Operations and Supply Chain Management Test 2 (CH 12,13,14)
Malcolm Baldridge National Quality Award
An award established in 1987 to promote quality awareness, to recognize quality achievements of U.S. companies, and to publicize successful quality strategies
Kanban Pull system
An inventory or production control system that uses a signaling device to regulate flows.
Waste
Anything that does not add value from the customer's perspective
Lean Six Sigma
Combines the implementation and quality control tools of Six Sigma and the inventory management concept of lean manufacturing
Defects per million opportunities
Common metric used to describe process performance
Appraisal Costs
Costs of the inspection, testing, and other taks to ensure that the product or process is acceptable
Assignable Variation
Deviation in the output of a process that can be clearly identified and managed.
Common Variation
Deviation in the output of a process that is random and inherent in the process itself.
Cost of Quality (COQ)
Expenditures related to achieving product or service quality, such as the costs of prevention, appraisal, internal failure, and external failure.
Quality at the source
The philosophy of making each worker responsible for the quality of his or her work
Quality at the Source
The philosophy of making each worker responsible for the quality of his or her work.
Value Stream
The processes of creating, producing, and delivering a good or service to the market. For a good, this encompasses the raw material supplier, the manufacturing and assembly of the good, and the distribution network. For a service, this consists of suppliers, support personnel and technology, the service "producer," and the distribution channel.
Upper and lower specification limits
The range of values in a measure associated with a process that are allowable given the intended use of the product or service
Capability Index
The ratio of the range of values allowed by the design specifications divided by the range of values produced by a process.
Prevention Costs
The sum of all the costs to prevent defects, such as the costs to identify the cause of the defect, to implement corrective action to eliminate the cuase, to train personnel, to redesign the product or system, and to purchase new equipment or make modifications.
Average aggregate Invetory value
The total value of all items held in inventory for the firm, valued at cost.
Bullwhip effect
The variability in demand is magnified as we move from the customer to the producer in the supply chain.
External benchmarking
Looking outside the company to examine what excellent performers inside and outside the company's industry are doing in the way of quality.
Total Quality Management
Managing the entire organization so that is excels on all dimensions of products and services that are important to the customer.
Preventive maintenance
Periodic inspection and repair designed to keep equipment reliable.
Innovative products
Products such as fashionable clothes and personal computers that typically have a life cycle of just a few months.
Variables
Quality Characteristics that are measured in actual weight, volume, inches, centimeters, or other measure.
Atrributes
Quality characteristics that are classified as either conforming or not conforming to specification.
Fail-Safe procedures and poja-yokes
Simple practices that prevent errors or provide feedback in time for the worker to correct errors
Uniform plant Loading
Smoothing the production flow to dampen schedule variation.
Value Stream mapping
a graphical way to analyze where value is or is not being added as material flows through a process
Level Schedule
a schedule that pulls material into final assembly at a constant rate
Statistical Process Control
Techniques for testing a random sample of output from a process to determine whether the process is producing items within a prescribed range
Conformance Quality
The degree to which the product or service design specifications are met.
Strategic Sourcing
The development and management of supplier relationships to acquire goods and services in a way that aids in achieving the immediate needs of a business.
Customer Value
The difference between the benefits a customer sees from a market offering and the costs of obtaining those benefits
Backflush
calculating how many of each part were used in production and using these calculations to adjust actual on-hand inventory balances. This eliminates the need to actually track each part used in production
Dimensions of Quality
criteria by which quality is measured
Vendor Managed inventory
is an inventory- management system whereby the supplier determines the product amount and assortment a customer (such as a retailer) needs and automatically delivers the appropriate items.
Weeks of supply
preferred measure of supply chain efficiency that is mathematically the inverse of inventory turnover times 52
Functional Products
staples that people buy in a wide range of retail outlets, such as grocery stores and gas stations
Design Quality
the inherent value of the product in the marketplace
Waste Reduction
the optimization of value-adding activities and elimination of non-value-adding activities that are part of the value stream
Freeze Window
the period of time during which the schedule is fixed and no further changes are possible
Statistical Quality Control
the process some managers use to continually monitor all phases of the production process to assure that quality is being built into the product from the beginning
Cost of Goods Sold
the total cost of buying raw materials and paying for all the factors that go into producing finished goods
Value
A customer's subjective assessment of benefits relative to costs in determining the worth of a product
Outsourcing
A decision by a corporation to turn over much of the responsibility for production to independent suppliers.
Inventory Turnover
A liquidity ratio. COGS / Inventory. How many times company turns its inventory annually.
Lean Production
A management approach that organizes resources such as people and machines around the flow of business processes and that only produces units in response to customer orders
Kanban
A method of Just-in-Time production that uses standard containers or lot sizes with a single card attached to each. It is a pull system in which work centers signal with a card that they wish to withdraw parts from feeding operations or suppliers.
Kaizen
A quality technique from Japan meaning continuous improvement in Japanese. With this technique, all project team members and managers should be constantly watching for quality improvement opportunities. The approach states that you should improve the quality of the people first, then the quality of the products or service.
ISO 9000
A series of quality standards developed by a committee working under the International Organization for Standardization to improve total quality in all businesses for the benefit of producers and consumers.
Six Sigma
A statistical term to describe the euqality goal of no more than 3.4 defeects out of every million units. Also refers to a quality improvement philosphy and program.
logistics
A subset of supply chain management that focuses largely on the tactics involved in moving products along the supply chain.
Total Cost of ownership
All of the costs associated with the design, development, testing, implementation, documentation, training and maintenance of a software system.
DMAIC
An acronym for the Define, Measure, Analyze, Improve, and Control improvement methodology followed by companies engaging in Six-Sigma programs.