Operations Management: Process Management

Question 1

Business Process Management

Answer 1

management approach that seeks to coordinate the function of an organization to customer satisfaction
The process seeks effectiveness and efficiency through promotion of innovation flexibility and integration with technology

Question 2

BPM can be categorized in 5 categories

Answer 2

• Design
• Modeling-what-if analysis
• Execution-changes are implemented. key indicators of success are developed
• Monitoring
• Optimization

Question 3

Techniques for BPM

Answer 3

• Define- WHere are we now?
• Measure-Objectively are we getting better?
• Analyze-Best options available?
• Improve-is selected and implemented
• Control-Does it work?

Question 4

Measures for BPM

Answer 4

1) Gross Revenue-Financial
Non-Financial
2) Customer Contracts-Leads
3) Customer Satisfaction-Complaints
4) Operational Statistics-Time

Question 5

Benefits of BPM

Answer 5

• Efficiency
• Effectiveness
• Agility- Responses to change are faster and more reliable

Question 6

Process management (PDCA)

Answer 6

Plan-Design the planned process environment
Do-Implement the process improvement
Check -Monitor the process improvement
Act-Continuously commit to the process and reassess the degree of improvement

Question 7

Benefits

Answer 7

1) Efficiency- Fewer resources are used to accomplish organizational objectives
2) Effectiveness-Obj. are accomplished with greater predictability
3) Agility- Responses to change are faster and more reliable

Question 8

Shared Services

Answer 8

Seeking out redundant services, combining them and then sharing those services within a group or organization.
Ex. HR, payroll, and legal dept. services will be consolidated into one centralized functions.

Question 9

Shared Services Implications for Business Risks and Controls -gaining efficiency

Answer 9

a) Service flow disruptions

b) Failure demand

Question 10

Outsourcing

Answer 10

Contracting services to an external provider.

Question 11

Outsourcing: Implications for Business Risks and Controls -gaining efficiency

Answer 11

a) Quality Risk -Product or service may be defective

b) Quality of Service-Poorly designed service agreements may impede the quality of service.

Question 12

Outsourcing Issues Continued

Answer 12

a) Quality Risk -Product or service may be defective
b) Quality of Service-Poorly designed service agreements may impede the quality of service.
c) Productivity
d) Staff turnover
e) Language Skills
f) Security
g) Qualifications of Outsourcers
h) Labor Insecurity

Question 13

Offshore Operations

Answer 13

relate to an outsourcing of services or business functions to an external party in a different country.

Question 14

Common types of Offshore Outsourcing

Answer 14

a) IT
b) Business Process( Call centers)
c) Software research and development
d) Knowledge Process

Question 15

Selecting Improving Initiatives

Answer 15

A) Irrational- Intuitive & Emotional

B) Rational- Structured & Systematic

Question 16

Implementing Improvement Initiatives

Answer 16

1) Internal Leadership
2) Inspections
3) Executive Support
4) Internal Process Ownership-Accountability

Question 17

Business Process Engineering

Answer 17

Refers to techniques to help organizations rethink how work is done to dramatically improve customer satisfaction and service, cut costs of operations and enhance competitiveness.

Question 18

Performance Improvement

Answer 18

Provide the highest quality goods and services in the most efficient and effective manner possible.

Question 19

Just in Time (JIT)

Answer 19

JIT mgmnt aticipates achievement of efficiency by scheduling the deployment of resources of JIT to meet customer or production requirements

Question 20

JIT & Inventory

Answer 20

The underlying concept is that inventory does not add value. The maintenance of inventory on hand produces wasteful costs.

Question 21

Benefits of JIT

Answer 21

1) Synch of production scheduling with dept.
2) Arrival of supplies at regular intervals throughout the production day.
3) Improved coordination and team approach with suppliers
4) More efficient flow of goods between warehouses and production
5) Reduces set-up time
6) Greater efficiency in the use of employees with multiple skills

Question 22

Costs of Quality

Answer 22

Conformance with quality standards & correcting nonconformance with quality standards.
Prevention + Cure

Question 23

Conformance Costs

Answer 23

Prevention and appraisal costs

Question 24

Prevention costs - Prevent the production of defective units

Answer 24

1) Employee Training
2) Inspection expenses
3) Preventive maintenance
4) Redesign of product
5) Redesign of processes
6) Search for higher quality suppliers

Question 25

Appraisal Costs- Discover and remove defective parts before they are shipped to the customer or the next department

Answer 25

1) Statistical Quality Checks
2) Testing
3) Inspection
4) Maintenance of the laboratory

Question 26

Nonconformance Costs

Answer 26

Often difficult to compute because most of these costs are in the form of opportunity costs. Basically the customer telling us to fix it.

Question 27

Internal Failure-Cure a defect discovered before the product is sent to the customer

Answer 27

1) Rework Costs
2) Scrap
3) Tooling Changes
4) Costs to discpose
5) Cost of the lost unit
6) Downtime

Question 28

External Failure-Cure a defect discovered after the product is sent to the customer

Answer 28

1) Warranty Costs
2) Cost of returning the good
3) Liability Claims
4) Lost Customers
5) Reengineering an external failure

Question 29

Total Quality Management

Answer 29

Organizational Commitment to customer focused performance that emphasizes both quality and continuous improvement

Question 30

Quality circles

Answer 30

Gather people together that can best solve the problem

Question 31

Objectives of TQM- Total Quality Management

Answer 31

a) Customer Focus
b) Continuous Improvement
c) Workforce Involvement-Quality Circles
d) Top Management Support
e) Objective Measures
f) Timely Recognition
g) Ongoing Training

Question 32

Lean Manufacturing

Answer 32

requires the use of only those resources required to meet the requirements of customers

Question 33

Focus of lean -Waste Reduction

Answer 33

Not quality focus

Question 34

Continuous Improvement

Answer 34

Kaizen refers to continuous improvement efforts that improve the efficiency and effectiveness or organizations through greater operational control

Question 35

ABC

Answer 35

Activity Based Management

Question 36

ABC- Cost Identification

Answer 36

Highlight the costs of activities, Makes the id of costs of quality and value added activities more obvious

Question 37

Theory of Constraints

Answer 37

States that org. are impeded from achieving objectives by the existence of one or more constraints.

Question 38

Constraints

Answer 38

a) Internal Constraints =When the market demands more than we can produce.

Question 39

Internal Constraints

Answer 39

1) Equipment may be inefficient or used inefficiently
2) People may lack the necessary skills or mind set necessary to produce required efficiencies.
3) Policies may prevent the efficient use of resources.

Question 40

External Constraints

Answer 40

Exist when our system produces more than the market requires.

Question 41

Six Sigma

Answer 41

Anticipates the use of rigorous metrics in the evaluation of goal achievement.

Question 42

Just In Time Characteristics

Answer 42

Insignificant setup times and costs.
.

Lot sizes equal to one.
Balanced and level workloads.