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Lecture notes/Operations Management Summary for Business Economics (325072-B-6)

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This is a comprehensive summary of the Operations Management course. All topics of the course are included in this summary with images. The following topics are all explained: The 4V Model, Operations Performance, Operations Strategy, Henderson & Clark Model, Product Innovation, Process Design, Layout and Flow, Process Technology, People in Operations, Planning and Control, Inventory Management, Structure and Scope of Operations, Lean and other approaches and Quality Management.

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September 17, 2023
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52
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2022/2023
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Vincent peters
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Hoofdstuk 1 – Operations Management
Pure goods: tangible, can be stored, production precedes consumption, low customer contact, can
be transported, quality is evident.
Pure services: intangible, can’t be stored, production and consumption simultaneously, high
customer contact, quality is questionable.

Operations management basismodel

Transformed resources: resources die
verandert worden binnen het proces.
Transforming resources: resources die zorgen
voor deze verandering.




Betekenis operations management
Operations management: the activity of managing the resources which are devoted to the
production and delivery of products and services.
Operations management: uses resources to appropriately create outputs that fulfill defined market
requirements.

Drie niveau’s van operations management
• Level of the supply network: flow between operations
• Level of the operation: flow between processes
• Level op the process: flow between resources

Het 4V model
• Volume
• Variety
• Variation in demand
• Visibility

Volume
Laag: low repetition, each staff member performs more of each task, less systemization, high unit
costs (vb. Buurtzaak).
Hoog: high repeatability, specialization, capital intensive, low unit costs (supermarket).

Variety
Hoog: flexible, complex, match customer needs, high unit costs (taxi bedrijf).
Laag: well defined, routine, standardized regular, low unit costs (openbaar vervoer).

Variation in demand
Hoog: changing capacity, anticipation, flexibility, in touch with demand, high unit costs.
Laag: stable, routine, predictable, high utilization, low unit costs.



1

,Visibility
Hoog: short waiting tolerance, satisfaction governed by customer perception, customer contact skills
needed, received variety is high, high unit costs.
Laag: time lag between production and consumption, standardization, low contact skills, high staff
utilization, centralization, low unit costs.

Hoofdstuk 2 – Operations Performance
QSFDC
Quality: being right. Are perceptions consistent with actual product?
Speed: being fast.
Flexibility: being able to change.
Dependability: being on time.
Cost: being productive.

TBL performance and how can operations impact this?
TBL: triple bottom line: bedrijven niet met een p bezighouden, maar ook andere p’s. Niet profit, maar
ook planet en people.
Planet: the environmental account, measured by environmental impact of the operation
People: the social account, measured by the impact of the operation on the quality of people’s lives.
Profit: the economic account, measured by profitability, return on assets, etc. of the operation.




Quality
The conformance (klopt alles) with which a product or service is produced.

External and internal benefits of quality
Externally: it enhances the product or service in the market or at least avoids customer complaints.
Internally: it brings other benefits to the operation:
- It prevents errors slowing down throughput speed
- It prevents errors causing internal unreliability and low dependability
- It prevents errors causing wasted time and effort, therefore saving cost

Quality → Speed, Dependability, Cost

Speed
How fast can the service or product be delivered?

External and internal benefits of speed


2

,Externally: it means the elapsed time between a customer asking for a product or service and getting
it (satisfactory condition).
Internally: it brings other benefits to the operation:
- It helps to overcome internal problems by maintaining dependability
- It reduces the need to manage transformed resources as they pass through the operation,
therefore saving cost

Speed → Dependability, Cost

Dependability
Is the product/services delivered on time?

External and internal benefits of dependability
Externally: it enhances the product or service in the market, or at least avoid customer complaints.
Internally: it brings other benefits to the operation:
- It prevents late delivery, slowing down throughput speed
- It prevents lateness causing disruption and wasted time and effort, therefore saving cost

Dependability → speed, cost

Flexibility
The ability to change:
- The products and services it brings to the market (product/service flexibility)
- The mix of products and services it produces at any time (mix flexibility)
- The volume of the products and services it produces (volume flexibility)
- The delivery time of its products and services (delivery flexibility)

Flexibility → Speed, Cost, Dependability

Cost
Soorten kosten: bought-in materials and services and facility costs and staff costs.

Polar diagrams: are used to indicate the relative importance of each performance objective to an
operation or process. Can also be used to indicate the difference between different products and
services produced by an operation or process.

The Slack model of operations management
Operations management: Direct → Design → Deliver → Develop
Direct:
- What is operations management?
- Operations performance
- Operations strategy



Hoofdstuk 3 – Operations Strategy
Strategy
Strategy is:
- Setting broad objectives that direct an enterprice toward its overall goal

3

, - Planning the path (in general rather than specific terms) that will achieve these goals
- Stressing long-term rather than short-term objectives
- Dealing with the total picture rather than stressing individual activities
- Being detached from, and above, the confusion and distractions of day-to-day activities

Operations: the processes that relate to the creation and delivery of products and services.

Operations strategy
Operations strategy: is about setting long-term, broad objectives that relate to the operations of the
organization and planning a path in general terms that will achieve these goals.
Vb. Mac: offering minimal service to have fast sales and low prices.
Operations strategie laat zien hoe je je onderscheidt van de markt.

3 manieren waarop operations zelf invloed hebben op strategie
Operations as implementor of strategy: Strategy → Operations.
strategie wordt uitgerold (protocol) en zo beland het op de werkvloer
Operations as supporter of strategy: Strategy  Operations
strategie komt vanuit operations zelf
Operations as driver of strategy: Operations → Strategy
unieke bronnen die je hebt bepalen wat de strategie wordt. Geeft je competitief voordeel in de
markt.

The 4 stage model of operations contribution




The four perspectives on operations strategy
Je kan operation strategy op vier manieren benaderen.
Top down; vanuit top management bepalen wat je doet als organisatie
Bottum up; wat leeft er op werkvloer, wat levert dit aan voor input om strategie te bepalen

4
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