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MANAGEMENT

RABIA
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Table of Contents
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MANAGEMENT THEORY

CHAPTER 1 MANAGEMENT
INTRODUCATION
The verb manage comes from the Italian maneggiare (to handle, especially tools), which derives from the Latin word manus (hand). The French word management (later mnagement) influenced the [1] development in meaning of the English word management in the 17th and 18th centuries. Some definitions of management are: Organization and coordination of the activities of an enterprise in accordance with certain policies and in achievement of clearly defined objectives. Management is often included as a factor of production along with machines, materials and money. According to Peter Drucker (19092005), the basic task of a management is twofold: marketing and innovation. Nevertheless, innovation is also linked to marketing (product innovation is a central strategic marketing issue). Peter Drucker identifies Marketing as a key essence for business success, but management and marketing are generally understood as two different branches of business administration knowledge. Directors and managers have the power and responsibility to make decisions to manage an enterprise when given the authority by the shareholders. As a discipline, management comprises the interlocking functions of formulating corporate policy and organizing, planning, controlling, and directing the firm's resources to achieve the policy's objectives. The size of management can range from one person in a small firm to hundreds or thousands of managers in multinational companies. In [2] large firms, the board of directors formulates the policy that the chief executive officer implements.

HISTORY OF MANAGEMENT
The verb manage comes from the Italian maneggiare (to handle, especially tools), which derives from theLatin word manus (hand). The French word mesnagement (later mnagement) influenced the development in meaning of the English word management in the 17th and 18th centuries.[1] Some definitions of management are:

Organization and coordination of the activities of an enterprise in accordance with certain policies and in achievement of clearly defined objectives. Management is often included as a factor of production along with machines, materials and money. According to Peter Drucker (19092005), the basic task of a management is twofold: marketing and innovation. Nevertheless, innovation is also linked to marketing (product innovation is a central strategic marketing issue). Peter Drucker identifies Marketing as a key

essence for business success, but management and marketing are generally understood as two different branches of business administration knowledge.

Directors and managers have the power and responsibility to make decisions to manage an enterprise when given the authority by the shareholders. As a discipline, management comprises the interlocking functions of formulating corporate policy and organizing, planning, controlling, and directing the firm's resources to achieve the policy's objectives. The size of management can range from one person in a small firm to hundreds or thousands of managers in multinational companies. In large firms, the board of directors formulates the policy that the chief executive officer implements.[2]

DEFINITION OF MANAGEMENT
Management in all business and organizational activities is the act of getting people together to accomplish desired goals and objectives using available resources efficiently and effectively. Management comprisesplanning, organizing, staffing, leading or directing, and controlling an organization (a group of one or more people or entities) or effort for the purpose of accomplishing a goal. Resourcing encompasses the deployment and manipulation of human resources, financial resources, technological resources, and natural resources. Since organizations can be viewed as systems, management can also be defined as human action,
including design, to facilitate the production of useful outcomes from a system. This view opens the opportunity to 'manage' oneself, a prerequisite to attempting to manage others.

Basic functions
Management operates through various functions, often classified as planning, organizing, staffing, leading/directing, controlling/monitoring and motivation.

Planning: Deciding what needs to happen in the future (today, next week, next month, next year, over the next five years, etc.) and generating plans for action. Organizing: (Implementation)pattern of relationships among workers, making optimum use of the resources required to enable the successful carrying out of plans. Staffing: Job analysis, recruitment and hiring for appropriate jobs. Leading/directing: Determining what must be done in a situation and getting people to do it. Controlling/monitoring: Checking progress against plans.

Motivation: Motivation is also a kind of basic function of management, because without motivation, employees cannot work effectively. If motivation does not take place in an organization, then employees may not contribute to the other functions (which are usually set by top-level management).

Mintzberg's Management Roles


Identifying the Roles Managers Play

As a manager, you probably fulfill many different roles every day. For instance, as well as leading your team, you might find yourself resolving a conflict, negotiating new contracts, representing your department at a board meeting, or approving a request for a new computer system. Put simply, you're constantly switching roles as tasks, situations, and expectations change. Management expert and professor, Henry Mintzberg, recognized this. He argued that there are ten primary roles or behaviors that can be used to categorize a manager's different functions. In this article we'll examine these roles, and we'll see how you can use your understanding of them to improve your management skills.

The Roles
Mintzberg published his Ten Management Roles in his book, "Mintzberg on Management: Inside our Strange World of Organizations," in 1990. The ten roles are: 1. Figurehead. 2. 3. 4. 5. 6. 7. 8. 9. Leader. Liaison. Monitor. Disseminator. Spokesperson. Entrepreneur. Disturbance Handler. Resource Allocator.

10. Negotiator. The 10 roles are then divided up into three categories, as follows:

The 10 roles are then divided up into three categories, as follows: Category Role Interpersonal Figurehead Leader Liaison Monitor Disseminator Spokesperson Entrepreneur Disturbance Handler Resource Allocator Negotiator

Informational

Decisional

Let's look at each of the ten roles in greater detail.

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Interpersonal Category
The roles in this category involve providing information and ideas. 1. Figurehead - As a manager, you have social, ceremonial and legal responsibilities. You're expected to be a source of inspiration. People look up to you as a person with authority, and as a figurehead. 2. Leader - This is where you provide leadership for your team, your department or perhaps your entire organization; and it's where you manage the performance and responsibilities of everyone in the group. 3. Liaison - Managers must communicate with internal and external contacts. You need to be able to network effectively on behalf of your organization.

Informational Category
The roles in this category involve processing information. 4. Monitor - In this role, you regularly seek out information related to your organization and industry, looking for relevant changes in the environment. You also monitor your team, in terms of both their productivity, and their wellbeing. 5. Disseminator - This is where you communicate potentially useful information to your colleagues and your team. 6. Spokesperson - Managers represent and speak for their organization. In this role you're responsible for transmitting information about your organization and its goals to the people outside it.

Decisional Category
The roles in this category involve using information. 7. Entrepreneur - As a manager, you create and control change within the organization. This means solving problems, generating new ideas, and implementing them. 8. Disturbance Handler - When an organization or team hits an unexpected roadblock, it's the manager who must take charge. You also need to help mediate disputes within it. 9. Resource Allocator - You'll also need to determine where organizational resources are best applied. This involves allocating funding, as well as assigning staff and other organizational resources. 10. Negotiator - You may be needed to take part in, and direct, important negotiations within your team, department, or organization.

Applying the Model


You can use Mintzberg's 10 Management Roles model as a frame of reference when you're thinking about developing your own skills and knowledge. (This includes developing yourself in areas that you consciously or unconsciously shy away from.) First, examine how much time you currently spend on each role. Do you spend most of your day leading? Managing conflict? Disseminating information? This will help you decide which areas to work on first. Next, get a piece of paper and write out all ten roles. Score yourself from 1-5 on each one, with 1 being "Very skilled" to 5 being "Not skilled at all." Once you've identified your weak areas, use the following resources to start improving your abilities in each role.

Figurehead
Figureheads represent their teams. If you need to improve or build confidence in this area, start with your image, behavior, and reputation. Cultivate humility andempathy, learn how to set a good example at work, and think about how to be a good role model.

Leader
This is the role you probably spend most of your time fulfilling. To improve here, start by taking our quiz, How Good Are Your Leadership Skills? This will give you a thorough understanding of your current abilities. Next, learn how to be an authentic leader, so your team will respect you. Also, focus on improving your emotional intelligence - this is an important skill for being an effective leader.

Liaison
To improve your liaison skills, work on your professional networking techniques. You may also like to take our BiteSized Training course on Networking Skills.

Monitor
To improve here, learn how to gather information effectively and overcome information overload. Also, use effective reading strategies, so that you can process material quickly and thoroughly, and learn how to keep up-to-date with industry news.

Disseminator
To be a good disseminator you need to know how to share information and outside views effectively, which means that good communication skills are vital.

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Learn how to share organizational information with Team Briefings. Next, focus on improving your writing skills. You might also want to take our communication skills quiz, to find out where else you can improve.

Spokesperson
To be effective in this role, make sure that you know how to represent your organization at a conference. You may also want to read our articles on delivering great presentations and working with the media (if applicable to your role).

Entrepreneur
To improve here, build on your change management skills, and learn what not to do when implementing change in your organization. You'll also need to work on yourproblem solving and creativity skills, so that you can come up with new ideas, and implement them successfully.

Disturbance Handler
In this role, you need to excel at conflict resolution and know how to handle team conflict. It's also helpful to be able to manage emotion in your team.

Resource Allocator
To improve as a resource allocator, learn how to manage a budget, cut costs, andprioritize, so that you can make the best use of your resources. You can also useVRIO Analysis to learn how to get the best results from the resources available to you.

Negotiator
Improve your negotiation skills by learning about Win-Win Negotiation andDistributive Bargaining. You might also want to read our article on role-playing - this technique can help you prepare for difficult negotiations.

Management Skills for New Managers

This seminar will give you the crucial foundational skills to shift from being an individual contributor to a wellrespected manager who can achieve team success and drive bottom-line performance. Using guided role play, exercises and practice sessions, you will discover how to adjust your management style and tackle new challenges. In-depth skills practice using the Situational Leadership II model combined with interactive activities take you through the paces of motivation, delegation, coaching, communication, performance management and leadership. You will be able to improve on key weakness areas, play to your strengths and get the best results from every member of your team.

How You Will Benefit



Gain a deeper understanding of your roles and responsibilities Improve communication to effectively set expectations for yourself and your direct reports Adapt your leadership style to meet the needs of individual team members Communicate organizational goals that get results Apply delegation strategies to increase productivity and motivation Use effective coaching techniques to maximize your teams performance

What You Will Cover


Your Role as Manager

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Identify qualities and abilities required for effective management Understand your role and responsibilities as manager Learn to transition from individual contributor to manager Know how to work effectively with a multigenerational workforce Understand the nuances when managing remote teams and across the matrix

Performance Management

Identify the challenges to effective performance management Understand and conduct performance planning, facilitation and evaluation Practice the skill of setting goals, providing effective feedback and conducting alignment discussions

Effective Communication

Recognize what effective communication really is Understand the communication process Know the barriers that can cause derailment and misunderstanding Identify the relative importance of face-to-face communication Get a firm grasp of the five building blocks of managerial communication Learn to match the right communication method with your communication goal Identify the challenges and practices when communicating virtually

Understanding and Appreciating Situational Leadership II: The Art of Influencing Others

How to develop people, value differences and encourage honest communication Develop your leadership style to gain commitment from employees Match your leadership style to the your developmental needs and task at hand

Coaching for Performance

How does coaching develop, enhance and achieve goals Know the requirements and importance of coaching Practice coaching and correcting difficult and challenging behaviors Use the AMA Guide for managing a coaching discussion Identify the differences between coaching and discipline

Creating a Motivational Climate

Define motivation and your role in creating a motivational setting The cost of demotivation and disengagement Recognize important elements of the motivational process Create your own practice for building a motivational climate

Delegation for Growth and Development

Understand the different types of delegation Know the benefits and challenges of delegation

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Recognize your comfort with delegation How to conduct an effective delegation conversation Practice your delegation skills

Who Should Attend


Managers with one to three years of experience who are seeking additional management training.

Special Feature
Real-world examples. Techniques and tools learned throughout this seminar are based on actual day-to-day interactions between managers and direct reports. See Ken Blanchards Situational Leadership II (SLII)a model for developing people and a way for leaders to help their employees become self-reliant achievers. To be truly effective, leaders styles must adapt to the skills and commitment of the people they want to influence. With some people, managers have to provide a great deal of direction. With others, encouragement and appreciation trigger the best results. Still others deliver their best when allowed to take the ball and run with it. Situational Leadership II helps managers become more flexible and responsive to their employees needs. This Seminar Features Blended Learning AMA Blended Learning combines instructor-led training with online pre- and post-seminar assessments, tune-up courses and other resources to maximize your training goals. Through a blend of proven instructor-led seminars and powerful online technology, AMA Blended Learning provides a compelling and more comprehensive experience for the learner - producing a greater return-on-investment for the employer and the seminar participant.

Levels of management
Most organizations have three management levels: first-level, middle-level, and top-level managers.[citation
needed]

These managers are classified in a hierarchy of authority, and perform different tasks. In many

organizations, the number of managers in every level resembles a pyramid. Each level is explained below in specifications of their different responsibilities and likely job titles. [11] [edit]Top-level managers Consists of board of directors, president, vice-president, CEOs, etc. They are responsible for controlling and overseeing the entire organization. They develop goals, strategic plans, company policies, and make decisions on the direction of the business. In addition, top-level managers play a significant role in the mobilization of outside resources and are accountable to the shareholders and general public. According to Lawrence S. Kleiman, the following skills are needed at the top managerial level. [12]

Broadened understanding of how: competition, world economies, politics, and social trends effect organizational effectiveness .

Top management's role is:

Lay down the objectives and broad policies of the enterprise.

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Issues necessary instructions for preparation of department budgets, procedures, schedules, etc. Prepares strategic plans and policies for the enterprise. Appoint middle level executives, i.e., departmental managers. Controls and coordinate activities of all departments. Maintain contact with the outside world. Provides guidance and direction. Answer to shareholders for the performance of the enterprise.

[edit]Middle-level managers Consist of general managers, branch managers and department managers. They are accountable to the top management for their department's function. They devote more time to organizational and directional functions. Their roles can be emphasized as executing organizational plans in conformance with the company's policies and the objectives of the top management, they define and discuss information and policies from top management to lower management, and most importantly they inspire and provide guidance to lower level managers towards better performance. Their functions include:

Design and implement effective group and inter-group work and information systems. Define and monitor group-level performance indicators. Diagnose and resolve problems within and among work groups. Design and implement reward systems that support cooperative behavior.

[edit]First-level managers Consist of supervisors, section leads, foremen, etc. They focus on controlling and directing. They usually have the responsibility of assigning employees tasks, guiding and supervising employees on day-to-day activities, ensuring quality and quantity production, making recommendations, suggestions, and up channeling employee problems, etc. First-level managers are role models for employees that provide:

Basic supervision Motivation Career planning Performance feedback

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Chapter 2: Operations management


INTRODUCTION: This is the first chapter of the book, and its intention is fairly obvious. Namely to introduce some of the basic ideas in operations management and provide some examples to illustrate them. It introduces the general model of operations management which is used to link together the different topics in operations management and the different parts of the book. There is nothing sacrosanct about this model, other books will use slightly different models. What is important is that you realise that it combines two distinct ideas. The first idea is that all types of business, organisation or enterprise, large or small, profit making or not-for-profit, .... are processes. This is illustrated by the input resources and output products and services arrows. The se cond idea is that, to make these process work, operations managers do things such as devising strategy, designing processes, planning and controlling processes, and improving them. So, operations managers in all types of operation .... have a common set of activities. This idea is illustrated in the model by the activities in the ovals.

Your learning objectives


This is what you should be able to do after reading Chapter 1, and working through this study guide. Identify the operations function in any kind of organisation. Describe any operation in terms of its transforming resources, transformed resources, operations processes and products and services. Describe the micro-operations within in an operation as input transformation - output processes. Define different operations in terms of their position on the four Vs of operations management, volume, variety, variation, visibility. Understand the responsibilities of operations managers.

What is operations management?

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Operations management is the term used for the activities which produce and deliver products and services. The important things to remember about operations management are, All types of organisation must do operations management because all organisations produce some mixture of products and services. Remember though that in many organisations the term operations management will not be used. In many smaller organisations operations management may be done by people who perform many other types of task such as marketing and accounting. Operations management is important. The decisions it makes have a major impact on both the cost of producing products or services and how well the products and services are produced and delivered which has a major impact on the revenue coming into the organisation. So, operations management has an important impact on both revenue and cost and therefore profits. This also applies to not-for-profit organisations. In a local government service, for example, good operations management can produce services which satisfy the community and are produced efficiently. So the community are getting value for money from their local services. Operations management has strategic importance. The box on IKEA in the text illustrates a company which has been strategically successful because of the way it manages its operations.

Click here for further details on the IKEA example.

What are the similarities between all operations?


This part of Chapter 1 is mainly devoted to categorising the types of resources and processes which are found in operations. The intention is to demonstrate these standard categorisations of resources and processes are to be found in any sort of organisation. So for example, the table below shows what would constitute the two types of transforming resources (facilities and staff) in three very different types of operation. The facilities and staff transforming resources of three operations Ferry company Types of facilities Ships on-board navigation Reeling equipment Dry docks Materials-handling equipment Steam-generating boilers On-shore buildings Paper manufacturer Pulp-making vats Paper-making machines Slitting equipment Transmitters Packing machinery Warehouses Outside broadcast vehicles Radio station Broadcasting equipment Studios and studio equipment

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Computerized reservation systems Warehouses

Types of staff

Sailors Engineers Catering staff

Operators Chemists and chemical engineers Process plant engineers

Disc jockeys Announcers Technicians

On-board shop assistants Cleaners Maintenance staff Ticketing staff Transformed resources in operations are some mixture of materials, information and customers. The important issue here is that, although most types of operation process all three types of transformed resource, one is usually the most important. So, for example, a hospital will process information in the form of patients medical records. It will also devote some of its resources to processing materials, for example in the way it produces meals for patients. The main operations task of a hospital, however, is to process customers in a way which satisfies its patients, maximises their health care and minimises its costs. It is predominantly a customer processing operation. Similarly, most operations produce some mixture of products and services. This emphasises one of the core philosophies of this text book.. The distinction between manufacturing and service is becoming increasingly irrelevant. Even government statistics cannot cope with the distinction any longer. For example, if you buy software on a disc it is classed as a product, but if you download it over the internet (legally of course) it is classed as a service.

Micro-operations and the internal customer concept


The idea of a hierarchy of operations processes within an organisation is introduced in the text and has had a significant effect on management thinking over the last few years. It has

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highlighted the issue of how different processes or micro-operations relate to each other within an organisation. This is sometimes called the internal customer concept. It has also helped to underpin the idea of business process reengineering which became fashionable in many businesses during the 1990s. One can consider the internal customer concept and business process reengineering as being alternative approaches to solving the same problem. This problem is that within any organisation different sections or departments find it difficult to interface with each other. This may be because they are too busy with their own tasks to worry about other parts of the organisation, or it may be that they have (or regard themselves as having) different interests and objectives. The internal customer concept advocates that each micro-operation should identify its internal customers and internal suppliers and formally talk to them about what they need and what they can offer. In other words, to treat internal suppliers and customers as if they were independent external organisations. Business process reengineering is more radical and advocates that all the resources and activities necessary to do everything required for an end-to-end business process should be put within the same unit or department. In other words, the organisation should be reconfigured around these key processes.

Buffering the operation


The turbulent environment in which most organizations do business means that the operations function is having to adjust continually to changing circumstances. For example, a foodprocessing operation might not be able to predict exactly when some foods will be harvested (bad weather might totally disrupt the supply to a factory for weeks). Demand could also be prone to disruption. Unpredictable changes in the weather, a health scare story in the press, and so on, can all introduce turbulence. One way in which operations managers try to minimize environmental disruption is by buffering or insulating the operations function from the external environment. It can be done in two ways: physical buffering designing an inventory or stock of resources either at the input side of the transformation process or at the output side; organizational buffering allocating the responsibilities of the various functions in the organization so that the operations function is protected from the external environment by other functions.

Physical buffering Physical buffering involves building up a store of the resources so that any supply disruptions will (initially at least) be absorbed by the store. The operation is storing its input transformed resources before it transforms them. The store of input resources are being used as buffer stocks to protect the operation. Similarly, buffering can be applied at the output end of the transformation process. A manufacturer could make its products and put them into a finished goods inventory (output stocks are not usually relevant to people-processing operations). Often operations do not need to have output stocks; they could react to each customers request as it was made. Yet by stocking their output, the operation is given much more stability when demand is uncertain. Organizational buffering In many organizations the responsibility for acquiring the inputs to the operation and distributing its outputs to customers is not given to the operations function. For example, the people who staff the operation are recruited and trained by the personnel function; the process technology

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for the operation is probably selected and commissioned by a technical function; the materials, parts, services and other bought-in resources are acquired through a purchasing function; and the orders from customers which trigger the operation into activity will come through the marketing function. The other functions of the organization are, in effect, forming a barrier or buffer between the uncertainties of the environment and the operations function. These relationships have developed partly for stability which allows the operation to organize itself for maximum efficiency

How are operations different from each other?


The text differentiates between different types of operation by using four dimensions it calls these the four Vs of operations. They are,

Volume how many products or services are made by the operation? Variety how many different types of products or services are made by the operation? Variation how much does the level of demand change over time? Visibility how much of the operations internal working are exposed to its customers?

The figure below gives some examples of operations at each end of these four dimensions. In most industries one can find examples at either end of each dimension. So, for example, in transport, a taxi service is low volume while a bus service or mass rapid transport is high volume. In accounting firms, corporate tax advice is high variety because all large corporations have different needs, while financial audits, which have to be carried out to comply with financial reporting legislation, are relatively standardised. In food manufacture, the demand for ice-cream varies considerably depending on the weather, while the demand for bread is far steadier and more predictable. In the dental care industry, dentists operate high visibility operations (its difficult to work on your teeth if you are not there) but rely on dental technicians in factory-type laboratories to make false teeth etc.

These dimensions are most useful in predicting how easy it is for an operation to operate at low cost. Figure 1.10 in the text indicates that operations whose profiles occupy the right-hand extreme of the dimensions (high volume, low variety, low variation and low visibility) tend to operate at lower cost than those at the other end of the dimensions.

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When operations processes do differ they do so mainly in terms of their volume, variety, variation and visibility. But not everyone agrees that these dimensions are sufficient. Operations processes, they say, differ in far more ways that the four Vs suggest. At the very least more dimensions are needed, for example the relativecomplexity which processes have to cope with, or the degree of discretion or decision making required by the staff with the process, or the risk of things going wrong in the process, or the value of each product or service produced, and so on.

What responsibilities do operations managers have?


The text divides the responsibilities of operations managers into,

Direct responsibilities the activities which are directly related to producing and delivering products and services. Indirect responsibilities the activities involved in interfacing with other parts of the organisation. Broad responsibilities a wider set of tasks that involve scanning the business, social and political environment in which the organisation exists in order to understand its context.

Naturally the vast majority of Slack et al is concerned with the direct responsibilities of operations managers. All other text books in this area take the same approach. However, both the indirect responsibilities of communicating with other functions and (especially) the broad responsibilities are becoming increasingly important to operations managers. This relates back to the idea of buffering. As the traditional barriers between the operations function and the other functions of the business and the business environment in general are being lowered, so operations manager must make decisions in the light of the their internal and external environments.

What operations managers actually do


In all of operations managements direct and indirect activities there is a need to communicate both with internal staff and with external customers, suppliers and the broader community. One survey carried out by Professor Arnoud De Meyer shows how much of a factory managers time is spent on different activities, and how the importance of each is changing (see the Table). Consulting and communicating with operations staff clearly takes up a large amount of these operations managers time. But the proportion of their time spent communicating with people outside the operations function and even outside the organization appears to be gaining in importance. This means, says Professor De Meyer, that operations managers are evolving to be more ... managers of interfaces, as opposed to a caretaker of an isolated manufacturing function.

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Chapter 2: The strategic role AND OBJECTIVES OF OPERATION

This chapter covers two areas, which although they seem separate at first, are in fact related. The first area is the strategic role of operations. This looks at how the operations function (or whatever else it may be called) in the business sees itself and its purpose. The second area looks at what we call performance objectives of operations. These are the specific aspects of performance on which the operations function is judged. In terms of our overall model of operations management (the one shown in Figure 2.1) the role of the operations function is important because it influences how operations managers understand their customers and translate their customers needs into performance objectives. In turn, the performance objectives (and especially the relative importance of each one) influence the overall operations strategy of the business.

Your learning objectives


This is what you should be able to do after reading Chapter 2, and working through this study guide.

Identify the three roles of the operations function. Relate the role of the operations function to the contribution which operations makes to the competitiveness of the business. Identify the five sets of stakeholders which any operation has to consider. Understand the external and internal affects of the five operations performance objectives quality, speed, dependability, flexibility and cost.

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The role of the operations function


"The role of the operations function means something beyond its obvious responsibilities and tasks it means the underlying rationale of the function, the very reason that the function exists." The idea of role is important. As individuals we all play roles in our everyday life. Sometimes we are colleagues of other people on our course. At other times we arefriends of the people we grew up with. At other times the children of our parents. Each is a different role. The important point is that we behave differently depending on which role we are in at any time. It is the same for the operations function. Depending on its role, it will behave differently. The chapter identifies three roles for operations management. They are not exclusive in the sense that an operation has to be one of them, but they all contribute to making up the way an operation behaves. The three roles are:

The implementer of business strategy. The supporter of business strategy. The driver of business strategy.

Two things are important in understanding these roles. First, they are stated in order of difficulty and in order of importance. Implementing business strategy is a very basic responsibility for operations, supporting business strategy is what most operations should aspire to, but driving business strategy is only possible if the operation really does have unique capabilities. Second, they are cumulative in the sense that an operation cannot be a supporter of business strategy unless it has skills as an implementer, and cannot drive business strategy unless it has the skills to support the business strategy.

Judging the operations contribution


The model used in the book to describe the contribution of operations to competitiveness is one which has been well known for many years and was originally devised by Professor Hayes and Wheelwright at Harvard University. It is useful here

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because it can be adapted to incorporate the three roles of the operations function. Moving from Stage 1 to Stage 2 requires the ability to implement strategy. Moving from Stage 2 to Stage 3 requires the ability to support strategy. Moving from Stage 3 to Stage 4 requires the operation to drive strategy through its unique capabilities. Remember a number of points though when using this model.

It is a conceptual model which allows organisations to think about how good their operations are. It is not a precise instrument for measuring operations excellence. Some parts of the business could be at different stages to other parts. So for example, an airport could have Stage 4 check-in facilities which use the most advanced information systems and have the most dedicated staff, while its baggage handling system is at Stage 2. The overall customer experience therefore might be very mixed (depending on whether their bags were lost or not). The real objective of this model is to show operations managers that they can be better (very few operations are at Stage 4) and to go some way in defining what really excellence in operations is (Stage 4).

Operations performance objectives


This first point made in this section of the chapter is that operations objectives are very broad. Operations management has an impact on the five broad categories of stakeholders in any organisation. Stakeholders is a broad term but is generally used to mean anybody who could have an interest in, or is affected by, the operation. The five groups are:

Customers These are the most obvious people who will be affected by any business. What the chapter goes on to call the five operations performance objectives apply primarily to this group of people. Suppliers Operations can have a major impact on suppliers, both on how they prosper themselves, and on how effective they are at supplying the operation. Shareholders Clearly, the better an operation is at producing goods and services, the more likely the whole business is to prosper and shareholders will be one of the major beneficiaries of this. Employees Similarly, employees will be generally better off if the company is prosperous; if only because they are more likely to be employed in the future. However operations responsibilities to employees go far beyond this. It includes the general working conditions which are determined by the way the operation has been designed. Society Although often having no direct economic connection with the company, individuals and groups in society at large can be impacted by the way its operations managers behave. The most obvious example is in the environmental responsibility exhibited by operations managers.

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After making this general point about operations objectives, the rest of the chapter goes on to look at the five performance objectives of quality, speed, dependability, flexibility, and cost.

Quality
Quality is placed first in our list of performance objectives because many authorities believe it to be the most important. Certainly more has been written about it than almost any other operations performance objective over the last twenty years. Later in the book we devote two whole chapters (Chapter 17 and Chapter 20) which look at different aspects of quality. As far as this introduction to the topic is concerned, quality is discussed largely in terms of it meaning conformance. That is, the most basic definition of quality is that a product or service is as it is supposed to be. In other words, it conforms to its specifications. There are two important points to remember when reading the section on quality as a performance objective.

The external affect of good quality within in operations is that the customers who consume the operations products and services will have less (or nothing) to complain about. And if they have nothing to complain about they will (presumably) be happy with their products and services and are more likely to consume them again. This brings in more revenue for the company (or clients satisfaction in a not-for-profit organisation). Inside the operation quality has a different affect. If conformance quality is high in all the operations processes and activities very few mistakes will be being made. This generally means that cost is saved, dependability increases and (although it is not mentioned explicitly in the chapter) speed of response increases. This is because, if an operation is continually correcting mistakes, it finds it difficult to respond quickly to customers requests. See the figure below.

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Chapter3 Total quality management

This chapter concludes the material on quality management which included quality planning and control covered in chapter 17, operations improvement (chapter 18) and failure prevention and recovery (chapter 19) by discussing the philosophy of quality improvement. This is usually referred to as total quality control or TQM. TQM has developed from traditional approaches to quality, such as quality control, and has been the subject of evangelistic teachings by the quality gurus. TQM is an approach to business which has had a significant influence on operations. This chapter discusses seven principles of TQM: meeting the needs and expectations of customers, covering all parts of the organisation, including every person in the organisation, examining all the costs related to quality, getting things right first time, developing systems and procedures and developing a continuous process of improvement. Implementing quality improvement is fraught with difficulties and many TQM initiatives run out of steam and loose their effectiveness (see figure 20.8). We have provided some suggestions about how TQM can be best implemented to ensure that long-term quality improvement is achieved. One way of influencing a TQM approach and maintaining momentum is through quality awards. Many countries around the world have developed quality awards and these encourage organisations to assess and improve their quality systems, practices and procedures.

Your learning objectives


This is what you should be able to do after reading Chapter 20, and working through this study guide.

Understand what is meant by TQM Be aware of the problems and approaches to implementing TQM Understand the role of quality awards in improving quality.

Key Questions
1. Where did the idea of TQM come from?

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2. What are the main differences between traditional quality management and TQM? 3. What is the role of ISO 9000? 4. What are the main implementation issues in TQM initiatives? 5. How do quality awards and models contribute towards TQM?

Where did the idea of TQM come from?


The notion of TQM was first developed by Feigenbaum and popularises by W Edwards Deming who implemented many TQM programmes in Japan, where his ideas, initially at least, were more readily accepted. In essence, Deming, Juran, Crosby and all the other gurus, said that total quality management involves everyone taking a positive and proactive approach to quality and that good quality, i.e. consistent conformance to customers expectations, can only be achieved if:

The organisation understands what customer needs are and could define and specify all of them (see quality characteristics chapter 17). All employees understand that all parts of an organisation have a role to play in meeting customer expectations, not just the people on the shop floor, but the work of finance staff for example in ensuring error free invoices for example. Each employee recognises that they have an impact on quality. All the costs of quality are considered, not just the cost of putting things right when they go wrong, but also the costs of trying to prevent problems, with an emphasis on the latter in order to bring about a reduction in the former. There is a focus on getting things right first time and instead of putting it right when it goes wrong to try to make sure it does not go wrong in the first place. There are robust and organisation-wide quality systems and procedures that both ensure the things above happen, but also the removal of systems and procedures that can make quality difficult to deliver (see Deliberate Defectives box). The organisation is concerned with continually improving what it does and how it does it (see chapter 18).

What are the main differences between traditional quality management and TQM?
What was different and important about TQM was that it changed peoples views about the nature of quality problems and the responsibility for quality. Quality was (and still is in some organisations!) seen simply an issue for manufacturing or service employees where the role of management is to put checks and controls in place (using some of the techniques described in chapter 17) in order to inspect-in quality. This is what is known as the traditional approach to quality. Deming and the other gurus challenged this view with their beliefs that:

Quality was an issue for everyone (everyone in the organisation and also suppliers and customers, i.e. the whole of the supply chain).

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and

Quality had to be built-in to prevent problems occurring.

The Eurocamp and Unipart illustrations in the chapter provide examples of this.

What is the role of ISO 9000?


One of the key tenents of TQM is the establishment of quality systems and procedures. ISO 9000 has been developed as a set of internationally recognised standards which provide evidence that an organisation (which another organisation may be considering to use as a supplier for example) has detailed quality systems and procedures in place. The Unichema illustration in Chapter 20 provides an useful description of the issues involved in the implementation of ISO 9000 and shows how the organisation overcame one of the main problems of ISO - management by manual.

What are the main implementation issues in TQM initiatives?


The main implementation issues are:

To realise that TQM is not a quick fix but a long-term approach to quality. Good quality needs to be underpinned by systems with clearly set out goals and guidelines. The need for top management commitment because TQM involves the whole organisation without top level support any such initiative is doomed to failure. This support usually is evidenced by an executive champion, and a high level steering group. Involving the people who know TQM is not a management tool but a means of involving everyone in identifying and solving problems. It is essential that there should be means of involving everyone, providing necessary training and also recognising success when it is achieved. The final issue is that TQM may, over time, lose its effectiveness (see figure 20.8), if it is seen as a programme (with an implied start and end) rather than a working philosophy that is a part of the organisations way of working. To this end many organisations refrain from using the name TQM and simply seek to encourage good (TQM) practice.

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Chapter 4 Decision-Making
ntroduction to Decision Making
People often find it hard to make decisions. Some people put off making decisions by endlessly searching for more information or getting other people to offer their recommendations. Others resort to decision making by taking a vote, sticking a pin in a list or tossing a coin. Regardless of the effort that is put into making a decision, it has to be accepted that some decisions will not be the best possible choice. This article looks at one technique that can be used in decision making that should help you to make effective decisions in the future. Although the following technique is designed for an organisational or group structure, it can be adapted to an individual level.

What is Decision Making?


In its simplest sense, decision making is the act of choosing between two or more courses of action. However, it must always be remembered that there may not always be a 'correct' decision among the available choices. There may have been a better choice that had not been considered, or the right information may not have been available at the time. Because of this, it is important to keep a record of all decisions and the reasons why decisions were made, so that improvements can be made in the future. This also provides justification for any decision taken when something goes wrong. Hindsight might not be able to correct past mistakes, but it will aid improved decision making in the future.

Effective Decision Making


Although decisions can be made using either intuition or reasoning, a combination of both approaches is often used. Whatever approach is used, it is usually helpful to structure decision making in order to:

Reduce more complicated decisions down to simpler steps. See how any decisions are arrived at.

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Plan decision making to meet deadlines.

Stages of Decision Making


Many different techniques of decision making have been developed, ranging from simple rules of thumb, to extremely complex procedures. The method used depends on the nature of the decision to be made and how complex it is. The method described in this article follows a number of stages. These are:

Stage One: Listing all possible solutions/options. Stage Two: Setting a time scale and deciding who is responsible for the decision. Stage Three: Information gathering. Stage Four: Weighing up the risks involved. Stage Five: Deciding on values, or in other words what is important. Stage Six: Weighing up the pros and cons of each course of action. Stage Seven: Making the decision.

REFERENCE:

http://wps.pearsoned.co.uk/ema_uk_he_slack_opsman_4/17/4473/1145151.cw/index.html

Find more at: http://www.skillsyouneed.com/ips/decision-making.html#ixzz2ONyGSbpN

http://en.wikipedia.org/wiki/Management