Operations management is concerned with designing and controlling the production of goods and services , ensuring that businesses are efficient in using resources to meet customer requirements.
98-538: It is concerned with managing an entire production system that converts inputs (in the forms of raw materials , labor , consumers , and energy ) into outputs (in the form of goods and services for consumers). Operations management covers sectors like banking systems, hospitals, companies, working with suppliers, customers, and using technology. Operations is one of the major functions in an organization along with supply chains , marketing , finance and human resources . The operations function requires management of both
196-529: A conveyor belt while workers added components to it until the car was completed. During World War II , the growth of computing power led to further development of efficient manufacturing methods and the use of advanced mathematical and statistical tools. This was supported by the development of academic programs in industrial and systems engineering disciplines, as well as fields of operations research and management science (as multi-disciplinary fields of problem solving). While systems engineering concentrated on
294-461: A 5,000 dollar incentive with an additional 5,000 dollars once that money was exhausted for the person that was able to accurately produce arms for the government. Because the cotton gin had not brought Whitney the rewards he believed it promised, he accepted the offer. Although the contract was for one year, Whitney did not deliver the arms until 1809, using multiple excuses for the delay. Recently, historians have found that during 1801–1806, Whitney took
392-459: A book they published in 1948 called Methods-Time Measurement . The methods-time measurement may be defined as follows: Methods-time measurement is a procedure which analyzes any manual operation or method into the basic motions required to perform it and assigns to each motion a predetermined time standard which is determined by the nature of the motion and the conditions under which it is made. Thus it may be seen that methods-time measurement
490-489: A contract to manufacture muskets in 1798 were mostly monetary. By the late 1790s, Whitney was on the verge of bankruptcy and the cotton gin litigation had left him deeply in debt . His New Haven cotton gin factory had burned to the ground, and litigation sapped his remaining resources. The French Revolution had ignited new conflicts between Great Britain, France, and the United States. The new American government, realizing
588-429: A dominant economic force, and slavery was sustained as a key institution of Southern society. Eli Whitney has often been incorrectly credited with inventing the idea of interchangeable parts, which he championed for years as a maker of muskets ; however, the idea predated Whitney, and Whitney's role in it was one of promotion and popularizing, not invention. Successful implementation of the idea eluded Whitney until near
686-665: A fair amount of standardization of artillery pieces, although not true interchangeability of parts. He inspired others, including Honoré Blanc and Louis de Tousard , to work further on the idea, and on shoulder weapons as well as artillery. In the 19th century these efforts produced the "armory system," or American system of manufacturing . Certain other New Englanders, including Captain John H. Hall and Simeon North , arrived at successful interchangeability before Whitney's armory did. The Whitney armory finally succeeded not long after his death in 1825. The motives behind Whitney's acceptance of
784-449: A gin which substituted circular saws for the spikes) and their cotton gin company went out of business in 1797. One oft-overlooked point is that there were drawbacks to Whitney's first design. There are claims that the use of wires rather than pegs was proposed by Mrs. Greene, but these are disputed. After validation of the patent, the legislature of South Carolina voted $ 50,000 for the rights for that state, while North Carolina levied
882-425: A given musket were fitted only for that particular musket and could not be used in other muskets. Interchangeability of parts allowed the mass production of parts independent of the final products in which they would be used. An entire new market to fill the need for the sale and manufacturing of muskets began at this time. In 1883, Frederick Winslow Taylor introduced the stopwatch method for accurately measuring
980-498: A high degree of labor intensity there are mass services (e.g., commercial banking bill payments and state schools ) and professional services (e.g., personal physicians and lawyers ), while with a low degree of labor intensity there are service factories (e.g., airlines and hotels ) and service shops (e.g., hospitals and auto mechanics ). The systems described above are ideal types : real systems may present themselves as hybrids of those categories. Consider, for example, that
1078-543: A high merchandise assortment, return services of purchases, and fast delivery is at the forefront of this business. It is the customer being in the system during the production and delivery of the service that distinguishes all services from manufacturing. Recent trends in the field revolve around concepts such as: A production system comprises both technological elements (machines and tools) and organizational behavior (division of labor and information flow ) needed to produce goods and services. An individual production system
SECTION 10
#17329341952741176-527: A job: a higher rate for workers with high productivity (efficiency) and who produced high quality goods (effectiveness) and a lower rate for those who fail to achieve the standard. One of the problems Taylor believed could be solved with this system was the problem of soldiering : faster workers reducing their production rate to that of the slowest worker. In 1911 Taylor published his " The Principles of Scientific Management ", in which he characterized scientific management (also known as Taylorism ) as: Taylor
1274-561: A lack of raw materials as a reason for their supply chain issues. Forecasting for 2023, 50% of respondents expect a reduced availability of raw materials in the US to drive supply chain disruptions. Raw materials markets are affected by consumer behavior, supply chain uncertainty, manufacturing disruptions, and regulations, amongst other factors. This results in volatile raw materials markets that are difficult to optimize and manage. Companies can struggle when faced with raw material volatility due to
1372-459: A lack of understanding of market demands, poor or no visibility into the indirect supply chain, and the time lag of raw materials price changes. Volatility in the raw materials markets can also be driven by natural disasters and geopolitcal conflict. The COVID-19 pandemic disrupted the steel industry, and once demand rebounded, prices increased 250% in the US . The Russian invasion of Ukraine caused
1470-416: A large body of mathematical literature focusing on the problem of production planning and inventory control . In 1924 Walter Shewhart introduced the control chart through a technical memorandum while working at Bell Labs , central to his method was the distinction between common cause and special cause of variation. In 1931 Shewhart published his Economic Control of Quality of Manufactured Product,
1568-467: A license tax for five years, from which about $ 30,000 was realized. There is a claim that Tennessee paid about $ 10,000. While the cotton gin did not earn Whitney the fortune he had hoped for, it did give him fame. It has been argued by some historians that Whitney's cotton gin was an important if unintended cause of the American Civil War. After Whitney's invention, the plantation slavery industry
1666-431: A machine to separate the short staple upland cotton from its seeds, work that was then done by hand at the rate of a pound of lint a day. In a few weeks Whitney produced a model. The cotton gin was a wooden drum stuck with hooks that pulled the cotton fibers through a mesh. The cotton seeds would not fit through the mesh and fell outside. Whitney occasionally told a story wherein he was pondering an improved method of seeding
1764-403: A major part of economic activity and employment in all industrialized countries comprising 80 percent of employment and GDP in the U.S. Operations management of these services, as distinct from manufacturing, has been developing since the 1970s through publication of unique practices and academic research. Please note that this section does not particularly include "Professional Services Firms" and
1862-533: A migrant from Connecticut). When he initially sailed for South Carolina, among his shipmates were the widow ( Catherine Littlefield Greene ) and family of the Revolutionary hero Gen. Nathanael Greene of Rhode Island. Mrs. Greene invited Whitney to visit her Georgia plantation, Mulberry Grove . Her plantation manager and husband-to-be was Phineas Miller, another Connecticut migrant and Yale graduate (class of 1785), who would become Whitney's business partner. Whitney
1960-439: A month after his 59th birthday. He left a widow and his four children behind. One of his offspring, Eli Whitney III (known as Eli Whitney Jr.), was instrumental in building New Haven, Connecticut's waterworks. During the course of his illness, he reportedly invented and constructed several devices to mechanically ease his pain. The Eli Whitney Students Program , Yale University's admissions program for non-traditional students ,
2058-677: A production system). A first possible distinction in production systems (technological classification) is between continuous process production and discrete part production ( manufacturing ). Another possible classification is one based on lead time (manufacturing lead time vs delivery lead time): engineer to order (ETO), purchase to order (PTO), make to order (MTO), assemble to order (ATO) and make to stock (MTS). According to this classification different kinds of systems will have different customer order decoupling points (CODP), meaning that work in progress (WIP) cycle stock levels are practically nonexistent regarding operations located after
SECTION 20
#17329341952742156-579: A series of events at Toyota Motor led to the development of the Toyota Production System (TPS) and lean manufacturing . In 1943, in Japan, Taiichi Ohno arrived at Toyota Motor company. Toyota evolved a unique manufacturing system centered on two complementary notions: just in time (produce only what is needed) and autonomation (automation with a human touch). Regarding JIT, Ohno was inspired by American supermarkets : workstations functioned like
2254-470: A single store in Roger's Arkansas in 1962, Walmart has now become the world's largest company. This was accomplished by adhering to their system of delivering the goods and the service to the customers at the lowest possible cost. The operations system included careful selection of merchandise, low cost sourcing, ownership of transportation, cross-docking, efficient location of stores and friendly home-town service to
2352-654: A supermarket shelf where the customer can get products they need, at the time they need and in the amount needed, the workstation (shelf) is then restocked. Autonomation was developed by Toyoda Sakichi in Toyoda Spinning and Weaving: an automatically activated loom that was also foolproof, that is automatically detected problems. In 1983 J.N Edwards published his "MRP and Kanban-American style" in which he described JIT goals in terms of seven zeros: zero defects, zero (excess) lot size, zero setups, zero breakdowns, zero handling, zero lead time and zero surging. This period also marks
2450-453: A usable state. Metallic ores are first processed through a combination of crushing, roasting, magnetic separation, flotation, and leaching to make them suitable for use in a foundry . Foundries then smelt the ore into usable metal that may be alloyed with other materials to improve certain properties. One metallic raw material that is commonly found across the world is iron , and combined with nickel , this material makes up over 35% of
2548-533: A very highly specialized line of work is bound to do it in the best possible manner." In the Middle Ages , kings and queens ruled over large areas of land. Loyal noblemen maintained large sections of the monarch's territory. This hierarchical organization in which people were divided into classes based on social position and wealth became known as the feudal system . In the feudal system, vassals and serfs produced for themselves and people of higher classes by using
2646-425: A whole trade, is enough to support a man: one man, for instance, makes shoes for men, and another for women; and there are places even where one man earns a living by only stitching shoes, another by cutting them out, another by sewing the uppers together, while there is another who performs none of these operations but only assembles the parts. It follows, therefore, as a matter of course, that he who devotes himself to
2744-412: Is also credited for developing stopwatch time study . This, combined with Frank and Lillian Gilbreth motion study , gave way to time and motion study , which is centered on the concepts of standard method and standard time . Frank Gilbreth is also responsible for introducing the flow process chart in 1921. Other contemporaries of Taylor worth remembering are Morris Cooke (rural electrification in
2842-552: Is basically a tool of method analysis that gives answers in terms of time without the necessity of making stop-watch time studies. Up to this point in history, optimization techniques were known for a very long time, from the simple methods employed by Harris to the more elaborate techniques of the calculus of variations developed by Euler in 1733 or the multipliers employed by Lagrange in 1811, and computers were slowly being developed, first as analog computers by Sir William Thomson (1872) and James Thomson (1876) moving to
2940-459: Is concerned with provisioning them. Not all management models distinguish between production and operations systems. When the two are distinguished, operations systems account for many of the tertiary factors that are abstracted away from in production system frameworks. In particular, there is an emphasis on service-based factors. Operations systems can be broadly divided into two categories: service and manufacturing . Service industries are
3038-514: Is most famous for two innovations which came to have significant impacts on the United States in the mid-19th century: the cotton gin (1793) and his advocacy of interchangeable parts . In the South, the cotton gin revolutionized the way cotton was harvested and reinvigorated slavery. Conversely, in the North the adoption of interchangeable parts revolutionized the manufacturing industry, contributing greatly to
Operations management - Misplaced Pages Continue
3136-647: Is the Democratic Republic of the Congo . Eli Whitney Eli Whitney Jr. (December 8, 1765 – January 8, 1825) was an American inventor, widely known for inventing the cotton gin in 1793, one of the key inventions of the Industrial Revolution that shaped the economy of the Antebellum South . Whitney's invention made upland short cotton into a profitable crop, which strengthened
3234-477: Is usually analyzed in the literature referring to a single business; therefore it is usually improper to include in a given production system the operations necessary to process goods that are obtained by purchasing or the operations carried by the customer on the sold products, the reason being simply that since businesses need to design their own production systems this then becomes the focus of analysis , modeling and decision making (also called "configuring"
3332-619: The African slavery system in the Southern United States to become more sustainable at a critical point in its development. Whitney applied for the patent for his cotton gin on October 28, 1793, and received the patent (later numbered as X72) on March 14, 1794, but it was not validated until 1807. Whitney and his partner, Miller, did not intend to sell the gins. Rather, like the proprietors of gristmills and sawmills , they expected to charge farmers for cleaning their cotton – two-fifths of
3430-608: The Crystal Palace Exhibition the term American system of manufacturing was used to describe the new approach that was evolving in the United States of America which was based on two central features: interchangeable parts and extensive use of mechanization to produce them. Henry Ford was 39 years old when he founded the Ford Motor Company in 1903, with $ 28,000 capital from twelve investors. The model T car
3528-572: The Soviet government and later in 1947 with the simplex method of Dantzig . These methods are known today as belonging to the field of operations research . From this point on, a curious development took place: while in the United States the possibility of applying the computer to business operations led to the development of management software architecture such as MRP and successive modifications, and ever more sophisticated optimization techniques and manufacturing simulation software, in post-war Japan
3626-595: The World Wide Web has opened new opportunities for operations, manufacturing, production, and service systems. Before the First Industrial Revolution , work was mainly done through two systems: domestic system and craft guilds . In the domestic system merchants took materials to homes where artisans performed the necessary work, craft guilds on the other hand were associations of artisans which passed work from one shop to another, for example: leather
3724-427: The probability that the observed phenomenon will fall within the given limits." In the 1940s methods-time measurement (MTM) was developed by H.B. Maynard , J.L. Schwab and G.J. Stegemerten. MTM was the first of a series of predetermined motion time systems , predetermined in the sense that estimates of time are not determined in loco but are derived from an industry standard. This was explained by its originators in
3822-523: The production line has been used multiple times in history prior to Henry Ford: the Venetian Arsenal (1104); Smith's pin manufacturing, in the Wealth of Nations (1776) or Brunel's Portsmouth Block Mills (1802). Ransom Olds was the first to manufacture cars using the assembly line system, but Henry Ford developed the first auto assembly system where a car chassis was moved through the assembly line by
3920-613: The water to create very stable and hard materials. Without the presence of clay on the riverbanks of the Tigris and Euphrates in the Fertile Crescent, such kilns would have been impossible for people in the region to have produced. Using these kilns, the process of metallurgy was possible once the Bronze and Iron Ages came upon the people that lived there. Many raw metallic materials used in industrial purposes must first be processed into
4018-496: The 1920s and implementer of Taylor's principles of scientific management in the Philadelphia's Department of Public Works), Carl Barth (speed-and-feed-calculating slide rules) and Henry Gantt (Gantt chart). Also in 1910 Hugo Diemer published the first industrial engineering book: Factory Organization and Administration . In 1913 Ford Whitman Harris published a paper on "How many parts to make at once", in which he presented
Operations management - Misplaced Pages Continue
4116-538: The CODP (except for WIP due to queues). (See Order fulfillment .) The concept of production systems can be expanded to the service sector world keeping in mind that services have some fundamental differences in respect to material goods: intangibility, client always present during transformation processes, no stocks for "finished goods". Services can be classified according to a service process matrix: degree of labor intensity (volume) vs degree of customization (variety). With
4214-595: The Japanese approach: Meanwhile, in the sixties, a different approach was developed by George W. Plossl and Oliver W. Wight, this approach was continued by Joseph Orlicky as a response to the TOYOTA Manufacturing Program which led to material requirements planning (MRP) at IBM , latter gaining momentum in 1972 when the American Production and Inventory Control Society launched the "MRP Crusade". One of
4312-451: The U.S. victory in the Civil War . The cotton gin is a mechanical device that removes the seeds from cotton, a process that had previously been extremely labor-intensive. The word gin is short for engine. While staying at Mulberry Grove, Whitney constructed several ingenious household devices which led Mrs Greene to introduce him to some businessmen who were discussing the desirability of
4410-530: The United States for another 70 years. Before the 1790s, slave labor was primarily employed in growing rice, tobacco, and indigo , none of which were especially profitable anymore. Neither was cotton, due to the difficulty of seed removal. But with the invention of the gin, growing cotton with slave labor became highly profitable – the chief source of wealth in the American South, and the basis of frontier settlement from Georgia to Texas. " King Cotton " became
4508-569: The acquisition or extraction of raw materials. For example, the European Commission notes that food supply chains commence in the agricultural phase of food production. A 2022 report on changes affecting international trade noted that improving sourcing of raw materials has become one of the main objectives of companies reconfiguring their supply chains. In a 2022 survey conducted by SAP , wherein 400 US-based leaders in logistics and supply chain were interviewed, 44% of respondents cited
4606-409: The broad characteristics of the relationships between inputs and outputs of generic systems, operations researchers concentrated on solving specific and focused problems. The synergy of operations research and systems engineering allowed for the realization of solving large scale and complex problems in the modern era. Recently, the development of faster and smaller computers, intelligent systems , and
4704-521: The coming of the Internet, in 1994 Amazon devised a service system of on-line retailing and distribution. With this innovative system customers were able to search for products they might like to buy, enter the order for the product, pay online, and track delivery of the product to their location, all in two days. This required not only very large computer operations, but dispersed warehouses, and an efficient transportation system. Service to customers including
4802-475: The construction of the pyramids. By 1100 B.C., labor was being specialized in China ; by about 370 B.C., Xenophon described the advantages of dividing the various operations necessary for the production of shoes among different individuals in ancient Greece : "...In large cities, on the other hand, inasmuch as many people have demands to make upon each branch of industry, one trade alone, and very often even less than
4900-467: The cotton when he was inspired by observing a cat attempting to pull a chicken through a fence, and able to only pull through some of the feathers. A single cotton gin could generate up to 55 pounds (25 kg) of cleaned cotton daily. This contributed to the economic development of the Southern United States , a prime cotton growing area; some historians believe that this invention allowed for
4998-470: The customer during delivery of the service (product and process design). While there are differences there are also many similarities. For example, quality management approaches used in manufacturing such as the Baldrige Award, and Six Sigma have been widely applied to services. Likewise, lean service principles and practices have also been applied in service operations. The important difference being
SECTION 50
#17329341952745096-411: The customer is in the system while the service is being provided and needs to be considered when applying these practices. Raw material A raw material , also known as a feedstock , unprocessed material , or primary commodity , is a basic material that is used to produce goods , finished goods , energy, or intermediate materials that are feedstock for future finished products. As feedstock,
5194-578: The customer. In 1987 the International Organization for Standardization (ISO), recognizing the growing importance of quality, issued the ISO 9000 , a family of standards related to quality management systems. There standards apply to both manufacturing and service organizations. There has been some controversy regarding the proper procedures to follow and the amount of paperwork involved, but much of that has improved in current ISO 9000 revisions. With
5292-463: The economic foundation of slavery in the United States and prolonged the institution. Despite the social and economic impact of his invention, Whitney lost much of his profits in legal battles over patent infringement for the cotton gin. Thereafter, he turned his attention to securing contracts with the government in the manufacture of muskets for the newly formed United States Army. He continued making arms and inventing until his death in 1825. Whitney
5390-504: The effectiveness and efficiency of manufacturing or service operations. The history of production and operation systems begins around 5000 B.C. when Sumerian priests developed the ancient system of recording inventories, loans, taxes, and business transactions. The next major historical application of operation systems occurred in 4000 B.C., when the Egyptians started using planning , organization , and control in large projects such as
5488-459: The electromechanical computers of Konrad Zuse (1939 and 1941). During World War II however, the development of mathematical optimization went through a major boost with the development of the Colossus computer , the first electronic digital computer that was all programmable, and the possibility to computationally solve large linear programming problems, first by Kantorovich in 1939 working for
5586-416: The end again as process production: it is unlikely that a single company will keep all the stages of production under a single roof, therefore the problem of vertical integration and outsourcing arises. Most products require, from a supply chain perspective , both process production and part production. If a production system is concerned with the production of goods and services, an operations system
5684-571: The end of his life, occurring first in others' armories. Attempts at interchangeability of parts can be traced back as far as the Punic Wars through both archaeological remains of boats now in Museo Archeologico Baglio Anselmi and contemporary written accounts. In modern times the idea developed over decades among many people. An early leader was Jean-Baptiste Vaquette de Gribeauval , an 18th-century French artillerist who created
5782-422: The fall of 1789 and graduated Phi Beta Kappa in 1792. Whitney expected to study law but, finding himself short of funds, accepted an offer to go to South Carolina as a private tutor. Instead of reaching his destination, he was convinced to visit Georgia. In the closing years of the 18th century, Georgia was a magnet for New Englanders seeking their fortunes (its Revolutionary-era governor had been Lyman Hall ,
5880-605: The famed evangelist Jonathan Edwards , daughter of Pierpont Edwards , head of the Democratic Party in Connecticut, and first cousin of Yale's president, Timothy Dwight , the state's leading Federalist , further tied him to Connecticut's ruling elite . In a business dependent on government contracts, such connections were essential to success. Whitney died of prostate cancer on January 8, 1825, in New Haven, Connecticut, just
5978-476: The first milling machine circa 1818. Subsequent work by other historians (Woodbury; Smith; Muir; Battison [cited by Baida ]) suggests that Whitney was among a group of contemporaries all developing milling machines at about the same time (1814 to 1818), and that the others were more important to the innovation than Whitney was. (The machine that excited Roe may not have been built until 1825, after Whitney's death.) Therefore, no one person can properly be described as
SECTION 60
#17329341952746076-475: The first hard cover book on the subject. MRP II was developed by Gene Thomas at IBM, and expanded the original MRP software to include additional production functions. Enterprise resource planning (ERP) is the modern software architecture, which addresses, besides production operations, distribution , accounting , human resources and procurement . Dramatic changes were occurring in the service industries as well. Beginning in 1955 McDonald's provided one of
6174-410: The first innovations in service operations. McDonald's is founded on the idea of the production-line approach to service. This requires a standard and limited menu, an assembly-line type of production process in the back-room, high customer service in the front-room with cleanliness, courtesy and fast service. While modeled after manufacturing in the production of the food in the back-room, the service in
6272-430: The first sources of iron ore is bog iron . Bog iron takes the form of pea-sized nodules that are created under peat bogs at the base of mountains. Places with plentiful raw materials and little economic development often show a phenomenon known as " Dutch disease " or the " resource curse ", which occurs when the economy of a country is mainly based upon its exports because of its method of governance. An example of this
6370-418: The first systematic treatment of the subject of statistical process control (SPC). He defined control: "For our present purpose a phenomenon will be said to be controlled when, through the use of past experience, we can predict, at least within limits , how the phenomenon may be expected to vary in the future. Here it is understood that prediction within limits means that we can state, at least approximately,
6468-493: The front-room was defined and oriented to the customer. It was the McDonald's operations system of both production and service that made the difference. McDonald's also pioneered the idea of franchising this operation system to rapidly spread the business around the country and later the world. FedEx in 1971 provided the first overnight delivery of packages in the U.S. This was based on the innovative idea of flying all packages into
6566-408: The future economy would provide more GDP and employment from services than from manufacturing and have a great effect on society. Since all sectors are highly interconnected, this did not reflect less importance for manufacturing, agriculture, and mining but just a shift in the type of economic activity. Although productivity benefited considerably from technological inventions and division of labor,
6664-478: The given task. At the turn of the twentieth century, the services industries were already developed, but largely fragmented. In 1900 the U.S. service industry consisted of banks, professional services, schools, general stores, railroads and telegraph. Services were largely local in nature (except for railroads and telegraph) and owned by entrepreneurs and families. The U.S. in 1900 had 31% employment in services, 31% in manufacturing and 38% in agriculture. The idea of
6762-471: The government complained that Whitney's price per musket compared unfavorably with those produced in government armories, he was able to calculate an actual price per musket by including fixed costs such as insurance and machinery , which the government had not accounted for. He thus made early contributions to both the concepts of cost accounting , and economic efficiency in manufacturing. Machine tool historian Joseph W. Roe credited Whitney with inventing
6860-570: The humans of that time period were able to excavate. The nickel content of the meteoric iron made it not necessary to be heated up, and instead, it was hammered and shaped into tools and weapons. Iron ore can be found in a multitude of forms and sources. The primary forms of iron ore today are Hematite and Magnetite . While iron ore can be found throughout the world, only the deposits in the order of millions of tonnes are processed for industrial purposes. The top five exporters of Iron ore are Australia, Brazil, South Africa, Canada, and Ukraine. One of
6958-485: The idea of the economic order quantity model. He described the problem as follows: " Interest on capital tied up in wages , material and overhead sets a maximum limit to the quantity of parts which can be profitably manufactured at one time; " setup costs " on the job fix the minimum. Experience has shown one manager a way to determine the economical size of lots." Harris described his theory as "reasonably correct", although "not rigorously accurate". His paper inspired
7056-536: The inventor of the milling machine. Despite his humble origins, Whitney was keenly aware of the value of social and political connections. In building his arms business, he took full advantage of the access that his status as a Yale alumnus gave him to other well-placed graduates, such as Oliver Wolcott Jr. , Secretary of the Treasury (class of 1778), and James Hillhouse , a New Haven developer and political leader. His 1817 marriage to Henrietta Edwards, granddaughter of
7154-471: The key insights of this management system was the distinction between dependent demand and independent demand . Independent demand is demand which originates outside of the production system, therefore not directly controllable, and dependent demand is demand for components of final products, therefore subject to being directly controllable by management through the bill of materials , via product design . Orlicky wrote "Materials Requirement Planning" in 1975,
7252-494: The material in the Earth's inner and outer core . The iron that was initially used as early as 4000 BC was called meteoric iron and was found on the surface of the Earth. This type of iron came from the meteorites that struck the Earth before humans appeared, and was in very limited supply. This type is unlike most of the iron in the Earth, as the iron in the Earth was much deeper than
7350-400: The money and headed into South Carolina in order to profit from the cotton gin. Although Whitney's demonstration of 1801 appeared to show the feasibility of creating interchangeable parts, Merritt Roe Smith concludes that it was "staged" and "duped government authorities" into believing that he had been successful. The charade gained him time and resources toward achieving that goal. When
7448-817: The need to prepare for war, began to rearm. The War Department issued contracts for the manufacture of 10,000 muskets. Whitney, who had never made a gun in his life, obtained a contract in January 1798 to deliver 10,000 to 15,000 muskets in 1800. He had not mentioned interchangeable parts at that time. Ten months later, the Treasury Secretary, Oliver Wolcott Jr. , sent him a "foreign pamphlet on arms manufacturing techniques," possibly one of Honoré Blanc's reports, after which Whitney first began to talk about interchangeability. In May 1798, Congress voted for legislation that would use 800,000 dollars in order to pay for small arms and cannons in case war with France erupted. It offered
7546-529: The price of natural gas to increase by 50% in 2022. While pottery originated in many different points around the world, it is certain that it was brought to light mostly through the Neolithic Revolution . That is important because it was a way for the first agrarians to store and carry a surplus of supplies. While most jars and pots were fire-clay ceramics , Neolithic communities also created kilns that were able to fire such materials to remove most of
7644-445: The problem of systematic measurement of performances and the calculation of these by the use of formulas remained somewhat unexplored until Frederick Taylor , whose early work focused on developing what he called a "differential piece-rate system" and a series of experiments, measurements and formulas dealing with cutting metals and manual labor. The differential piece-rate system consisted in offering two different pay rates for doing
7742-409: The production of jeans involves initially carding , spinning , dyeing and weaving , then cutting the fabric in different shapes and assembling the parts in pants or jackets by combining the fabric with thread, zippers and buttons, finally finishing and distressing the pants/jackets before being shipped to stores. The beginning can be seen as process production, the middle as part production and
7840-499: The professional services practiced from this expertise (specialized training and education within). According to Fitzsimmons, Fitzsimmons and Bordoloi (2014) differences between manufactured goods and services are as follows: These four comparisons indicate how management of service operations are quite different from manufacturing regarding such issues as capacity requirements (highly variable), quality assurance (hard to quantify), location of facilities (dispersed), and interaction with
7938-405: The ruler's land and resources. Although a large part of labor was employed in agriculture, artisans contributed to economic output and formed guilds . The guild system, operating mainly between 1100 and 1500, consisted of two types: merchant guilds, who bought and sold goods, and craft guilds, which made goods. Although guilds were regulated as to the quality of work performed, the resulting system
8036-574: The single airport in Memphis Tenn by midnight each day, resorting the packages for delivery to destinations and then flying them back out the next morning for delivery to numerous locations. This concept of a fast package delivery system created a whole new industry, and eventually allowed fast delivery of online orders by Amazon and other retailers. Walmart provided the first example of very low cost retailing through design of their stores and efficient management of their entire supply chain. Starting with
8134-467: The spread of total quality management (TQM) in Japan, ideas initially developed by American authors such as Deming , Juran and Armand V. Feigenbaum . TQM is a strategy for implementing and managing quality improvement on an organizational basis, this includes: participation, work culture, customer focus, supplier quality improvement and integration of the quality system with business goals. Schnonberger identified seven fundamentals principles essential to
8232-420: The strategic and day-to-day production of goods and services. In managing manufacturing or service operations, several types of decisions are made including operations strategy, product design , process design , quality management , capacity , facilities planning, production planning and inventory control . Each of these requires an ability to analyze the current situation and find better solutions to improve
8330-475: The term connotes these materials are bottleneck assets and are required to produce other products. The term raw material denotes materials in unprocessed or minimally processed states such as raw latex , crude oil , cotton , coal , raw biomass , iron ore , plastic , air , logs , and water . The term secondary raw material denotes waste material which has been recycled and injected back into use as productive material. Supply chains typically begin with
8428-578: The time of each task. PMTS allows the use of standard predetermined tables of the smallest body movements (e.g. turning the left wrist by 90°), and integrating them to predict the time needed to perform a simple task. PMTS has gained substantial importance due to the fact that it can predict work measurements without observing the actual work. The foundation of PMTS was laid out by the research and development of Frank B. and Lillian M. Gilbreth around 1912. The Gilbreths took advantage of taking motion pictures at known time intervals while operators were performing
8526-427: The time to perform each single task of a complicated job. He developed the scientific study of productivity and identifying how to coordinate different tasks to eliminate wasting of time and increase the quality of work. The next generation of scientific study occurred with the development of work sampling and predetermined motion time systems (PMTS). Work sampling is used to measure the random variable associated with
8624-405: The value, paid in cotton. Resentment at this scheme, the mechanical simplicity of the device and the primitive state of patent law , made infringement inevitable. Whitney and Miller could not build enough gins to meet demand, so gins from other makers found ready sale. Ultimately, patent infringement lawsuits consumed the profits (one patent, later annulled, was granted in 1796 to Hogden Holmes for
8722-510: The work to the man and not the man to the work. That is the real principle of our production, and conveyors are only one of many means to an end" This became one of the central ideas that led to mass production , one of the main elements of the Second Industrial Revolution , along with emergence of the electrical industry and petroleum industry . The post-industrial economy was noted in 1973 by Daniel Bell. He stated that
8820-482: Was 11. At age 14 he operated a profitable nail manufacturing operation in his father's workshop during the Revolutionary War . Because his stepmother opposed his wish to attend college, Whitney worked as a farm laborer and school teacher to save money. He prepared for Yale at Leicester Academy (later Becker College ) and under the tutelage of Rev. Elizur Goodrich of Durham , Connecticut, he entered Yale in
8918-401: Was a characteristic of the growing cities and trade networks of Europe. An important leap in manufacturing efficiency came in the late eighteenth century as Eli Whitney popularized the concept of interchangeability of parts when he manufactured 10,000 muskets. Up to this point in the history of manufacturing, each product (e.g. each musket) was considered a special order, meaning that parts of
9016-444: Was a staple that could be stored for long periods and shipped long distances, unlike most agricultural products. It became the U.S.'s chief export, representing over half the value of U.S. exports from 1820 to 1860. Whitney believed that his cotton gin would reduce the demand for enslaved labor and would help hasten the end of southern slavery. Paradoxically, the cotton gin, a labor-saving device, helped preserve and prolong slavery in
9114-532: Was born in Westborough , Massachusetts , on December 8, 1765, the eldest child of Eli Whitney Sr., a prosperous farmer, and his wife Elizabeth Fay, also of Westborough. The younger Eli was famous during his lifetime and after his death by the name "Eli Whitney", though he was technically Eli Whitney Jr. His son, born in 1820, also named Eli, was known during his lifetime and afterward by the name "Eli Whitney Jr." Whitney's mother, Elizabeth Fay, died in 1777, when he
9212-551: Was facilitated by two elements: interchangeability of parts and division of labor. Division of labor has been a feature from the beginning of civilization , the extent to which the division is carried out varied considerably depending on period and location. Compared to the Middle Ages, the Renaissance and the Age of Discovery were characterized by a greater specialization in labor, which
9310-403: Was introduced in 1908, however it was not until Ford implemented the assembly line concept, that his vision of making a popular car affordable by every middle-class American citizen would be realized. The first factory in which Henry Ford used the concept of the assembly line was Highland Park (1913), he characterized the system as follows: "The thing is to keep everything in motion and take
9408-409: Was rather rigid, shoemakers , for example, were prohibited from tanning hides. Services were also performed in the Middle Ages by servants. They provided service to the nobility in the form of cooking, cleaning and providing entertainment. Court jesters were considered service providers. The medieval army could also be considered a service since they defended the nobility. The Industrial Revolution
9506-531: Was rejuvenated, eventually culminating in the Civil War. The cotton gin transformed Southern agriculture and the national economy. Southern cotton found ready markets in Europe and in the burgeoning textile mills of New England . Cotton exports from the U.S. boomed after the cotton gin's appearance – from less than 500,000 pounds (230,000 kg) in 1793 to 93 million pounds (42,000,000 kg) by 1810. Cotton
9604-448: Was tanned by a tanner , passed to curriers , and finally arrived at shoemakers and saddlers . The beginning of the industrial revolution is usually associated with the eighteenth-century English textile industry , with the invention of the flying shuttle by John Kay in 1733, the spinning jenny by James Hargreaves in 1765, the water frame by Richard Arkwright in 1769 and the steam engine by James Watt in 1765. In 1851 at
#273726