Topic outline

  • Course Introduction

    Operations management is a science with which we are all, in some capacity, familiar. We all have scarce resources and have to allocate those resources properly. Think about the process of preparing a meal: you have to gather all the proper ingredients and prepare them for cooking. Certain ingredients go in at certain times. Occasionally, you fall behind or get too far ahead, jeopardizing the entire meal. And, of course, if you find that you do not have enough ingredients, even more problems arise. All of these elements of meal preparation - purchasing ingredients, prepping the ingredients by dicing them up, mixing ingredients together, boiling or baking the dish, serving, and cleaning - can be seen as parts of operations management. In the realm of business, operations management is more complicated than preparing a family meal. There may be hundreds or thousands of participants rather than just you and your brother or wife or grandfather cooking in the kitchen. Each participant has a specific role in the operations process; if any step of the process is disrupted, the whole process can stall or fall apart. Smart operations managers will have contingency plans in the event that stoppages occur. In this course, you will learn the fundamentals of operations management as they apply to both production and service-based operations. Successful completion of this course will empower you to implement the concepts you have learned in your place of business. Even if you do not plan to work in operations, every department of every company has processes that must be completed; someone savvy with operations management will be able to improve just about any process.
  • Unit 1: Operations Management Overview

    Operations management is a vast topic but can be bundled into a few distinct categories, each of which will be covered in later units. (It should be noted, however, that entire courses could be devoted to each of these topics individually.) Because most people do not work in a formal operations department, we will begin with an overview of operations management itself. The top manager of an operations department is usually called the Director of Operations. Most operations departments will report to a Chief Operating Officer (COO), who reports to the Chief Executive Officer (CEO). The COO is often considered the most important figure in a firm, next to the CEO.

    The history of operations management can be traced back to the industrial revolution, when production began to shift from small, local companies to large-scale production firms. One of the most significant contributions to operations management came in the early 20th century, when Henry Ford pioneered the assembly line manufacturing process. This process drastically improved productivity and made automobiles affordable to the masses. Understanding the motivations behind innovations of the past can help us identify factors that may motivate individuals in the future of operations management.

    Completing this unit should take you approximately 7 hours.

  • 1.1: Introduction to Operations Management

  • 1.2: Manufacturing versus Service Operations

  • 1.3: The Systems View of Operations Management

    • Read this unit. Simply put, operations management is the process of transforming inputs into outputs. This reading provides the foundation for understanding an underlying model that supports this process. This is important because the types of inputs are discussed and there are opportunities for you to consider how different types of organizations combine inputs to create unique products and services. Be sure to complete each section Activity. After you have considered each question, you can view author's response under the Discussion section. 

    • Read this unit. Operations management does not exist in a vacuum within the organization. Operations management is a functional area, which interacts with and is supported by other functional parts of the organization. This reading provides information about the suppliers and customers as areas outside of the control of the organization. Be sure to complete each section Activity. After you have considered each question, you can view author's response under the Discussion section.

    • Read this section. This reading provides an overview of the functional structure common in many organizations. Operations is a function within the organization. It is important to understand the other functional units and how operations fit within the overall structure. Answer the quiz question at the end of the unit.

  • 1.4: The Process View of Organizations

    • Read this page and explore the transformation process that occurs in operations management. Operations management transforms inputs like labor, widgets, steel, and capital into outputs (goods and services) that provide added value to customers. By the end of this reading, you will be able to analyze the importance of operations management in protecting an organization’s competitive advantage. When you are done reading, answer the quick quiz question.
  • Unit 1 Activity and Assessment

    • After reviewing the unit materials, please post and respond to the following topics on the course discussion board. Feel free to start your own related posts and respond to other students' postings as well. If you haven't done so already, you will need to create a free account at the link above to participate in the discussions.

      Choose a company that creates a product or offers a service that you are familiar. Using the company website and additional research, list the inputs that the company uses to produce outputs. Define the outputs created. After creating this list, discuss the additional functional units within the organization that are important to the final product. How important do you believe the quality of the operations management is to the final output? Explain your answer.

    • For this activity, you will apply the concepts of operations management to real world situations. You will use this unit to begin developing an operation management plan by writing a 2-3 page paper on a business concept of your choosing.

  • Unit 2: Operations Strategy

    The most significant aspect of operations management is the process itself. How does Apple take a pile of chips, glass, and plastic, and turn it into an iPhone? Their manufacturer in China is responsible for this process, but Apple is involved every step of the way in order to ensure quality, reliability, and consistency. Process flow structures are the different methods of production deemed appropriate for various manufacturing contexts. Does it make sense for Apple to wait for 1 million orders, then make and ship them? Or should they instead produce iPhones based on current demand and try to balance inventory? These are decisions that the COO must make as each process flow has various costs associated with it. 

    Additionally, not every operations department is producing a good we can consume. Wall Street traders receive orders from clients and must execute trades on open markets. The order itself may pass through dozens of people before confirmation of the trade is sent back to the client. If you consider that "actual trade” to be the product, you can design an operations process around the goal of executing the trade. The result is a process remarkably similar to production. In this unit, you will learn how operations managers use long-term, strategic planning to manage internal and external influences on the organization's resource base.

    Completing this unit should take you approximately 5 hours.

  • 2.1: Role of Strategy in Operations Management

    • Read this article, making sure to pay particular attention to the section on the strategy hierarchy.

    • Read section 2.5. This provides insight into the nature of Corporate Social Responsibility (CSR) and the necessity of stakeholders to the success of the organization. CSR crucial to the establishment of goodwill amongst the employees and within the local and/or greater business community. Integrating a CSR plan when developing the strategy requires that managers consider all of the stakeholders’ (internal and external) needs. Complete Exercise 1 located at the end of the reading. This is a self-graded activity. 

    • Read this section. The strategy pursued by an organization has a distinct impact on the way that the organization chooses to operate. The five steps of strategy are crucial in the design of the operations. Answer the quiz question at the end of the page.  After answering the question, check your answer.

    • Read section 7.1. There are many discussions surrounding the importance of the Board of Directors taking a guiding role in the development of strategy. Consider the challenges that boards face in carving out a significant role in the strategy process. 

    • Read chapter 5. This chapter explains the connection between operations and strategy.  There is a direct connection (or should be) between this functional area and organizational plan. The strategy provides the foundation for the operational decisions made on a daily basis. In other words as an operations manager, you choose tactics based on the developed organizations corporate, business, and functional level strategy. Take time to complete the Action Checklist activity at the end of the chapter. This is a self-graded activity.

    • Read chapter 8. This chapter explains the nature of planning and the importance of analysis to the creation of differentiated product or services or higher levels of efficiency. Understanding the nature of strategic planning and the types of analysis used during the strategic planning process are important for operation managers

  • 2.2: Operations Competitive Priorities

  • Unit 2 Activity and Assessment

    • After reviewing the unit materials, please post and respond to the following topics on the course discussion board. Feel free to start your own related posts and respond to other students' postings as well. If you haven't done so already, you will need to create a free account at the link above to participate in the discussions.

      Use the company you chose for the discussion board activity in Unit 1 to complete this question. Use Porter’s Five Forces to explore the competitive advantage that this company has in the industry. How does the current Five Forces analysis help explain the current competitive advantage in the industry? How is the value chain used to increase competitive advantage? If it is not used effectively, what adjustments to the current value chain would you suggest to increase the competitiveness of the company?

    • For this activity, you will write a 2-3 page paper on the development of an operation management plan that focuses on your business concept that you developed for the Unit 1 Activity.

  • Unit 3: Product Design and Process Selection

    If you have purchased a mobile phone recently, you have witnessed a product category with perhaps the most diverse range of product designs in the marketplace. The variety can be mind-boggling. Looking back a year or two, you can probably recall a design that looked very promising, but simply faded away from the shelves after a few months. Have you ever wondered what happened to those short-lived products?

    Businesses want to design the products that consumers demand. A good marketing department can tell the organization what consumers want, and even convince consumers that they want it. A company with the most wonderful product concept cannot be successful unless it also can devise a process to profitably manufacturer the product. In this unit, we will consider the steps involved in designing a product with the manufacturing process in mind. We will look at several models that businesses can use to select the best design process or analyze an existing process.

    Completing this unit should take you approximately 8 hours.

  • 3.1: Generating Ideas

    • Read this section on the importance of innovation to the design process. Often, we think of innovation as what happens when a creative person has a stroke of genius. In reality, innovation is a process that any individual within any type of organization can engage in as a normal part of the daily work. It’s all about making something better, whether that’s an actual product or a process used in the organization. Answer the quiz question at the end of the section.

    • Watch this video to learn how design is defined and what makes good design. Good design is often difficult. Once you understand user needs, the creation process requires that those needs be met in the most pleasing and useful way possible. Brainstorming is a method used to help facilitate good design process. 

    • Watch this video on the importance of developing a culture of creativity to drive business success. Culture is the foundation of what and how we do things within an organization. The culture must support a creative approach to solving problems, designing product/services, and testing new ideas.  Consider how you would apply this information to the operations landscape.

    • Watch this lecture on the importance of discovering the needs of your customers/users. A product or service will only be successful if the customer/user finds utility in what you have created. This requires user needs research to help identify areas where you can focus the development of new products/services. Consider how you would gather information on what customers’ want/need for your current organization.

    • Read this article and consider the importance of following the four-part process to determining a product or service that is worth a company investment. Every new idea has the potential to be useful for a customer. However, the product/service is only useful to the company if there is a good return-on-investment (ROI). The financial important of resource investment must be considered during the screening process.

  • 3.2: Product & Service Screening

    • Read this article to explore the ways in which lifestyle analysis is used to screen product ideas. This is only one method for approaching the screening process. One of the challenges during this development process is determining the best way to screen ideas so that a project can move forward. This introduces to one of your options. 
    • Read this article to explore the challenges associated with choosing a successful product design. A new product strategy is important to successful screening. This provides you with another way that screening a new product can be approached. As you can see there variety in the types of approaches available. 

    • Read this section to explore how a product/service is evaluated for appeal to the marketplace. Once you have identified that users may want or need a particular type of product or service, you are faced with making decisions about how best to satisfy that want/need. The product development process provides a systematic way to approach this often-complex issue. By the end of this reading you will be able to outline the stages of new product development. Answer the quiz question at the end of the section. 
    • After reviewing the unit materials, please post and respond to the following topics on the course discussion board. Feel free to start your own related posts and respond to other students' postings as well. If you haven't done so already, you will need to create a free account at the link above to participate in the discussions.

      Considering the importance of product selection, review each development and selection tools provided in this unit. Do a web search to identify at least one additional method for development or screening. How might you use these tools together to make a selection choice between three good ideas? Does one method appear more useful than the others? Why?

  • 3.3: Preliminary and Final Design

    • Watch this video to see the movement of a preliminary idea to a final design that is ready for a market. This is important because not every idea should or can move forward to a final design phase. There are many different considerations when looking at preliminary designs. This is not only a creative process but also an analytical evaluation. 

    • Read chapter 7. Review 7.14 Appendix 2: FAD template for wine aging product to get a better understanding of how this can be applied to any business to explore the product/service feasibility. Product/service feasibility analysis is crucial to a successful design. This type of analysis is used to analyze the market feasibility and the product feasibility of the product or service. An organization can develop a wonderful product or service but fail to gain marketshare. This is often directly related to a lack in the feasibility analysis. 

    • Read this chapter and learn how key assumptions impact financial decisions.  The profit margins associated with production are an important piece of information needed by managers when making decisions about what development projects to invest in within the company. This is one method for looking at the financial information needed to make decisions.  

  • 3.4: Methods for Improving Product & Service Design

    • Watch this video to get an overview of the product development process and the need to improve product and service design. The video is interesting because the speaker walks you through his experience of designing a product for a company. An integrated product development process that includes steps for improving products and services that already exist is important. 

    • Watch this video about OpenIDEO. This provides information on additional methods for improving product and service design using DQ. IDEO is an exemplar for the innovation process. This website provides you access to a platform that can provide you many tools and connections as you move forward in your career. 

    • Read 10.7 to better understand how to take a product idea and match that to the needs of the marketplace. Product development is risky. There are many different ways that an organization can fail to do this well and gain a competitive advantage. Make sure that you watch the video clip embedded in the section.  Complete the exercise at the end of the section. 

  • 3.5: Process Selection

    • Review the information related to the use of manufacturing resource planning and enterprise resource planning. Both are useful within the organization. Resources are necessary to successful operations. One challenge that every manager faces is the decision of resource utilization. Pay attention to the benefits and requirements.  Review the questions at the end of the summary. After answering the questions, compare your answers to the author’s answers. 

    • Read this source. Different types of production can be used within a manufacturing organization. This source provides information about these types of production. Pay particular attention to the batch and flow production. 

    • Read this source to explore the way that continuous production works in a manufacturing environment. This is important because often operations managers must make choice about what type of method is appropriate given the requirements of the business. 

    • Read this source to explore the history and usefulness of batch processing in a manufacturing company. Consider how batch processing is used in today’s manufacturing environments. 

    • After reviewing the unit materials, please post and respond to the following topics on the course discussion board. Feel free to start your own related posts and respond to other students' postings as well. If you haven't done so already, you will need to create a free account at the link above to participate in the discussions.

      You have been hired as a consultant for a company that wants to manufacture high-end bicycles. The owners of the new business have designed a bike that can be sold to cyclists that choose to compete. They have asked you to provide an evaluation and recommendation of the best manufacturing process. Use the information from this unit to write a recommendation to the owners. Include support for your choices.

  • Unit 3 Activity and Assessment

    • In this activity, you will continue working on your operations management plan by addressing how the current state of the economy will affect your business, and applying the Transformation Model that you learned about in this unit.

  • Unit 4: Quality Management

    Quality management is a primary concern in operations departments. Though all employees and managers should be concerned with maintaining quality, most firms host a team dedicated to ensuring the quality of production. Quality management can come in any number of different forms. Quality control usually involves the random sampling of products coming off the line (with the goal of ensuring that all products are up to standards). This may be for compliance reasons (such as in meat production) or for quality service (such as checking the seams in the leather of a Rolls Royce car). Other quality managers are concerned with the quality of the production process itself: are all employees being productive? Is there a bottleneck in the production process? These focuses on efficiency are especially important for products with low margins. In this unit, you will learn about a few of the pioneers in total quality management as well as the processes used to control quality in manufacturing and service organizations.

    Completing this unit should take you approximately 5 hours.

  • 4.1: Productivity and Total Quality Management

    • In many ways, quality is very expensive. There are multiple categories of costs associated with quality management. Understanding these costs is the first step in designing an argument of why the investment is an important one. Complete this assessment of your understanding of Cost of Quality concepts.  The activity is self-graded.

    • This video describes the integrated system necessary to create a quality management system within an organization. Just using the word quality can be confusing for managers. Understanding what quality is and how it should be approached is challenging. Designing a systematic way to approach management of quality is fundamentally important to successfully controlling quality. 

    • Read this page. This page explores the nature of total quality management (TQM) and the necessity of use in the operations environment.  TQM is one of the bedrock approaches to quality management. You will see many of the components of TQM in other quality management approaches.  This approach is important because of the focus on a continuous cycle of improving the quality of a product, service, or process. Answer the quiz question at the end of the section and compare your answer to the author’s. 

    • Read this description of the quality principles. These principles are important to the focus on and ability to lead an organization toward a culture that embraces continual quality improvement. Answer the quiz question at the end of the section. 

    • Read this section to better understand the usefulness of quality audits in managing to quality standards. Quality audits are an important part of the quality process. Companies ensure that they are producing a quality product or service by integrating the ISO standards into processes. To ensure that all parts of operations is compliant audits are conducted. Answer the quiz question and compare your answers to the author’s. 
    • Read this section on the quality control process. Quality control is focused on identifying issues with quality and initiating corrective action. Quality control processes are vital to a healthy quality control function. Answer the quiz question at the end of the section and compare your answer to the authors. 

    • Read this article to better understand the history of quality management and the impact of these three men on the approaches to quality management. You might call these men the founding fathers of quality process. There contribution to this organizational focus on quality needs to be understood.

    • Read this chapter summary. Successful management of quality requires an understanding of the dimensions of product or service quality that add utility for your customers. Pay particular attention to the three awards that are given to recognize outstanding quality. 

    • Read pages 171-174 on the methods for measuring and improving productivity. Productivity levels are often a focus within organizations that are working toward increasing efficiency and decreasing waste. 

    • After reviewing the materials above, please post and respond to the following topic on the course discussion board. Feel free to start your own related posts and respond to other students' postings as well. If you haven't done so already, you will need to create a free account at the link above to participate in the discussions.

      Research the three well-known awards (Baldridge Award, European Quality Award, Deming Prize) given annually to recognize quality. Pick one of the awards and one of the main evaluation criteria. Compare and Contrast this evaluation criterion for Apple and Microsoft. How would these two organizations score on this quality dimension?  How would you suggest improving the quality related to this criterion based on the material that is covered in this section?

  • 4.2: Statistical Process Control

    • Watch this video to explore the relationship between quality and costs in operations. Ultimately, there is always a tradeoff between the cost of addressing quality and the cost of ignoring quality. Every organization has to determine how they will address the cost factors associated with managing quality. 

    • Read this wiki page to better history and application of the SPC method. This is a standard method used in many organizations to monitor the quality of processes. Familiarizing yourself with the method is the first step in understanding how processes can be monitored for more effective evaluation. 

    • Pay attention to the key concepts related to the development of a process map and workflow charts. Process development is crucial to an efficient and effective organization. Each process contains the workflow (system design with tools used) and the procedures (work instructions for people). Both of these must align and together become the process. 

    • Watch this video for an introduction to process design and improvement. This video provides a foundation for the use of process design as a tool to improve processes to impact quality. Every time we adjust work, we are changing the process. This means that as an operations manager, it is important that you understand how each change impacts the whole process. When an adjustment needs to be made to improve quality a systematic approach to process design is the best method for a successful change. 

  • Unit 4 Activity and Assessment

    • In this activity, you will continue working on your operations management plan by explaining techniques and methodologies for managing your organization's productive resources.

  • Unit 5: Supply Chain Management (SCM)

    Many of the problems associated with supply chain management are closely related to the typical problems of operations management. Instead of the question: "How should we make this?”, it becomes: "How should we get this from point A to B?” It may be best to ship the product straight from the factory to the customer, but it may be prohibitively expensive to do so. Many firms find it easier and cheaper to ship products to distribution warehouses first and distribute to customers on a more local level. 

    Supply chain management refers to the entire process of obtaining the raw goods from a supplier, converting those goods into products, shipping products, and placing them in front of customers. Operations management typically focuses on the production side of supply chain management, but a good manager is concerned with the entire process. In this unit, we will look at the management of firm resources on the supply side as well as the distribution of finished goods to the consumer.

    Completing this unit should take you approximately 5 hours.

  • 5.1: Fluctuations in the Supply Chain

  • 5.2: Supply Chain Procurement

  • 5.3: Supply Chain Distribution

    • Read this section to explore supply chain optimization. Supply chains must be fast, cheap and reliable for a good return-on-investment. This section is important because it focuses on how to focus on designing a supply chain that allows for the manufacturing and distribution of products and a low cost and high profit.  Answer the quiz question at the end of the section. Compare your answer with that of the authors. 

  • Unit 5 Assessment

    • In this activity, you will continue working on your operations management plan.  As part of your continuing development of your operations management plan, discuss the goal of supply chain management and its application within your business.

  • Unit 6: Just-In-Time and Lean Systems

    Would you order a delivery pizza for dinner from a restaurant advertising delivery in 6 hours? How about a restaurant that can bring you a cold, stale pizza in only 5-minutes? To meet the consumer's needs, the pizza shop must be able to give customers the number of pizzas they want when they want it. Preparing pizzas in advance is too wasteful because most consumers are not likely to buy a stale pizza. Meanwhile, if you take too long to deliver the pizza, you will lose customers to a more responsive competitor. The concept of just-in-time focuses on making what you need to meet customer demand only when you need it. For a pizza delivery shop, that probably means a fresh pizza at the customer's door in around 30 minutes. This philosophy can apply to a range of operations, from simply washing a car to manufacturing a complex aircraft.

    Similarly, the concept of lean manufacturing refers to eliminating waste in the manufacturing process. The Toyota Product System is the model for modern manufacturers that want to control waste. In this unit, we will look at seven types of waste and processes for controlling them. In addition, we will explore the origins of the "Just-in-Time" (JIT) philosophy and the use of pull systems to control inventory.

    Completing this unit should take you approximately 4 hours.

  • 6.1: Lean Manufacturing

    • Read this article. Pay close attention to the connection between strategic decision-making and the use of Lean tools. Lean practices are useful in manufacturing and service industries. Lean can be complicated to implement. This article is useful because it provides information on some of the challenges that you might face when implementing Lean practices within an organization. 

    • Read this article about the use of Lean Manufacturing related to system dynamics. Technology use is important to Lean Manufacturing and this article explores the relationship of technology improvement on Lean Manufacturing. Pay particular attention to how technology can be utilized to help eliminate waste. 

    • Watch this video to review the use of Lean methods in the manufacturing process to reduce waste and increase continuous quality improvement. Waste can be placed in eight different categories. This video is useful because of the guidance it provides in avoiding pitfalls that have hindered organizations from successfully using Lean methods to increase CQI.

    • Read this section to better understand the application of Lean. Pay particular attention to the five core principles of Lean. This starts by defining value from the customer’s perspective. Lean methods are not hard, but require that you truly understand what waste is within your organization.  This provides the foundation for choices that improve efficiency and effectiveness. Complete exercise five at the end of the section. This is a self-graded activity. 
  • 6.2: Eliminating Waste

    • Read this article. Pay particular attention to the examples of the eight wastes. These eight types of waste should be understood and evaluated. Take time to consider your workplace. Identify each type of waste within your organization. Where does it occur? Why does it occur? Is it required waste (regulatory or quality assurance step)? Answers to these questions are a precursor to making sound decisions related to the elimination of waste and changes in process. 

    • Watch this slide show and explore how waste can be found throughout the work done in the office processes. Often, Lean methods are considered only applicable in a manufacturing context. Sometimes, Lean methods are applied in a service industry when there is direct contact with customers. However, this slide show provides some examples of how waste (as identified by Lean) can be found throughout all parts of an organization. 

    • Watch this slide show to explore the eight wastes defined in Lean. Pay close attention to the differences between value-added activities and non-value added activities. Value added activities create value for the customer/client/patient. Non-value added activities are often pure waste within the system. 

  • 6.3: Continuous Improvement

    • Read this overview of continuous improvement in the context of education. Education is a service. Therefore, operations management concepts apply in the education industry. Keep in mind; some would argue that students are a product manufactured by the education system. This can create a different perspective when reviewing this process in relation to education. 

    • Watch this video about the use of Kaizen events to increase the quality of your process. Kaizen is one tool that is used when practicing Lean methods. This provides you with background information on the development of this tool. 

    • Read this article. Consider the importance of creating a culture focused on continuous improvement within both service and manufacturing organizations. This is important because the culture either supports or hinders any initiative started within an organization. If the culture does not support continuous quality improvement, then either the CQI process will fail or the culture must be shifted. 

    • After reviewing the materials above, please post and respond to the following topic on the course discussion board. Feel free to start your own related posts and respond to other students' postings as well. If you haven't done so already, you will need to create a free account at the link above to participate in the discussions.

      All of us are familiar with the education system. This might be through our personal experience with K-12 or post K-12 education or our children’s experience. Using information in this unit, evaluate the operations of an education system. You may choose a K-12 system, a Higher Education (community college, college, or university) program, or a technical institute that you are familiar with to complete this evaluation. Discuss how and where continuous quality improvement processes could be embedded within the system to increase the quality of the outcomes. 

  • 6.4: JIT Pull Systems

    • Read this page and explore the just-in-time manufacturing systems. Just-in-time inventory principle is designed to reduce waste associated to maintaining inventory or inputs. Consider the impact of a just-in-time approach to the reduction of waste in your inventory system.

    • Watch this video and explore how Kanban is used in organizations to increase effectiveness in IT projects. Kanban is a less complex method to apply Lean within the organization. This is also is designed to be agile and easily adapted to the needs of the organization. Pay attention to how you might adapt this method to work in your organization in improving quality and reducing waste in a way that does not relate to an IT project.

  • Unit 6 Activity and Assessment

    • In this activity, you will continue working on your operations management plan. As part of your continuing development of your operations management plan, you will discuss the goal of supply chain management and its application within your business.

  • Unit 7: Capacity Planning and Facility Layout

    In the last unit, we looked at manufacturing and service processes that help companies deliver what a customer wants when they want it. Before the firm can successfully institute these processes, it must understand the requirements that determine its production capacity. In the introduction to Unit 6, we considered how a pizza shop delivers its product. Is it likely that their 30-minute delivery would cover an order for 100 pizzas? Probably not, because they have planned their production capacity based on the demand of individual or family-sized consumers. When planning production capacity, the firm has to consider not only demand, but also the physical aspects of their facility. How close does the operation need to be to consumers? Is the facility within easy reach of the resources needed for production?

    In this unit, you will learn how to use forecasting models to understand capacity requirements. We will also evaluate factors that help managers identify the optimal location for a new facility. Finally, we will conclude with a review of basic facility layout designs that maximize production efficiency.

    Completing this unit should take you approximately 10 hours.

  • 7.1: Capacity Planning

    • Watch this lecture for a detailed look at the importance of forecasting in identifying capacity requirements. Professor Kanda also reviews a variety of forecasting models along with the process of forecast control. 

    • Read section 10.5. Forecasting is difficult in the best of circumstances. However, there are standard questions you can ask that can help you make good forecasting decisions.  Pay close attention to the discussion surrounding published industry data. Look for sources that would provide you with industry data specific to your current workplace. Complete the exercise at the end of the section. This is a self-graded activity. 

    • Read the chapter five summary. Pay attention to the inputs to capacity planning and the determinates and steps in the capacity planning process. This is important to understanding how to use this information to increase the quality of your forecasts. In addition, this helps you understand your organizations capability to meet the forecast needs. Answer the questions at the end of the summary. Compare your results with the authors. 

  • 7.2: Facility Location and Layout

    • Read this article, which should help you understand the many factors that can determine where an organization will locate its facilities and why choosing a location to match an organization's requirements is important.

    • Read this article, which will help you understand the criteria of creating an effective and efficient workflow and building a high standard of production. This article also discusses the three types of workflow layouts that managers can choose from and how office and factory facilities are approached differently.

    • Review #1 Location Cost-Volume-Profit Analysis, which should help you to understand the financial aspects of choosing a location. In addition consider the factors that influences the location of a new facility. This is important because a poor choice can make it very difficult to meet demand and manage costs effectively. 

    • Read this article to explore the importance of improving the assembly line to increase production levels and decrease associated costs. This is important because if costs rise to high, the organizations profit margins shrink. When this happens, the organization may struggle to keep a facility open.

    • This article provides a case study to help you understand the use of line balancing methods in assembly line processing layouts. This is important because productivity improvements are a crucial component of managing production costs. How might you use principles defined in this case to streamline production (# of workstations, etcetera) in your current working environment?

    • After reviewing the materials above, please post and respond to the following topic on the course discussion board. Feel free to start your own related posts and respond to other students' postings as well. If you haven't done so already, you will need to create a free account at the link above to participate in the discussions.

      Choose a business that you would be interested in opening in your community. How would you decide where to locate that business? What would you be most concerned about in making this choice? 

  • Unit 7 Activity and Assessment

    • In this activity, you will continue working on your operations management plan. In this section of your business plan, you will discuss facility design and layout.

  • Unit 8: Work Systems Design

    It seems reasonable that a worker's level of job satisfaction would influence his or her job performance. At some point in your life, you have probably performed a job task that you did not enjoy. Perhaps the work was too physically demanding or there was a problem with the location of the work area. Or perhaps the work was so monotonous that you were starved for mental stimulation. One of the ways that operations managers can impact job satisfaction is through work systems design. In this unit, we will explore how operations managers use strategies like skill variety, task significance, or work organization to enhance job performance. We will also consider models for analyzing work to eliminate unnecessary tasks and regulate the duration of each stage in a production line. 

    Completing this unit should take you approximately 5 hours.

  • 8.1: Job Design

    • Read this section. Pay close attention to the approaches to job design and the importance of the key elements to good design. This is important because efficiency and effectiveness is directly related to the way in which a job is designed. Good job design takes attention to detail and alignment with process. Answer the three quiz questions at the bottom of the section and compare your answers with the authors. 

    • Read this wiki page. Pay close attention to core dimensions and techniques of job design. This is important because different combinations of these core dimensions motivate different types of employees. Each of the core dimensions can be viewed as if on a continuum. You may need a high skill variety and a low task identity for a specific job. 

    • Read the section titled “The value of high-performance work systems”. This section provides an overview of the research associated with high-performance work systems from a human resource department’s perspective. This is important because high-performance work systems are the holy grail of organizations focused on quality and Lean. 

    • After reviewing the materials above, please post and respond to the following topic on the course discussion board. Feel free to start your own related posts and respond to other students' postings as well. If you haven't done so already, you will need to create a free account at the link above to participate in the discussions.

      Take each core job dimension and using a 1-10 scale (1 = lowest and 10 = highest), rate each dimension in relation to your current job or a job that you have had in the past. Based on your job experience, how did the job design impact your job satisfaction, loyalty to the organization, and quality of work and performance? Based on your answer, how would you redesign your job in relation to these core dimensions? If you have never had a job, think about a volunteer experience you may have had, or you might try answering the above questions based on your dream job.
  • 8.2: Motion Study

    • Read this page. Pay close attention to the types of time and motion studies and the criticisms associated with this approach. Time motion studies have been used and continue to be used in all types of organizations. This source creates a foundation for application of time motion studies within an operations context. 

    • Read this article to gain an understanding of how the theory of time-motion studies is translated into a service industry. This type of activity can easily be used to track the amount of time it takes for a group in the hospital to answer the phone each time it rings. The study would track the associated motions, delays, distractions, etcetera that this activity causes. This information can be discussed in terms of the waste of time associated with a specific type of motion. The inverse can also be true. The goal is to use this information to make sound decisions related to worker actions to increase efficiency and effectiveness. 

  • 8.3: Work Measurement

  • 8.4: Project Management Issues

  • Unit 8 Activity and Assessment

  • Unit 9: Inventory

    In a manufacturing context, inventory includes raw materials, work that is in process, and finished goods. Running out of a necessary component in the middle of production can be very costly for a manufacturer. The goal of inventory management is to balance the cost of ordering and storing material with the cost of not having that material available when it is needed. Effective inventory management combines elements of accounting, sales, and operations management. Certain aspects of this unit will feel like a review of accounting, but we will be discussing accounting from the perspective of the operation manager. There are a number of strategies for managing inventory. Because direct costs can be calculated based on the length of time an inventory is in storage, accountants and operations managers try to prevent inventory from "sitting around."

    An example of one of the most successful implementers of inventory management is Walmart. Walmart uses vendor-managed inventory, meaning that its merchandise does not sit in a Walmart warehouse. Instead, it stays with the manufacturer until Walmart learns from its stores that more is needed. This keeps Wal-Mart from having to pay to store all of the products it sells. In this unit, we will consider how demand influences the operations manager's choice of inventory management system. We will also examine models for determining how much inventory to order and when to order it. 

    Completing this unit should take you approximately 5 hours.

  • 9.1: Inventory Management

  • 9.2: Types of Inventory and Inventory Decisions

    • Read this section, which will help you understand the ABC analysis method and the application to inventory categorization. The ABC analysis is important because this method helps control overall inventory cost by using selective inventory control policies. Answer the quiz question at the end of the section and compare your answer to the authors.

    • Read pages 202-204. Pay close attention to the inventory flow diagram. This diagram is important because it describes how different information from different areas are crucial to the development of a sound operations plan. Planning is a primary element of management. As an operations manager, it is crucial that information from other functional areas are incorporated into operations plan. 

  • 9.3: Inventory Control

    • Read this section and explore the fundamentals of inventory management. The benefits to improved inventory management processes are lower costs and improved cash flows. A skill in inventory management is necessary for sound operations. Answer the quiz question and compare your answer to the authors. 

    • Read this section, which will help you understand how companies keep and manage inventory. There are basic reasons for keeping inventory on hand. The important part is that these reasons are evaluated for the needs of each organization and an inventory management system is created that allows for the highest level of efficiency possible. Answer the quiz question at the end of the section and compare your answer with the authors. 

    • Read this section to explore the elements of inventory control. Inventory control is crucial to the bottom line.  Pay close attention to connection between inventory control and demand planning.  Answer the three review questions at the end of the section.

    • Read this description of EOQ, which will help you understand the fundamental function of this equation. EOQ is important because it helps minimize the total holding and ordering costs related to inventory. Pay close attention to when this applies in the production process. 
    • Read this chapter summary. Pay close attention to the types of inventory control and the EOQ model. This source is useful because of the detailed information provided related to the function of inventories, reasons for inventory management, and types of inventory control that is useful. Answer the questions at the end of the summary. Compare your results with the authors

  • Unit 9 Activity and Assessment

    • In this activity, you will continue working on your operations management plan. This final part of your operations management plan requires that you identify the critical factors involved in inventory control systems. After developing this final portion of your plan, compile all of the parts you have work on in the activities for Units 1-9 to develop one comprehensive business plan.