Week 9 - Chapter 8 - Operations Management and Supply Chain

Chapter 8 Weekly Questions

1. Define the term operations management
(OM)

Operations management, is the management and responsibility of systems or processes that convert/transform resources into goods and services. That is, identifies strategies to turn inputs into outputs.

Three Foundational Components of Operations Management; Product Design (planning the processes and design of the product or service) Product Development (i.e manufacturing, turning inputs into outputs), Supply Chain (the processes involved, directly or indirectly, in the procurement of a product or raw material). This photo is available on: http://www.ocw.nur.ac.rw/NR/rdonlyres/Global/4/485BFEBE-85DD-49B7-9E93-802DA4390769/0/chp_ops_mgt_foundation.jpg.

Turning inputs into outputs through the implementation of design, plan, scheduling and improvement of the product or service. This photo is available on: http://www.sussex.ac.uk/Users/dt31/TOMI/images/om-model.gif

2. Explain operations management’s role in business

Operations management is responsible for managing the core processes used to manufacture goods and produce services. OM perform the following activities; forecasting, capacity planning, scheduling, managing inventory, assuring quality processes, motivating, training employees, and locating facilities. Reviewing these activities for any service will allow a business to understand how an operations management team adds value.

Watch: http://www.youtube.com/watch?v=LeeTy3YaMu0, to identify and learn more about the role of operations management, how it plays a part in every product and service in the world.

Watch: http://www.youtube.com/watch?v=hT6LnqNe-NI&feature=related. The significance of operations management in the world and in every business.

3. Describe the correlation between operations management and information technology


Managers use IT to influence OM decisions, these include: productivity, costs, flexibility, quality and customer satisfaction. Benefits of IT on OM is in making operational decisions as OM’s influence over an organization is crucial to objectives and goals for a firm. OM information systems are critical for managers to be able to make strategic decisions. A large amount of information and activity is involved within the role of OM, therefore OM rely heavily on information systems to provide them with the visibility over an organization, that is, for example, processes are either productive or nonproductive. Information systems enables OM to identify:

- What types of resources or employees they need. Also what will be needed and what amounts.

- How much resources are needed or how will be the product or service be designed. How will business processes such as wireless technology track customers, giving real time information to the firm for decision making.

- When will each resource be needed (scheduling) or when will materials be ordered. Further, ensuring adequate inventory is available, implementing a just in time method for ordering supplies.

- Where will work be performed, i.e. OM chooses best locations to work, eg close to transport, close to suppliers.

- Who will perform work i.e. either firms are going to insource or outsource

4. Explain supply chain management and its role in a business


Supply chain are sequences or processes involved in the production and distribution of a commodity ie all the links involved, in the procurement of a product or raw material, that is having goods and services moving information backwards and forwards (upstream, downstream). Supply chain management involves the management of information flows between and among stages in a supply chain to maximize total supply chain effectiveness and profitability. i.e flow of produces from suppliers to manufactures to distributors to retailers to customers. A productive supply chain enables a firm to decrease cost of goods sold and become efficient in manufacturing, supplying and distributing goods and services.

watch: http://www.youtube.com/watch?v=Mi1QBxVjZAw. What is supply chain management?

5. List and describe the five components of a typical supply chain


Movement of materials from raw materials to finished goods.

1. Plan (focusing on Customers)– companies must have a plan for managing resources that go toward meeting customer demands for products or services.

2. Source (Supplier) – companies choose reliable suppliers that will deliver goods and services required for making products, either outsource or insource. Companies also develop set pricing, delivery and payment with suppliers.

3. Make (Manufacturer) – companies manufacture their products or services, such activities for production include: testing, packaging and preparation for delivery.

4. Deliver (Distributer) – logistics – the processes that plans how a product or service is to be delivered and ensuring effective processes from distributers to retailers then customers

5. Return (Retailer) – companies ensure they have enough inventory and there not defective, organisations can implement a just in time method for inventory. If companies have excess products then they must have a way for returning these products.

Steps of a supply chain - available: http://www.hoyer-group.com/en/images/supplychain.gif & http://dspace.mit.edu/bitstream/handle/1721.1/39816/ESD-260JFall2003/NR/rdonlyres/Engineering-Systems-Division/ESD-260JFall2003/C63EDF2B-1583-46F8-A430-5A2330821E3A/0/chp_supchain.jpg

6. Define the relationship between information technology and the supply chain.

Advancements in technology including the five SRM components have significantly improved companies forecasting, scheduling and business operations. Integrated systems provide companies with greater visibility over the supply chain inventory levels. IT’s primary role is to create integrations or tight process and information linkages between functions within an organization such as creating tight process and communication between the sales department, the marketing department, etc. This will allow for a smooth, effective flow of information and service of products between customers, suppliers and transportation across the supply chain.

The Supply chain is very complex and it involves movement of materials, information and funds up and down stream along the chain. IT gives firms visibility of inventories, it helps manage complexity & information flows between suppliers are more accuarate and faster. Wireless technologies are helping with inventory tracking and auditing such as RFID.

Supply chain management relies on IT to make accurate decisions regarding each step in the supply chain, i.e, enabling the firm to identify decisions surrounding, forecasting, scheduling, and additional business processes.

Example, imported extranet, each stage of the supply chain companies use electronic data in exchange, meaning systems from suppliers can see systems from manufactures, and triggeres of events such as if too much supply exists, an organisation can hold back supply. This allows for a more efficient supply chain and further reduces cost of goods sold.

Disintermediation refers to the situation when intermediaries are removed from the supply chain, cutting out specific processes within the supply chain. For instance, if you buy a product from eBay, the retail store is not required in the process, thus cost effective and efficient for the customer and firm. IT can identify steps in the supply chain that aren't effective and can eliminate and discover new ways of cutting costs and making a product more effective.

Week 8 Questions - Networks, telecommunications.

1. Explain the business benefits of using wireless technology.

Benefits include:

- Less hardware, cable and IT infrastructure - Wireless gives users a live (Internet) connection via satellite or radio transmitters, whereas the use of physical cables such as ethernet and fibre optic to connect to the Internet. i.e, reduce the requirements for hub/switches. Businesses are able to track customer activity through the use of wireless networks.

Available: http://images.google.com.au/imgres?imgurl=http://worlddigitalinnovations.com/db2/00173/worlddigitalinnovations.com/_uimages/bigstockphoto_Wireless_Technology_507629.jpg&imgrefurl=http://www.i-working.org/tag/wi-fi/&usg=__VUgZPfS6E5S4udkFtRDd4BjkJ08=&h=1350&w=2017&sz=133&hl=en&start=3&sig2=Oz2ZrtiqnDvml1zBfa2RnQ&um=1&itbs=1&tbnid=aEPZ_ZYE-QvfsM:&tbnh=100&tbnw=150&prev=/images%3Fq%3Dwireless%2Btechnology%26um%3D1%26hl%3Den%26client%3Dsafari%26sa%3DN%26rls%3Den-us%26tbs%3Disch:1&ei=AGrWS9unMpPs7AOgtO3LAg.

This image displays the use of wireless and no more cords and wires needed.

- Wireless technology such as Bluetooth enables users to connect to each other for free, and exchange information.

- Increase productivity & mobility - Companies can generate revenue in less time, through wireless technology, as wireless can be assembled and brought online in as little as two to three hours. That is, access data 24/7, 365 days.

- Universal access to many applications, that is, an extensive amount of information.

Available: http://www.toppindavis.com/njnetworks/fig2wireless.jpg. Different wireless technologies, such as PC with wireless card, or laptop with wireless card.

Available: http://www.progent.com/images/cisco-wireless-topology-2.gif: This image describes how wireless works, the connectors, access points.

2. Describe the business benefits associated with VoIP

Voice over IP is the use of technology to transmit voice calls over the Internet. An example of a program would be Skype, allowing an individual to phone another individual to communicate over the Internet and the ability to view them.

Benefits include:

- Decreased costs for individuals wanting to communicate from overseas, as calls over the Internet do not attract telecommunications charges.

- Increase in flexibility - enabling phone calls, faxes, voice mail, e-mail and web conferences over digital networks. Allowing organizations to save on costs like travel and airfare.

- Less hardware, and cables to make calls. That is you don’t need telphone infrastructure and leverage existing network for free communication which is cost saving.

- You are able to add a third party to your conversation eg for Skype. That is, more then one person can communicate, which could increase convenience and decrease time.

Available: http://tonyserve.files.wordpress.com/2009/11/skype_logo_connect-web.jpg. This image displays what skype is able to do and an example of VoiP, through video conference calls, phone calls, messaging etc.

3. Compare LANs and WANs

LAN (Local area network) – connects a group of computer in close proximity i.e same geographical area to each other. A LAN example in an office building, a school, or home. Another example; is the city campus of Notre Dame University, computer join together via a network.

Available: http://www.conceptdraw.com/products/img/ScreenShots/netdiagrammer/SimpleLAN.gif. An image of how LAN works, connecting computers in close proximity via a network.

WAN (Wide area network) – spreads through a large geographical area, such as a state or country. WANs usually connect multiple smaller network such as local area networks. Eg Sydney campus connecting via internet to Perth campus, which makes up the WAN.

Available: http://wally.cs.iupui.edu/n241-new/webMag/wan.jpg. Connecting multiple smaller networks through a large geographical area.

Available: http://technet.microsoft.com/en-us/library/Cc751420.wan_msp01_big(en-us,TechNet.10).gif. Another example of WAN, connecting computers from different states. (large geographical area)

4. Describe RFID and how it can be used to help make a supply chain more effective.

Radio frequency identification (RFID) technologies use active or passive tags in the form of chips or smart labels that can store unique identifiers and relay this information to electronic readers. When a tag is placed on an item, it automatically radios its location to RFID readers. Example; is an e-tag in a car, runs RFID, a small device that sends information back to a database.

RFID:

- Active RFID has more power and transmits much stronger and accurate data then a passive RFID. Where it can pick up a very faint signal from an antenna.

- RFID tags on inventory allows companies to keep track of stock, identifying where they are and estimated time of delivery.

- Cut costs by requiring fewer workers for scanning items. The bar code on a case or pallet no longer needs to be swiped to identify the contents. RFID replaces barcodes, immediately identifying a products characteristics at a point in time.

- RFID provide more accurate and current information to the entire supply chain.

- Businesses used RFID to control theft, increase efficiency in their supply chains and improve demand planning.

Available: http://www.erpsoftwarebusiness.com/Pic/rfid3.gif. An example of RFID on containers, allowing an organisation to track their movement.

Image Available at: http://www.skyetek.com/Portals/0/Images/Architechture/Embedded-RFID-Overview.jpg. Another example of RFID on products and services, locating these products and services for an organisation, example ensuring their is enough inventory and provides other information necessary for business decisions.

5. Identify the advantages and disadvantage of deploying mobile technology

Advantages:

- Broad reach – users can be reached instantly when carrying an open mobile device.

- Cheap technology

- Convenience and flexibility – access quickly without a PC. Connectivity anytime, anywhere. Thus a mobile workforce allowing to see real time data about eg sales or stock.

- Instant connectivity – you don’t need to boot up, nothing technical

- Customization – personalized information depending on location/ taste/ preferences

- Real time processing

Disadvantages:

- There are limits and restrictions in what technologies and applications you can use on your mobile, thus, a PC may be needed for extensive applications and content load.

- New technology can result in faults within the software. This can impact on the users activity.

- Insecure: Threat of viruses and hackers: Bluetooth hackers, and mobile phone hackers can occur. Mobile technology is not secure. If you have insecure devices, there is a high risk of attracting viruses.

- Safety wireless device - reports say; microwave signals links to cancer.

- Various privacy issues, - example, mobile phones with cameras.

Available: http://thepreppyprincess.files.wordpress.com/2009/07/iphone-parallels.jpg. The iphone, includes the internet, bluetooth, and has applications for users to access and download onto their phone such as banking, itunes, news etc. This is can be a benefit for the user as in convenience and cheaper in then having all separate services which can be expensive however can be a risk as all these applications can be insecure and cause harm to an individual example cancer from the radiation.