I&P 2 Flashcards
What is operations management ?
is the activity of managing the resources, which produce and deliver products and services.
Why is operations important in all types of organizations ?
operations have to take decisions about their products and/ or service.
How do operations produce services and products?
by changing inputs into outputs
what are input resources?
- transformed resources –> materials, information and costumers.
- transforming resources –> facilities and staff
What are transformed resources?
resources that transform in the process. (materials, information)
What are transforming resources?
the resources that act upon the transformed resources (facilities, staff)
What is the hierarchy of operations?
- the process –> resources
- the operation –> processes
- the supply network –> network of operations
what are the four V’s ?
- volume
- variety
- variation dimension
- visibility
What is volume?
focused on time –> systemization
What is variety ?
different products
What is variation dimension ?
easy to plan –> routine and predictability
What is visibility ?
how much is involved? costumer experience
What are the activities of operations management?
operation strategy –> design –> planning and control –> improvement (develop)
Why is operations performance important in any organisation?
Operations management is a make or break activity
What are stakeholders ? explain internal and external
the people and groups that have a legitimate interest in the operations activities.
internal –> employees
external –> costumers, society
How does the operations function incorporate all stakeholders objectives?
listening and responding to the needs of the stakeholders
What is CSR –> corporate social responsibility
take account of its economic, social and environmental impacts. but also the needs of the stakeholders
What does top-management expect from the operations function.
top management has the most immediate impact on performance. So they expect that all their operation managers to contribute to the success by using their resources effectively. –> improving processes, reduce cost, reducing risk, reducing the amount of investments
What are the performance objectives? name all 5 of them.
- quality
- speed
- dependability
- flexibility
- cost
explain quality of the performance objectives.
- do things right
- satisfy your costumers
- error free goods
What is the impact of quality related to the performance objectives ?
- quality reduce costs –> the fewer mistakes are made
- quality increases dependability –> loss or revenue if product is not able to be bought.
explain speed of the performance objective
- fast
- reduce time between a costumer asking and receiving them.
What is the impact of speed related to the performance objectives?
- speed reduces inventories and reduces risk
explain dependability of the performance objective.
You want to do things on time.
keep delivery promises
What is the impact of dependability related to the performance objectives?
dependability saves time and money.
it gives stability –> level of trust between the departments.
Explain flexibility of the performance objective
to adapt the organisations activities to the circumstances.
What is the impact of flexibility of performance objective
- product and service flexibility
- mix flexibility –> produces a wide range
- volume flexibility –> to change the output
- delivery flexibility
what are the internal benefits of flexibility?
- flexibility speeds up response
- flexibility saves time
- flexibility maintains dependability
what are the external benefits of flexibility?
increase ability of operation to do different things for different costumers.
what is mass customization?
some companies developed their flexibility in such a way that products and services are customized for each individual costumer. Yet the manage to produce them in high volume which keep costs down. (dell: design your own PC)
what is agility ?
reacting to the market requirements by producing new and existing products and services fast and flexible.
explain cost of the performance objective
you want to do things cheaply
what is the impact of cost of performance objective ?
- improve the performance to save costs –> processes
What is polar representation?
represent the importance of each performance objective
What is trade-off?
by improving one performance objective might only be achieved by sacrificing an other performance objective.
What is the efficient frontier?
identifies operations with performance that dominate other operations performance
what is strategy?
- set objective to reach a goal
- planning the path
What is operation strategy?
the strategic decision and actions which lead to the objectives and activities of an organisation
name the three steps of strategies you can use
1) implement strategy
2) support strategy
3) drive strategy
What is implement strategy ?
you have to implement your strategy effectively to make it work.
What is support strategy?
develop the capabilities which allow the the organization to improve and refine their strategic goals
What is drive strategy?
giving the business an unique and long term advantage
What is Hayes and Wheelwright four stages of operations contribution?
stage 1 : internal equity –> correct the worst problems
stage 2 : external neutrality –> adopt best practice
stage 3 : internally supportive –> link strategy with organisation.
stage 4: externally supportive –> give an operations advantages.
What is the top-down strategy?
is a reflection of what the whole business wants to do. divided up by business and how they should position itself in the market.
What is bottom up-up strategy?
emergent strategy –> day to day decisions that need to be made to run the company
what are the three steps of strategic planning?
1) corporate –> what business shall we be in? what resources do we need?
2) business –> how do we compete in the business? what is our mission?
3) Function –> how does the function contribute to the business?
what is market requirements strategy?
to satisfy your markets requirements
what is competitive factors?
the 5 performance objectives which define the costumer satisfaction.
How do you determine the importance of competitive factors?
- order winning factors
- qualifying factors
What are order winning factors
are the things that which directly contribute to winning business ( cost, speed etc. ) (reason why costumers choose your business)
What are qualifying factors?
factors that the operations performance need to be above average just to be considered by costumers. (quality, speed, price) (basic needs consired by the guest
What are the four steps of the product/service cycle ?
1) introduction stage –> product is introduced
2) growth stage –> sales volume will grow
3) Maturity stage –> only the strongest ones will still exist –> reduce costs
4) Decline stage –> more competitors are dropping out,, market will be dominated by price competition.
Name the 5 subjects of operations strategy
- cooperate objectives –> profit, growth
- business strategy –> the four V’s, standardize.
- competitive factors –>order and qualifying factors
- delivery system choice –> location, capacity, process design!!
- infrastructure choice –> procedures, planning and control systems.
What is a supply network?
all organisations a business will have interaction with
What is the supply side of a supply network?
suppliers of parts, information or services
what is the demand side of a supply network?
costumers
What are first tier and second tier suppliers?
first tier suppliers direct supply the organisation and the second tier supply the first tier suppliers.
What are the three important reasons for taking a supply network perspective?
- it helps understand competitiveness
- see the links in the network
- it helps focusing on long term issues
Which three decisions do you make with process design?
1) how should the network be configured?
- outsourcing
- vertical integration
- do-or-buy decisions
2) Location
3) long-term capacity management –> how big will the factory be?
What is vertical integration?
when a company expend into areas that are at different points on the same production path. For example a manufacturer owns it suppliers.
How do you change the shape of the supply network?
- disintermediation –> cutting out the middle men
- co-opetition –> all players of the network (suppliers, costumers, complementors, competitors) can be friends and enemies at different times.
What is the difference and advantages of competitors and complementors?
Competitors normally will bring down the value of your product. But for example other restaurant in the area attract also guest together as a cluster.
What are porters five foreces??
competitors, complementors, suppliers, costumer, (company)
Name the three factors of vertical integration
- the direction –> the costumer or the supplier?
- the extent -> how far?
- the balance among stages –> how exclusive should the relationship be between operations
What are the questions you nee to ask if you are considering outsourcing or keep it in-house ?
1) is the activity of strategic importance ?
2) Has the company specialized knowledge?
3) Is company’s performance superior?
4) is significant operations performance improvement likely?
Answers: no –> outsource
what is offshoring?
obtaining services and products outside your own country.
name 2 reasons for changing location
- change in demand
- change in supply –> cost, availability of supplies.
what are the 3 objectives of location decision?
- the cost
- the service the operation is able to provide
- the revenue potential
name the supply side influences (5)
- labour cost
- land cost
- energy cost
- transportation cost
- community factors –> tax, language, politics
name the demand side influences
- labour skills
- the suitability of the land itself
- image of the location
- convenience for the costumer
what is the weighted score method?
you rank your criteria by it importants. example the cost weight higher than convenience.
what is the center of gravity method?
is the method that is used to find the location with the lowest transportation cost.
what is capacity leads demand?
timing the introduction of capacity that there is always that there is always enough to meet forecast demands
what is capacity lags demand?
the demand is always equal or higher than capacity
what is planning?
’ what is going to happen at one point in the future?’
what is control?
is dealing with changes with changes in the planning
what is long-term planning ?
forecasting, what do they hope to achieve?
what is mid-term planning?
forecasting, more detailed
what is short-term planning?
difficult to make large changes, is used for if things are not going by plan.
what can you do with spare capacity?
can be used to supply other companies
what is the bullwhip effect?
forecasting is really difficult, refers to larger and larger swings in inventory as a result of costumer demands.
what is lean operation?
is the elimination of all waste in order to develop and operation that is faster, more dependable, produces high quality, and low cost.
what is the jit approach?
to produce something when something is ordered ( no buffer inventory)
what is waste (7)
- over production
- waiting time
- transport
- (over) processing
- inventory
- motion
- defectives
why is overproduction a waste?
you make more than the costumer required
why is waiting time a waste?
it’s a delay between one process ending and the other one to begin.
why is transport a waste?
movement between departments do not add any value to the product/service
why is over processing a waste?
you add more value to the product than the costumer required.
why is inventory a waste?
you have more material in hand than is currently required.
why is motion a waste?
needless movement of PEOPLE
why is defects/inspection a waste?
does not conform to customer needs
the 5’s of lean operations
- sort –> keep only what is needed
- straighten –> position things in such way that you can easily reach them.
- shine –> keep things clean
- standardize –> maintain cleanness
- sustain –> keep up to the standards
