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Part I

Chapter 1: Introduction

"The internet is ultimately about innovation and integration. Innovation is what your objective is-- in cost, structure, selling, marketing, sales, supply chain. But you don't get the innovation unless you integrate web technology into the processes by which you run your business. ..." ~ Louis V. Gerstner, CEO, IBM, (Business Week, Dec. 13, 1999)

Managing Operations and Information Technology-- A typological Approach

Key question: What technologies are suited for what types of organizations and how the organization can successfully integrate the technology into its operations, structure, culture, etc. to achieve its goals?

For example, it is well known in Operations Management that certain types of operations can benefit from particular types of processes. A job shop is best suited for high variety, low volume types of operations such as hospitals and auto body shops, while repetitive process is good for standardized high volume production. We want to expand this approach to analyze a bigger issue in order to provide an answer to a top manager's questions such as "Which technologies should I adopt to boost our productivity, profit, morale, etc.?" Based on the typological approach, we need to understand what types of business we are dealing with. However, we can classify a business based on many criteria -- size, task, geographical locations, etc. We can also divide technologies into information, telecommunications, manufacturing, etc. Is there a better typological framework that can help us answer the question. Hopefully, we can find it out by the end of the semester.

Importance of Operations and IT Management

Amazon built its distribution center to improve their service. However, it had problem to run the center efficiently. [need to combine technology with operations.]
In a UPS TV commercial, UPS offers dot com's logistic services
Operations is one of the business function that is in every organization.
IT has become an important but not always an independent functional area yet. We do see more and more CIO recently.
Goal of the course: to provide a framework for thinking and analyzing the roles played by operations and IT in an organization.
Changes in market place and technologies make the subject ever more important. ( globalization, buyers' market, flexible systems, knowledge society).
Business functions (Finance, Marketing, Operations) and Management functions (Planning, organizing, leading, directing, controlling)

What is Operations Management?

Definition:
What decisions are made in Operations?
Typology: Manufacturing/Service, job shop/repetitive
Operations Strategies
OM planning from a Supply Chain Management point of view (What is the relationship among supply-chain, ERP, TQM, and JIT)
Example of Mission Statement and Strategies involving Operations
How IT is used to help OM: UPS package tracking,

What is Information Technology?

Is it a functional area?
Definition: Information Systems converts input to output ( formal system, computer-based information systems) and information technology includes information system and all hardware/software that support a information system.
Typology: Internet/www->E-commerce->(B2B, B2C,etc.), Telecom, computer hardware/software, artificial intelligence
IT Strategies
IT planning: *IS planning sophistication, IS success, integration, IT capability (Environmental uncertainty, information technology management climate, information-technology-management-process-effectiveness, IS maturity. (What factors lead to IS success? Define success)
Example of Mission and Strategies involving IT
Example of Technology Users: high tech and traditional industries.
Example of Technology Suppliers
Issues: CRM
*Sabherwal, R, "The Relationship Between Information System Planning Sophistication and Information System Success: An Empirical Assessment", Decision Sciences, Vol. 30, No. 1, Winter 1999, pp 137-167.

The framework to analyze the two areas

Competitive Advantage (Michael Porter): Cost, Differentiation, Quick Response)
Value Chain (Michael Porter)
Sociotechnical : Technical--Computer Science, Management Science, Operations Research; Behavioral-- Psychology, Sociology, and Economics ( transaction cost, perfect information)
　
Part 1: introduction and organizational issues.
Part 2: Operations Management from the view point of Supply chain Management: a process of converting input to output from raw materials to finished goods that includes suppliers and suppliers to suppliers, manufacturers, distributors, wholesalers, and retailers, customers. Two flows involved: physical flow and information flow, physical flow includes the delivery of materials, components, finished products, and payments etc. Information flow includes order processing, credit rendering, order updating, etc.
Part 3: in-depth view of technological development.
Part 4: Integration of the two areas to support overall organizational strategies. (from Brick-and-Mortar to Click-and-Mortar) EOQ: reducing order cost brings closer to JIT due to lower transaction cost from information technology
PLS: reducing setup cost brings closer to JIT due to lower setup cost from production technology.
Part 5: closing remarks and future trend.

　Chapter 2: Organizations -- Structures, Processes, Decision Making

"Organizations are tools for shaping the world as one wishes it to be shaped." ~ Charles Perrow, in his book Complex Organization-a critical essay, 3rd ed., Random House, NY, 1986.

"When you bring your company to the web, you expose all the inefficiency that comes from decentralized organizations" ~ Louis V. Gerstner, CEO, IBM, (Business Week, Dec. 13, 1999)

Business Structures: flattened organizational structure

Business Processes: business process re-engineering

Business Decision Making: strategic corporal

Implications to Organizations

Structure, goal, technology (task)
Relationship with other functional areas. Widening and overlapping roles of functional areas.