Operations Mgt Test 1
Terms
undefined, object
copy deck
- Define Operations Management(OM)(components of OM)
- Manage resources to transform inputs into outputs to create value Resources – people, machines, IT systems, equipment, inventory, facilities Transform – make product and/or service Inputs – raw materials, components Outputs – finished goods, components, services Transforming inputs into outputs – turn something into something and sell Value - cost, quality, service, ethics, customization/personalization (ex: mfg.com matches customers up with suppliers for sourcing….that’s its value provided!)
- What is internal facing?
- cost lowered, quality raised, productivity/efficiency raised (increased firm competitiveness)
- Describe why OM is important
- (1)Produces the product/service (2)Performance defines company success (3) Costs dominate
- Categorize the the types of OM decisions
- (1) Strategic Decisions long term (5-20 years) senior mgt level Production methods/tech, facilities, long-term capacity (2)Tactical Decisions medium term (.5-2 years) mid/senior mgt Aggregate planning, forecasting, quality programs, supply chain (3) Operational Decisions shorter term (daily, weekly) lower mgt Forecast consumption, inventory, production scheduling, labor scheduling
- Compare and contrast product versus service characteristics.
- * “Products†Tangible Storable - Production ≠demand Production unimportant Quality pre-assessible * “Service†Intangible Not storable - Production = demand Production important Quality not pre-assessible
- Define order winners, order losers, and order qualifiers. (Identify order winners, losers, and qualifiers for a given company.)
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Order Qualifier – this is what you have to have to compete in the industry (base level offering)…to play in the market
Order Winner – something that you have that separates you to consumer base (quality)
Order Loser – something that you have that potentially turns someone away (ex: not have certain MPG or warranty, low price for some)
* Order winner for some is a order loser for others (ex: cheap Mexican food vs. “Fine†Mexican food)
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Recognize value sources and their definitions.
Apply to a given company. -
Value (e.g., Apple) quality/price, price customer is willing to pay
Cost - Low cost?
Quality - Dependability & Reliability?
S
ervice - Quick? Received when promised? Responsive to issues?
Convenience - Easy to get?
Style, Features - Current style? Advanced features/technology?
Flexibility, Customization - Producer adapts to change? Delivers to unique needs?
Ethics - Producer operating responsibly?
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List and briefly describe the 4 perspectives of the balanced scorecard
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Performance measures (KPIs)- progress/ success
How do you know if you’ve had a good day?, Can’t manage what you don’t measure
Financial Perspective- watch cost
Customer Perspective- serve customers
Internal Perspective- inventory cycle times (time from order to delivery)
Learning and Growth- R&D, training, and technology -
Define make-to-stock, make-to-order, hybrid.
Provide an example of each.
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Make-to-stock
Push supply chain
Make-to-order
Pull supply chain
Hybrid
Assemble to order
- Define the process flows
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Go from Low efficency and low variety, to high efficency and high variety
Low Volume = Less Standardization
Project - fixed location, equipment moves to product
Specialized tools/labor
High cost
Example: pipe organ
Workcenter/job shop - similar equipment, functions
Example: Martin Guitars, hospital
Manufacturing Cell - dedicated to products/customers needing similar processing
More flexibility than assembly line
"U shaped" assmebly line
Example: TaylorMade Golf
Assembly line - layout by sequence, efficient production steps
Very small amount of customization (long runs w/ same features)
Example: auto
Continuous flow processes - assembly line for one product/service
Typically automated
Low labor (less cost)
Example: Steel/chemicals - Apply the product-process matrix by describing differences across volume, variety, and flexibility (product/process matrix) for different process types
- See chart
- Conduct a break-even analysis to select a process given expected volume
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Breakeven - compare fixed and variable costs to identify best alternatives
Also determine breakeven of process profitability (cost vs. revenue)
Fixed costs (FC) - costs not variable by volume
Variable costs (VC) - costs variable by volume
Total Cost = FC + VC*Volume (TC = y = a + bn)
- Define cycle time, throughput time, set-up time, run time
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Cycle time – average time between successive completed units
Throughput time – time to process one unit (includes processing, waiting time)
Set-up time – time to prepare equipment, personnel to run a batch
Run time – time to process a batch
- Define buffering, bottleneck, utilization, balance delay
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Buffering – allows stages to run independently
Blocking – preventing the flow
Starving – not getting any flow
Bottleneck – Defines capacity for the entire process
Can only run as fast as slowest step
There is ALWAYS a bottleneck
Utilization – Actual time of a resource used / best operating time
Balance delay – lost utilization in one stage caused by another bottleneck stage...every step being used the same amount of time
- Identify the capacity and bottleneck of a process
- See problems
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Recognize behavioral aspects of service design
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Training, motivation-
extremely important (Ex: Zappos employees making $11/hr and no “perksâ€â€¦work for helping others
Strong finish -
> strong start (ideally you like to have both, but want good lasting impression)
Effective recovery -
if you mess up, what do you? Customers understand that you may mess up from time to time but must be able to recover to keep customers for life
Service guarantees -
set consistent quality/expectations, focus employees (Ex: 30 min or less)
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Construct the service system design matrix.
Describe relationships between sales opportunities, customer contact, and process efficiency. -
See diagram
Greater customer contact, greater sales opportunities
More customization = less efficiency
As contact increases, efficiency declines
Mail, E-Mail – Ex: Statement Inserts
Web Site – Ex: ATMs, online banking
Phone – Ex: Help Desk
Face-to-Face (tight specs) – Ex: Teller/Customer Interaction
Face-to-Face (loose specs)- Ex Personal Banker
Face-to-Face (customization) – Ex: extreme personal banker - Define and recognize aspects of a queue, including arrival population, phase, servers, # lines, queue discipline
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Arrival population/pattern - how many people can start in system
Finite vs. infinite – run out of room/time to server (ex: office hours)
# servers - multiple employees
# phases - multi phases (ex: seating guests and taking drink order)
# lines/channels - multiple lines look shorter even tho single line going into multiple queues is more efficent
Queue discipline - how do you select people/items out of queue (first in first out, reservation/priority system, generally LIFO in production because it is stacked)
Customer behavior
Jockeying – switching lines
Balking – look at line and choose to not enter
Reneging - leaving the line
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Define ways to improve customer experience/perception in queues
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Keep customers busy/distracted
Keep line moving
Control expectations
Acknowledge waiting time
Alternatives: self-service, call-back service, reservations, express check-in