Week 9

1) Define the term operations management 

Operations management is the management of all processes that transport inputs into outputs. It is responsible for managing the core processes the business used to create their product.

2) Explain operations management’s role in business 

If all processes are efficient and productive in the transformation of inputs into outputs, the role would be:

• imaginative role, as they determine the process in the future
• forecasting, which involves estimating set demands
• capacity planning,
• scheduling
• managing inventories
• ensuring quality processes
• motivating employees
• Locating facilities

3) Describe the correlation between operations management and information technology 

The correlation is strong as Operation Managers role is varied and the need for IT to provide them with visibility of the business. This will help show them where the processes are. This will also show them what resources will be needed and in what amounts, when it should be scheduled, ordered and when corrective management will be needed. It also helps with where the work will be performed (e.g. near transport and near available labour) and how will the good be designed while designating who will perform the work, either in-source or outsource.

Overall, it is greatly used in the Operation Managers role as it helps them make correct decisions that will influence the whole business. Decision support systems greatly help in this area as many decisions have many possible outcomes. This is done through the use of what-if-analysis, which will help determined the best outcome.

4) Explain supply chain management and its role in a business

Supply chain management involves the management of information flows between the different stages of the supply chain in order to maximise total efficiency and profitability. The supply chain has 5 different steps - plan, source, make, deliver and return. This management involves communication between all 5 steps of the chain. The supply chains role in business is to decrease the power of its buyers while increase its own supplier power. It also as the job of increasing switching costs to reduce threats of substitutes and create entry barriers which will help with increasing efficiencies

5) List and describe the five components of a typical supply chain 

1. Plan: they must have a plan for managing all resources, a major part is developing sets of metrics to monitor the supply chain
2. Source: this is where the firms must choose their suppliers. While doing this they also determine the pricing, delivery and payment processes which they will do with the suppliers
3. Make: where companies manufacture the products, including scheduling, testing etc
4. Deliver: logistics e.g. set of processes that plans for and controls the transportation and storage of the products
5. Return: the receiving of the defective and excess products that the customers don't want

The supply chain could also take the form of: supplier to manufacturer to distributer to retailer to customer. In certain cases such as through the use of ebay, some of these steps are cut out. This then becomes the probem of disintermediation.

6) Define the relationship between information technology and the supply chain

The supply chain heavily relies on IT to make accurate decisions regarding each step. As without IT problems such as over forecasting or under forecasting can be made. Therefore with the use of IT managers can accurately manage the supply chain. It also helps the supply chain gain visibility which allows us to view all areas up and down the supply chain. Through this the bullwhip effect is decreased, which involves the distorted product demand. The consumer behaviour helps with the use of Demand Planning Systems. This allows the company to respond quicker to customer demands by supply chain enhancements. And finally competition which is the supply chain planning systems that help improve the flow of the supply chain. Supply chain execution systems automate some of the steps in the supply chain. This shows that IT would then greatly make the supply chain faster. There is also the element of speed which through technology the supply chain would become faster. Overall, IT greatly benefits the supply chain and helps it develop as it makes it faster and more efficient.