Operation Management

Ch. 1 – Definitions

Production – the creation of goods & services

Operations Management – activities that relate to the creation of goods & services through the transformation of inputs to outputs

Management process – the application of planning, organizing, staffing, leading and controlling to the achievement of objectives

Services – Economic activities that typically product an intangible product (i.e. education, entertainment, etc.)

Pure Service – a service that does not include a tangible product

Service Sector – the segment of the economy that includes trade, financial, lodging, education, legal, medical and other professional occupations

Productivity – the ratio of outputs (goods and services) divided by one or more inputs (i.e. labor, capital or management)

Single factor productivity – indicates the ratio of one resource (input) to the goods and services produced (outputs)

Multifactor productivity – indicates the ratio of many or all resources (inputs) to the goods and services produced (outputs)

Productivity variable – the three factors critical to productivity improvement – labor, capital and the art and science of management

Knowledge society – a society in which much of the labor force has migrated from manual work to work based on knowledge

Ch. 2 – Definitions

Maquiladoras – Mexican factories located along the U.S.-Mexico border that receive preferential tariff treatment

Mission – the purpose or rationale for an organization’s existence

Strategy – how an organization expects to achieve its mission and goals

Competitive advantage – the creation of a unique advantage over competitors

Differentiation – distinguishing the offerings of an organization in a way that the customer perceives as adding value

Experience differentiation – Engaging the customer with a product through imaginative use of the 5 senses so the customer experiences the product

Low cost leadership – achieving maximum value as perceived by the customer

Response – a set...