 What does Operations mean?

 Any individual, (or) a group of people (or) an organization, that produce

goods or service which is of use.

 Example of Operations
 Maruti Suzuki
 Dominoz Pizza
 PVR Cinemas
 Apollo Hospital
 Delhi Metro
 Hair Stylist
 ITM Gurgaon
 Does the companies produce everything on their own?
 Tata Motors manufactures cars, do they make all the components that
go into manufacturing of the car by themselves
 Tata Motors manufactures important parts like engine, body of the car,
gear-box, assemble the car and sell it in the market
 Tata Motors buy many finished and semi-finished components from its
supplier for example., bumpers, mirrors, seat, paint, battery, spark plug,
tyre , nuts & bolts.
 Operations management is the planning, scheduling, and control of the
activities that transform raw material into finished goods and services

 Planning
 Tata Motors decide to make 100 petrol cars & 100 diesel cars based on
the demand forecast from marketing, as per this plan they need to
purchase components from suppliers, manufacture engine

 Scheduling
 Whether to manufacture all 100 petrol engines first and the 100 diesel
engines (OR) as per the actual demand from the market

 Control
 To execute the activities as per plan and change as per latest
information available.
 The demand for red colour car has reduced, change the production
schedule
 Is it sufficient to manage the operations of Tata Motors alone, efficiently; to
be competitive in the market?
 No, to be competitive in the market the product should be of good
quality, low price and available in the market at the right time
 It is necessary for the supplier of the Tata Motors, the transporters and
the retailers also to manage the operations effectively

 In today’s world the raw material is sourced from one country, production
happens in another country, and the final market for these goods is a third
country.

 These decisions are taken based on the advantages each location/country

offer for the entire chain
 A network of manufacturers and service providers that work together to
convert and move goods from the raw materials stage through to the end user

 Indica Car
 Network of manufacturers include, Tata Ficasso, Lumax, JK Tyre, Tata
Green/Exide, Tata Steel, Sundaram fasteners, Tata Yazaki and many more
 Transportation company to move finished car from Pune to the various
locations across the country
 Retail Showroom

 Commonly used definition

 to make the right product of the right quality in right quantity for the
right market at the right cost to maximize customer satisfaction and
profit
 Upstream activity (OR) firm
 Activities or firms that are positioned earlier in the supply chain relative
to some other activity or firm of interest
 Example: Louis Philip Shirts, cotton harvest, manufacture of fabric,
dyeing of fabric

 Downstream activity (OR) firm

 Activities or firms that are positioned later in the supply chain relative
to some other activity or firm of interest
 Example: Louis Philip Shirts, packaging, transportation, Reliance Retail,
Planet Fashion
First-tier supplier
 The supplier that provides products or services directly to a firm . Eg.,
Tata Auto components supply bumpers to Tata Motors

 Second-tier supplier
 The supplier that provides products or services to a firm’s first-tier
supplier. Eg., Reliance Industries supplying plastic granules to Tata Auto
Components

 Inventory
 Material

Information
Supplier Supplier

Funds
 To balance supply & demand

 Can we exactly match the supply & demand

 SCM helps in coming close to the reality

 Helps in deciding on whether to manufacture or outsource
 Where the plant should be located
 What should be order size
 What mode of transportation to be used
 Operations & SCM does not function independently, they work in tandem
with every other function in the organisation like Finance, HR, Marketing, IT

 Marketing and operations interact to understand the market demand

 IT provides the vital information amongst the suppliers, manufacturer,

distributor, transporter, retailer

 HR has to support the operations strategy by providing skilled manpower

 Reliance Industries

 Tata Nano

 Big Bazaar

 Wal Mart

 e-bay

 Amazon.com
 Auto
 Pharma
 Banks
 Hospitality
 Health Care
 IT
 Logistics

Every organisation needs people with strong Ops & SCM knowledge
 EXIM Manager
 Transportation Manager
 Material Management
 Purchase
 Consultant jobs to implement ERP (Enterprise Resource Planning) software
 Warehouse Manager
Assignment
Case Study : Supply Chain Challenges at LeapFrog
Book : Introduction to Operations & Supply Chain
Management - Cecil C.Bozarth & Robert .Handfield
Pg No : 17