MIDTERM 1 Flashcards
Operations Strategy defines:
The long-term direction of the firm’s operating resources
The order of a typical strategy heirarchy is:
Corporate -> Business Unit -> Functional
What are the 4 generic performance objectives that managers need to trade off?
(CQDF) Cost, Quality, Delivery, Felxibility
5 Types of resources to be considered in operations strategy
Physical, Human, Tech, Ecosystem, Financial
Examples of Physical Resources
Manufacturing plants, equipment, offices, vehicles
Examples of Human Resources
Employee skill level and abilities
Examples of Tech Resources
Info processes, trade secrets, software
Examples of Ecosystem Resources
Resources from partners like suppliers and distributers
Examples of Financial Resources
Finances available to operations for acquiring the other 4 classes
By definition, directed strategies determine the organization’s realized strategy
FALSE, emergent strategies do
Directed strategies come from
The top of the pyramid
Emergent strategies come from
The bottom of the pyramid
Structural Decision Areas
(CFSIP) Capacity, facilities, scope, information and process technology
Infrastructure decision areas include:
Workforce, Organization, Quality, Production Planning & Dist, Product/Process Development
Was Boeing’s strategy effective?
No, too many changes too quickly
Did Microsoft take the right step in making two operational strategies?
Yes, because they were able to keep up with their competitors
3 Business Organizations
Operations, Marketing, Finance
LEAN effects on cycle time
40-80% better
LEAN effects on cost
25-50% better
Number 1 reason LEAN succeeds or fails is due to
Management
Hierarchal Leadership Model
Top-Down
Servant Leadership Model
Bottom-Up
3 advantages of the Servant Leadership Model
Good communication, actions, and molds employees for success
Where was LEAN derived from?
Toyota Production System
You are only as strong as your ________________
Weakest Link
Constraint
Something in the system that prevents you from achieving your goal
LEAN goal:
eliminate waste and max productivity
Continuous Improvement Culture asks:
Does this improve the organization and support our strategy and objectives
6S (visual control/workspace)
- Sort
- Set in Order
- Shine
- Standardize
- Sustain
- Safety
LEAN and improvement in the Company is best achieved by:
Employees as they support the objectives
Kaizen Event is a _________________
change for the better
Where are Kaizen Events used?
Complex processes/organizations
Kaizen re-engineers:
entire business, process with many players
Keys to sustaining Kaizen Events
Continuous Improvement, leadership accountability
Six Sigma was created by
Bill Smith from Motorola (adopted by Jack Welch from GE)
Six Sigma requires a commitment by management to
make decisions on data and statistical methods
Six Sigma warnings
May hurt company in long run if there is not tremendous commitment
5 Why’s Analysis
Ask WHY a minimum of 5 times to get to root cause
Fixing a symptom _____________________________
does not fix the overall problem
Fish Bone Diagram
Cause-and-effect diagram to achieve the root cause
Expeditor
An individual who accelerates the progress of an existing order
How does Jonah define productivity?
The act of bringing a company closer to its goal
When first queried by Jonah in the airport, how does Alex describe the goal of his manufacturing operation?
Market Share
Which sentence best represents the measurement of inventory as presented by Jonah?
All the money the system invests in purchasing things the system intends to sell
Which sentence best represents the measurement of operational expense as presented by Jonah?
All the money the system spends to turn inventory into throughput
Which sentence best represents the measurement of throughput as presented by Jonah?
Rate system generates money thru sales
How many months is Alex Rogo given to turn around the Bearington plant?
3 Months
What does Alex conclude is the goal of a manufacturing organization?
Make Money
The reality that most of the factors critical to running your plant cannot be determined precisely ahead of time is known as
Statistical Fluctuation
Alex realized on the hike that the distance between himself an Herbie was equivalent to
Inventory
Which one of Jonah’s measurements represent the money still inside the system?
Inventory
Jonah teaches that the closer one comes to achieving a balanced plant…
The closer they are to bankruptcy
According to Jonah, an hour lost at a bottleneck lowers the plants overall __________.
Throughput
Jonah teaches that you should balance the flow of the plant with _____________.
Market Demand
5 Focusing Steps on Theory of Constraints
(ID(S)ER)) Identify, Decide, Subordinate, Elevate, Repeat
2 Major Time Factors:
Queue Time, Wait Time
Performance Metric
Determines an organization’s behavior and performance
When are performance metrics good?
When they motivate behavior that supports the Corporate, Business Unit, and Functional Strategies and are aligned with all three
Throughput formula
Add each sequential step
Labor Content formula
Add EVERY step
Cycle Time formula
Bottleneck time
Capacity formula
Time / Cycle Time
Labor Utilization formula
Step Time / Cycle Time
Avg Labor Utilization formula
Avg Step Time / Cycle Time
Total Batch Time formula
Set-up + Processing Time
Cross-Trained formula
Add cross-trained steps / # of steps
Labor Cost (Cycle Time) formula
Cycle Time x # of People
Labor Cost formula
Labor Content / Avg Labor Util
