Flashcards
The process used to acquire inputs, such as people, capital, and material, and transform them into outputs, such as products and services.
Operations
Who allocates resources?
Operations manager
Facilities and equipment
Capital
Developing capabilities that customers value, can be sustained over the long-term, and competitors find difficult to replicate.
Competitive Advantage
The process of separating production from consumption; cannot be done for services because they are produced and consumed simultaneously.`
Inseparability
The application of knowledge, tools, processes, and procedures to solve problems.
Technology
The characteristics, features, and performance of the product; how the product functions; does not fundamentally change the product. Example: changing Coca-Cola’s beverage containers from glass to aluminum.
Product Design
The application of knowledge to improve the product.
Product Technology
What is used to accomplish a task?
Process
When individuals with different expertise work towards a common goal; this is an essential business process.
Cross-functionality
Completing product design and process design simultaneously.
Concurrent Engineering
Subsystems within an organization, such as marketing, finance, and accounting, that are linked together by a common organizational goal.
Functional Areas
Consists of the organizational goals and the methods of implementing the goals; every element of the SWOT analysis should be considered when developing strategies.
Strategy
Main goals of an organization.
Key policies
The formal relationships among different functional areas that aids in communication.
Organizational structure
Where one entity has an advantage over another; will often trade their specialized products for those that they do not produce; are able to produce products at a lower cost than their competitors
Relative Advantage
A free trade agreement between the United State, Mexico, and Canada to reduce tariffs and other trade restrictions.
North American Free Trade Agreement (NAFTA)
A trade agreement designed to reduce tariffs and other trade restrictions.
General Agreement on Tariffs and Trade (GATT)
Balancing the interconnected obligations to economic viability, society, and the environment (the triple bottom line).
Sustainability
What is the percentage of businesses that operate within the service sector?
88%
Supplies and equipment that aid in the development of products and services.
Supporting Goods
The percentage of sales in a particular market.
Market Share
VIRAL
Value, Inimitable, rare, aptitude, and lifespan.
Analyzing the internal (strengths and weaknesses) and external (opportunities and threats) environments.
SWOT Analysis
What is required to developing competitive advantage?
SWOT, business process, competitive capabilities, and customer requirements.
Continuously improving a product to make it better and cheaper.
Learning curve
Teamwork where the whole is greater than the sum of its parts.
Synergy
Strategy development, product development, system development, and order fulfillment.
Key Process
The process of producing goods and system.
System
Matching strengths to opportunities.
Matching
Converting weaknesses or threats into strengths or opportunities.
Converting
Output / Input; the goal is achieving more output given the amount of inputs, thus saving money and reducing production costs.
Productivity
Starting in the late 1800s, increases in manufacturing productivity reduced the need for physical labor and enabled a shift towards service-based jobs.
The First Revolution
Productivity and efficiency improvements in manufacturing freed resources for the rapid expansion of the service industry.
The Second Revolution
Also known as the post-industrial era, this revolution began in the 1950s with the development of computers. This technology has allowed fewer people to do more work.
The Third Revolution
The ability to perform dependably and accurately.
Reliability
Knowledge and courtesy of employees and their ability to convey trust and confidence.
Assurance
The complete overhaul of a process to improve performance.
Process Redesign
How quality is defined by the business; often measured as the amount of a desired attribute; objective.
Quality (internal)
How quality is defined by the customer and the product’s fitness for use; meets customer’s needs and expectations; subjective.
Quality (external)
Ask what they value (not just what they want), how do they work, what makes them happy, and feedback on specific product attributes.
Questions for Customers when Improving Products
Failure costs, appraisal costs, and prevention costs.
Costs of Quality
Costs accrued by the organization or customer as the result of a failure of the product.
Failure Costs
Investments in measuring quality and assessing customer satisfaction.
Appraisal Costs
Investments designed to prevent defects from occurring.
Prevention Costs
Mistake proofing; an approach to prevent defects, such as color-coding parts so that customers assemble the product correctly.
Poka-yoke
Products should be designed so that they are simple and inexpensive to produce.
Design for Manufacture and Assembly (DFMA)
Services should be simple and inexpensive.
Design for Operation (DFO)
The development of products that appeal to the changing wants and needs of customers.
Quality Planning
Ensure that the product fits the customer’s perception of fitness for use.
Quality Control
Leadership ought to lead efforts to eliminate waste and errors.
Quality Improvement
A team from all levels who meet to discuss, analyze, and eliminate quality issues using Deming’s 14 points; a senior manager overseas their progress and approves their changes.
Quality Circles
An organization-wide philosophy that calls for 1) focusing on the customer, 2) quality function deployment, 3) responsibility for quality, 4) team problem-solving, 5) employee training, and 6) fact-based management.
Total Quality Management (TQM)
Describes what customers want and what they like and dislike; can get to know customers, hold focus groups, and request improvement suggestions; the business can also use their knowledge of how the customer would benefit from a new technology that they are not familiar with to create a future need on behalf of the customer.
Voice of the Customer
Relating customer needs and expectations to specific design characteristics through a series of grids or matrices.
Quality Function Deployment (QFD)
The matrix used in Quality Function Deployment (QFD); lists customer needs (WHATs), design characteristics related to these needs (HOWs), the nature of the relationship between each customer’s need and design characteristic (WHAT versus HOW), the reasons for WHATs (WHYs), and performance comparisons on design characteristics against competitors (HOW MUCH).
House of Quality
Where quality control obligations traditionally fell; now, it is up to everyone to ensure quality.
Quality Control Department
Developing a preset procedure
Standardization
The act of putting a procedure into writing.
Documentation
2000: An international quality standard.
ISO 9000
Fishbone diagrams, check sheets, control charts, histograms, Pareto charts, scatter diagrams, and control charts (classified as flow/run charts).
Seven Tools of Statistical Process Control (SPC)
Used to record data points in real-time at the site where the data is generated; raw data is collected without interpretation and then depicted using a different statistical tool.
Check Sheets
Shows the frequency of data observations within a preset range of values.
Histogram/Box Chart
Displays data as a relationship between two variables; correlations can be drawn based upon the data. The controlled variable is the independent variable.
Scatter Plot
A bar chart that reflects data values in a descending order.
Pareto Chart
A graphical depiction of process outputs where the raw data is plotted in real-time within upper control limits (UCL) and lower control limits (LCL); this allows one to determine if a process is stable or trending towards instability and take corrective action before variations result in non-conforming products.
Control Chart
Another form of a control chart for processes that have common features, a common scale, or a central tendency; an optimal line is drawn horizontally across the chart to gauge the central tendency (see Page 30 for example).
Run Chart
Relates to the firm’s ability to produce error-free products; uses six standard deviations rather than three, which translates to 3.4 defects per 1 million units (99.99966% error-free). Uses the DMAIC (Define, Measure, Analyze, Improve, and Control) process; uses quantitative and qualitative techniques.
Six Sigma
Used in the Six Sigma “define” stage to include all aspects of a project to ensure optimal success, including the project scope, problem statement, time frame, boundaries, and team members.
Project Charter
The “define, measure, analyze, improve, and control” process of Six Sigma.
DMAIC
Provides an overview of an entire process.
Value Stream Mapping
Defines the supplier-input-process-output-customer relationships in a process.
SIPC Chart
Used to identify potential causes of defects, errors, breakdowns, or failures.
Failure Modes and Effects Analysis (FMEA)
Determines the accuracy and repeatability of the measurement methods and devices used to control variation in the process.
Measurement System Analysis
Real-time solving of problems within complex systems with many different factors that are difficult to isolate.
Design of Experiments (DOE)
A team that can make rapid changes using ideas from those involved in the process.
Kaizen Teams
Sort, straighten, shine, standardize, and sustain; used to create visual control of the workplace.
5S Methodology
Define, measure, analyze, design, and verify; this method is like Six Sigma, but it is used specifically for new products and processes.
DMADV/Design for Six Sigma (DFSS)
When using Six Sigma, these specialists are developed within an organization who are experts in specific methods.
Black Belts/Green Belts
A concise verbal statement of the problem, based upon the organization’s expectations.
Problem Statement
A concise verbal statement of the problem, based upon the organization’s expectations.
Problem Statement
Products throughout their development cycle, from raw material through the final consumer product.
Supply Chain
The organization that directs the flow of information, and has the most influence and control, across the supply chain; Apple doesn’t manufacturer, but the product design and marketing-focused firm is focal because it’s brand dominants the market; also, the companies that own the oil fields and refineries are the focal firms because they control the key resource in the supply chain.
Focal Firm
Owning multiple assets in a supply chain.
Vertical Integration
A manufacturer purchases components from tier 1 suppliers. When they produce these components, they may purchase components from tier 2 suppliers, and so on.
Tier # Suppliers
Managing the movement of materials, components, and information along the supply chain.
Logistics
Taking actions to have all members of the supply chain coordinate their activities and share information.
Supply Chain Management
The process of returning defective products and efforts to reuse and recycle materials.
Reverse Logistics
When goods are provided from within the organization.
Insourced
When goods are obtained from outside suppliers.
Outsourced
