Count 旅客登機時間會影響旅客 對服務品質的認知、航空 公司準點表現與營運成本 Speed and Convenience for Passengers! 18 9

2nd Use: Help Making Trade-Offs High Very short waiting times Frequent operator idle time Responsiveness Trade ‐ off Long waiting times, yet operators are almost fully utilized Low Low Labor Productivity High 19 Call center of Deutsche Bundesbahn Goal: 80% of incoming calls wait less than 20 seconds Starting point: 30% of incoming calls wait less than 20 secs Starting point: 30% of incoming calls wait less than 20 secs. Problem: Must decide staffing levels of call centers and understand impact on efficiency Solution: Provides tools to support strategic trade ‐ offs 20 10

3rd Use: Evaluate Proposed Redesigns/New Technologies High Redesign New frontier process Responsiveness Current frontier In the industry h d Low Low Labor Productivity High 21 22 11

Operation is the Heart of the Business  Operations account for 60 to 80% of the direct expenses that burden a firm’s profit. p p  Operations directly affect customers and are essential to the competitiveness of the firm.  Managers need to perform and make decisions in all functions. 23 12