lOMoARcPSD|11911780
Summary Operations, Management & Logistics
Lecture 1: Ch 1 & 2.
Operations = the conversion of inputs (resources) into outputs (products).
→ Involves the workflow ordering of activities to produce the product.
Supply chain = The processes that move information and material to and from
firms, ranging from raw materials to consumers. Raw material → Manufacturer →
Dealernetwork.
Operations & Logistics are considered primary (production process) activities within
an organization.
Success of producing at low cost while meeting customer demand depends on:
- Clever integration of great operations-related strategy.
- Processes to produce and deliver products and services.
- Analytics to support the decisions needed to manage the firm.
Basic principles guide the design of transformation processes:
- How different types of processes are organized.
- How to determine the capacity of a process.
- How long it should take to make a unit.
- How the quality of a process is monitored.
- How information is used to make decisions.
Operations and Supply Chain Management (OSCM) is also about improvement of
the systems that create and deliver the firm’s primary products and services.
- Change of Operations and Supply Chain strategies.
- New production technologies and modes of transport.
- Optimizing the processes of production and logistics activities.
- Improvements in data analytics and how to use them in decision making.
, lOMoARcPSD|11911780
Functional-based workflow (for example):
- 1 product at a time.
- Batch based → Product B after product A.
Product-based workflow (for example):
- Simultaneously produce 2 products.
- A and B both have their own production process.
Operations and Supply Chain processes are interlinked and require metrics to
steer, some examples are speed, quality, work productivity but also ordering,
payments, shipping.
Producing and delivering goods (food) is different compared with services (medical).
Current issues in operations and supply chain management
- Coordinating the relationships between mutually supportive but separate
operations.
- Optimizing global supplier, production and distribution networks.
- Managing customer touch points.
- Raising senior management awareness of OSCM as a significant
competitive weapon.
- Uncertainty in global tariffs and regulations.
- Difficulty in hiring and keeping employees.
- Adapting to change in business technology and infrastructure.
- Sustainability and the triple bottom line (life cycle analysis)
- Digitization and BIG data (industry 4.0)
Evaluating operations and supply chain process on efficiency, effectiveness, and
value:
- Efficiency = doing something at the lowest possible cost.
- Effectiveness = Doing the right things to create the most value for the company.
- Value = quality / price.
- Quality = the attractiveness of the product, considering its
features and durability.
Benchmarking based on management efficiency ratios (higher = better)
- Receivable turnover = Annual credit sales / average account receivable.
- Inventory turnover = Cost of goods sold / average inventory value.
- Asset turnover = Revenue (or sales) / total assets.
, lOMoARcPSD|11911780
Summary of Chapter 1:
- Various processes are associated with OSCM and used to implement the
strategy of the firm.
- Analytics support ongoing decisions needed to manage the firm.
- Firms face increasing pressure on mass customization and quality in
combination with efficiency and speed that is reflected in OSCM.
- Supply chain control, Servitization (services after the sale, e.g.
maintenance), sustainability and industry 4.0 are very important.
- Efficiency ratio’s help benchmarking firm practices to meet goals.
, lOMoARcPSD|11911780
Chapter 2
→ Life cycle.
Sustainable strategy is aimed at pleasing not only shareholders but also other
stakeholders.
- The firm's strategy describes how it will create and sustain value for shareholders.
- Shareholders = individuals or companies who own shares of stock.
- Stakeholders = individuals or companies who are directly or
indirectly influenced by actions of the firm.
- Adding sustainability requirements means meeting value goals without
compromising the ability of future generations to meet their own needs.
- It might even be the case that pleasing other stakeholders might in
the end also please shareholders.
- Triple bottom line: evaluating the firm against social, economic, and
environmental criteria.
Different ways to produce and innovate in a sustainable way
- Cleaner products
- More efficient production process
- Alternative technologies
- New business models (services / innovation)
Score on dimensions:
- Energy saving / renewable energy
- Resource saving / recycling / renewable material
- Pollution reduction
- measure: CO2 reduction.
Some dilemmas for OSC managers:
- Using less energy vs using renewable energy
- Using less materials vs biodegradable vs recycling processes.
Summary Operations, Management & Logistics
Lecture 1: Ch 1 & 2.
Operations = the conversion of inputs (resources) into outputs (products).
→ Involves the workflow ordering of activities to produce the product.
Supply chain = The processes that move information and material to and from
firms, ranging from raw materials to consumers. Raw material → Manufacturer →
Dealernetwork.
Operations & Logistics are considered primary (production process) activities within
an organization.
Success of producing at low cost while meeting customer demand depends on:
- Clever integration of great operations-related strategy.
- Processes to produce and deliver products and services.
- Analytics to support the decisions needed to manage the firm.
Basic principles guide the design of transformation processes:
- How different types of processes are organized.
- How to determine the capacity of a process.
- How long it should take to make a unit.
- How the quality of a process is monitored.
- How information is used to make decisions.
Operations and Supply Chain Management (OSCM) is also about improvement of
the systems that create and deliver the firm’s primary products and services.
- Change of Operations and Supply Chain strategies.
- New production technologies and modes of transport.
- Optimizing the processes of production and logistics activities.
- Improvements in data analytics and how to use them in decision making.
, lOMoARcPSD|11911780
Functional-based workflow (for example):
- 1 product at a time.
- Batch based → Product B after product A.
Product-based workflow (for example):
- Simultaneously produce 2 products.
- A and B both have their own production process.
Operations and Supply Chain processes are interlinked and require metrics to
steer, some examples are speed, quality, work productivity but also ordering,
payments, shipping.
Producing and delivering goods (food) is different compared with services (medical).
Current issues in operations and supply chain management
- Coordinating the relationships between mutually supportive but separate
operations.
- Optimizing global supplier, production and distribution networks.
- Managing customer touch points.
- Raising senior management awareness of OSCM as a significant
competitive weapon.
- Uncertainty in global tariffs and regulations.
- Difficulty in hiring and keeping employees.
- Adapting to change in business technology and infrastructure.
- Sustainability and the triple bottom line (life cycle analysis)
- Digitization and BIG data (industry 4.0)
Evaluating operations and supply chain process on efficiency, effectiveness, and
value:
- Efficiency = doing something at the lowest possible cost.
- Effectiveness = Doing the right things to create the most value for the company.
- Value = quality / price.
- Quality = the attractiveness of the product, considering its
features and durability.
Benchmarking based on management efficiency ratios (higher = better)
- Receivable turnover = Annual credit sales / average account receivable.
- Inventory turnover = Cost of goods sold / average inventory value.
- Asset turnover = Revenue (or sales) / total assets.
, lOMoARcPSD|11911780
Summary of Chapter 1:
- Various processes are associated with OSCM and used to implement the
strategy of the firm.
- Analytics support ongoing decisions needed to manage the firm.
- Firms face increasing pressure on mass customization and quality in
combination with efficiency and speed that is reflected in OSCM.
- Supply chain control, Servitization (services after the sale, e.g.
maintenance), sustainability and industry 4.0 are very important.
- Efficiency ratio’s help benchmarking firm practices to meet goals.
, lOMoARcPSD|11911780
Chapter 2
→ Life cycle.
Sustainable strategy is aimed at pleasing not only shareholders but also other
stakeholders.
- The firm's strategy describes how it will create and sustain value for shareholders.
- Shareholders = individuals or companies who own shares of stock.
- Stakeholders = individuals or companies who are directly or
indirectly influenced by actions of the firm.
- Adding sustainability requirements means meeting value goals without
compromising the ability of future generations to meet their own needs.
- It might even be the case that pleasing other stakeholders might in
the end also please shareholders.
- Triple bottom line: evaluating the firm against social, economic, and
environmental criteria.
Different ways to produce and innovate in a sustainable way
- Cleaner products
- More efficient production process
- Alternative technologies
- New business models (services / innovation)
Score on dimensions:
- Energy saving / renewable energy
- Resource saving / recycling / renewable material
- Pollution reduction
- measure: CO2 reduction.
Some dilemmas for OSC managers:
- Using less energy vs using renewable energy
- Using less materials vs biodegradable vs recycling processes.
