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SCM 352-1004 > Session 1 - > Flashcards

Session 1 - Flashcards

1
Q

What are the major business functions?

A

1- Finance and Accounting
2- Marketing
3- Human Resource
4- Operations

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2
Q

What is Operations?

A

The transformation process that converts inputs into outputs

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3
Q

What is Operations Management (OM)?

A

Managing the transformation process

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4
Q

What are the two types of outputs / businesses?

A

1- Manufacturing

2- Services

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5
Q

Whare are characteristics of the Manufacturing Output?

A

1- Products are physical objects
2- Low degree of customer contact
3- Quality can be easily checked prior to consumption

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6
Q

What are characteristics of Service output?

A

1- Products are not tangible objects
2- High degree of customer contact
3- Quality cannot be easily assessed prior to delivery
4- Services cannot be stored

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7
Q

What is cross-functional collaboration?

A

The interaction and collaboration of the different business functions

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8
Q

What does Cross-Firm collaboration lead to?

A

Supply Chain management

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9
Q

What is a trait CEO’s from many companies have?

A

They have Operations Background

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10
Q

What is Strategy?

A

Strategy is a careful plan
- Alternatives
- Trade-offs

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11
Q

What does a firm’s strategic plan do?

A

Focuses on how a firm will deploy internal resources and capabilities within its external environment to achieve a competitive advantage

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12
Q

What is in the Strategic Planning Hierarchy?

A

Corporate Strategy —>
Business Strategy —>
Functional Strategy —>

(three level plan)

Consistent Patterns of Decisions —>
Results

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13
Q

What is Corporate Strategy?

A

It defines what business that the company is pursuing

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14
Q

What is Business Strategy?

A
  • Follow the corporate strategy
  • Defines how each business unit competes
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15
Q

How many and what are the different strategies in the Functional Strategy level?

A

3 types of strategy
- Finance Strategy
- Operations Strategy
- Marketing Strategy

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16
Q

What is Functional Strategy?

A
  • Follow the business strategy
  • Support the competitive advantage being pursued
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17
Q

What are the Three Generic Business Strategies? What defines them?

A

1) Differentiation - Is associated with a unique and frequently innovative product or service

2) Low Cost - Is pursued in commodity markets where the products or services are imitative

3) Focus - Refers to the geographical or product portfolio being narrow or broad in nature

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18
Q

What are the three functional strategies and what is their purpose?

A

1) Marketing Strategy - to increase sales and attract customers

2) Finance Strategy - to maximize business profit

3) Operations Strategy - to deliver products or services to customers
- to help the firm develop capabilities that sustain its competitive advantage

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19
Q

What is Operations Strategy?

A

A consistent pattern of business decisions for operations and the associated supply chains that are linked to the business strategy and other functional strategies, leading to a competitive advantage for the firm

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20
Q

What are the four elements in Operations Strategy?

A

1) Mission - Why?
2) Objectives - Where to compete?
3) Strategic Decisions - How to achieve?
4) Distinctive Competence - What have achieved?

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21
Q

What is the purpose of Mission in Operations Strategy?

A

Why does the firm pursue a line of business?

  • A mission with a clear sense of purpose motivates employees
  • Creating an organization of highly motivated people is hard to duplicate
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22
Q

What is the purpose of Objectives in operations management?

A

Where does the firm want to compete?

  • Also called competitive priorities
  • Has four common objectives = Cost, Quality, Flexibility, Delivery
  • Most firms choose one or a few objectives to focus on - they cannot be everything to everyone
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23
Q

What is the purpose of Competing on Cost?

A

Fulfilling customers needs at a lower price relative to the competitors

24
Q

What are the key focuses of Competing on Cost?

A

1) Continually reduce costs in
- Materials, Labor, Inventory, Transportation, etc.

2) Invest in long term productivity
- updated facilities & equipment, streamlining operations, training & development

3) Focusing on Economies of Scale & Learning Curve

25
Q

What are examples of Competing on Cost?

A

-Southwest Airlines
- Walmart
- ALDI

26
Q

What is Economies of Scale?

A

Measure of Average Unit Cost in relation with Cumulative Volume

27
Q

What is Economies of Scope?

A

Measure of Average Unit Cost in relation to Product Variety

28
Q

What is “Competing on Quality” purpose?

A

to Please the customer

  • premium, organic, luxury, etc.
29
Q

What is the key focus of Competing on Quality?

A

1) Product Development
- High durability, close tolerances, superior features

2) Quality is defined from customer’s view

3) Quality is linked to profitability

30
Q

What are some examples of Competing on Quality?

A
  • BMW
  • Apple
  • Ritz-Carlton
  • Whole Foods
31
Q

What is the purpose of Competing on Flexibility?

A

Being better able to adapt to changes in customer needs

32
Q

What are the key focus for Competing on Flexibility?

A

1) Product Variety through:
- Flexible manufacturing systems, components commonality, mass customization

2) Volume Flexibility through:
- Temporary Labor and Outsourcing

3)Introduce New Products

4) Respond to customer needs

33
Q

What are examples of Competing on Flexibility?

A

TIMBUK2

Chipotle

34
Q

What is the purpose of Competing on Delivery?

A

Reliably fulfilling customer needs faster than competitors

35
Q

What are the key focus of Competing on Delivery?

A

1) Reduce Processing Time
- use technology rather than human labor

2) Reduce Wasted Time
- Redesign office layout to work more efficiently & fast moves

3) Tight Structure linkages

36
Q

What are examples of Competing on Delivery?

A
  • Amazon
  • Fedex
  • Lenscrafters
37
Q

What is the trade-off between Quality vs. Cost?

A

Designing a better quality control system may cost more

38
Q

What is the trade-off of Flexibility vs. Cost?

A

Designing a more flexible process may cost more

39
Q

What is the trade-off of Time vs. Cost?

A

Immediate healthcare services may cost more

40
Q

What is the trade-off of Time vs. Quality?

A

A higher quality product may take more time to produce

41
Q

What is Strategic Decisions?

A

How to achieve objectives?

42
Q

What are the five areas of Strategic Decisions?

A

1) Process
2) Quality
3) Capacity
4) Inventory
5) Supply Chain

43
Q

What are the Strategic Decisions in the Process area?

A

1) What process to design? May or buy?

2) How much automation in the process? Hand-made or machine-made?

44
Q

What are the Strategic Decisions in the Quality area?

A

1) What approach for product control? Prevention or Inspection?

2) Whether investing in training? Technical or managerial training?

45
Q

What are the Strategic Decisions in the Capacity area?

A

1) What are the size and location of the facility? One large facility to reduce production cost or several small facilities near the markets?

46
Q

What are the Strategic Decisions in the Inventory area?

A

How much inventory to hold?

What level of controls in the warehouse? By pallet or product case?

47
Q

What are the Strategic Decisions in the Supply Chain area?

A

Where to source raw materials or technique support? Insource or outsource?

48
Q

What is the purpose of Distinctive Competence?

A
  • What has the firm achieved?
  • Also called Operations Capability - the operations of the firm does better than anyone else
49
Q

What should firms focus on in Distinctive Competence?

A

Firms should focus on developing distinctive competencies
( rather than achieving specific marketing or financial goals)

50
Q

What are the sources of building Distinctive Competencies?

A

1- Unique Resources
2- Proprietary or patented technology
3- Talents

51
Q

What is the purpose of extending operations strategy to the supply chain?

A

To achieve a competitive advantage for the entire supply chain
(rather than individual entities)

52
Q

What are two supply chain strategies and what are they?

A

1) Functional Products (commodities)
- Predictable Demand
- Efficient, low-cost supply chain

2) Innovative Products (new technologies)
- Unpredictable demand
- Flexible, fast supply chain

53
Q

What should a firm do when extending operations strategy to the supply chain?

A

Firms must design the right supply chain for each product or group of products.
- avoid a one size fits all strategy

54
Q

What are the aspects of demand in the two supply chain strategies?

A

1) Product Life Cycle
2) Profit Margin
3) Average forecast error

55
Q

What is the general rule for Supply Chain Strategy?

A

Firms must design the right supply chain for the right product

SCM 352-1004 (7 decks)

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