Department of Technology, Operations, and Statistics | Operations Management

Operations Management
COR1-GB.2314
3 credits

This course serves as an introduction to operations, viewed from the perspective of the general manager, rather than from that of the operations specialist. The coverage is very selective; the course concentrates on a small number of themes from the areas of operations management and information technology that have emerged as the central building blocks of world-class operations. It also presents a sample of key tools and techniques that have proven extremely useful. The topics covered are equally relevant to the manufacturing and service sectors.

Supply Chain Management (Business Logistics)
OPMG-GB.2306
3 credits
Prerequisites: COR1-GB.2314

The function of supply chain management is to design and manage the flow of material and information, starting from the raw materials until finished goods reach customers. Typically, logistics-related costs account for 20 to 25 percent of firms' total costs. On the revenue side, the supply chain decisions have a direct impact on market penetration and customer service. With the globalization of the economy and advances in information technology, supply chain design and coordination have become important tools for gaining competitive advantage. Therefore, the objectives of the course are to (1) develop an understanding of individual components of the supply chain (such as order management, transportation, network design, distribution channel management, after-sales service, and customer service strategy) and their interrelationships with other functions of firms, such as marketing, manufacturing, and accounting; (2) impart analytical and problem-solving skills necessary to develop solutions for a variety of logistics problems; (3) understand the complexity of interfirm and intrafirm coordination in implementing programs such as "quick response" and "vendor-managed inventories" and (4) develop the ability to design logistics systems and formulate integrated supply chain strategy, so that all components are not only internally synchronized but also tuned to fit corporate strategy, competitive realities, and market needs.

Operations Consulting: Design of Operations
OPMG-GB.2307
3 credits
Prerequisites: COR1-GB.2314

Enhancing the effectiveness and productivity of operations is a major goal of most organizations. Designing the operations of a firm will be critical to achieving this goal. This course aims to develop an understanding of the components that make up an integrated operating system and to impart modeling skills for understanding the design tradeoffs. The objectives of the course are

• To develop skills for designing and improving operations.
• To demonstrate the wide applicability of modeling methodology to different functional areas, with emphasis on manufacturing and service operations.
• To provide insights into actual business practices and outline the scope for applying the modeling and design ideas developed in this course.
• To develop optimization and simulation modeling skills.

Managing for Quality
OPMG-GB.2310
3 credits
Prerequisites: COR1-GB.2314

This course introduces the basic principles and techniques of managing for quality. Students learn the most important principles and tools by which organizations create value for their customers, including quality measurement and assessment, quality planning, quality control, quality improvement, and quality strategy. Students learn to:

• Understand the historical development of modern quality methods, including the unrivalled contributions of New York University to this field.
• Analyze systems with respect to quality, using such tools as Six Sigma, Pareto analysis, statistical process control, quality function deployment, reliability analysis, and design of experiments.
• Apply different philosophies and approaches to quality intelligently, including those of Deming, Hackman and Oldham, Ishikawa, Juran, Shewhart, and Taguchi.
• Make use of the Malcolm Baldrige National Quality Award criteria, as well as those of other quality examination, certification, and evaluation tools.

The focus is on management planning and decision making, not advanced statistical inference. This course is aimed at M.B.A. students who have already completed the core requirements in operations, marketing, and management. The emphasis is on methods with wide application across diverse industries and organizations, including recent developments in information technology and electronic commerce.

Operations in Panama: A man, a plan, a canal: Panama
OPMG-GB.2312
3 credits
Prerequisites: COR1-GB.2314

This advanced elective from the IOMS department will be a three (3) credit course studying the major businesses operating in Panama. During a one-week visit, students will observe and study the intricacies of the Panama Canal from an operations management point of view. Process techniques and strategies abound within this fascinating operation. Although the canal is certainly the country's major attraction, financial revenues from the canal have allowed Panama to emphasize other developments including extensive real estate projects and major tourism improvements.

The specific topics that will be studied include:

• The Panama Canal and its effect on the global shipping supply chain
• History of the building of the canal and independence of Panama
• Modern banking and real estate development
• Economic growth in the tourism industry
• Urban development and infrastructure of major cities

All of the classes, tours, speaker sessions and group meetings must be attended by students for course credit. No exceptions.

The course will be limited in enrollment. Details will be announced.

Operations in Entertainment: Las Vegas
OPMG-GB.2313
3 credits
Prerequisites: COR1-GB.2314

When we think of entertainment, perhaps the most popular location that comes to mind is Las Vegas. Behind the glitter and excitement in Las Vegas are industries dedicated to supplying entertainment to customers. Operations address the supply side of business, including how products are produced and how services are supplied. This course goes behind the scenes in Las Vegas to observe and analyze the operations involved in performing this supply function. This course presents an opportunity to observe and study the entertainment industry including strategy formation and decision-making that are quite unique.

The entertainment comes in various forms. The underlying driver is certainly gaming, but the industries surrounding the various forms of gambling have become major profit centers separate from the millions made on the casino floors.

During a one-week visit to Las Vegas, students will observe and study some of the major operating industries that comprise the broad scope of entertainment in this city. Although the Operations Management models, techniques and strategies in this field are applicable anywhere, Las Vegas is the epicenter of the industry.

The specific areas that will be studied include:

• Hotel/Resort operations
• Gaming
• Marketing strategy and consumer relations
• Analytics and technology
• Real estate development
• Food/Beverage operations
• Nightlife, nightclubs and the Theatre of Las Vegas

The class will have an opportunity to tour the major entertainment centers of Las Vegas, and have presentations and question and answer sessions concerning the back-of-the-house operations strategies in each industry. Executives from the top hotel/casino resorts will make presentations to the class and work in small groups with students to explain the strategies that drive the industry. Delivering the information will be top executives and department heads from Station Casinos Red Rock Resort, Harrah's Caesars Palace, MGM Mirage Treasure Island, Light Group Nightclubs, Ultimate Fighting Championship (UFC), Cirque du Soleil and MGM City Center Real Estate Development.

IT in Supply Chains
OPMG-GB.2320
3 credits
Prerequisites: COR1-GB.2314

The course presents an introduction into Supply Chain Management from an IT point of view. It shows an integrated business framework of modern flexible Supply Chain Management, which is based on the principles of demand driven synchronization of supply to demand and network wide visibility and collaboration. The underlying corresponding IT systems to support such a business framework, namely ERP-, Supply Chain Planning-, Event Management- (incl. RFID) and Collaboration Systems, are explained. A focus of the course is Supply Chain Planning, where the different planning areas and their integration to each other are explained. Latest trends in SCM and IT, like Service Oriented Architectures, which facilitates the integration of new business processes into an existing Supply Chain Management solution, will end the course.

Retail Operations
OPMG-GB.2330
3 credits
Prerequisites: COR1-GB.2314

This course is highly recommended for students interested in careers in retailing and retail supply chains, businesses like banking, consulting and information technology that provide services to retail firms, and manufacturing companies that sell their products through retail firms.

Retailing is a huge industry (40% of the U.S. economy and the largest employer) that has consistently been an incubator for new business concepts. In the 80's and early 90's Wal-mart pioneered new approaches to supply chain management, and also influenced major established firms like P & G. More recently, Dell has revolutionized the supply chain for PCs using the direct model. Finally, Amazon.com, more than any other firm, has been credited with transforming the Internet from an academic toy to the primary technology influencing business today. Even if you don't expect to work for a retailer, this course can be useful to you in two ways:

• First, because retailers are such dominant players in many supply chains today, it is important that the processes they follow be understood by manufacturers and distributors, or by the consultants and bankers that service retailers and their suppliers.
• Second, the problems retailers face (e.g., making data accessible, interpreting large amounts of data, reducing lead-times, eliciting the best efforts from employees, etc.), are shared by firms in many other industries. It's easier to understand these issues through case studies in retailing because we all experience the industry as consumers and can readily relate to chronic problems such as stock outs and markdowns.

The course will examine how retailers understand their customers' preferences and respond with appropriate products through effective supply chain management. Supply chain management is vitally important for retailers and has been noted as the source of success for many retailers such as Wal-mart and Zara, and as an inhibitor of success for e-tailers as they struggle with delivery reliability.

Decision Models & Analytics
OPMG-GB.2350
3 credits

This course introduces the basic principles and techniques of applied mathematical modeling for managerial decision making. Students learn to use some of the more important analytic methods (e.g., spreadsheet modeling, optimization, Monte Carlo simulation) to recognize their assumptions and limitations and to employ them in decision making. Students learn to: Develop mathematical models that can be used to improve decision making within an organization, Sharpen their ability to structure problems and to perform logical analyses, Translate descriptions of decision problems into formal models and investigate those models in an organized fashion, Identify settings in which models can be used effectively, and apply modeling concepts in practical situations, Strengthen their computer skills, focusing on how to use the computer to support decision making.

The emphasis is on model formulation and interpretation of results, not on mathematical theory. This course is aimed at M.B.A. students with little prior exposure to modeling and quantitative analysis, but it is appropriate for all students who wish to strengthen their quantitative skills. The emphasis is on models that are widely used in diverse industries and functional areas, including finance, operations, and marketing.

Decision Making Under Uncertainty
OPMG-GB.2351
3 credits
Prerequisites: COR1-GB.1305

This course is designed for students who have taken Decision Models & Analytics (B60.2350) and would like develop further their quantitative modeling skills for managerial decision making. Students will learn more advanced modeling tools including: static stochastic optimization, two-stage stochastic optimization with recourse, chance-constrained stochastic optimization, and dynamic programming. We explore their applications in various business domains, such as marketing, finance, inventory management, revenue management, supply chain management, project management, among others. Students will learn how these models can be solved using Risk Solver Platform for Excel, a powerful tool for risk analysis, simulation, and optimization. The emphasis throughout the course will be model formulation, solution methods, and managerial interpretation of the results, rather than on the mathematical algorithms used to solve models.

Real Estate Development and Entrepreneurship
OPMG-GB.2360
3 credits
Prerequisites: COR1-GB.2314

This is course will introduce students to the wide ranging aspects of real estate development from an operations perspective. It is directed to students interested in real estate development from the point of view of three classes of investors:

• an entrepreneurial investor, looking to buy a coop, condo or small property for individual use or rental
• a working general partner of a small group of investors, who will actually manage &/or be responsible for overseeing the property after purchase
• a passive outside investor, who may be searching for an investment that is limited in liability to the original investment

Operations Management involves the decisions made at the operating level of a business or project to assure the attainment of higher level goals and strategies. In real estate development, these operating decisions will determine whether or not a deal will be successful and meet overall financial goals. Many students may choose to pursue investments in real estate, and often to actually operate these deals and manage the investments. Although most students will not work full-time in the real estate industry, property investments will arise as opportunities to increase passive income and wealth. Understanding how these deals are created and managed will allow investors to choose deals with the highest probability of success. The real estate topics discussed in the course will investigate all types of development: single family, multifamily, hotel, office, retail and industrial properties. In addition to case studies, class lectures and discussions, some outstanding industry developers will be invited as guest speakers to reinforce the ideas taught in class. The class will culminate in a real estate development simulation with group presentations to the class, and a panel of outside investors.

Operational Risk
OPMG-GB.2365
3 credits
Prerequisites: COR1-GB.2314

Operational risk is a new branch of risk management that assesses and mitigates the risk of operational errors to affect the profitability or even the existence of a firm (financial or not). Some examples of these events are: flawed data processing, legal suits, frauds (internal and external), natural or man-made disasters (e.g., terrorist acts), power outages, system problems, etc. Although these issues were always a part of the business, with the advent of operational risk management for the first time they are being seen on an integrated framework with specialized teams responsible for its modeling, measurement and management.

In the particular case of financial institutions, with the sign off of the Basel 2 Accord by the G-10, a new set of standards was established that will regulate the industry. The new Accord established a new capital charge for operational risk as well as detailed new standards that financial firms need to follow. This new environment created a demand for talents with knowledge in the area, and the size of operational risk departments has been increasing significantly. However, as operational risk is such a new concept in the industry, there are major gaps in the development of these risk managers.

This course has the objective to provide the student with an excellent overview of the current industry issues and to give in-depth training on the most important techniques used to model, measure and manage operational risk. The course will provide the students with basic general concepts of risk management techniques. It will be shown techniques to identify operational risk in processes as well as modeling techniques and hedging possibilities available in the market. The course will be given in 12 classes of 3 hours each in the evenings.

Stochastic Processes
OPMG-GB.3321
3 credits
Prerequisites: COR1-GB.2314

This course will serve as an introductory course to stochastic processes. We will closely follow the book "Stochastic Processes" by Ross. The course will begin with a one week review of basic concepts in probability and then proceed to the study of Poisson processes, renewal processes, discrete time Markov chains, and finally, continuous time Markov chains. The are no prerequisites for the course, however, a calculus based understanding of probability is helpful. Courses in analysis and measure theory are not required. A tentative course outline is as follows.

Revenue Management and Pricing
OPMG-GB.3330
3 credits
Prerequisites: COR1-GB.2314

Course description pending.

Operations for Global Entrepreneurs
OPMG-GB.3335
3 credits
Prerequisites: COR1-GB.2314

This course deals with international operations and strategy for international business ventures and small and medium enterprises (SMEs). It is intended for current and would-be executives of, investors in and management consultants to ventures going global. The discussions are based on current business situations and augmented through presentations by industry partners. Integrated learning, through cases and readings, provides an opportunity to expand the educational experience beyond the theory in the classroom into the local and international business community.

Consider the following questions regarding international new ventures:

• What are the key success factors of a global operations strategy?
• How to sustain and expand global operations?
• What is behind the success of ventures that went international early in the business life cycle?
• How to manage the risks entailed in global operations?

Students are assigned to work on real cases discussing issues such as:

• Global operations strategy
• Global supply chain management
• Foreign market entrepreneurial entry modes
• Operations financing and controls
• Global outsourcing/insourcing
• International location of facilities and regional headquarters

Here are some examples:

• A small generic pharmaceutical company based in the Middle East wants to expand globally and is considering whether to enter North America, Europe or Asia as their first step and what the best entry mode would be?
• A small telecom equipment company in the US has expanded into Europe through the acquisition of another similar company, how do they rationalize the research, product development, manufacturing, marketing and sales operations to accelerate the success, globally, of both?
• A hi-tech company based in Europe is looking to sell its software and/or IP to the US market through regional partners, how do they choose the right ones, and what terms should they pursue?
• A successful medium sized Chinese motorcycle manufacturer wants to sell to the US market but wants to understand how to account for local manufacturing requirements, exchange rate exposure?

During the course, teams of four to six students each will be presented with real life strategic operational challenges through a case or by an international business manager. Each team will make two presentations: the first specifying the business dilemma and the second, presenting the results of the analysis. Students will have an opportunity to work with their respective groups and meet or video-conference with the project sponsors or executives.

Prof. Ehud Menipaz lectures and conducts research on international business strategy, entrepreneurship and derivatives. He is a former senior partner with Ernst & Young International, a co-founder of an international memory devices venture, a chaired professor of entrepreneurship management and the founding chair of a center of business, technology and society. He is a national director of the Global Entrepreneurship Monitor project, the leading longitudinal, in depth, study of entrepreneurship, conducted concurrently in over forty countries. In addition to Prof. Menipaz, several guest executives will address the class.

Operations Strategy
OPMG-GB.3355
3 credits
Prerequisites: COR1-GB.2314

There is an increasing awareness that operations should contribute to the global competitive stance of a business and not merely be a place where the firm's products or services are produced. This can be done by contributing distinctive competence or capability to the business, and continually improving the products and process of the business. In the OM core course, students study the basic aspects of how firms produce their products and services to gain a competitive advantage, and take a tactical or short-term look at operations.

This course is a natural follow-up to the core course. Students examine the strategic and long-term policies of the firm, and learn how the operations strategies and policies are developed to be consistent with corporate and overall business strategies. To do this effectively, students examine, through case studies, how firms' operations play an important role in building and shaping their competitive posture. This course helps students to

• recognize the strategic and policy implications that can be gained from managing operations;
• develop a framework for allocating resources and managing the operations function in ways that distinguish firms from their competitors;
• analyze, develop, and formulate operations strategies to exploit competitive opportunities;
• visualize how operations strategies can and must be linked to overall business strategies, as well as the financial and marketing strategies; and
• highlight effective examples involving continuous improvement and implementation of operations strategies.

Service Operations and Strategy
OPMG-GB.3356
3 credits
Prerequisites: COR1-GB.2314

Course description pending.

Service Operations and Strategy
OPMG-GB.3357
3 credits
Prerequisites: COR1-GB.2314

This course is designed to prepare students to manage service businesses and/or service operations in manufacturing firms. The objective is to focus attention on some unique aspects of service businesses and relate these aspects to service operations and strategy. For example, some of the issues this course covers include the following:

• What impact does intangibility have on corporate and business strategy and operations in service businesses?
• What is the impact of simultaneous production and consumption of services on how service delivery systems are designed and managed?
• What impact do customers have on service quality and productivity of service firms?
• What unique organizational designs are needed to manage a service business?

Consistent with the need to emphasize an integrative multidisciplinary perspective on service operations and strategy, students are asked to undertake a project assignment to design a complete service business, starting from idea to incorporation.

Dynamic Programming & Stochastic Control
OPMG-GB.4306
3 credits

This course covers the basic models and solution techniques for problems of sequential decision making under a deterministic setting or under uncertainty (stochastic control). We will discuss both finite and infinite horizon models. Most of the contents will be based on the book by D.P. Bertsekas: Dynamic Programming and Optimal Control.

Submodularity & Applications
OPMG-GB.4325
3 credits

Submodularity has played an important role in combinatorial optimization, game theory, operations management, etc. In this course, we cover the following selected topics on submodularity:

• Lattice programming: the problem of minimizing submodular functions over sublattices. Our focus is on monotonicity of optimal solution in problem parameters. We also study the concepts ``substitutes and complements", especially in the context of network optimization. We discuss applications in stochastic dynamic programming, especially stochastic inventory theory.
• Game Theory: submodular cooperative game and submodular non cooperative game. Applications include game theoretical analysis of models in inventory and supply chain management.
• Discrete Convexity, in particular the L-convex and L-natural-convex functions. We discuss its implications in computational complexity of some inventory and scheduling models.
• Greedy Algorithms. We discuss how submodularity can be used to derive optimality or near optimality of greedy algorithms for many (deterministic and stochastic) optimization problems. Applications to queueing theory and inventory theory will be covered.

Computational Mathematics & Large Scale Dynamic Programming
OPMG-GB.4326
3 credits
Prerequisites: COR1-GB.2314

This course offers an introduction to the methodology of large-scale dynamic programming, with emphasis on computational methods and applications. The objective is to provide students in the areas of operations management, finance and economics with working knowledge of the dynamic programming methodology and state-of-the-art approaches for dealing with the curse of methodology. By the end of the course, students will have been exposed to:

• stochastic modeling techniques for problems of sequential decision-making, central concepts and methods in dynamic programming
• learning methods and theory for dealing with situations where system parameters are unknown, including considerations of efficiency and complexity
• state-of-the-art algorithms for large-scale dynamic programming based on value function approximation, including discussions about errors and performance guarantees, and design of approximation architectures
• state-of-the-art algorithms for large-scale dynamic programming based on policy approximation, including discussions about convergence rates and application of methods in settings with incomplete knowledge of the system state
• recent literature with applications in finance, economics and operations management, such as revenue management, dynamic pricing, dynamic resource allocation, pricing of American options and high-dimensional financial derivatives, portfolio optimization, asset allocation and trading, among others. The applications illustrate application of the algorithms and theory of large-scale dynamic programming for deriving policies, performance evaluations and structural insights about the different problems considered.

The course includes a final project that can be on any subject related to theory, algorithms and/or applications of large-scale dynamic programming. Students are encouraged to use their own research as motivation for the project.

Pre-requisites: probability and linear algebra. Dynamic programming is strongly recommended but not required.