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CIPS L5M9 Operations Management LO1

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CIPS L5M9 Operations Management LO1

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  • March 18, 2024
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  • 2023/2024
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CIPS L5M9 Operations Management LO1
Operations Management

The processes of managing the resources and processes involved in the acquisition and transformation
of inputs and the distribution of outputs.

Five Key Performance Dimensions / Performance Objectives - Slack and Brandon-Jones

1. Quality
2. Speed
3. Dependability
4. Flexibility
5. Cost

Quality

Producing products and services that satisfy customer needs.

Speed

Ensuring a short lapse of time between when orders are made and fulfilled.

Dependability

Producing products that are reliable and consistent.

Flexibility

Adapting to changes in demand or marketplace changes.

Cost

Producing products and services at minimum cost.

Operation

Smallest divisible piece of work or activity within an organisation. CREATING FLOW

Production Methods

1. Make to Order - craft production. Does not commence until an order has been received.
2. Mass Production - make to stock - low variety / high volume
3. Mass Customisation / Late Customisation - mix between made to order and mass production.
Products standardised to a certain point e.g. Dell

ITO

Input - Transformation - Output
The market is the point in which an output transforms into an input

Input

, * Materials
* Information
* Customers

Transformation

* Facilities
* Staff
* Infrastructure e.g. road, rail, air
* IT
* Marketing

Four V's

1. Volume - quantity of products / services produced
2. Variety - of products / services produced
3. Visibility - of the process to customers
4. Variation - changes in demand for products / services

Order Qualification

Competitive standards that make an organisations products viewed as fit for purpose by customers

Order Winning

Standards that separate the products from on organisation to another

Hayes & Wheelwrights 4 Stages of Operations Readiness

1. Internal Neutrality
2. External Neutrality
3. Internally Supportive
4. Externally Supportive

Internal Neutrality

Operations function makes a minimal contribution to the overall corporate strategy.
Stage 1 - correct the worst problem

External Neutrality

Operations function compares itself with similar businesses or organisations. Actively keeping pace with
comparable companies in the same industry.
Stage 2 - adopt best practice

Internally Supportive

Operations management function delivers the best capabilities to the organisation, contributing to the
organisations overall competitive strategy.
Stage 3 - link strategy with operations

Externally Supportive

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