History of Operations Management

Operations management has existed for as long as people have produced goods and services. Origins of operations can be traced to early civilizations.

There are seven major areas of contribution to the operations management field.

Division of Labor. The division of labor is based on a very simple concept. Specialization of labor to a single task can result in greater productivity and efficiency than the assignment of many tasks to a single worker. This concept was recognized in 400 B.C. by Plato in The Republic when he said, “A man whose work is confined to such a limited task [e.g., shoe stitching] must necessarily excel at it.” The ancient Greeks also recognized the concept of the division of labor when they assigned some workers to do nothing but sharpen stone chisels.

The first economist to discuss the division of labor was Adam Smith, author of the classic Wealth of Nations (1776). Smith noted that specialization of labor increases output because of three factors: 1) increased dexterity on the part of workers, 2) avoidance of lost time due to changing jobs, and 3) the addition of tools and machines. Later, in 1832, Charles Babbage expanded on these ideas. He noted that specialization of labor not only increases productivity but also has effect on worker morale, turnover, job boredom, and job performance.

Standardization of Parts. Parts are standardized so that they can be interchanged. According to Chase and Aquilano, standardization was practised in early Venice, where rudders on warships were made to be interchangeable. This provided a great advantage when rudders were damaged in battle. Eli Whitney used interchangeable parts in musket production. Prior to this time, musket parts and even ammunition were tailored to each individual musket. When Henry Ford introduced the moving automobile assembly line in 1913, his concept required standardized parts as well as specialization of labor. The idea of standardized parts is by now so ingrained in our society that we rarely stop to think of it. For example, it is difficult to imagine light bulbs which are not interchangeable.

Industrial Revolution. The industrial revolution was in essence the substitution of machine power for human power. Great impetus was given to this revolution in 1764 by James Watt’s steam engine, which was a major source of mobile machine power for agriculture and factories. The industrial revolution was further accelerated in the late 1800s with the development of the gasoline engine and electricity. Early in this century, mass-production concepts were developed, but they did not gain widespread use until World War I, when heavy demands for production were placed on American industry. The age of mass marketing has continued this pressure for automation and high-volume production. However, our society has now entered a postindustrial period, characterized by a shift to a service economy and greater concern for the natural and social environment.

Scientific Study of Work.The scientific study of work is based on the notion that the scientific method can be used to study work as well as physical and natural systems. This school of thought aims to discover the best method of work by using the following scientific approach:

1) observation of the present work methods:

2) development of an improved method through scientific measurement and analysis;

3) training of the workers in the new method, and

4) continuing feedback and management of the work process.

These ideas were first advanced by Frederick Taylor in 1911 and later refined by Frank and Lillian Gilbreth throughout the early 1900s. The scientific study of work has come under attack by labor unions, workers, and academics. In some cases, these attacks have been justified because the approach was misapplied or used as a “speedup” campaign by management. Nevertheless, the principles of scientific management can still be applied in today’s world by recognizing the interaction between the social and technical work environments.

Human Relations. The human relations movement highlighted the central importance of motivation and the human element in work design. Elton Mayo and others developed this line of thought in the 1930s at Western Electric, where the now famous Hawthorne studies were conducted. These studies indicated that worker motivation – along with the physical and technical work environment - is a crucial element in improving productivity. This led to a moderation of the scientific management school, which had emphasized the more technical aspects of work design. The human relations school of thinking has also led to job enrichment, now recognized as a method with a great deal of potential for “humanizing the work place” as well as improving productivity.

Decision Models. Decision models can be used to represent a productive system in mathematical terms. A decision model is expressed in terms of performance measures, constraints, and decision variables. The purpose of such a model is to find optimal or satisfactory values of decision variables which improve systems performance within the applicable constraints. These models can then help guide management decision making.

Computers. The use of computers has dramatically changed the field of operations management since computers were introduced into business in the 1950s. Most manufacturing operations now employ computers for inventory management, production scheduling, quality control, computer-aided manufacturing, and costing systems. In addition, computers are used extensively in office automation, and they are used in virtually all types of service operations. Today the effective use of computers is an essential part of the operations management field.

Each of these seven areas of contribution has advanced the operations management field in a major way. Furthermore, the contributions are still applicable to the management of modern operations, although sometimes in modified form.

Reading tasks

A. Understanding main points. Answer these questions:

1. What is the importance of labor division?

2. Due to what does specialization of labor increase output?

3. How did economists consider the division of labor?

4. What opportunities does division of labor provide?

5. Why is it important to produce standardized parts?

6. When is industrial revolution considered to begin?

7. What does the scientific approach to study of work consist of?

8. What is a crucial element in improving productivity?

9. What is the purpose of a decision model.

10. How have computers changed the field of operations management?

Date: 2016-04-22; view: 933