Managers tackling operations in cultures different from what they know are often tasked to develop strategies that adapt local cultural norms. Finally, in addition to pure manufacturing and pure service, there are companies that have some characteristics of each type of organization. We can further divide a service operation into high contact and low contact segments.
However, manufacturing and service operations answer different questions and formulate different strategies when it comes to planning and managing the way in which an organization is run. Differences in Manufacturing Versus Service Operations All organizations can be broadly divided into two categories: For example, both create mission statements and a vision for how the organization will be run and perceived by customers.
Figure illustrates this by showing that the vice president of each of these functions reports directly to the president or CEO of the company. This is true regardless of the size of the company, the industry it is in, whether it is manufacturing or service, or is for-profit or not-for-profit.
In a service operation, operations managers schedule workers to handle customer demand. At a university OM is involved in organizing resources, such as faculty, curriculum, and facilities, to transform high school students into college graduates.
There are two primary distinctions between these categories of organizations. Issues managers in this environment face include managing the space to store raw materials, the flow of materials through the manufacturing process, how much product to produce and quality of output.
For example, a manufacturer of jet engines, such as Rolls Royce, not only produces engines but services them. Dimensions of the service environment include the layout of furnishings, arrangement of signs and tangible cues, such as colors and sounds designed to enhance the customer experience.
Second, in manufacturing organizations customers typically have no direct contact with the process of production. Rapid changes in technology also mean that operations managers must be able to make decisions quickly to keep up with the latest trends.
An excellent example is an automated warehouse or a mail-order catalog business. Service operations, by contrast, plan the environment according to how it affects customers. However, in service organizations the customers are typically present during the creation of the service.
Yet, employees on the front line may feel they are too busy to inform management of every problem they encounter. Managers must create strategies to manage relationships between customers and employees.
First, manufacturing organizations produce a physical or tangible product that can be stored in inventory before it is needed by the customer.
However, it is the operations function that plans and coordinates all the resources needed to design, produce, and deliver the various pharmaceuticals to hospitals, pharmacies, and other locations where needed. These differences are shown in Table Similar Issues Service and manufacturing organizations face many similar issues that affect the end result of the operation.
Managers may run into ethical issues such as bribery. Manufacturing can be broken down into two branches: Consider a restaurant or a barber shop, where the customer is present during the creation of the service. On the other hand, service operations provide certain intangible services that may not be easily identifiable.
As a result it is directly responsible for many decisions and activities that give rise to product design and delivery problems. Service operations that also sell physical goods also face inventory control issues, such as how much to stock and when to order. The design and management of operations strongly influence how much material resources are consumed to manufacture goods or deliver a service, making sure that there is enough inventory to produce the quantities that need to be delivered to the customer, and ensuring that what is made is in fact what the customer wants.
Examples would include the kitchen segment at a fast-food restaurant or the laboratory for specimen analysis at a hospital. Finance is responsible for managing cash flow, current assets, and capital investments.
They are most like manufacturing organizations yet they provide a service. This is shown in Figure Most manufacturers provide services as part of their business, and many service firms manufacture physical goods they use during service delivery.
Characteristics Manufacturing operations produce tangible goods, which are physical products that can be held and seen.Similar Issues. Service and manufacturing organizations face many similar issues that affect the end result of the operation.
For example, both face issues of cost control. Manufacturing operations must find suppliers of raw materials at the lowest cost -- and highest quality -- possible.
In Key Issues in Operations, a blog detailing the relationship between system design and operational management, the main theme is that organizations must develop systems capable of “producing quality goods and services in demanded quantities in acceptable time frames.” Designing the system, planning the system, and managing the system present a wide variety of challenges to even the most savvy.
In any business enterprise, products are produced or services are provided.
For this, certain operations are carried out through a combination of raw material, processing or assembling the various components, using the services of workers, machines, tools and power. Two challenges facing operations management are globalization and worker engagement in solving problems.
Increasingly, operations managers must be flexible when coming up with solutions for operating a business within an alternative culture.
Managers face challenges in. After studying and analyzing the principles in the operational management department of Pepsi co, one of clear of the problems that the organization was facing and the reasons that led to these problems. 1 Introduction to Operations Management 2 Competitiveness, Strategy, and Productivity 3 Forecasting presents an introduction and overview of operations management.
Among the issues it addresses are: What is operations a manufacturing firm, a car wash, or some other type of business; all business organizations have these three basic.Download