Pom Summary Chapter 1
Chapter 1
Introduction to Operations Management
Adding Value by Improving Operations Management
Better management of a company’s operations can add substantial value to the company by improving its competitiveness and long-term profitability. Poor operations decisions can hurt a company’s competitive position and increase its costs on the other hand; good operations decisions can improve the value of the company by increasing profitability and growth. Operations management is an important discipline in the struggle to remain competitive in an ever-changing global marketplace. There are three primary functions in business: operations, marketing, and finance/accounting.
Production is the creation of goods and services, while operation management is the set of activities that creates value in the form of goods and services by transforming inputs into outputs. This conversion process is the heart of what is called operations or production and is the predominant activity of a production system. Managers in POM is operations managers who manage the production system, their primary concern is with the activities of the conversion process or production.
Historical Milestone in POM
There are several developments that have impacted the evolution of POM.
1. The Industrial Revolution
2. The post-Civil War period
3. Scientific management
4. Human Relations and behaviorism
5. Operations research
6. The service resolution
7. The computer revolution.
The Industrial Revolution
Production system prior to the 1700s are often referred to as cottage system, because the production of products took place in homes or cottages where craftsmen directed apprentices in performing handwork on products. In England in the 1700s, a development occurred that we refer to as the Industrial Revolution. This advancement involved two principal elements: the widespread substitution of machine power for human and waterpower and the establishment of the factory system. The
Introduction to Operations Management
Adding Value by Improving Operations Management
Better management of a company’s operations can add substantial value to the company by improving its competitiveness and long-term profitability. Poor operations decisions can hurt a company’s competitive position and increase its costs on the other hand; good operations decisions can improve the value of the company by increasing profitability and growth. Operations management is an important discipline in the struggle to remain competitive in an ever-changing global marketplace. There are three primary functions in business: operations, marketing, and finance/accounting.
Production is the creation of goods and services, while operation management is the set of activities that creates value in the form of goods and services by transforming inputs into outputs. This conversion process is the heart of what is called operations or production and is the predominant activity of a production system. Managers in POM is operations managers who manage the production system, their primary concern is with the activities of the conversion process or production.
Historical Milestone in POM
There are several developments that have impacted the evolution of POM.
1. The Industrial Revolution
2. The post-Civil War period
3. Scientific management
4. Human Relations and behaviorism
5. Operations research
6. The service resolution
7. The computer revolution.
The Industrial Revolution
Production system prior to the 1700s are often referred to as cottage system, because the production of products took place in homes or cottages where craftsmen directed apprentices in performing handwork on products. In England in the 1700s, a development occurred that we refer to as the Industrial Revolution. This advancement involved two principal elements: the widespread substitution of machine power for human and waterpower and the establishment of the factory system. The