Managing your operations to balance inventory in an effort to satisfy customer demand that is, actual demand in the market for products and services without exposing the company to unnecessary cost and risk is crucial. Apr 26, 2020 inventory management is a neverending process, with multiple factors affecting the overall outcome. Introduction inventory theory deals with the management of stock levels of goods with the aim of ensuring that demand for these goods is met. Sometimes called production management, the field is crossfunctional, tying in with other departments such as sales, marketing, and finance. So we have to set inventory management in its overall context, noting its interactions with other activities, and explicitly recognizing its strategic importance. Production and operations management notes for mba pdf. This study aims to identify the key factors that influence inventory management practices, investigate efficient and effective inventory management approaches, and examine the impact of supplier cooperation on supply chain improvement. Inventory management is a business process which is responsible for managing, storing, moving, sorting, arranging, counting and maintaining the inventory i. Excel models for business and operations management. With a good understanding of the various forecasting techniques available, you will have the tools you need to effectively manage your inventory without long periods of overstocked or understocked goods.
Apr 01, 2017 free download inventory management ppt with pdf. It involves the responsibility of ensuring that business operations are efficient in terms of using as few resources as needed and effective in terms of meeting customer requirements. Inventory management is a very important function that determines the health of the supply chain as well as the impacts the financial health of the balance sheet. The apics foundation 2014 board officers and members are. Inventory management ensures that the right inventory is available as per the demand at low costs. Inventory management models every business should make the effort to continually optimize its inventory quantities and keep a healthy supply chain running full speed ahead. The importance of production and operation management is the process that combines and transforms various resources used in the production operation subsystem of the organization into valueadded productsservices in a controlled manner as per the policies of the organization. Lecture notes operations management sloan school of. In the previous chapters, we have discussed priority and capacity planning and control. The content in these pages will help you make your operation a higher performing machine. Inventory means all the materials may be raw or finished partscomponents, in process or finished products, castings and consumable tools, electrodes etc. First, it requires managers to know how best to use available information.
Learn vocabulary, terms, and more with flashcards, games, and other study tools. Operations management free download as powerpoint presentation. Definition, principles, activities, trends since all companies have operations, i. Sometimes called production management, the field is crossfunctional, tying in with other departments. Powerpoint, presentations, business, slides, diagrams, charts, transformation process, inoutput, macro operations, physical buffering, operations strategy, process design, manufactoring, supply chain management, vertical integration, assembly operations. The case of a language teaching institute both at home and from across southeast asia. Operations management operations management inventory. How do companies use operations research to improve their inventory policy for.
Even if all the assumptions dont hold exactly, the eoq gives us a good indication of whether or not current order quantities are reasonable. While it is very necessary to maintain the optimum level of inventory, it is not so easy as well. It looks after the units in a firm and makes sure that they are in a moderate amount which. Sumit thakur april 1, 2017 free download inventory management ppt with pdf. Word count exclu ding covers, tables, executive summary and references table of contents. We provide complete mba production and operations management notes. The inventory rotation speed is analyzed by starting from the data collected from the financial statements on which the efficiency indicators of the inventory management were calculated, according to table 2. Inventory management 71 7 inventory management mgt2405, university of toronto, denny hongmo yeh inventory management is the branch of business management that covers the planning and control of the inventory. Consequently, the study of inventory literature has been enlarged day by day and various inventory models have been. The apics operations management body of knowledge ombok framework provides an outline of the areas of knowledge required to manage the processes for producing and delivering common products and services.
Inventory management definition, types of inventory and. Inventory management makes sure that the core processes of a business keep running efficiently by optimizing. Formulate a mathematical modeldescribing the behavior of the inventory system. The demand is known with certainty and occurs at a constant rate shortages are not allowed. Mba production and operations management study material includes production and operations management notes, production and operations management book, courses, case study, mcq, syllabus, question paper, questions and answers and available in production and. In this paper, we focus on inventory management in a manufacturing company in china. Pdf inventory management example problems with solutions. Operations management is a systematic approach to address all the issues pertaining to the transformation process that converts some inputs into output that are useful, and could fetch revenue to the. The case of a language teaching institute some models of educational management the formal model the formal model bush, 2003 or classical model everard, morris and wilson, 2004 is characterised by a high degree of job specialisation and is highly centralised. Apr 14, 2019 inventory management is a business process which is responsible for managing, storing, moving, sorting, arranging, counting and maintaining the inventory i. In the term operations management, operations relate to. Log in to save your progress and obtain a certificate in alisons free inventory management using inventory models online course. Pdf inventory management models and their effects on uncertain. Production and operations management notes pdf mba 2020.
Purchase logistics operations and management 1st edition. You will learn how these models help determine order quantities that minimize total inventory holding costs and ordering costs. There is no question that uncertainty plays a role in most inventory management. Productionoperation management is the process which combines and transforms various resources used in the productionoperation subsystem of the organization into value added productsservices in a controlled manner as per the policies of the organization. Second, managers need to quantify the value of information. What are the different types of models in production and. Operations management models and diagrams for presentations. Inventory management theory is mostly concerned with finding the optimal way to manage inventories given exogenous and usually static business environments. Different models in production and operations management include the following. What can be learned from classical inventory models. Operations management ppt and pdf free study mafia. Discuss the basic workings of two classic independent demand inventory models. The number of different models we use in production and operations management run into hundreds, or even more than a thousand.
The descriptions give an ryhuylhz ri hdfk duhd dqg zkhq wdnhq wrjhwkhu gh. Mba production and operations management study material includes production and operations management notes, production and operations management book, courses, case study, mcq, syllabus, question paper, questions and answers and available in. Inventory management makes sure that the core processes of a business keep running efficiently by. Mar 31, 2017 operations management ppt and pdf free.
Obviously we have to put some limit on the material covered, and we have concentrated on the core questions of inventory management. Inventory control helps your business maintain the right amount of. Models operations research formal sciences mathematics formal sciences statistics. In most inventory models, just one product is being considered at a time. The article thus proposes a framework to help managers determine the best.
Seek an optimal inventory policy with respect to this model. This is vital to having a positive balance sheet because having an overabundance or shortage of inventory can be extremely harmful to the financial health of an organization. In this free online course in inventory management, learn to minimize total inventory holding and ordering costs while maintaining production flow. Operations management chapter 12 inventory management powerpoint presentation to accompany heizerrender principles of operations management, 7e operations management, 9e 2008 prentice hall, inc. Both examples indicate that there exists a tradeoff between the costs involved. This free online applied operations management course from alison will give you a better insight into inventory models. These are really too many to enumerate in a place like these. The term operations management encompasses planning, implementing, and supervising the production of goods or services. Download production and operations management notes pdf 2020 for mba. Every organization constantly strives to maintain optimum inventory to be able to meet its requirements and avoid over or under inventory that can impact the financial figures. However, after several years, this purpose was expanded to cater to the teaching and learning of southeast asian languages in addition to english. But this aspect of operations can be one of the toughest. Inventory models encyclopedia of life support systems. Distinguish between independent demand and dependent demand inventory items.
Introduce some basic inventory models, both deterministic and probabilistic. Lectures notes on production and operation management. Nonetheless, some models or methods have been developed in the recent past for determining the optimum level of inventories to be maintained in the enterprise. Operations managers have responsibilities in both strategy and daytoday production, in either manufacturing or services.
Operations management is an area of management concerned with designing and controlling the process of production and redesigning business operations in the production of goods or services. In the previous chapters, we have discussed priority and. Project management new product development and 3dce. Inventory models with constraints 291 probabilistic models 293 inventory control.
This refers to the system of mass production and consumption developed by the ford motor company and used. Models for inventory management rutgers business school. The purpose of inventory in operations management dummies. It looks after the units in a firm and makes sure that they are in a moderate amount which does not affect the performance of a company. H encyclopedia of life support systems eolss replenished in continuous units. Inventory management is obliged for the goods in inventory, also to their inward flow and outward flow. Introduction to operations management mit opencourseware. They use scientific inventory management comprising the following steps. Systems and operations management study guide, ardavan asefvaziri. Description 100 operations management models and diagrams for powerful business presentations and business knowledge. Pdf strategic operations management radhitya wirawan. A case study of inventory management in a manufacturing. Definition an operations system is defined as one in which several activities are performed to transform a set of inputs into useful output using a transformation process.
Third, they need to coordinate decentralized inventory operations. By b mahadevan this is a slide presentation on the book b y b mahadevan on operations. Operations management refers to the administration of business practices to create the highest level of efficiency possible within an organization. Inventory model is a mathematical model that helps business in determining the optimum level of inventories that should be maintained in a production process, managing frequency of ordering, deciding on quantity of goods or raw materials to be stored, tracking flow of supply of raw materials and goods to provide uninterrupted service to customers without any delay in delivery. How do companies use operations research to improve their inventory policyfor when and how much to replenish their inventory.