Exam 1 Flashcards
Services vs. manufacturing - Comparisons
- Degree of customer contact
- Labor content of jobs
- Uniformity of input
- Uniformity of output
- Measurement of productivity
- Production and delivery
- Quality assurance
- Amount of inventory
- Evaluation of work
- Ability to patent design
Production Types - Defined
- Continuous flow.
- Fast chain.
- Efficient chain.
- Agile.
- Custom-configured.
- Flexible
Bottlenecks
a point of congestion that creates delays and will cost your business valuable time, as well as increase your production costs.
Functional coordination interdependence
The activities that are parts of a supply chain (regardless of how it is defined) are interdependent with other supply chains in that they share various common resources.
Generally the key aspects of Supply Chain management are Purchasing (sourcing), Planning (scheduling) and Logistics (delivery)
Core competencies
The special attributes or abilities that give an organization a competitive edge. To be effective, core competencies and strategies need to be aligned.
Make/buy decisions
A make-or-buy decision is an act of choosing between manufacturing a product in-house or purchasing it from an external supplier.
Quantitative vs. qualitative
Quantitative data is numbers-based, countable, or measurable. Qualitative data is interpretation-based, descriptive, and related to language.
Efficiency vs. effectiveness -Formula, differences
Efficiency (Output/Input) is defined as the ability to accomplish something with the least amount of wasted time, money, and effort or competency in performance. Effectiveness is defined as the degree to which something is successful in producing a desired result; success.
Agility measurement
Measuring the impact of agility on business performance, therefore, requires measuring metrics assessing the level of customer service (i.e., speed, reliability and quality of service), and the cost to serve.
Sustainability
sustainability in business refers to a company’s strategy to reduce negative environmental impact resulting from their operations in a particular market.
4DX value
Focus on the wildly important, Act on the Lead Measures, Keep a Compelling Scorecard, Create a Cadence of Accountability
Business modeling shortfalls
Neglecting operations strategy
Failing to take advantage of strengths and opportunities and/or failing to recognize competitive threats
Too much emphasis on short-term financial performance at the expense of R&D
Too much emphasis on product and service design and not enough on process design and improvement
Neglecting investments in capital and human resources
Failing to establish good internal communications and cooperation
Failing to consider customer wants and needs
Order winners vs. order qualifiers
Order qualifiers
Characteristics that customers perceive as minimum standards of acceptability for a product or service to be considered as a potential for purchase
Order winners
Characteristics of an organization’s goods or services that cause it to be perceived as better than the competition
Economics of scale
Economies of scale are cost advantages companies experience when production becomes efficient, as costs can be spread over a larger amount of goods.
Productivity formula
Total output/Total input
Organizations strategy connections
Effective product and service design can help the organization achieve competitive advantage:
Packaging products and ancillary services to increase sales
Using multiple-use platforms
Implementing tactics that will achieve the benefits of high volume while satisfying customer needs for variety
Continually monitoring products and services for small improvement opportunities
Reducing the time it takes to get a new or redesigned product or service to the market
Quality functional deployment
structured approach to defining customer needs or requirements and translating them into specific plans to produce products to meet those needs. The “voice of the customer” is the term to describe these stated and unstated customer needs or requirements.
Product life cycle
Feasibility analysis
Product specifications
Process specifications
Prototype development
Design review
Market test
Product introduction
Follow-up evaluation
Value analysis
Examination of the function of parts and materials in an effort to reduce the cost and/or improve the performance of a product
Common questions used in value analysis
Is the item necessary; does it have value; could it be eliminated?
Are there alternative sources for the item?
Could another material, part, or service be used instead?
Can two or more parts be combined?
Can specifications be less stringent to save time or money?
Do suppliers/providers have suggestions for improvements?
Can packaging be improved or made less costly?
Strategies
Leading
Build capacity in anticipation of future demand increases
Following
Build capacity when demand exceeds current capacity
Tracking
Similar to the following strategy, but adds capacity in relatively small increments to keep pace with increasing demand
Utilization formula
Actual Input/Design Capacity
Standard work impact
Standard work helps to ensure that every worker is executing tasks by following the specific set of rules and processes. This helps to reduce errors, waste and risks and also facilitates problem-solving
Internal and external inputs
Planning capacity
Service capacity planning can present a number of challenges related to:
The need to be near customers
Convenience
The inability to store services
Cannot store services for consumption later
The degree of demand volatility
Volume and timing of demand
Time required to service individual customers
Design capacity
The maximum output rate or service capacity an operation, process, or facility is designed for
Effective capacity
Design capacity minus allowances such as personal time and maintenance
Layout types
Product layouts
Process layouts
Fixed-position layout
Combination layouts
Process types
Job Shop
Batch Process
Repetitive Process
Continuous Process
Line balancing value
Line balancing
The process of assigning tasks to workstations in such a way that the workstations have approximately equal time requirements and in sequence to performance
Goal:
Obtain task grouping that represents approximately equal time requirements, since this minimizes idle time along the line and results in a high utilization of equipment and labor
Why is line balancing important?
It allows us to use labor and equipment more efficiently
To avoid fairness issues that arise when one workstation must work harder than another
Process flow mapping value
Flow process chart: Chart used to examine the overall sequence of an operation by focusing on movements of the operator or flow of materials
Worker machine chart: Chart used to determine portions of a work cycle during which an operator and equipment are busy or idle
Technique types
Stopwatch Time Study
Used to develop a time standard based on observations of one worker taken over a number of cycles.
Standard Elemental Times
Derived from a firm’s own historical time study data.
Predetermined time standards
Involve the use of published data on standard elemental times.
Work sampling
A technique for estimating the proportion of time that a worker or machine spends on various activities and idle time.
Cost volume profit analysis
Locational cost-profit-volume analysis
Technique for evaluating location choices in economic terms
Steps:
Determine the fixed and variable costs for each alternative
Plot the total-cost lines for all alternatives on the same graph
Determine the location that will have the lowest total cost (or highest profit) for the expected level of output
Center of gravity
Center of gravity method
Method for locating a distribution center that minimizes distribution costs
Treats distribution costs as a linear function of the distance and the quantity shipped
The quantity to be shipped to each destination is assumed to be fixed
The method includes the use of a map that shows the locations of destinations
The map must be accurate and drawn to scale
A coordinate system is overlaid on the map to determine relative locations
3 types of flow management
Product and service flow
Involves movement of goods and services from suppliers to customers as well as handling customer service needs and product returns
Information flow
Involves sharing forecasts and sales data, transmitting orders, tracking shipments, and updating order status
Financial flow
Involves credit terms, payments, and consignment and title ownership arrangements
Centralized vs Decentralized Purchasing
Decentralized Purchasing: Departments know their needs better, Quicker response time
Dealing with local suppliers may save money
Centralized: Lower prices by combining orders, Better service from suppliers due to larger volumes, Better handling of special items
Order Fulfillment
Engineer-to-Order (ETO)
Make-to-Order (MTO)
Assemble-to-Order (ATO)
Make-to-Stock (MTS)
