Operations Management

Supplementary Lecture
Introduction

The process which

Production? combines and transforms
various resources used in
the production operations
system of the
organization into value
Operation? added product and
services in controlled
manner as per policies of
the organization.
Management?
 Why Study Production Operation
Management?
1970s
Frederick
Identify the three major 1930s to Adam Emerges
Winslow two distinct
functions of any 1950s Smith Taylor
organization changes

How Goods and Services

are produced • Specialization of Labor
Adam • Highly Skilled and
Smith Efficient
Understand the costly part
of the organization
• Scientific Management
F.W. • Manufacturing
Stimulate Jobs Taylor Management
Function with Business Organization

All activities related to

Operations producing goods Planning

Assessing Customers Wants

Marketing and Needs Coordinating

Finance Securing and allocating

resources
Controlling
Operation Management
The activity of managing the resources which produce and deliver
products and services
Operation in the Organization

The operations function is central to the organization because it produces the

goods and services which are its reason for existing, but it is not the only
function
Operation Function
Fulfilling customer requests for service through the
Marketing production and delivery of products and services.
Communicating the organization’s
products and services

Accounting and Finance

Decision-making and manages the financial
Product and Service resources of the organization

Development
Creating new and modified products and services
Human Resource
Recruits and develops the organization
Operation Performance..

Why is operations performance important in any organization?

How does the operations function incorporate all stakeholders’ objectives?

What does top management expect from the operations function?

What are the performance objectives of operations and what are the internal
and external benefits which derive from excelling in each of them?
How do operations performance objectives trade off against each other?
 Reduce costs

Increase revenue

Reduce risk

Reduce the need for

investment

Enhance innovation
Competitiveness, Strategy,
and Productivity
Understanding Competitiveness

Price

Quality

Service Differentiation
Factors Affecting
Competitiveness Flexibility

Time

Service

Managers and Workers

Understanding Strategy

Strategy Formulation
Mission Order Qualifiers

Order Winner

Mission Distinctive Competencies

Statement
Understanding Productivity
Factors Affecting Productivity
Standardization
Improving Productivity
Quality Differences
Develop productivity measures
Use of the Internet
Bottleneck Operation
Computer Viruses

Scrap Rates
Develop methods for productivity improvement

New Workers Establish reasonable goals for improvement

Information Shortage Management encourage productivity improvement
Layoffs Don’t be confuse productivity from efficiency
 Scope of Operations Management

Concern with the conversion of inputs to outputs

Maximizing Physical Resources

Provide desired utilities for customers

Deliver Efficiently and Effectively

Promote Sustainability
Organizational
Operations
 National Grid Corporation of the
Philippines
Competitiveness, Strategy, and Productivity

ü Power Industry
ü Monopolize
ü Transmission Facilities
National Grid Corporation of the
Philippines
Competitiveness, Strategy, and Productivity
National Grid Corporation of the
Philippines
Competitiveness, Strategy, and Productivity
Strengthen LVM Grid
extending 230 kV and 138 kV Backbones toward
Zamboanga Peninsula and Eastern Mindanao
Enhance resiliency
establishing 230 kV loop in Western and Eastern LVM

Improve reliability and flexibility

establishing 138 kV and 69 kV loops

Philippine
Grid Development
Roadmap Improve Power Quality
ensuring safe and reliable supply of
power through voltage improvement
projects

Support Load Growth and Island

Interconnections
constructing new substations, upgrading
existing substation capacity and
Promote Renewable Energy interconnecting island to boost economic
identifying RE Zones growth
End of Discussion