Efficiency means doing something in the lowest possible cost.

The goal of an efficient process is to produce goods or provide services by the smallest input of resources. Effectiveness means doing the right things to create the most value for the company. Often maximizing effectiveness and efficiency at the same time creates conflict between the two goals. At the customer service center at a local store or bank , being efficient means using the fewest possible at the counter. Being effective though means minimizing the amount of time customers need to wait on line. Thus related to efficiency and effectiveness is the comcept of value, which can be metaphorically defined as uality divided by price !or example if a company can provide the customer with a better car without changing price value has gone up."f the company can provide a better car at a lower price, value goes way up. O#$ is defined as the design, operation, improvement of the systems that create and deliver the firm%s primary products. &ike, marketing and finance, O#$ is a functional field of business with clear line management responsibilities. Transformation processes are used in all types businesses. A transformation process uses resources to convert inputs into some desired outputs. Transformation processes cab be categorized as follows '.(hysical )as in manufacturing* +. &ocation )as in transportation* ,. -xchange )as in retailing* .. #torage )as in warehousing* /. (hysiological)as in health care* 0. "nformational ) as in telecommunications Operations and #upply 1hain $anagement #upply 1hain (rocesses #ourcing (rocesses &ogistics (rocesses $anufacturing (rocesses #ervice (rocesses 2istribution (rocesses There are five essential differences between services and goods. These are Tangibility +.#ervice re uire some degree of interaction with the customers ,.#ervices with the exception of hard technologies such as AT$s and information technologies such as answering machines, and automated internet exchanges are heterogeneous-they vary from day to day and even hour by hour as a functions of attitudes of the customers and servers. 3oods on the other hand has a slight variability. ..#ervices are perishable and dependent unlike goods. /.#ervices are defined as and evaluated as a packages of features that affect the five senses.

Operation & Supply strategy

Operations and supply strategy is concerned with setting broad policies and plans for using the resources of a firm to best support its long term competitive strategy. A firm%s operations and supply chain strategy is comprehensive through integration with corporate strategy. The ma4or competitive dimensions that form the competitive position of a firm include following 1ost or (rice 5uality 2elivery #peed 2elivery 6eliability 1oping with changes in demand !lexibility and 7ew product introduction speed Other (roduct #pecific criteria often relate to specific products and situations. Often special services are provided to augment the sales of manufactured products. These could be A. Technical &iaison and support and #upport, B. $eeting a launch date. 1. #upplier after sale support 2 Other dimensions include such factors as colours availability, size, weight, location, of the fabrication , customization available, , and product mix options. Why Trade Offs 1entral to the O#$ strategy is the notion of operations focus and trade offs. The underlying logic is that an operation cannot excel simultaneously on all the competitive dimensions. !or example a company wants to focus on speed of delivery, it cannot be very flexible in its ability to offer a wide range of products. #imilarly, a low cost strategy is not compatible with either speed of delivery or flexibility. 8igh uality also is viewed as a trade off to low cost (roductivity measurement (roductivity is a common measure of how well a country, or business unit is using its resources, )or factors of production*. #ince operations and supply management focuses on making the best use of the resources available to a firm, productivity measurement is fundamental to understanding operations related performance. 9e will define various measures of productivity,. But in its broadest sense, productivity is defined as (roductivity: Outputs;"nputs To increase productivity, we want to make ratios of outputs to inputs as large as practical.

History of OSM &ook at page '< of the referred book.. Lean Manufacturing, Just In Time and Total uality Management !rom the history of O#$, the '=>?s saw a revolution in the management philosophies and technologies by which production is carried out. Just In Time )hereafter called @"T* was the ma4or brakthrough in manufacturing philosophy. (ioneered by the 4apanese, @"T is an integrated set of activities designed to acheive high volume production using minimal inventories of parts that arrive at the work station exactly when they are needed. The philosophyA coupled with total uality management )T5$*, which aggressively seeks to eliminate causes of production defectsA is now cornerstone in many manufacturers% production practices, The term lean manufacturingB is used to refer to the set of concepts. "n '=',, 8enry !ord developed an assembly line to make the $odelAT automobile. O!erations and Su!!ly Strategy "ramewor#$ "rom %ustomer &eeds to Order fulfilment &ook at page number ,+ of the referred book or the photocopy handed in the class. Linear 'rogramming$ (sing the E)cel Solver &inear programming refers to several related mathematical techni ues used to allocate limited resources among competing demands in an optimal way. &( is the most of the approaches falling under the general heading of mathematical optimization techni ues and has been applied to many operations manageemnt problems. The following is the typical applicationsC *+ Aggregate sales and operating planning: !inding the minimum cost production schedule. The problem is to develop a three Dto sixAmonth plan for meeting expected demand given constraints on expected production capacity and workforce size. Relevant costs considered in the problem include regular and overtime labour rates, hiring and firing, subcontracting and inventory carrying cost. + Service,Manufacturing !roductivity analysis$ 1omparing how efficiently different service and manufacturing outlets are using their resources compared to best performing unit. This is done using an approach called Data envelopment analysis. %+ 'roduct 'lanning$ (roduct (lanning is finding the optimal product mix where several products have different cost and resource re uirements. -+ 'roduct .outing$ !inding an optimal way to produce a product that must be processed se uentially through several machine centers, with each machine in the center having its own cost and output characteristics. E+ /ehicle, %rew Scheduling$ !inding an optimal way to use resources such as aircrafts, buses, or trucks and their operating crews to provide transportation services

to customers and materials to be moved between different locations. + 'rocess %ontrol$ $inimizing the amount of scrap material generated by cutting steel, leather or fabric from a roll or sheet of stock material. "+ Inventory %ontrol$ !inding the optimal combinations of products to stock in a network of warehouses or storage locations. 0+ -istri1ution Scheduling$ !inding the optimal shipping schedule for distributing products between factories and warehouses or between warehouses to retailers. H+ 'lant Locations Studies$ !inding the optimal location of a new plant by evaluating shipping costs between alternative locations and supply and demand sources. I+ Material Handling$ !inding minimumA cost routing of materialAhandling devices) such as forklift trucks* between departments in a plant, or hauling materials from supply yard to work sites by trucks, for example each truck might have different capacity and performance capabilities.

$anaging a modern supply chain involves specialists in manufacturing, purchasing and distribution, of course. 1hanges in operations and supply management have been truly revolutionary, and the pace of progress shows no sign of moderating. "n our increasingly interconnected and interdependent global economy, the process of delivering supplies and finished goods to one place to another is accomplished by means of mindA boggling technological innovation, clever new applications of old ideas, seemingly magical mathematics, powerful software, and old fashioned concrete, steel and muscles. This lecture is designed to give students of !roduction and o!erations management a layout of foundation for understanding the dynamic field of o!erations and su!!ly management+ What Is O!eration and Su!!ly2 9hether the economy is booming or in a recession, delivering a firm%s goods and services in the most effective manner is critical to its survival. Operations and supply management is about getting work done uickly, efficiently, without error, and obviously at low cost. Operation refers to the process that is used to transform the resources employed by a firm into products and services desired by the customers. #upply refers to how materials and services are moved to and from the transformation process of the firm. The 'urchasing 'ower Inde) 2uring the first week of every month, headlines on the front page of The Wall Street Journal announce the current reading of the Purchasing Managers Index PMI!. hat is it and !hy "#I is so important to the economy, ho! it relates to operations and supply management. This "#I is one of the leading indicators in the economy. A "#I above $$.% percent indicates that the &ross Domestic "roducts or the the overall economy is e'panding. A "#I belo! $$.% percent over a periods of time normally indicates that the economy is at declining stage The indicator is calculated from the activity levels for functions !e study in operations management. e !ill study about (o! manufacturing orders are processed, (o! decisions related to volume that can be processed are made, )oordination of supplier deliveries #anagement of inventory, * +cheduling of employees.