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CBM Operation and Production Management

The document discusses the historical evolution of production and operations management from the 18th century industrial revolution to modern times. It covers key developments like Adam Smith's theories of specialization of labor, scientific management pioneered by Frederick Taylor, the incorporation of human factors through studies like the Hawthorne Experiments, the growth of operations research during World War 2, and the rise of the service sector in recent decades. The primary focus is on outlining major changes in approaches and perspectives within the field over time as new techniques and understandings emerged.

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Risha Mhie Matila
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188 views

CBM Operation and Production Management

The document discusses the historical evolution of production and operations management from the 18th century industrial revolution to modern times. It covers key developments like Adam Smith's theories of specialization of labor, scientific management pioneered by Frederick Taylor, the incorporation of human factors through studies like the Hawthorne Experiments, the growth of operations research during World War 2, and the rise of the service sector in recent decades. The primary focus is on outlining major changes in approaches and perspectives within the field over time as new techniques and understandings emerged.

Uploaded by

Risha Mhie Matila
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
You are on page 1/ 5

Risha Mhie M.

Matila

Room: BE306

August 27, 2019

1. Historical Evolution in Production and Operations Management

Industrial Revolution

 Prior to 1700, all production took place in cottage industries.


 From 1770 to the early 1800, industrial revolution resulted in two major
developments, substitution of machine power to human power and establishment
of the factory system.
 The industrial revolution developed in England in the 1700s.
 The steam engine invented by James Watt in 1764, largely replaced human and
water power for factories.
 Adam Smith’s The Wealth of Nations in 1776 touted the economic benefits of the
specialization of labour.
 Thus the late-1700s factories had not only machine power but also ways of
planning and controlling the tasks of workers.
 The industrial revolution spread from England to other European countries and to
the United Sates.
 In 1790 an American, Eli Whitney, developed the concept of interchangeable
parts.
 The first great industry in the U.S. was the textile industry.
 In the 1800s the development of the gasoline engine and electricity further
advanced the revolution.
 By the mid-1800s, the old cottage system of production had been replaced by
the factory system

Post-Civil War Period

 During the post-civil war period great expansion of production capacity occurred.
 By post-civil war the following developments set the stage for the great
production explosion of the 20th century
 increased capital and production capacity
 the expanded urban workforce
 new Western U.S. markets
 an effective national transportation system

Scientific Management
 Frederick Taylor is known as the father of scientific management. His shop
system employed these steps:
 Each worker’s skill, strength, and learning ability were determined.
 Stopwatch studies were conducted to precisely set standard output per
worker on each task.
 Material specifications, work methods, and routing sequences were used
to organize the shop.
 Supervisors were carefully selected and trained.
 Incentive pay systems were initiated.
 In the 1920s, Ford Motor Company’s operation embodied the key elements of
scientific management:
 standardized product designs
 mass production
 low manufacturing costs
 mechanized assembly lines
 specialization of labour
 interchangeable parts

Human Relations and Behaviorism

 In the 1927-1932 period, researchers in the Hawthorne Studies realized that


human factors were affecting production.
 Researchers and managers alike were recognizing that psychological and
sociological factors affected production.
 From the work of behaviorists came a gradual change in the way managers
thought about and treated workers.
Operation Research
 During World War II, enormous quantities of resources (personnel, supplies,
equipment, …) had to be deployed
 Military operations research (OR) teams were formed to deal with the complexity
of the deployment.
 After the war, operations researchers found their way back to universities,
industry, government, and consulting firms.
 OR helps operations managers make decisions when problems are complex and
wrong decisions are costly.
Service Revolution
 The creation of services organizations accelerated sharply after World War II.
 Today, more than two-thirds of the U.S. workforce is employed in services
 About two-thirds of U.S. GDP is from services
 There is a huge trade surplus in services.
 Investment per office worker now exceeds the investment per factory worker.
 Thus there is a growing need for service operations management.

For over two centuries operations and production management has been recognised as
an important factor in a country’s economic growth. The traditional view of
manufacturing management began in eighteenth century when Adam Smith recognised
the economic benefits of specialisation of labour. He recommended breaking of jobs
down into subtasks and recognises workers to specialised tasks in which they would
become highly skilled and efficient. In the early twentieth century, F.W. Taylor
implemented Smith’s theories and developed scientific management. From then till
1930, many techniques were developed prevailing the traditional view.

Production management becomes the acceptable term from 1930s to 1950s. As F.W.
Taylor’s works become more widely known, managers developed techniques that
focussed on economic efficiency in manufacturing. Workers were studied in great detail
to eliminate wasteful efforts and achieve greater efficiency. At the same time,
psychologists, socialists and other social scientists began to study people and human
behaviour in the working environment. In addition, economists, mathematicians, and
computer socialists contributed newer, more sophisticated analytical approaches. With
the 1970s emerge two distinct changes in our views. The most obvious of these,
reflected in the new name

Operations management was a shift in the service and manufacturing sectors of the
economy. As service sector became more prominent, the change from production to
operations emphasized the broadening of our field to service organizations. The
second, more suitable change was the beginning of an emphasis on synthesis, rather
than just analysis, in management practices
2. Difference of Production Management and Operation Management

The primary objective of production and operations management is to effectively


manage and utilize those resources of the firm that are essential for the production of
goods and services.

Production Management Operation Management


Production Management can be defined Operations Management is used to mean
as the administration of the set of activities that branch of management which deals
concerning the creation of goods or with the administration both production of
transformation of raw material into finished goods and provision of services to the
goods. customers.
the scope of operations management is
larger in comparison to the production
In production management, the manager management wherein the operations
has to make decisions regarding the manager looks after the product design,
design, quality, quantity and cost of the quality, quantity, process design, location,
product manufactured by the department. manpower required, storing, maintenance,
logistics, inventory management, waste
management, etc.
Production Management can only be one can find operations management in
found in the firms where production of every organization, i.e. manufacturing
goods is undertaken. concerns, service-oriented firms, banks,
hospitals, agencies, etc.
The basic objective of production Operation management aims at making
management is to provide the right quality the best possible use of organization’s
goods in the right quantity at right time and resources, in order to fulfil the customer’s
best price. wants.

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