PART ONE
                                              CHAPTER ONE
         PRODUCTION AND OPERATIONS MANAGEMENT
                                  INTRODUCTION
      •Chapter One
         •Production and Operations Management
      •Chapter Two
         •Productivity, Competitiveness, and Strategy
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   Irwin/McGraw-Hill                         The McGraw-Hill Companies, 
                                            Inc., 1999
                                                CHAPTER ONE
         PRODUCTION AND OPERATIONS MANAGEMENT
                     Operations Management
       Operations function consists of all activ ities directly
         related to producing goods or providing services.
                            Organization
         Finance             Production/           Marketing
                             Operations
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                                           CHAPTER ONE
        PRODUCTION AND OPERATIONS MANAGEMENT
             Business Operations Overlap
                           Production/
                           Operations
             Marketing                  Finance
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                                                     CHAPTER ONE
          PRODUCTION AND OPERATIONS MANAGEMENT
                       Types of Operations
            Operations                          Examples
       Goods Producing             Farming, mining, construction,
                                   manufacturing, power generation
       Storage/Transportation      Warehousing, trucking, mail
                                   service, moving, taxis, buses,
                                   hotels, airlines
       Exchange                    Retailing, wholesaling, banking,
                                   renting, leasing, library, loans
       Entertainment               Films, radio and television,
                                   concerts, recording
       Communication               Newspapers, radio and television
                                   newscasts, telephone, satellites
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                                                      CHAPTER ONE
          PRODUCTION AND OPERATIONS MANAGEMENT
                             Value-Added
          • The difference between the cost of inputs
             and the value or price of outputs.
                             Value added
          Inputs                                          Outputs
             Land             Transformation/
             Labor              Conversion                  Goods
             Capital               process                  Services
                                            Feedback
                                   Control
                  Feedback                          Feedback
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