Operations Management

Moutaz Khouja

Business Information Systems and Operations Management Department

The Belk College of Business Administration
The University of North Carolina at Charlotte
Charlotte, NC 28223
Ph: (704) 687-7653, Fax: (704) 687-6330

mjkhouja@uncc.edu

http://www.belkcollege.uncc.edu/mjkhouja/

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Outline
 Introductions
 Name cards
 Brief bios
 Suggested info (optional)
 University history

 Job history

 Family and/or friends

 Hobbies

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Brief bio
 BSME, MBA, PhD Operations Management
 Married to Lisa Smith for 18 years, three cats.
 Teaching
 Operations Management, MBA, Undergraduate (UG)
 Topics in Management Information Systems (PhD)
 Quantitative Analysis and Business Statistics, MBA
 Service Operations Management, UG
 Production Planning and Control, UG
 Research and Consulting
 Inventory Management
 Supply Chain Management
 Pricing
 Applications of Artificial Intelligence to Operations Management
 Cooking, reading
 Very happy to be in Monterrey.

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What is operations management?
 Operations management (OM) is defined as the design,
operation, and improvement of the systems that create and
deliver the firm’s primary products and services.
 OM is management of processes that produce and distribute
products and/or services to customers.
 OM objective is make sure that the processes work effectively and
efficiently.
 What is the difference between effectiveness and efficiency?
 Efficiency: producing something at the lowest possible cost
 Effectiveness: doing the right things to create the most value for
the firm
 What is value?
 quality divided by price

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 Typical Operations Decisions and Their
Hierarchy

Strategic level
Broad scope, long term
Tactical level
Moderate scope, medium term

Operational level
Narrow scope, short term

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Transformations

 Physical--manufacturing

 Locational--transportation

 Exchange--retailing

 Storage--warehousing

 Physiological--health care

 Informational--telecommunications

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Transformation Processes
 Inputs Use resources  Outputs

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What is a Service and What is a Good?
 Classic view:
 Physical output (tangible) of process  Good
 If you drop it on your foot, it may hurt you
 Intangible process  Service
 If you drop it on your foot, it won’t hurt you

 McDonald’s is in Service or Manufacturing sector?

 Every organization is in the service business, T or F?

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 OM in the
Organization
Chart

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 Core Services
 Core services are the basic things that
customers (internal or external) want from
products they purchase (quality, on time
delivery, price (cost), etc.)
 Somewhat easier to emulate or copy

Performance Objectives Quality

Flexibility Operations Speed

Management

Price (or cost

Reduction)
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 Value Added Services
 Value-added services differentiate the
organization from competitors and build
relationships that bind customers to the
firm in a positive way (sales and field
support, problem solving, etc.)
 Significantly more difficult to copy and
implement
Problem
Solving
Value-Added Service Categories

Information
Operations Sales Support
Management

Field Support

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Case: Fast-Food Feast, p. 21
 Please read this very short case and visit McDonald’s
and one more fast-food restaurant.
 You do not have to eat there but make sure to observe
as much as possible how they prepare their meals
using the seven questions listed on page 21.
 Also, please read the article “McDonald's focus flips
back to fast”

 Discuss case

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Case Questions
 What do these different fast food restaurants sell?
 Does each of them sell something different?
 What is different about the operations of these
restaurants?
 Processes, Technology, Service Speed, Capacity, Flexibility
 How do these stores make hamburgers?
 Did you notice any differences?
 What are sources of variability that these stores must
deal with?
 How do these businesses ensure quality?

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