MBA Course: Operations Management Notes

Overview: Operations Management is about using resources effectively. It is required for all products we see around.
Input-Process-Output (IPO) Model: This model applies to all the work we do, taking inputs, transforming them through processes, and producing outputs.

Business Strategy: A strategy is a plan with some objectives. Business strategy focuses on overall business success, whereas operations strategy focuses on the long-term capabilities of operations (Slack and Lewis).
Operations Strategy Elements: Includes target customers, external environment, other functional strategies, and business performance.
Implementation Elements: The three core elements of operations strategy implementation are customer requirements, competitive capabilities from operations, and decision areas for investments in operations.
Implementing Operations Strategy: Begin with the customer. What does the market want? What do target customers value?
Order Qualifiers vs. Order Winners: Order qualifiers are the minimum selection criteria required for a customer to even consider a product. Order winners are the differentiators that cause a customer to choose your product over others. For different customers, these can be different.
Common Operational Capabilities: Cost, quality, delivery, and flexibility.

Overview: Covers the cost of quality, quality processes (like Lean, Six Sigma, etc.), and related quality management areas.
Service Quality Dimensions: The five dimensions of service quality are Reliability, Assurance, Tangibles, Empathy, and Responsiveness. High service quality is achieved when services exceed customer expectations.
Cost of Quality (CoQ): A methodology to calculate the cost of quality for a product or service.
- Cost of Good Quality: Consists of prevention costs (preventing defects before they happen) and appraisal costs (the cost of inspecting quality at all stages of production processes).
- Cost of Poor Quality: Consists of internal failure costs and external failure costs. Internal failures are defects found before delivery (like scrapped products). External failures occur after delivering to customers (like warranty claims, returns, and replacements).

Supply Chain Management: Focuses on managing the flow of goods, services, data, and finances from raw material suppliers through production processes all the way to the end customer. Efficient supply chain management balances lead times, inventory levels, and logistics costs to meet market demand.

Reference: Coursera course, Operations Management by the University of Illinois Urbana-Champaign.

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