Introduction to the Course

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1 Introduction to the Course Operations Management Master Degree Course In Management Engineering Prof. Sergio Cavalieri 1

2 Course objectives Operations Management course aims to provide the student of the graduate program in Management Engineering with an understanding of the issues related to the strategic management of Operations in terms of concepts, methodologies and tools needed to optimize the manufacturing processes both in terms of radical change and of continuous improvement Success factors Current activities Continuous improvement Breakthrough approaches 2

3 Educational goals By the end of the course, students will acquire Knowledge related to the methods of analysis, the modeling and simulation techniques of the business processes, Mastery on how to manage the Production Planning and Control Process, in order to complement the knowledge already acquired during the industrial production management course, Insight on the role of the industrial services, and in particular on the maintenance activities to support the company operations, Good theoretical and practical understanding of the lean production techniques: kaizen principles, auto-quality, just in time techniques, and Hoshin 3

4 Management Theory and Practice The Course includes the alternation of theoretical sessions with exercises and simulation business case studies, and at least one industrial visit It also provides articles related to industrial case studies to complement the theoretical part. 4

5 Course Organization Responsible: Prof. Sergio Cavalieri Teaching assistants: Dr. Fabiana Pirola assistant researcher of CELS Center Research Group on Industrial Engineering, Logistics and Service Operations E-learning: 5

6 Lecture Schedule Lectures are normally scheduled in the following days and hours. Tuesday from 2.00 pm to 5.00 pm Thursday from 2.00 pm to 4.00 pm Schedules could be subjected to variations or prolongations according to the specific topic or for logistics reasons. In particular, the lectures given by Prof. Crespo will be taught on Thursday and Fridays afternoon with a 4-hour schedule for each module. 6

7 Course program and calendar - 1 Date Subject Professor 02/10/2014 Role of Operations in manufacturing and service industries Cavalieri 07/10/2014 Tutoring - Fundamentals of OM Pirola 09/10/2014 Operations Strategy in industrial companies Cavalieri 14/10/2014 Operations Strategy in industrial companies Cavalieri 16/10/ /10/2014 Innovative operation strategies in Spain. Sample case studies in the service sector and in the textile industry Methods and techniques for maintenance management effectiveness and efficiency Crespo Crespo 21/10/2014 Business Process Re-engineering Cavalieri 23/10/2014 Methods and tools for Business Process Modeling and Simulation Pirola 28/10/2014 Exercises on BPM Pirola 30/10/2014 Exercises on BPM Pirola 04/11/2014 Simulation Pirola 7

8 Course program and calendar - 2 Date Subject Professor 06/11/2014 Methods and techniques for maintenance management control Crespo 07/11/2014 Methods and techniques for maintenance management control Crespo 11/11/2014 Industrial Visit Cavalieri, Pirola 13/11/2014 Kaizen, polivalence and policompetence Cavalieri 18/11/2014 Lean Production: definition and general concepts. Cavalieri 20/11/2014 No lecture 25/11/2014 VSM (Case study) Cavalieri 27/11/2014 VSM (Case study) Cavalieri 02/12/2014 Industrial Visit in ABB Cavalieri, Pirola 04/12/2014 SMED Cavalieri 09/12/2014 Lean Production: Indicators Cavalieri 11/12/2014 Lean Production: Indicators (exercise) + Final Lecture Cavalieri 16/12/2014 No lecture 18/12/2014 No lecture 8

9 Exam Rules The examination will consist of two parts: Written Oral (based on assignments) The written exam includes exercises and questions, based on all the Operations Management program (exercise, theory and mandatory papers). The oral exam consists of the discussion of the assignments. The assignments can be prepared either individually or by groups of two students. The assignments must be uploaded on the elearning platform 1 week before the written exam (the duedate will be available on the platform) The assignments contents and rules will be provided during the course 9

10 Consulting Hours Prof. Sergio Cavalieri Office 406 Tuesday from 9.30 am to am (Appointment needed). Ph Ing. Fabiana Pirola CELS Lab Monday from am to am (Appointment needed). Ph

11 What is Operations Management? Operations Management is responsible for all activities of planning, implementation and improvement of business systems that create products and provide services. It supervises an entire system that produces an asset or delivers a product or a service. Operations operate in production systems. They produce products, manage quality, create services. They are located in banking systems, hospitals, companies, working with suppliers, customers, and using technology. 11

12 Why should we study Operations Management? Systemic vision of business processes Education in management Operations Management Career Opportunities Interdisciplinary applications 12

13 Systemic Vision Demand satisfaction Procurement Production Order delivery Primary processes Collection and order entry Create delivery Transport. planning Vehicle Receiving Picking and delivery output Transport Promotion Billing Support process Master data set Control Credit Control Price Control Availability Control Case: Active Cycle Expedite an order 13

14 From the steam engine. 14

15 to a complex logistics system Volkswagen Logistics Network 15

16 Education in management disciplines Finance / Accounting Orders for Materials Production and Delivery schedules quality requirements Design/performance Spec Suppliers Material available Quality data Delivery Schdules Design Production and Inventory data Capital budgeting request Capacity expansion and technology plans Operations Personnel needs Skill sets Performance evaluations Job design Work measurement Human Resources Budgets Cost Analysis Capital investments Stockholder requirements Hiring/firing Training Legal requirement Union contract Negotiations Product /service available Lead time estimates Status of order Delivery Schedules Sales Forecast Customers Orders Customer feedback Promotions Marketing 16

17 Interdisciplinary applications Agents/commercial partners Marketing and/or customers Distributeb demand planning (local area/channel) WDP Product & Process development Aggregate demand planning Production to demand allocation (AATP) Searching & qualifing suppliers Collaborative sourcing (contract definition) PP DP Aggregate production & purchase & distribution planning AATP ATP Order quoting with ATP Collaborative sourcing (contract definition) Suppliers/subcontractors WSM Collaborative ordering (order launching/ dispatching) Collaborative delivering (order replanning) Detailed production & purchase & distribution planning & scheduling OPS Production & purchase scheduling Order quoting with CTP Distribution scheduling DMO Collaborative ordering (order launching/ dispatching) Collaborative replanishment WOM Customers/distributors execute! Order tracking & monitoring Shop floor control Order tracking & monitoring 17

18 Article Corriere Article Italia Oggi Career Opportunities Main areas of graduate employment in Management Engineering at Politecnico of Milan The first job after graduation (Politecnico) Main areas of graduate employment in Management Engineering at University of Bergamo Responsabile altre mansioni; 10% segnamento; 3% anche - Consulenza finanziaria; 8% Impiegato altre mansioni; 13% Controllo di gestione; 4% Altro; 1% Management; 3% Commerciale - marketing; 6% Gestione della qualità; 13% Informatica; 8% Progettazione; 7% Logistica; 13% Produzione; 10% Industria altro; 25% Industria costruzioni; 4% Industria macchine elettriche, ottiche ed elettroniche; 2% Major industries (UNIBG) Informatica e servizi annessi; 11% Industria metalmeccanica; 33% (fonte AIP-IARD ) Commercio ecc. 6% Credito, assicurazioni, interm. finanziaria; 6% Altro; 14% 18

19 The ten main duties of an Operations Manager Product/Service planning design Business process (re-)engineering Factory Lay-out Planning Human Resources Management Supply Chain Management Inventory management Production planning and control Industrial Asset Management Quality Management 19

20 What is a production system? A production system is traditionally defined as a system that uses resources to transform inputs into desired output 20

21 Transformation Processes Physical processes (ex. manufacturing) Localization processes (ex. transport) Trade processes (ex. trading retail) Storage processes (ex. goods warehouse) Human-related processes (ex. health care); Information processes (ex. telecommunications). 21

22 Produce to serve The line between manufacturing and services is blurred The Economist Extended product Object that integrates the key features of a tangible product. It's also a set of services that contribute to highlight its properties and to diversify the supply on the market. 22

23 The variety of services to support the life cycle of a product Source: Thoben et al. (2002) 23

24 The effect on management policies source Thoben et al. (2002) 24

25 «Production» in a hospital Fonte: ibmg Erasmus University 25

26 Managing Operations in a hospital Fonte: ibmg Erasmus University 26

27 The organization chart of OM The company brings together its own manufacturing operations usually needed to carry the product in one area or function. 27

28 OM in Corporate Services In service businesses, operations pervade the whole organization: in an airline company managing reservation is part of the process of operations, although the department is specifically dedicated to operations; This is most visible in the banking system, which often provide a "production unit" both at the counter of commercial services and at the counter of conventional services. 28

29 OM in an Airline company 29

30 OM in Customer Service 30

31 Decision levers available to OM Strategic level SUPPLY -CHAIN CONFIGURATION Decision Level Tactical level SUPPLY CHAIN PLANNING Supply Production Distribution Execution level OPERATIVE LOGISTICS Inventory Demand CUSTOMER SERVICE STRATEGY Supplier source make stock deliver Customer PERFORMANCE MEASUREMENT 31

32 32

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