Operations management : history, goals, implications

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Operations Management : Course Work 1



I. History of Operations Management (p.3)
II. New goals & implications for Operations Management (p.5)

If you ask some people in the street to define Operations Management, they certainly respond that they do not know. But, without knowingit, they are vicariously concerned by this concept. Indeed, when they buy things like TV, they are going to use products which result from a value generating transformation of inputs into outputs. This process is called Operations Management. Companies have used that function for many decades. But, Operations Management and its objectives have evolved much since its “creation” in 1776 by AdamSmith.
So, what are the main developments of Operation Management during these past years? And what are the new goals of Operations Management?
Firstly, we are going to deal with Operations Management history and compare current OM to old OM. Then, we will explicate the new aims and implications that Operations Management is going to be confronted in the next years.

I. History of OperationsManagement
Adam Smith was the first to initiate the concept of Operations Management in 1776. Even if he did not use this term, his labour specialization is really a kind of Operations Management. This idea will be employed in factories and manufactures. It consists in majoring each employee in a specific domain of the production process. Thanks to this, workers increase factory’s productivitybecause they only do one thing, very well and very quickly. So, the company makes more profit and gains time in its production process.
Then, in 1800, Eli Whitney created the notion of standardization. Its goal is to make similar parts in order that each part could substitute another one. It enables production costs to reduce significantly.
These two concepts were notably at the root of the IndustrialRevolution which regulated the nineteenth century.
At the end of this century begins a new “era”, established by Taylor, Gantt and Gilbreth. During that period, Frederick Taylor launched scientific management. Even if labour specialization and standardization are part of Operations Management, we could say Taylor is the founder of Operations Management. Indeed, he developed a scientificapproach for labour, based on standardization and labour specialization. He fixed operations times and operations methods, he introduced the notion of “consulting” and “tasks prescription”. With this method, Taylor, helped by Frank and Lillian Gilbreth, wanted to reduce to the maximum production costs by gaining time and quality.
Henry Gantt was in line with Taylor’s process. Indeed, he created a famousgraph which enables operations managers to see project progress. This scheme is very helpful in order to manage the production; it is an important instrument for rationalizing labour and increasing production rate.
To this “scientific management era” succeeded another era, that we could call “mass production era”. In fact, it is very inspired by Taylor’s work. Thus, Henry Ford and CharlesSorensen took scientific management to the extremes. In 1913, they created assembly lines. It was very innovative because, for the first time, it wasn’t workers who moved but materials. Thanks to this, factories gained much time and improved the quality of their products because workers stayed in the same place and they didn’t tire anymore in useless moving.
In the 1970s, we attended to the emergenceof a new concept: the Toyota Production System (TPS) or Toyotism. With this system, the creator, Taï Chi Ono, wanted to increase the low Japan productivity in those days by subordinating offer to demand. The company must obey to the demand. This policy needs special requirements, called “5 zeros policy”. Firstly, it means that company must try to have no manufacturing faults in its products...