Capita selecta 1 – Behavioral Operations Management fall 2022

Operations Management (OM) encompasses a broad field of study, covering not only the design and management of processes in manufacturing and service organizations that create value for society, but also the search for rigorous laws governing the behaviors of physical systems and organizations. Encompassing such a broad range of topics, OM frequently overlaps with other academic streams, such as quality management, operations research (OR), finance, and marketing, and employs methods from these streams. In doing so, the methods employed in OM research are generally heavily oriented towards the development of normative (mathematical) models. This approach has proven to be highly valuable for the advancement of the field of OM, as these models enable us to explain and predict the impact of certain decisions and actions on supply chain outcomes. At the same time, because models always offer a simplification of reality they are subject to certain rigid assumptions that might not reflect reality accurately. For example, such models commonly assume that:

• People are deterministic and predictable
• People are independent
• People are “stationary” (no learning, fatigue, or problem solving occurs)
• People are not part of the product or service
• People are emotionless
• Work is perfectly observable

As a result, these models often leave a substantial part of the variance in their outcome variable of interest unexplained. The field of Behavioural Operations Management (BOM) is driven by the departure from the assumption that all agents participating in operating systems or processes – ranging from decision-making managers to workers – are fully rational or at least act that way.

More specifically, BOM explores the interaction of human behaviors and operational systems and processes. Specifically, it has the goal of identifying ways in which human psychological and sociological phenomena impact operational performance, as well as identifying the ways in which operations policies impact such behavior.

In this course students will be exposed to studies and activities that demonstrate behavioural dynamics in a range of work contexts. Students will be encouraged to come up with examples of situations in which behavior impacts performance, and will analyze data to establish the impact of such behavioural effects. In-class discussions will enable a thorough understanding of the phenomena treated in each session, and offer students ideas about how the insights are applicable in many types of contexts.