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cal Decisions Continued ?Process and capacity design ? What processes will these products require and in what order? ? What equipment and technology is necessary for these processes? ?Location ? Where should we put the facility ? On what criteria should we base this location decision? 136 The Critical Decisions Continued ?Layout design ? How should we arrange the facility? ? How large a facility is required? ?Human resources and job design ? How do we provide a reasonable work environment? ? How much can we expect our employees to produce? 137 The Critical Decisions Continued ?Supply chain management ? Should we make or buy this item? ? Who are our good suppliers and how many should we have? ?Inventory, material requirements planning, ? How much inventory of each item should we have? ? When do we reorder? 138 The Critical Decisions Continued ?Intermediate, short term, and project scheduling ? Is subcontracting production a good idea? ? Are we better off keeping people on the payroll during slowdowns? ?Maintenance ? Who is responsible for maintenance? ? When do we do maintenance? 139 Responsibilities of Operations Management Products amp。 services Planning – Capacity – Location – – Make or buy – Layout – Projects – Scheduling Controlling – Inventory – Quality Organizing – Degree of centralization – Subcontracting Staffing – Hiring/laying off – Use of Overtime Directing – Incentive plans – Issuance of work orders – Job assignments 140 Operations Interfaces with a number of supporting functions Public Relations Accounting Industrial Engineering Operations Maintenance Personnel Purchasing Distribution MIS 141 Where are the OM Jobs 142 Where Are the OM Jobs? ?Technology/methods ?Facilities/space utilization ?Strategic issues ?Response time ?People/team development ?Customer service ?Quality ?Cost reduction ?Inventory reduction ?Productivity improvement 143 The Historic Evolution of Operations Management ?Preindustrial revolution Craft production: skilled workers, flexible tools, small quantities and customized goods Traits: production was slow and costly, no economies of scale and thus on stimulant for production expansion. ?Industrial revolution A number of innovations changed the face of production: James Watt’s steam engine (1764), James Hargreaves’ spinning jenny (1770) and Edmund Cartwright’s power loom (1785). 144 The Historic Evolution of Operations Management Continued ?Scientific management Based on observation, measurement, analysis and improvement of work methods, and economic incentives. Until then scientific management turned production from “ the rule of thumb” to the “science of management”. Frederick W. Taylor and many other pioneers contributed a lot in this stage. ?The human relations movement Scientific management ignored the human element which was emphasize by a number of psychologists who introduced a series of theories, among them Theory X, Theory Y, and Theory Z are best known. 145 The Historic Evolution of Operations Management Continued ?Decision model and management science With the development of mathematics and due to the World War Two, many newly invented techniques were applied for the civilian use and warfare purpose. Especially, with the advent of personal puter this trend was greatly improved and a new branch of management emerged: management science which deal with the problem with mathematical method and puter. ?The influence of Japanese manufacturers During 1970s to now, Japanese manufacturers developed or refined management practices which originated from the West and greatly increased the productivity of their operations and the quality of their products and this influence exerts profound impact to their counterparts in the West. 146 The Heritage of Operations Management 147 Significant Events in Operations Management 148 The Heritage of Operations Management Division of labor (Adam Smith 1776 and Charles Babbage 1852) Standardized parts (Whitney 1800) Scientific Management (Taylor 1881) Coordinated assembly line (Ford/Sorenson/Avery 1913) Gantt charts (Gantt 1916) Motion study (Frank and Lillian Gilbreth 1922 Quality control (Shewhart 1924。 Deming 1950) Computer (Atanasoff 1938) CPM/PERT (DuPont 1957) 149 The Heritage of Operations Management Continued Material requirements planning (Orlicky 1960) Computer aided design (CAD 1970) Flexible manufacturing system (FMS 1975) Baldrige Quality Awards (1980) Computer integrated manufacturing (1990) Globalization(1992) Inter (1995) 150 Eli Whitney ? Born 1765。 died 1825 ? In 1798, received government contract to make 10,000 muskets ? Showed that machine tools could make standardized parts to exact specifications ? Musket parts could be used in any musket 169。 1995 Corel Corp. 151 Frederick W. Taylor ? Born 1856。 died 1915 ? Known as ?father of scientific management? ? In 1881, as