Key definitions [Lecture 1+2] Flashcards
Motivations for studying O&SC?
- reduce costs
- reduce risk exposure
- increase customer satisfaction (high service level)
- meeting sustainable/ESG goals
What does ‘Opus’ mean?
The planning and execution of work
What is meant by operations?
Creation and delivery of products and services to the customers”
What are the three core functions of an organisation?
- marketing and sales: communicating the organization’s
products and services to its markets - product/service development: developing new and
modified offerings - operations function: creation and delivery of products and
services to customers
Describe the process view
Inputs: tangible/ intangible items that flow into the process
from the environment.
Processes: a transformation that converts inputs into outputs.
Outputs: tangible/ intangible items that flow from the process
back into the environment.
What constitutes an input?
- materials (natural or processed resources, parts and components)
- information
- customers
- money
- energy
What are some examples of processes?
- changing location of materials (eg. parcel delivery process)
- changing physical properties of materials (e.g. in manufacturing), or customers (e.g. hairdressing process)
- to store materials (e.g. warehousing), or customers (e.g. hotel)
- Synthesize or analyse information (e.g. in accounting process)
- Transform physiological (e.g. in health care process) or
psychological (e.g. in entertainment process) state of customers
What can be considered an output?
outputs of some processes are just products, others just
services, but most a mixture of the two
What are the five elements of the process view?
- Input/ Output
- Flow unit
- Resources
- Information structure
- Network of activities and buffers
What is a flow unit?
it may be a unit of input, such as a customer order, or a unit of output such as a finished product, or the value of input or output.
List the four product attributes that we know
- product cost (C)
- product delivery time (T)
- product variety (V)
- product quality (Q)
What is product cost?
total cost of ownership of the product/service to
the customer including the purchase price, service, maintenance, repair, insurance and disposal cost.
What is product delivery time?
total waiting time for the customer before
receiving a product/ service.
What is product variety?
the choices offered to the customer
–> Options, colours and styles offered for a particular model
–> Number of product lines and families.
What is product quality?
how well the product works.
what factors determine the quality of a product?
- features
- performance
- reliability (how consistently it works over time?)
- serviceability (how quickly it can be restored?)
- aesthetics
What is the customer value proposition?
a set of benefits (along the four product attributes) that the firm offers to customers
What are process competencies?
determine the product attributes that the
process is particularly good at supplying
What are the four process competencies?
- process cost (C)
- process flexibility (flex)
- process quality (Q)
- process flow time (T)
What is meant by process cost?
the total cost of producing and delivering
products and services.
What is process flexibility? What are the two types?
- scope flexibility = ability of the process to produce and deliver a range of products/services
- volume flexibility = the ability of the process to deal with fluctuating demand.
What is process quality?
the ability of the process to deliver quality
products
What is process flow time?
the total time needed to transform a flow unit
from input to output
What is process architecture?
Type of the resources used to perform the activities and their physical layout in the processing network
What are characteristics of job shop architecture?
- Uses flexible resources to produce low volumes of highly customized variety products.
example: hospitals
- Similar resources are located together in a layout that is called a functional layout
What are characteristics of flow shop architecture?
- Uses specialized resources that perform limited tasks with high precision and speed
example: Ford Model-T
- Resources are arranged according to the sequence of activities needed to produce a particular product, with limited storage space between activities, in a product layout.
What are the process competencies for a job shop architecture?
- High flexibility
- long flow time
- high variable cost but often low initial investment
- high quality but may not be consistent
What are some challenges to the job shop architecture?
- Complicated work flows
- slow material handling over long distances
- large volume of inventories
- difficult product tracing
- difficult product scheduling
What are the process competencies associated with flow shop
architecture?
- Low flexibility
- short flow time
- low variable cost but often high initial investment (since volume is high, the unit price is often low)
- consistent quality
Operations strategy
a specific plan of action to reach a particular objective
What is a market-driven strategy?
A firm starts with key competitive
priorities and then develops processes to support them
What is a process-driven strategy?
A firm starts with a given set of process competencies and then identifies a market position that is best supported by those processes.
What are trade-offs?
a giving up of one thing in
return for another
What is the efficient frontier?
the smallest curve that contains all current industry positions
