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TRENDS
The lean systems concept is a current trend in operations management. This involves taking
a total system approach to creating an efficient operation. This includes concepts such as justin-time (JIT), total quality management (TQM), continuous improvement, resource planning,
and supply chain management (SCM).
Companies are using the Internet to reach out to customers, and suppliers directly.
Amazon.com has been able to sell books and many other items directly from its warehouse to
people like you and me. The Internet is changing how the supply chains work since we can
now eliminate the middle man or distributor by selling directly from the factory to the final
or end customer. Companies can also ease transactions between businesses, known as B2B
commerce, by using electronic trading networks.Large information systems, called Enterprise
Resource Planning (ERP) systems, are allowing companies to increase efficiency. These
large, sophisticated software programs coordinate, across the entire enterprise, the activities
involved in producing and delivering products to customers.;l;lEach of these concepts makes
intensive use of information and cooperation between partners. OM will most likely continue
to be more information intensive and require greater cooperation among all the players in the
value chain.
ISSUES
Recently there has been a dramatic surge in the outsourcing of parts and services that had
previously been produced internally. This has been encouraged by the availability of fast,
inexpensive communications. A whole new breed of contract manufacturers that specialize in
performing focused manufacturing activities now exists. The success of this kind of traditional
outsourcing has led companies to consider outsourcing other major corporate functions such as
information systems, product development and design, engineering services, packaging, testing,
and distribution. The ability to coordinate these activities is a significant challenge for the
operations manager of the future.
The implementation of global enterprise resource planning systems, now common in large
companies, has challenged managers to use all of this information. This requires a careful
understanding of where control should be centralized and where autonomy is important, among
other issues. Companies have only begun to truly take advantage of the information from these
systems to optimally control such resources as inventory, transportation, and production
equipment.
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