B6 Flashcards
Business Process Management (BPM)
A management approach that seeks to coordinate the functions of an organization toward an ultimate goal of continuous improvement in customer satisfaction. Customers are both internal and external to the organization. Process management seeks effectiveness and efficiency through promotion of innovation, flexibility, and integration with technology.
5 BPM Activities
- Design
- Modeling
- Execution
- Monitoring
- Optimization
Process management has been commonly referred to as…PDCA
Plan
Do
Check
Act
Benefits of BPM
- Effectiveness
- Efficiency
- Agility
Shared Services
Refers to seeking out redundant services, combining them, and then sharing those services within a group or organization.
Outsourcing
The contracting of services to an external provider.
Offshore operations
Outsourcing of services or business functions to an external party in a different country.
Business Process Reengineering (BPR)
Refers to techniques to help organizations rethink how work is done to dramatically improve customer satisfaction and service, cut costs of operations, and enhance competitiveness.
Just-in-Time (JIT)
- Anticipates achievement of efficiency by scheduling the deployment of resources just in time to meet customer or production requirements
- Pull demand
- Reduce costs
- Improve quality
Quality control principles-costs of quality
The cost of quality includes costs associated with activities related to conformance with quality standards and opportunity costs or activities associated with correcting nonconformance with quality standards
Conformance costs
Prevention and appraisal costs
Prevention costs
Incurred to prevent the production of defective units. Includes: -employee training -inspection -preventative maintenance -redesign of product -redesign of processes -search for higher quality suppliers
Appraisal costs
Incurred to discover and remove defective parts before they are shipped to the customer or the next department Includes: -Statistical quality control -Testing -Inspection -Maintenance of the lab
Nonconformance costs
Internal failure costs and external failure costs
Internal failure costs
Costs to cure a defect discovered before the product is sent to the customer. Includes: -rework costs -scrap -tooling changes -costs to dispose -cost of the lost unit -downtime
External failure costs
Costs to cure a defect discovered after the product is sent to the customer. Includes: -warranty -cost of returning the good -liability claims -lost customers -reengineering an external failure
Cost of quality acronym
APIE
Appraisal
Prevention
Internal
External
Total quality management (TQM)
Represents an organizational commitment to customer-focused performance that emphasizes both quality and continuous improvement. Has 7 critical factors.
7 critical factors of TQM
- customer focus
- continuous improvement
- workforce involvement-quality circles
- top management support-delegation and empowerment
- objective measures
- timely recognition
- ongoing training
Lean manufacturing
Requires the use of only those resources required to meet the requirements of customers
Theory of Constraints (TOC)
States that organizations are impeded from achieving objectives by the existence of one or more contraints
Six Sigma
Anticipates the use of rigorous metrics in the evaluation of goal achivement
Operations management
Pertains to the ongoing production of goods and services and ensuring that all company’s operations function efficiently by using the optimal resources necessary to meet the sales demand of its customers. Focuses on managing the processes that transform inputs into outputs.
Project
A temporary undertaking intended to produce a unique service, product, or result.