Operations management and organizational practices

Operations Management

What are the advantages of using a computer-aided design technology

Computer aided design technology is particular useful in a globalized world of commerce and business activity. Through the use of computer aided design technology information can seamlessly be transferred from one entity to another with little administrative cost to the business. This is particularly helpful for businesses that rely on human capital rather than physical infrastructure to create a product. Through computer aided design, concepts can be manipulated, transferred and discusses via the internet or other channels of communication. Through this mutual exchange of information, more individuals can have input within the overall design phase. Those with a particular specialty can provide feedback to the overall design as well (Askin, 1993).

Cross functional teams are advantaged through the use of CAD. Designers may not have the financial acumen needed to create a product at a price point consumers are willing to pay. Through CAD, teams including finance, accounting, and engineering can all have input within the overall design process. These cross functional teams, each with their own unique perspective and expertise can then create products that satisfy key company metrics. This metrics often include materials cost, profit margins, overhead expense, inventory turnover, and much more. Through the use of CAD on cross functional teams, better more efficient products are ultimately created.

2) Describe the major elements of FMS and evaluate the concept

The FMS has a litany of major elements that provide for efficient and automated operations of facilities. The first major elements of a FMS are computer numerically controlled machines. These automated machines allow for efficient task that humans may not be able to carry out. In addition, these machines also help streamline processes, ultimately helping to improve company profitability. In addition to the CNS, the FMS also incorporates machines that can automatically sense when a particular part has depreciated substantially and is no longer able to perform the needed task. An example, is that of a drill bit, which, when thoroughly worn, can no longer be used to help manufacture items. This concept of machine controlled aspect is very beneficial from a company perspective. Unlike their human counterparts, machines do not get sick. Nor do they have families or other obligations that can hinder productivity. As such, operations are more efficient, with fewer errors, and more products being created (R. B. 2007).

3) Discuss how CIM could provide strategic advantage

Computer Integrated Manufacture is particularly useful for organizations with high fixed cost structure within the business. Industries that rely extensively on fixed costs need to produce large amounts of volume to ultimately lower the cost per unit. Property, plant and equipment are fixed cost to corporations. These costs are incurred irrespective of production. A machine that costs $100 and produces 2 items, will incur nearly the same expense as if it produces 200 items. As such, CIM allows for companies to integrate their fixed cost structure to run the business in the most efficient manner. Through integrating assembly, manufacturing, design, testing, and fabrication, companies can better pinpoint areas of opportunity within their firms. They can also can reduce cost as the entire system is connected rather than having disparate parts and operations (D.C. 2012)

Strategically, through integration, a firm can alter operations as business needs dictate. For instance, if customers are demanding higher quality specifications for a product, the design component of the CIM can create these products, which will be manufactured and distributed using the same network.

4) Describe the categories of operational information systems and management information systems and provide business examples of their use

Operation information systems are used for more routine and daily tasks of a business. Although routine, these daily tasks are critical to the proper functioning of a business. Categories include:

Transaction processing systems- Transaction processing systems are systems that record and process data from operational transactions. A very common form of this system is used within the financial services industry to record debits and credits on checking or savings accounts.

Office Automation systems- This system is used primarily for administrative task that involve multiple stakeholder groups. The service industry, in particular relies heavily on office automation for video conferencing, and other firms of communication. Office automation is critical for the rapid exchange of pertinent information within any industry. Examples may include, a retail conference call outlining holiday sales initiatives.

Process control systems- Process control systems are important to manufacturing firms that need to increase efficiency and volumes by reducing error. Process control systems include many of the concepts mentioned above including FMS and CIM.

Management Information systems support tactical decisions that are often unique to a particular business or industry. Categories include:

Decision Support Systems- These systems are used to help facilitate problem solving on company specific issues. This system relies heavily on models to help determine the best course of action for a company. Financial firms use this system to anticipate how changes in interest rates can impact their loan portfolios over time.

Information Reporting Systems- These systems are more specific as they provide information that can be used on daily basis to aid in the decision making process. An example would include daily sales figures for a particular retail product category.

Executive Information Systems -- These systems include more of the high level information needed to form strategic initiative for the overall company. Information such as sales demographics can be used to determine where firm's customers are located and how to properly market to them.

5) Explain the relationships between the concepts of ecommerce and business

Both ecommerce and ebusiness are intertwined in regards to their overall relationship with one another. Ebusiness relies extensive of automating processes through the internet. Aspects such as human resources, marketing, and finance can now be conducted through "cloud" based infrastructure. Through use of the internet companies can now better market their products while also streamlining processes and eliminating bureaucracy. For example, customers can now pay for products online through services such as PayPal or Google Wallet.