Introduction to Operations Management

At its core, operations management is about finding and then reducing inefficiencies. We will start by examining key concepts such as cost-quality trade-off, the efficiency frontier, and three system inhibitors. We will also explore process analysis, enabling you to identify and analyze the steps involved in a process and make changes to improve its outcomes. By the end of this module, you will have opportunities to practice these concepts by creating process flow diagrams and calculating the resource with the lowest capacity. Additionally, you'll be able to practice calculating capacity, flow rate, and utilization. You will be able to transfer these skills to initiate process analysis within your organization.

In operations management, flow focuses on the movement of materials, products, and information through the various stages of a production or service process. Lean operations focus on identifying sources of waste both in terms of resources and processes. Optimizing flow can improve productivity, reduce costs, and enhance customer satisfaction. By learning to carefully observe how work is done, we can become better at identifying waste. The goal is to create efficient and effective processes that maximize output while minimizing waste.

Little's Law, a foundational concept in operations management, helps quantify and evaluate the efficiency and effectiveness of a system by providing key performance indicators. By understanding the relationship between inventory, arrival rate, and cycle time, managers can make informed decisions regarding capacity planning. Little’s Law also serves as a diagnostic tool for process improvement initiatives and is particularly valuable in supply chain management, where it enables companies to optimize inventory levels, reduce lead times, and enhance coordination among various stages of the supply chain. It helps strike a balance between supply and demand, improving overall responsiveness and customer service.

Variability can introduce defects and hinder the pursuit of excellence. By recognizing and managing variability, organizations can lay the foundation for consistent and exceptional quality standards. This module introduces frameworks that provide systematic ways to analyze variability. We’ll look at how statistical analysis and problem-solving methodologies can enhance quality. We’ll also explore the power of real-time information and how it fosters continuous improvement. We’ll examine strategies for finding the root cause of an issue and explore how we might develop targeted solutions as we unravel complex problems.