CH4 : Operations and Productivity

Question 1

Operations management means

Answer 1

Operations management (OM) is the set of activities that create value in the form of goods and services by transforming inputs into outputs

Question 2

Operations

Answer 2

the part of a business organization that is responsible for producing good or services

Question 3

Essential functions

Answer 3

1-Marketing – generates demand
2-Production/operations – creates the product
3-Finance/accounting – tracks how well the organization is doing, pays bills, collects the money

Question 4

OM & basic functions

Answer 4

Supply          vs.   Demand: 
Operations & 	Sales & Marketing 
Supply Chains
Supply 	> 	 Demand (Wasteful Costly )
Supply 	< 	 Demand (Opportunity Loss  			Customer Dissatisfaction 
Supply     = 	 Demand  (Ideal)

Question 5

‘Input-Transformation-Output’ process of OM

Answer 5

The production of goods or services involves transforming inputs into outputs.

Question 6

OM as a value-added function

Answer 6

_ OM is about adding values during the conversion/transformation processes.
_ Value-added: (Difference between price and cost)
The value/price of outputs - Cost of Inputs
Its about the effectiveness (Value of output) and efficiency (cost of inputs) of the transformation processes

Question 7

Difrent between Effectiveness&Efficiency:

Answer 7

Effectiveness: doing the right things and achieving goals
Efficiency: doing things right and achieving lower costs