Ops Mgmt C - Process Mgmt Flashcards
Business process mgmt is supported by
approaches, techniques, and measures
The tool used when a manufacturer compares its procedures against the check-in process for a major airline is known as
benchmarking
Prevention costs are
the costs of production process changes that reduce the rate at which product defects occur
Inspection costs are
tests to make sure products meet quality standards
Internal failure costs are
reworking or scrapping defective products
External failure costs are
costs related to selling defective products, which results in product liability claims, warranty and repair expenses, loss of customer satisfaction, and damage to the company’s reputation
Process mgmt is
the process of planning and monitoring the operations of a business process
Off-shore operations are when
an organization incorporates outside of the original jurisdiction of the primary operations
An example of an off-shore operation is
a US company incorporating in Japan
Main goals of off-shoring are
competitive pressure and cost reduction
Shared services is
combining efforts of two departments that share the same resources
Operational planning results in
budget data to be used in planning day-to-day ops
Strategic planning is performed at
the highest level of mgmt and focuses on long-term goals
Data collection is most critical in the implementation of an improvement initiative at
all stages; before, during, and after implementation
Six Sigma is
a methodological approach to eliminating defects with the goal to achieve 6 std. dev. from the desired target of quality
Business process re-engineering (BPR) is
a systematic approach or methodology for analyzing business activities or processes with a view to improving the org’s alignment with strategic goals and/or its effectiveness, efficiency, competitiveness, etc.
3 questions to answer to check on implementing business process re-engineering (BPR)
- the effort focused on critical business processes
- desired improvement’s ambition
- receptiveness of senior mgmt
The role of IT in BPR is
the major facilitator for new ways of sharing information within a specific org and outside of the org
If a business has intracompany service transfers from a cost center to a profit center, under stable economic conditions, the best transfer price to be most conducive to evaluating whether both divisions have met their responsibilities is
Standard VC
Business process modeling tools include:
- use case diagrams
- activity diagrams
- business process modeling notation
- extended business modeling language
- unified modeling language
Lean Production aka Lean manufacturing is
the set of tools that assist in the identification and elimination of waste to improve quality while reducing production costs
Main purpose of outsourcing is to
reduce costs
Other reasons to outsource include:
- focus on core business
- improve quality
- capacity mgmt
BPR is
the search for and implementation of radical change in business processes to achieve breakthrough results
BPR does what within an org?
analyzes and designs workflows and processes
Learning curve is
a graphical description of the learning process that shows the impacts of learning over a # of practice opportunities on work behaviors
Basic assumption of the learning curve model is
the DL required for the n+1st unit will always be less than the labor required for the n unit
JIT production environments typically feature:
- small lot sizes
- low setup times/costs
- balanced workloads
- demand-pull system
Traditional production systems feature:
- products produced based on expected demand
- a fixed schedule
- a push-through system
Cost of conformance =
prevention costs + appraisal costs
Cost of nonconformance (failure) =
internal failure + external failure
JIT is aka
Lean manufacturing
Drum Buffer Rope theory:
- assumes a limited # of constraints created by scarce resources
- states that to protect throughput, the limiting factor must be protected
- states that it is important to protect against inventory build up and associated carrying costs which can occur at bottlenecks
- focuses on only the queuing area in front of the bottleneck
A newly introduced costing method that has recently been adopted at some firms is called _____ costing
throughput
Throughput costing is
a type of variable costs that assigns only DM costs to products and treats all other production costs as period costs
3 basic measurements used by the theory of constraints (TOC) are
throughput contribution, inventory aka investments, and operational expenses
The technique to effectively measure improvements in product quality as a result of internal failure costs would be
tracking the # of products reworked
Mgmt of a company would perform _______ to compare and contract its financial info to published info reflecting optimal amounts
bechmarking
If a business moves from a traditional manufacturing philosophy to a JIT system, then their inventory turnover will ______ and their inventory as a % of total assets will ______
increase; decrease
Kanban is
a technique for managing JIT inventory systems developed by the Japanese which involves a communication device (card, sign, or empty bin) which is returned to the previous work area to signal the need for additional units demanded
Benchmarking is
the comparison of existing activities with the best levels of performance in other, similar organizations
Companies that adopt JIT systems often experience
a reduction in the # of suppliers
Rework costs should be regarded as a cost of quality in a manufacturing company’s quality control program when they are
caused by internal failure
The costs of a company’s quality control system are divided into 4 parts
prevention costs, appraisal costs, internal failure costs, and external failure costs
Examples of prevention costs, appraisal costs, internal failure costs, and external failure costs include
Prevention - training
Appraisal - inspection
Internal Failure - reworking
External Failure - warranties
Benefit of JIT system usually includes
elimination of nonvalue-adding operations
JIT system will generally:
- decrease the # of suppliers
- minimize the standard delivery qty
- increase the # of deliveries required
Value chain is
any part of an entity that enhances the quality or usefulness of the product or service in the eyes of the customer
Business functions considered part of a company’s value chain include:
customer service, marketing, and R&D
Accounting is not part of a company’s value chain. Fact or Fiction?
FACT
