Chapter 18 Flashcards
Total quality management (TQM)
An integrated, principle-based, organization-wide strategy for improving product and service quality
Principles
- customer focus : an organizational goal to concentrate on meeting customers needs at all levels of the organization
- customer satisfaction
Continuous improvement
An organizations ongoing commitment to constantly assess and improve the processes and procedures used to create products and services
Variation
A deviation in the form, condition, or appearance of a product from the quality standard for that product
Teamwork
Collaboration between managers and nonmanagers, across business functions, and between companies, customers, and suppliers
Internal service quality:
The quality of treatment employees receive from management and other divisions of a company
- employee satisfaction occurs when companies treat employees in a way that meets or exceeeds their expectations
- service capability is an employee perception of his or her ability to serve customers well
Service recovery
Restoring customer satisfaction to strongly dissatisfied customers
- Requires employees to delight highly dissatisfied customers by surpassing their expectations of fair treatment
- Service employees are empowered
- given the authority and responsibility to make decisions that immediately solve customer problems
Make-to-order operation
A manufacturing operation that divides manufacturing processes into separate parts or modules that are combined to create semi customized products
Make-to-stock operation
A manufacturing operation that orders parts and assembles standardized products before receiving customer orders
Manufacturing flexibility
The degree to which manufacturing operations can easily and quickly change the number, kind, and characteristics of products they produce
-categories
-continuous-flow production : a manufacturing operation that produces goods at a continuous, rather than a discrete, rate
Least flexible
Line-flow production
Manufacturing processes that are preestablished occur in a serial or linear manner, and are dedicated to making one type of product
-relatively less flexible
Batch production
A manufacturing operation that produces good in large batches in standard lot sizes
-relatively flexible
Job shops
Manufacturing operations that handle custom orders or small batch jobs
- Each shop is different
- most flexible
Inventory
The amount and number of raw materials, parts, and finished products that a company has in its possession
Raw material inventories
The basic inputs in a manufacturing process
Component parts inventories
The basic parts used in manufacturing that are fabricated from raw materials
Work-in-process inventories
Partially finished good consisting of assembled component parts
Finished goods inventories
The final outputs of manufacturing operations
Average aggregate inventory
Average overall inventory during a particular time period
-weeks of supply: number of weeks it takes company to run out of current supply
Stock out
The point when a company runs out of finished product
Inventory turnover
The number of times per year that a company sells or ‘turnover’ it’s average inventory
Ordering cost
The costs of associated with ordering inventory including the cost of data entry, phone calls, obtaining bids, correcting mistakes, and determining when and how much inventory to order
Setup cost
The costs of downtime and list efficiency that occur when a machine is changed or adjusted to produce a different kind of inventory
Holding cost
The cost of keeping inventory until it is used or sold, including storage, insurance, taxes, obsolescence, and opportunity
Stockout cost
The cost incurred when a company runs out of product, including
Kanban
A ticket based JIT system that indicates when to reorder inventory
MRP materials required planning
Production and inventory system that determines the production schedule, production batch sizes, and inventory needed to complete final products
