Operations Management

the ability of the operation to efficiently product highly customized and unique products.

Produce finished goods; customer buys from inventory
Advantage: smooth production
Disadvantage: inventory
MTS

Start production when customer orders
Advantage: no finished goods inventory
Disadvantage: intermittent production
Key performance measures: Lead time, orders completed on time (or late), and quality measures.
MTO

Make parts and subassemblies; finish when customer places order
Advantages: less inventory, faster service
Disadvantage: some WIP inventory
Key performance measures: speed of service, inventory levels, and quality of product and service
ATO

Wait until someone places an order, then make the product

Make different parts, then put the parts together based on what customer ordered

Provides a basis for matching product choices made by marketing with process choices made by operations.

What are the 5 types of processes?

Begin production only after receiving a customer order

Build modules prior to receiving order; assemble product after receiving customer order.

Manufacture entire product prior to receiving customer order.

can provide a variety of options by using an assemble-to-order process. Example: Dell.

is the form of mass customization Motorola uses ofr its pager.

is used to defer a portion of the production until the point of delivery. example: Hewlett-Packard printers receive their final configuration for various voltages and powers supplies at U.S. or overseas warehouses before delivery.