Chapter 5 - Producing the Goods/Operations Mgmt.

Question 1

Operations/Production/Manufacturing Management

Answer 1

Creates value for customers by transforming capital, technology, labor, and materials into more highly valued products and services.

• Drives productivity growth
• Wellspring of innovation
• Higher living standards

Question 2

Roles That Influence the Role of Production Management

Answer 2

1. Industrial Revolution (machine power)
2. Personal wealth = consumer society = demanded better operations to please customers
3. Frederick Taylor = scientific method = observation, improvement, training, & monitoring
4. Quantitative Analysis

Question 3

Prerequisite to Success

Answer 3

Operational Excellence

Question 4

Design Decisions

Answer 4

INFRASTRUCTURE, PRODUCT, AND PROCESS

• Facility Location
• Facility Layout
• Product Design
• Process Design

Question 5

Facility Location

Answer 5

• Affect access to factor inputs & customer markets.
• Focus on labor costs and resource proximity
• Service focus on customer location

Question 6

Facility Layout

Answer 6

• Determine the positioning of equipment
• Flow of materials
• Number of times each item should be handled
• Minimizes movement and handling

Question 7

Product Design

Answer 7

• Represent the company’s ability to profitably capture future market share.
• Fewer than 1 in 10 ideas make it

Question 8

Process Design

Answer 8

Technology selection and work design.

- Work design = increased worker motivation and process efficiency.

Question 9

Control Decisions

Answer 9

Day-to-Day basis and define how materials move.

• Forecasting
• Scheduling
• Inventory
• Quality Control

Question 10

Forecasting

Answer 10

Provides an estimate of what products need to be produced and when they need to be produced.

• Plan production
• Determine capacity Needs
• Refine workforce plans
• Determine inventory levels
• FORECASTS ARE ALMOST ALWAYS WRONG.

Question 11

Inventory Control

Answer 11

Determines how much and when to make specific products.

• Economic Order Quantity (how much)
• Reorder Point

Question 12

Scheduling - Aggregate Planning

Answer 12

Aggregate Planning

• Determines what needs to be produced with a rough idea of the timing
• Inputs = measure of production capacity, a demand forecast, and cost data.

Question 13

Scheduling - Work to be done

Answer 13

Work to be done at each station must be defined.

- Assign priorities to each job.

Question 14

Quality control

Answer 14

Focuses on designing, building, and inspecting quality into both the process and the product.
- Goal = to make it right the first time, every time.

Question 15

Toyota & Lean Production

Answer 15

• Just-in-time
• Inv. reduced to small levels
• As 1 item moves out, another comes in.

Question 16

Learning Curve

Answer 16

Expresses the cost relationship between the number of items produced and the cost per item.

Question 17

Waste Elimination

Answer 17

Goal of lean = identify and eliminate waste

• 5S
• Inventory Reduction

Question 18

5S

Answer 18

• Sort
• Set in Order
• Shine
• Standardize
• Sustain

Question 19

Workforce Participation - Jidoka

Answer 19

• Allows workers to stop the production line when a quality problem occurs
• Man and machine system = jidoka
• Everyone is trains, takes responsibility, and participate in all aspects of the process.

Question 20

Managerial Responsibility

Answer 20

Managers take on the role of teacher, team facilitator, and motivator when workers take responsibility.

Question 21

Process Development

Answer 21

• Toyota reduced changeover time from 4 hrs. to 12 min.

- Time buffers

Question 22

Time buffers

Answer 22

• Slack time

- Built into a process to allow process engineers to experiment with new tools or techniques to perform the work.

Question 23

Network Orientation

Answer 23

• Upstream suppliers for Toyota need to become an extension of Toyota’s Supply Chain.

Question 24

Synchronization

Answer 24

• Pull or Kaban system
• Driven by Customer Demand
• Items arrive just in time
• “little card”

Question 25

Continual Imrpovement = Kaizen

Answer 25

• High level of workforce training
• Organizational attitude that everyone is responsible for the organizations success.
• Keep a long-term perspective.

Question 26

Operations Mgmt. in the Service Setting

Answer 26

• Many SC processes are services.
• Services dominate economic activity.
• Customers want to buy solutions.

Question 27

Tangibility

Answer 27

• Production outputs are tangible (stored)

- Services are intangible

Question 28

Customer Contact

Answer 28

• Customers of manufactured products have little contact with the production process.
• Services = customers involved in the delivery

Question 29

Ability to Inventory

Answer 29

• Physical goods stored so manufacturers can produce now to meet future demand.
• Services - produced and consumed simultaneously

Question 30

Economies of Scale

Answer 30

• Production operations tend to produce greater revenues and profits per hour than service operations.

Question 31

Objectivity of Control

Answer 31

• Product dimensions and characteristics can be measure to determine if it is fit for use.
• Customer Experience with services is seldom measured directly. (quality of feedback is limited)

Question 32

Transportability

Answer 32

• Physical goods are transported so manufacturers can locate production anywhere as long as their landed cost is competitive.
• Services are difficult to transport.

Question 33

Operations Skills for a SC World

Answer 33

1. Careful outsourcing mgmt.
2. Supplier Integrated Manufacturing
3. Dissemination (sharing) of Best Practices

Question 34

Supplier Integrated Manufacturing

Answer 34

• What needs to be done and who should do it.