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TeachingjNotes
Thisjchapterjisjaimedjatjprovidingjanjoveralljframeworkjforjthejtextbookjandjthejfieldjofjope
rationsjandjsupplyjchainjmanagement.jAjnewjsectionjisjaddedjonjthejrolejofjoperationsjandjsupplyjc
hainjmanagementjinjthejeconomyjandjinjthejfirm.j Thejchapterjprovidesjajframeworkjthatjservesjasj
ajbeneficialjwayjofjorganizingjstudents'junderstandingjofjfivejmajorjoperationsjandjsupplyjchainjma
nagementjdecisionjtypes:j process,jquality,jcapacity,jinventoryjandjsupplyjchain.jThejcross-
functionaljviewjofjoperationsjmanagementj(OM)jisjalsojintroducedjinjthisjchapterjtojprovidejreleva
ncejforjthejcoursejinjparticularjforjnon-
majors.j Whenjoperationsjmanagementjisjrelatedjtojmarketingjandjfinancejasjajmajorjbusinessjfuncti
on,jalljstudentsjreadilyjunderstandjthejrolejofjoperationsjandjsupplyjchainjinjbusiness.
Injteachingjthisjchapter,jwejhighlightjthejimportantjrolejthatjOMjandjsupplyjchainsjplayjinjth
ejeconomyjandjthejfirm.j Thejfivejdecisionjareasjinjoperationsjandjsupplyjchainjandjthejimportancej
ofjcross-
functionaljdecisionjmakingjarejemphasized.j Wejalsojspendjsomejtimejdiscussingjthejimportancejofj
bothjservicesjandjmanufacturing,jandjhowjbusinessjoperationsjarejmanagedjwithinjlarger,jmulti-
organizationjsupplyjchains.j Wejintroducejthejconceptjofjcontingenciesjandjexplainjthatjthejtextboo
kjincludesjinformationjonjwhenjparticularjOMjactivitiesjarej„bestjpractices‟jandjwhenjtheyjarejnot.j
Wejalsojdefinejanalyticsjandjexplainjhowjanalyticsjisjusedjinjoperationsjandjsupplyjchainjmanagem
entjdecisions.j Finally,jwejillustratejmajorjOMjandjsupplyjchainjdecisionsjusingjthejPizzajU.S.A.jex
ample,jasjwelljasjinjotherjtypesjofjbusinesses.j StudentsjmayjfindjthejtypicaljjobsjinjOMjandjsupplyjc
hainjfromjMonster.comj(injajChapterj1jOperationsjLeaderjbox).
ThejLearningjEnrichmentjsectionjatjthejendjofjthejchapterjprovidesjvideosjand/orjwebsitesjthatjstud
entsjcanjaccessjoutsidejofjclassjorjinstructorsjcanjusejinjclass.j Thesejresourcesjhelpjbringjthejchapte
rjmaterialsjtojlife,jandjtapjintojstudentjinterest.
LearningjEnrichmentj(forjself-studyjorjinstructorjassignments)
WhatjisjOperationsjManagementjhttps://yo Video
utu.be/leMOReAE2hkj j5:19
SupplyjChainjManagement:jAjForcejforjGood.j Video
https://youtu.be/Bl0UhiOvrdc j5:01
CocajCola:jSupplyjChain Video
https://youtu.be/UBSOiHUctrY j2:2
9
1-1
, Sustainability WebjLink
https://www.epa.gov/sustainability/learn-about-sustainability#what
Globablization WebjLink
http://www.globalization101.org/what-is-globalization/
AnswersjtojQuestions
1. Operationsjandjsupplyjchainjmanagementjisjubiquitous,jthatjisjpresentjinjeveryjorganization
.j Daily,jwejcomejinjcontactjwithjvariousjgoodsjandjservicesjproducedjbyjthejtransformationj
ofjinputsjtojoutputsjunderjthejcontroljofjoperationsjmanagers.j Operationsjandjsupplyjchainj
managementjisjajcorejbusinessjfunctionjalongjwithjmarketingjandjfinance.j Alljdecisionsjarej
cross-
functionaljinjnature.j Youjwilljbejinteractingjwithjthejoperationsjfunctionjnojmatterjwhatjcar
eerjyoujchoose.j Muchjofjwhatjisjlearnedjrelatedjtojoperationsjandjsupplyjchainjmanagement
jcanjbejappliedjtojotherjfunctions.
2. Operationsjmanagementjisjajbroaderjtermjthanjproductionjmanagement,jencompassingjserv
icejorganizationsjasjwelljasjmanufacturing.j Operationsjmanagementjisjalsojajmorejrecentjte
rmjreplacingjthejearlierjtermjproductionjmanagement.
3. Thejdifferencejbetweenjoperationsjandjsupplyjchainjmanagementjisjoperationsjmanagemen
tjfocusesjonjdecisionsjtojmanagejthejtransformationjprocessjthatjconvertsjinputsjintojdesired
jfinishedjgoodsjorjservicesjwithinjajsinglejfirm.j Operationsjmanagementjoccursjwithinjandja
crossjmultiplejfacilitiesjinjanjorganization.j Supplyjchainjmanagementjrelatesjtojthejnetworkj
ofjmanufacturingjandjservicejoperationsjthatjsupplyjeachjotherjfromjrawjmaterialsjthroughj
manufacturingjtojthejultimatejcustomer.j Thejsupplyjchainjconsistsjofjthejflowsjofjmaterials,
jmoney,jandjinformationjalongjthejentirejchainjofjsourcing,jproduction,jandjdistribution.j Th
ejsupplyjchainjlinksjthejoperationsjofjmanyjdifferentjorganizationsjinjorderjtojsatisfyjcustom
erjneeds.
4. Responsibilitiesjdifferjamongjoperations,jmarketingjandjfinancejmanagers.j Ajmarketingjm
anagerjidentifiesjdemandjforjgoodsjorjservicesjandjdevelopsjthejmarket,jwhereasjthejoperati
onsjmanagerjassuresjsupplyjofjthejproductsjorjservices.j Thejfinancejmanagerjacquiresjandja
llocatesjthejcapitaljresourcesjforjthejotherjfunctions.j Similaritiesjinjthejthreejfunctionsjinclu
dejmanagerialjdecisionjmakingjandjsharedjorganizationaljgoals.
5. Operations,jmarketing,jandjfinancejarejprimaryjfunctionsjofjthejorganization.j Humanjresou
rces,jinformationjsystems,jandjaccountingjarejsupportingjfunctionsjthatjprovidejresourcesja
ndjservicesjforjthejthreejprimaryjfunctions.j Thejoperationsjmanagerjappliesjresources,janal
ysisjandjinformationjprovidedjbyjsupportingjfunctionsjandjintegratesjthemjintojdecisionjma
king.j Thejfocusjofjthejoperationsjmanagerjisjonjdecisionjmakingjratherjthanjonjanalyticjmet
hods.
6. a.j j Thejpurposejofjajcollegejlibraryjisjtojmakejinformationjavailablejtojstudentsjandjfacultyj
forjresearchjandjstudying.j Thejoutputjisjthejbundlejofjservicesjprovidedjalongjwithjf
acilitatingjgoods:j buildings,jcomputers,jbooks,jcatalogsjandjindices.
Processj --
j facilityj layoutj consideringj bookj stacks,j referencej rooms,j computerjaccessj on-
sitej andj fromj off-site,j degreej ofj computerj usej andj proceduresj for
1-2
, accessingjandjcirculatingjinformation.j Theyjmustjnotjonlyjselectjthejappropriatejpro
cess,jbutjmanagejthejflowjofjusersjandjinformation.
Qualityj--
jstandardsjofjthejcollegejlibraryjprofessionjarejadopted;jqualityj measuresjinclude:j r
atiojofjconsultingjstaffjhoursjtojstudents,jratejofjnewjbookj andjotherjmaterialjpurcha
ses,jnumberjofjcomplaints,jstudentjsatisfaction.
Capacityj--
jforecastingjofjlibraryjuserjneedsjcontributesjtojdecisionsjonjbuildingjsize,jvolumejof
jspacejforjstudyjandjmaterials,jprintjacquisitions,jcomputerjworkjstations,jstaffjhirin
gjandjschedulingjofjshifts.
Inventoryj--jdecisionsjconcerningjthejnumberjofjbooks,jperiodicals,jetc.jtojstock.
SupplyjChainj–
jdecisionsjaboutjsourcingjofjmaterialsjandjinformation.j Also,jdecisionsjarejmadejab
outjbestjtojdistributejprintedjandjonlinejmaterials,jalongjwithjmovingjmaterialsjandji
nformationjintojthejlibrary.
b. Thejpurposejofjajhoteljisjtojattractjandjsatisfyjconventioneersjandjovernightjguests.j
Thejoutputjisjthejbundlejofjservicesjandjgoodsjprovided:j overnightjaccommodations
,jmaidjservice,jroomjservice,jtelevision,jpool,jbar,jcoffeejshop.
Processj--
jajsetjofjprocessesjforjreservingjandjpaymentjofjrooms,jhousekeeping,jrestaurant,jrec
reationjservices,jandjongoingjstudyjofjservicejmethods;jthejpeoplejwhojimplementjt
hesejprocessesjincludingjreceptionists,jaccountants,jhousekeepers,jandjmaintenance
jworkers.
Qualityj--
jhoteljindustryjstandardsjandjthejmarketjpositioningjofjthejhotelj(firstjclassjvs.jbudge
t)jdeterminejstandards;jqualityjmeasuresjincludejnumberjofjreturnjvisitors,jconventi
onsjbooked,jandjratingsjbyjindustryjevaluators.
Capacityj--
jnumberjofjunitsjandjbeds;jappropriatejsizejforjrestaurant,jbarjandjconventionjhalls;js
taffingjforjhousekeeping,jrestaurantjandjoffice.j Schedulingjofjthejworkforcejisjalsoji
ncluded.
Inventoryj--
jgoodsjtojmeetjrequirementsjforjroomjupkeepj(towels,jsheets,jetc.),jconventionjcateri
ngj(glasses,jdishes,jfood),jrestaurantjandjbar.
Supplyjchainj–
jdecisionsjaboutjsourcingjthejvariousjmaterialsjandjservicesjusedjbyjthejhotel.j Logis
ticsjisjaboutjmovingjmaterialsjandjservicesjtojthejhoteljandjthenjreturnjandjrecyclingj
ofjgoods.
c. Thejpurposejofjajsmalljmanufacturingjfirmjisjtojprovidejcustomersjwithjajqualityjpro
ductjatjajreasonablejprice.j Thejoutputjconsistsjofjnotjonlyjthejphysicaljgoodjbutjalsoj
anyjservicesjthatjaccompanyjthejgood,jsuchjasjassistancejinjselectingjthejgoodj(thejs
1-3
, hoppingjprocess)jorjajwarranty.
Processj--
jthejprocessjofjsecuringjthejrawjmaterials,jtransformingjandjassemblingjthemjintojajf
inishedjgood,jpackagingjthejproduct,jandjarrangingjforjitsjdeliveryjtojcustomers.
1-4
OPERATIONSjMANAGEMENTjINjTHEjSUPPLYjCHAINjDECISIONSj&
CASES,j8thjEditionjChapt
erj1-18
Chapterj1
ThejOperationsjFunction
TeachingjNotes
Thisjchapterjisjaimedjatjprovidingjanjoveralljframeworkjforjthejtextbookjandjthejfieldjofjope
rationsjandjsupplyjchainjmanagement.jAjnewjsectionjisjaddedjonjthejrolejofjoperationsjandjsupplyjc
hainjmanagementjinjthejeconomyjandjinjthejfirm.j Thejchapterjprovidesjajframeworkjthatjservesjasj
ajbeneficialjwayjofjorganizingjstudents'junderstandingjofjfivejmajorjoperationsjandjsupplyjchainjma
nagementjdecisionjtypes:j process,jquality,jcapacity,jinventoryjandjsupplyjchain.jThejcross-
functionaljviewjofjoperationsjmanagementj(OM)jisjalsojintroducedjinjthisjchapterjtojprovidejreleva
ncejforjthejcoursejinjparticularjforjnon-
majors.j Whenjoperationsjmanagementjisjrelatedjtojmarketingjandjfinancejasjajmajorjbusinessjfuncti
on,jalljstudentsjreadilyjunderstandjthejrolejofjoperationsjandjsupplyjchainjinjbusiness.
Injteachingjthisjchapter,jwejhighlightjthejimportantjrolejthatjOMjandjsupplyjchainsjplayjinjth
ejeconomyjandjthejfirm.j Thejfivejdecisionjareasjinjoperationsjandjsupplyjchainjandjthejimportancej
ofjcross-
functionaljdecisionjmakingjarejemphasized.j Wejalsojspendjsomejtimejdiscussingjthejimportancejofj
bothjservicesjandjmanufacturing,jandjhowjbusinessjoperationsjarejmanagedjwithinjlarger,jmulti-
organizationjsupplyjchains.j Wejintroducejthejconceptjofjcontingenciesjandjexplainjthatjthejtextboo
kjincludesjinformationjonjwhenjparticularjOMjactivitiesjarej„bestjpractices‟jandjwhenjtheyjarejnot.j
Wejalsojdefinejanalyticsjandjexplainjhowjanalyticsjisjusedjinjoperationsjandjsupplyjchainjmanagem
entjdecisions.j Finally,jwejillustratejmajorjOMjandjsupplyjchainjdecisionsjusingjthejPizzajU.S.A.jex
ample,jasjwelljasjinjotherjtypesjofjbusinesses.j StudentsjmayjfindjthejtypicaljjobsjinjOMjandjsupplyjc
hainjfromjMonster.comj(injajChapterj1jOperationsjLeaderjbox).
ThejLearningjEnrichmentjsectionjatjthejendjofjthejchapterjprovidesjvideosjand/orjwebsitesjthatjstud
entsjcanjaccessjoutsidejofjclassjorjinstructorsjcanjusejinjclass.j Thesejresourcesjhelpjbringjthejchapte
rjmaterialsjtojlife,jandjtapjintojstudentjinterest.
LearningjEnrichmentj(forjself-studyjorjinstructorjassignments)
WhatjisjOperationsjManagementjhttps://yo Video
utu.be/leMOReAE2hkj j5:19
SupplyjChainjManagement:jAjForcejforjGood.j Video
https://youtu.be/Bl0UhiOvrdc j5:01
CocajCola:jSupplyjChain Video
https://youtu.be/UBSOiHUctrY j2:2
9
1-1
, Sustainability WebjLink
https://www.epa.gov/sustainability/learn-about-sustainability#what
Globablization WebjLink
http://www.globalization101.org/what-is-globalization/
AnswersjtojQuestions
1. Operationsjandjsupplyjchainjmanagementjisjubiquitous,jthatjisjpresentjinjeveryjorganization
.j Daily,jwejcomejinjcontactjwithjvariousjgoodsjandjservicesjproducedjbyjthejtransformationj
ofjinputsjtojoutputsjunderjthejcontroljofjoperationsjmanagers.j Operationsjandjsupplyjchainj
managementjisjajcorejbusinessjfunctionjalongjwithjmarketingjandjfinance.j Alljdecisionsjarej
cross-
functionaljinjnature.j Youjwilljbejinteractingjwithjthejoperationsjfunctionjnojmatterjwhatjcar
eerjyoujchoose.j Muchjofjwhatjisjlearnedjrelatedjtojoperationsjandjsupplyjchainjmanagement
jcanjbejappliedjtojotherjfunctions.
2. Operationsjmanagementjisjajbroaderjtermjthanjproductionjmanagement,jencompassingjserv
icejorganizationsjasjwelljasjmanufacturing.j Operationsjmanagementjisjalsojajmorejrecentjte
rmjreplacingjthejearlierjtermjproductionjmanagement.
3. Thejdifferencejbetweenjoperationsjandjsupplyjchainjmanagementjisjoperationsjmanagemen
tjfocusesjonjdecisionsjtojmanagejthejtransformationjprocessjthatjconvertsjinputsjintojdesired
jfinishedjgoodsjorjservicesjwithinjajsinglejfirm.j Operationsjmanagementjoccursjwithinjandja
crossjmultiplejfacilitiesjinjanjorganization.j Supplyjchainjmanagementjrelatesjtojthejnetworkj
ofjmanufacturingjandjservicejoperationsjthatjsupplyjeachjotherjfromjrawjmaterialsjthroughj
manufacturingjtojthejultimatejcustomer.j Thejsupplyjchainjconsistsjofjthejflowsjofjmaterials,
jmoney,jandjinformationjalongjthejentirejchainjofjsourcing,jproduction,jandjdistribution.j Th
ejsupplyjchainjlinksjthejoperationsjofjmanyjdifferentjorganizationsjinjorderjtojsatisfyjcustom
erjneeds.
4. Responsibilitiesjdifferjamongjoperations,jmarketingjandjfinancejmanagers.j Ajmarketingjm
anagerjidentifiesjdemandjforjgoodsjorjservicesjandjdevelopsjthejmarket,jwhereasjthejoperati
onsjmanagerjassuresjsupplyjofjthejproductsjorjservices.j Thejfinancejmanagerjacquiresjandja
llocatesjthejcapitaljresourcesjforjthejotherjfunctions.j Similaritiesjinjthejthreejfunctionsjinclu
dejmanagerialjdecisionjmakingjandjsharedjorganizationaljgoals.
5. Operations,jmarketing,jandjfinancejarejprimaryjfunctionsjofjthejorganization.j Humanjresou
rces,jinformationjsystems,jandjaccountingjarejsupportingjfunctionsjthatjprovidejresourcesja
ndjservicesjforjthejthreejprimaryjfunctions.j Thejoperationsjmanagerjappliesjresources,janal
ysisjandjinformationjprovidedjbyjsupportingjfunctionsjandjintegratesjthemjintojdecisionjma
king.j Thejfocusjofjthejoperationsjmanagerjisjonjdecisionjmakingjratherjthanjonjanalyticjmet
hods.
6. a.j j Thejpurposejofjajcollegejlibraryjisjtojmakejinformationjavailablejtojstudentsjandjfacultyj
forjresearchjandjstudying.j Thejoutputjisjthejbundlejofjservicesjprovidedjalongjwithjf
acilitatingjgoods:j buildings,jcomputers,jbooks,jcatalogsjandjindices.
Processj --
j facilityj layoutj consideringj bookj stacks,j referencej rooms,j computerjaccessj on-
sitej andj fromj off-site,j degreej ofj computerj usej andj proceduresj for
1-2
, accessingjandjcirculatingjinformation.j Theyjmustjnotjonlyjselectjthejappropriatejpro
cess,jbutjmanagejthejflowjofjusersjandjinformation.
Qualityj--
jstandardsjofjthejcollegejlibraryjprofessionjarejadopted;jqualityj measuresjinclude:j r
atiojofjconsultingjstaffjhoursjtojstudents,jratejofjnewjbookj andjotherjmaterialjpurcha
ses,jnumberjofjcomplaints,jstudentjsatisfaction.
Capacityj--
jforecastingjofjlibraryjuserjneedsjcontributesjtojdecisionsjonjbuildingjsize,jvolumejof
jspacejforjstudyjandjmaterials,jprintjacquisitions,jcomputerjworkjstations,jstaffjhirin
gjandjschedulingjofjshifts.
Inventoryj--jdecisionsjconcerningjthejnumberjofjbooks,jperiodicals,jetc.jtojstock.
SupplyjChainj–
jdecisionsjaboutjsourcingjofjmaterialsjandjinformation.j Also,jdecisionsjarejmadejab
outjbestjtojdistributejprintedjandjonlinejmaterials,jalongjwithjmovingjmaterialsjandji
nformationjintojthejlibrary.
b. Thejpurposejofjajhoteljisjtojattractjandjsatisfyjconventioneersjandjovernightjguests.j
Thejoutputjisjthejbundlejofjservicesjandjgoodsjprovided:j overnightjaccommodations
,jmaidjservice,jroomjservice,jtelevision,jpool,jbar,jcoffeejshop.
Processj--
jajsetjofjprocessesjforjreservingjandjpaymentjofjrooms,jhousekeeping,jrestaurant,jrec
reationjservices,jandjongoingjstudyjofjservicejmethods;jthejpeoplejwhojimplementjt
hesejprocessesjincludingjreceptionists,jaccountants,jhousekeepers,jandjmaintenance
jworkers.
Qualityj--
jhoteljindustryjstandardsjandjthejmarketjpositioningjofjthejhotelj(firstjclassjvs.jbudge
t)jdeterminejstandards;jqualityjmeasuresjincludejnumberjofjreturnjvisitors,jconventi
onsjbooked,jandjratingsjbyjindustryjevaluators.
Capacityj--
jnumberjofjunitsjandjbeds;jappropriatejsizejforjrestaurant,jbarjandjconventionjhalls;js
taffingjforjhousekeeping,jrestaurantjandjoffice.j Schedulingjofjthejworkforcejisjalsoji
ncluded.
Inventoryj--
jgoodsjtojmeetjrequirementsjforjroomjupkeepj(towels,jsheets,jetc.),jconventionjcateri
ngj(glasses,jdishes,jfood),jrestaurantjandjbar.
Supplyjchainj–
jdecisionsjaboutjsourcingjthejvariousjmaterialsjandjservicesjusedjbyjthejhotel.j Logis
ticsjisjaboutjmovingjmaterialsjandjservicesjtojthejhoteljandjthenjreturnjandjrecyclingj
ofjgoods.
c. Thejpurposejofjajsmalljmanufacturingjfirmjisjtojprovidejcustomersjwithjajqualityjpro
ductjatjajreasonablejprice.j Thejoutputjconsistsjofjnotjonlyjthejphysicaljgoodjbutjalsoj
anyjservicesjthatjaccompanyjthejgood,jsuchjasjassistancejinjselectingjthejgoodj(thejs
1-3
, hoppingjprocess)jorjajwarranty.
Processj--
jthejprocessjofjsecuringjthejrawjmaterials,jtransformingjandjassemblingjthemjintojajf
inishedjgood,jpackagingjthejproduct,jandjarrangingjforjitsjdeliveryjtojcustomers.
1-4
