Production and Operations Management


Spring Semester
6 ECTS credits, Advanced level

Learning Outcomes

The aim of the course is to introduce the student to the design, analysis, reengineering, optimisation and functional control of Manufacturing and Service operations, and to highlight the need for effective management of the constrained resources of operations systems. Through the course, the student will understand the organizational structure and the various components and functions of a Production or Service Operations System. They will practice basic analysis and problem-solving methods that are used by all kinds of organizations to understand and optimize operations.

The topics of the course cover the major business processes inherent in the operation systems, starting from operations strategy – showing the bigger picture of operations in a transforming global economy. Then the course delves into product, service and process design, forecasting, facility location and layout, procurement and inventory management, operations scheduling, and, finally, quality control. In summary, the course provides: a) an introductory overview of the major areas of operations management, b) an understanding of the practical and theoretical problems encountered in operations, and, c) practice of tools and techniques for effective operations management emphasizing both qualitative reflection and quantitative methods.

Mode of delivery (face-to-face, distance learning)

Face-to face teaching, individual work on cases and exercises.

Prerequisites and co-requisites

Fundamentals in quantitative methods. Fundamentals in management.

Recommended optional programme components

Simulation Game.

Video Tours of operations issues in companies and organizations.

Course contents

The topics included within the scope of Production and Operations Management (POM) are numerous and diverse. The following list provides the areas that will be covered within the course including recommended readings, which are available to the students through the AUEB Library and e-Library.

 1. Introduction – Definitions

  • Course content and structure
  • Context and definitions of POM


    • Operations as a Competitive Weapon", Chapter 1 in Operations Management, L.J. Krajewski & L.P. Ritzman.
    • Merrifield, R. et al (2008), "The Next Revolution in Productivity", Harvard Business Review, June, pp. 73-80.

2. Operations Strategy and Lean Production

  • The strategic framework, Illustration and deployment of operations strategies
  • "New" operations strategies – Agile Operations


    • "Operations Strategy", Chapter 2 in Operations Management, L.J. Krajewski & L.P. Ritzman.
    • Pisano, G.P. & Shih, W.C. (2009), "Restoring American Competitiveness", Harvard Business Review, July-August, pp. 114-125.
    • Womack, J.P. & Jones, D.T. (2005), "Lean Consumption", Harvard Business Review, March, pp. 59-68.

3.  Product, Service and Process Design and Development

  • Key concepts in product and service design
  • The product development process and project
  • Classifications of production process structures (product and process). Video


    • "Process Design Strategy", Chapter 3 in Operations Management, L.J. Krajewski & L.P. Ritzman.
    • Bonabeau, E et al (2008), A More Rational Approach to New Product Development, Harvard Business Review, March, pp. 96-102.

4. Facility Location

  •  Factors affection location decisions
  • Locating a single facility


    • "Location", Chapter 10 in Operations Management, L.J. Krajewski & L.P. Ritzman.
    • Article

5. Facility Layout

  • Layout types and performance
  • Product and process layout designs - models/algorithms
  • Application exercises in class


    • "Process Layout", Chapter 7 in Operations Management, L.J. Krajewski & L.P. Ritzman.
    • Article

6. Capacity Planning

  • Capacity strategies and tools
  • Basic forecasting methods
  • Application exercises in class


    • "Process Capacity", Chapters 6 in Operations Management, L.J. Krajewski & L.P. Ritzman.
    • Article

7. Forecasting

  • Basic forecasting methods
  • Application exercises in class


    • "Forecasting", Chapter 13 in Operations Management, L.J. Krajewski & L.P. Ritzman.
    • Saffo, P. (2007), "Six Rules for Effective Forecasting", Harvard Business Review, July-August, pp. 122-131.

8.  The Beer Game

  •  Business game in class where students are practically familiarized with the problems of inventory control and management.

    Readings (common to sessions 8-10):

    •  "Inventory Management", Resource Planning", and "Lean Systems", Chapters 15, 16, and 11 in Operations Management, L.J. Krajewski & L.P. Ritzman.
    • Abernathy, F.H. et al, (2000), "Control Your Inventory in a World of Lean Retailing", Harvard Business Review, Nov-Dec, pp. 169-176.
    • Liker, J.K. & Choi, T.Y. (2004), "Building Deep Supplier Relationships", Harvard Business Review, December, pp. 104-113.

9. Production Planning and Inventory Control I

  • Deterministic models: Economic Order Quantity
  • Materials Requirements Planning (MRP)
  • Application exercises in class

10. Production Planning and Inventory Control II

  • Just-In-Time – KANBAN
  • Integrated exercise: Determining inventory strategy

11. Production Scheduling

  • Operations Scheduling and Monitoring
  • Application exercises in class


    • "Scheduling", Chapter 17 in Operations Management, L.J. Krajewski & L.P. Ritzman.
    • Article

12. Statistical Quality Control and Total Quality Management – TQM

  • Overview and introduction to Quality Management, Fundamental definitions
  • Basics of Statistic Process Control (SPC)
  • Application exercises in class


    • "Process Performance and Quality", Chapter 5 in Operations Management, L.J. Krajewski & L.P. Ritzman.
    • Grant, R.M. et al (1994), "TQM's Challenge to Management Theory and Practice", Sloan Management Review, Winter, pp. 25-35.

Recommended or Required Reading

Krajewski, L.J. and L.P. Ritzman (2005). Operations Management: Strategy and Analysis, 7th Edition, Addison-Wesley, ΝΥ. (Newer and older editions, as well as any other Operations Management textbook cover all relevant issues).

Articles according to the above list.

Planned learning activities and teaching methods

Lectures, exercises in class, case assignments and readings, video illustrations and Business Game. Cases and readings are discussed in class, case assignments are also handed in written and can be part of formal assessment.

Assessment methods assessment methods and criteria

  • Two case studies to accomplish in groups of two students (30% (2*15%) of final grade).
  • One individual reading note (10% of final grade).
  • Final individual written exam (60% of final grade).

The first case study "Disney" consists of various documents that assess the students' understanding of fundamental introductory aspects of operations management and operations strategy. Students are asked to reflect on how an entertainment company and especially entertainment parks take into account different operational and strategic changes, and how operations interact with other functions of the enterprise.

The second case study "Fitness Plus Part A" (Krajewski & Ritzman, 2005, p. 272) is a capacity analysis and planning case. Students are faced with the problem of a fitness center that operates a number of training areas all which have different demand and different capacity. Students should calculate capacity of each area as well as total capacity for the center, and suggest how capacity should be balanced and what moves the center should make in view of maximizing utilization and customer satisfaction. The case requires calculation, reflection and use of capacity notions such as peak and effective capacity, capacity cushions and break-even analysis.

The reading note will be accomplished on the basis of one of the suggested articles (above list) selected by each student. Students can also propose a topic of their own choice. A template for the reading note will be distributed separately.

The final exam lasts for three hours and is composed of two parts. The first assesses through short questions and mini-cases the understanding of fundamental operations management concepts such as different operations paradigms (standardized and diversified mass production, lean production), product, service and process development concepts, procurement, location and lay out issues, forecasting issues and quality management. The second part is based on problems and assesses the different quantitative aspects of the course focusing on inventory management, capacity planning and statistic process control. The above are indicative areas covered, each exam is tailored to the specific emphasis given in class and adapted to what was examined in the case studies