1.
Hospital Operation Management System
• Inputs: Patients, medical team, gear, supplies, money.
• Process: Registering patients → diagnosing → treating → recovery, scheduling resources, managing
inventory.
• Output: Treated patients, billing, patient satisfaction scores.
2. Competitive Dimensions of Operations Strategy
Key priorities:
• Cost – Competing on low prices (like Walmart).
• Quality – Reliable performance (like Mercedes).
• Delivery – Quick shipping (like Amazon).
• Flexibility – Custom options and volume changes (like Dell).
• Innovation – New products (like Apple).
3. Historical Development of Operations Management
• Before the Industrial Revolution: Crafts made by skilled workers.
• Industrial Revolution (1760–1840): Mass production and dividing tasks (Eli Whitney).
• Scientific Management (1900s): Studies on efficiency (Frederick Taylor).
• Human Relations Movement (1930s): How worker motivation affects productivity (Elton Mayo).
• Operations Research (WWII): Using math techniques like linear programming.
• Modern OM (1980s–now): Lean manufacturing, TQM, Six Sigma, digital tools (IoT, AI).
4. Advantages & Disadvantages of Production Systems
Job Shop:
• Pros: Highly customizable, flexible.
• Cons: Expensive, slow, complicated scheduling.
Batch Production:
• Pros: Moderately flexible, cheaper than job shops.
• Cons: Inventory costs, setup delays.
Continuous Production:
• Pros: Very efficient, low cost per unit.
• Cons: Inflexible, needs a lot of investment.
5. Operation Design
Looks at making processes efficient for delivering products/services, including how things flow, planning
capacity, and using technology.
6.1 Modular Design:
• Pros: Easy to fix, customizable (think LEGO).
• Cons: Higher initial design costs.
6.2 Design for Disassembly (DfD):
• Designed for easy recycling (like IKEA furniture).
6.3 Robust Design:
• Works well under different conditions (Taguchi methods).
6. Mass Customization
• What it is: Making custom products at mass-production prices (like Nike ID).
• Achieved through: Modular design, flexible manufacturing, and a strategy to delay final assembly.
7. Product Design Approaches
Traditional Approach: Steps in order (design → engineering → production); slow.
Concurrent Engineering: Teamwork happens at the same time (design and production work together).
Quality Function Deployment (QFD): Converting customer needs into design specs (House of Quality).
8. Location Decision Factors
• Cost: Labor, taxes, utilities.
• Market Proximity: Access for customers.
• Infrastructure: Transport and utilities.
• Regulations: Environmental rules.
• Competition: Companies often gather in the same area (like tech firms in Silicon Valley).
9. Types of Layouts
1. Process Layout – Job shops/hospitals (group similar tasks).
2. Product Layout – Assembly lines (straight flow).
3. Fixed-Position Layout – Shipbuilding (product stays in one place, workers move).
4. Cellular Layout – Group similar processes (like production cells).
10. Aggregate Planning Costs
• Production Costs: Overtime, subcontracting.
• Inventory Costs: Holding items, stockouts.
• Workforce Costs: Hiring/firing, training.
11. Elements of Successful TQM
1. Leadership Commitment – Leadership drives a quality culture.
2. Customer Focus – Listen to customer needs (like surveys).
3. Continuous Improvement (Kaizen) – Always looking for small upgrades.
4. Employee Involvement – Let staff suggest improvements.
5. Process-Centric Approach – Standardize workflows (SOPs).
6. Data-Driven Decisions – Use Six Sigma/statistical tools.
12. Productivity Calculations
Given:
• Output = $400,000
• Raw materials = 8,000 units
• Labor = 2,000 hrs ($4/hr)
• Machine = 4,000 hrs ($2/hr)
• Raw material cost = 40/labor hr → Total RM cost = 2,000 × 40 = $80,000
A) Single-Factor Productivity (Raw Material):
= Output / RM Cost = 400,000 / 80,000 = 5
B) Multifactor Productivity (Labor + Machine):
= 400,000 / (400,000 / (8,000 + 80,000)) = 25
C) Total Productivity:
= 400,000 / (80,000 + 8,000 + 8,000 + 8,000) = 4.17
13. Case Study: Hawkins Supply
Ways to Reduce Handling:
1. FIFO System: Make sure the oldest stock gets used first to cut down on restacking.
2. Automated Storage: Use barcode scanners to keep track of expiration dates.
3. Warehouse Redesign: Use rolling shelves for easy access to perishables.
4. Vendor-Managed Inventory (VMI): Let suppliers watch stock expiration.
Alternatives:
• Color-coded labels for expiration dates.
• Train staff on proper inventory rotation.
