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#purchasing&logistic > Logistics L2 > Flashcards

Logistics L2 Flashcards

1
Q

Manufacturing Process Decisions

A

The impact of people, facilities and physical layouts and information systems working together
The effect of the manufacturing processes on the overall business strategy
The impact many different types of manufacturing processes working together

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2
Q

Selecting a Manufacturing Process

A
  • What are the physical requirements of the company’s product?
  • How similar to one another are the products the
    company makes?
  • What are the company’s production volumes?
  • Where in the value chain does customization take
    place (if at all)?
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3
Q

SIX types of Manufacturing Processes

A

(1) Job Shop
(2) Continuous (Flow) Process
(3) Batch Process
(4) Production Line
(5) Fixed Position Layout
(6) Hybrid Manufacturing Process

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4
Q

Job shop

A B C D E F A G

A

General-purpose equipment and broadly skilled workers
Functional layout: work areas are arranged by function
Requirements can change dramatically from one job to the next
Customized products
Highly flexible but not very efficient

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5
Q

Continuous (Flow) Process

AAAAAAAAAA

A

Large production volumes (24/7)
High level of automation
Production materials are gases, liquids, or powders (in
mining they are granular or chunky materials)
Basic material passed along, converted as it moves
Usually cannot be broken into discrete units
Usually very high fixed costs and inflexible

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6
Q

Batch-process

AA BC AA

A

Items are moved through the different manufacturing steps in groups, or batches
Moderate volumes, multiple products
Sequence of steps is not as tightly linked as a production line
Strikes a balance between the flexibility of a Job Shop
and the efficiency of a production line

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7
Q

Production Line

A

High-volume production of standard items with identical or highly similar designs
Processes arranged by product flow
Often “paced”Highly efficient, but not too flexible
Resources are arranged sequentially

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8
Q

Fixed-Position Layout

A

The position of the product is fixed.
Materials, equipment, and workers are transported
to and from the product.
Used in industries where the products are very
bulky, massive, or heavy and movement is
problematic

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9
Q

Hybrid Manufacturing Processes

A

Seeks to combine the characteristics and advantages of more than one classic process.
Machining centers
Group technology
Flexible manufacturing systems

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10
Q

4 levels of customization

A

Make-to-stock (MTS)
Assemble-to-order (ATO)
Make-to-order (MTO)
Engineer-to-order (ETO)

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11
Q

Make to stock

A

Products that require no customization, are made on demand forecasts and sold to the customer from
finished goods stock
the issue is how to forecast demand accurately

Books, television, spec homes, standard vacation package

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12
Q

Assemble to order

A

Products that are customized only at the very end of the manufacturing process from a stock of standard
❖ Computer systems, corporate training

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13
Q

make to order

A

Products that use standard component but production of the final product is linked to the final customer’s specifications

❖ Wedding invitations, air craft manufacture

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14
Q

Engineer-to-order (ETO)

A

● Products that are designed and produced from the unusual customer needs or requirements
❖ End-product tends to be complex
❖ Power plan boilers, electrical switch gear, industrial cranes

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15
Q

law of variability

A

The greater the random variability, either demanded of the process or inherent in the process itself or in the items processed, the less productive the process is

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16
Q

When customization occurs early in the supply chain

A

Flexibility in response to unique customer needs will be greater
Lead times to the customer will tend to be longer Products will tend to be more costly

17
Q

When customization occurs late in the supply chain

A

Flexibility in response to unique customer needs will be limited
Lead times to the customer will tend to be shorter Products will tend to be less costly

18
Q

How different services are organized and managed

A

The service package
The degree of customization
The level of customer contact

19
Q

The service package

A

Includes all value-added physical and intangible activities
The greater the emphasis on physical activities, the more attention will be directed to capital expenditures, material costs and other tangible assets
○ Example: airline, trucking
The greater the emphasis on intangible activities, the more critical are the training and retention of skilled employees and the development of the firm’s knowledge assets
○ Example: law firm, software developer

20
Q

Service customization

A

Ranges from highly customized to standardized
● High: greater flexibility and highly responsive to customer’s needs (car repair)
● Low: more emphasis on controlling process and improving productivity (oil shop)
● As the degree of customization increase, the service package become less predictable and more variable

21
Q

Customer contact

A

relates to the importance of front-room or back-room operations.
Front room ➔ The physical or virtual point where the customer interfaces directly with the service organization
◆ What the customer can see
◆ Managed for flexibility and customer service
● Customer lobbies, back teller, receptionist

● Back room ➔ The part of a service operation that is completed without direct customer contract
◆What the customer does not see
◆ Managed for efficiency and productivity
● Package sorting, accounting department, car repair

22
Q

Managerial Challenges in Service
Environments

Nature of the service package

  • Primarily physical activities Greater emphasis on managing physical assets (airline, trucking firm)
  • Primarily intangible activities greater emphasis on managing people and knowledge assets (law firm, software developer)

Degree of customization

  • Lower customization ​greater emphasis on closely controlling the process and improving productivity (quick-change oil shop)
  • Higher customization​ greater emphasis on being flexible and responsive to customers’ needs (full-service car repair shop)
A

Degree of customer contact

  • Lower contract​ more of the service package can be performed in the back room. Service layout, location and hours will be based more on cost and productivity concerns (mail sorting)
  • Higher contract​ more of the service package must be performed in the front room. Service layout, location and hours must be designed with customer convenience in mind (physical therapist)
23
Q

Service blueprinting
➔ A specialized form of business process mapping that lays out the service process from the viewpoint of the customer & parses out the organization’s service actions based on

A

◆ The extent to which an action involves direct interaction with the customer
◆ Whether an action takes place as a direct response to a customer’s needs

24
Q

Layout decisions

Product-based layout ➔ Arranges resources sequentially, according to the steps required

Functional layout ➔ Physically groups resources by function

A

Cellular layout ➔ Production resources are dedicated to a subset of products with similar requirements

Fixed position layout ➔ Productive resources are moved to where product is made or service is being provided

25
Q

Supply chain
➔ The system of organizations, people, activities, information and resources involved in moving a product or service from supplier to customer

A

Supply chain activities transform raw materials and components into a finished product that is delivered to the end customer Supplier - manufacturer - distributor - retailer - customers

26
Q

Supply chain management

A

➔ The dessign and management of processes across organizational boundaries with th goals of matching supply and demand in the most cost-effective way.
➔ Vary widely according to the end product

27
Q

Supply chain management

A

➔ The dessign and management of processes across organizational boundaries with th goals of matching supply and demand in the most cost-effective way.
➔ Vary widely according to the end product

28
Q

Why so Difficult to Match Supply and Demand?

A

● Uncertainty in demand and/or supply (forecasting)
● Changing customer requirement
● Decreasing product life cycles
● Fragmentation of supply chain ownership
● Conflicting objectives in the supply chain

Conflicting objectives even within a single firm (mkt, production, distribution)

29
Q

Supply Chain Performance Measures

Cost

Total supply chain cost
- The sum of all supply chain costs for all products processed through a supply chain during a given period

A

Inventory turnover
- The ratio of the cost of goods sold to the value of average inventory
◆ How often the company replenishes inventory
◆ High value of inventory turnover means that the inventory was not sitting around a long time

Weeks of inventory
- The ratio of average inventory to the average weekly sales
◆ Means how many weeks worth of inventory does the company have on hand
◆ High value weeks of supply means that firm has a lot of inventory sitting around

30
Q

Supply Chain Performance Measures

- Customer service

A

Average response time
➔ The sum of delays of ordering, processing and transportation between the time an order is placed at a customer zone and the time the order arrives at the customer zone

31
Q

Outsourcing

A

Moving some of the firms internal activities and decisions to outside providers
◆ Examples:
Outsourcing of call centers (customer care)
Advertising is often outsourced completely

32
Q

Why do firms outsource?

  • Organizational reasons
  • Operational reasons
  • Financial reasons
A 
Organizational reasons
● Focus on service 
● Focus on core capabilities 
● Transform the organization 
● Increase flexibility

Operating reasons
● Improve performance (quality, productivity)
● Obtain expertise, skill and technology
● Risk management

Financial reasons
● Transfer assets to the outsourcing partner
● Free up resources for investment in other purposes

33
Q

Why do firms outsource?

  • Cost driven reasons
  • Revenue driven reasons
A

Cost driven reasons
● Transform fixed costs into variable costs
● Reduce costs through outsourcing partner efficiencies

Revenue driven reasons
● Expand and grow with the help of another organization
● Obtain access to outsourcing partner’s network

#purchasing&logistic (6 decks)

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