MGMT 425 | Chapter 5: Process Focus

Continuous Improvement: Importance

- Customer loyalty is driven by delivered value. - Delivered value is created by business processes. - Sustained success in competitive markets requires a business to continuously improve delivered value. - To continuously improve value-creation ability, a business must continuously improve its value-creation processes.

Process Improvement: Alternatives

- Eliminate: Remove unnecessary steps or tasks that don't add value. - Combine: Merge related tasks or processes to streamline workflows. - Rearrange: Change the sequence of tasks for more logical and efficient flow. - Simplify: Make tasks easier by reducing complexity, tools, or steps.

Reasons for Mistakes and Errors

- Forgetfulness due to lack of reinforcement or guidance - Misunderstanding or incorrect identification because of the lack of familiarity with process or procedures - Lack of experience - Absentmindedness and lack of attention, especially when a process is automated

Process Mapping: Symbols

- Oval: Start/End - Represents the beginning or end of a process. - Rectangle: Process Step - Indicates a task or activity in the process. - Diamond: Decision - Represents a point where a decision is required, leading to different process paths. - Arrow: Flow - Shows the direction or sequence of steps in the process. - Triangle: Storage - Indicates where materials or information are stored within the process.

Process Design: Considerations

- Safety - Cost - Variability - Productivity - Environmental Impact - Measurement - Maintainability

Steps of the Manufacturing Process

1. Conduct a detailed technical analysis: Analyze the characteristics of the product, including technological capabilities of machines, required operation sequences, and assembly methods. 2. Define the sequence of steps: Determine the steps required to produce the component or product efficiently. 3. Document the procedures and requirements: Create flowcharts or process maps to visually outline the process steps and requirements. 4. Analyze the processes prior to implementation: Evaluate and improve the process for quality, efficiency, and potential bottlenecks before full-scale implementation.

Kaizen

A Japanese term meaning "continuous improvement," focusing on making small, gradual, and consistent improvements over time with the participation of all employees, leading to better efficiency and quality. Examples: 1. A company practices ______ by encouraging workers to suggest small changes to their daily tasks that can improve efficiency and reduce waste over time. 2. A manufacturing firm holds regular team meetings where employees discuss potential process improvements, leading to incremental changes that enhance productivity and product quality.

Poka-Yoke

A mistake-proofing approach that uses simple methods or automatic devices to prevent human errors in processes by either predicting defects before they occur or detecting them and stopping the process; "Error is inevitable, but should be eliminated." Examples: 1. A car manufacturer implements ______ by adding sensors that alert workers if a part is incorrectly placed on the assembly line, preventing defects before the vehicle moves to the next stage. 2. A company installs a machine that automatically shuts down if an error is detected in the product's packaging, ensuring that defective items are not shipped to customers.

Flowchart

A visual representation of the steps in a process, using symbols to map out the sequence of tasks, decisions, and flows, helping to understand, document, and improve processes. Examples: 1. A company creates a ______ to map the steps of its product assembly process, identifying inefficiencies and potential areas for improvement. 2. A business uses a ______ to document the customer service process, ensuring that each step from inquiry to resolution is clear and easy to follow.

Breakthrough Improvement

Discontinuous change, as opposed to the gradual, continuous improvement philosophy of kaizen; breakthrough improvements result from innovative and creative thinking; often these are motivated by stretch goals, or breakthrough objectives. Examples: 1. Motorola: Improve product and services quality ten times within two years, and at least 100-fold within four years 2. A business reengineers its supply chain, cutting costs and delivery times dramatically, giving it a competitive edge in the market.

Process Focus

Emphasizes the importance of understanding, managing, and continuously improving processes to ensure efficiency, consistency, and alignment with organizational goals and customer needs; "Unless you change the process, why would you expect the results to change?"

Deming's View of a Production System

Emphasizes the need for continuous improvement, reducing variation, and optimizing processes through a holistic approach that integrates all elements of production, from design to customer feedback. Examples: 1. A company adopts Deming's view by continuously analyzing and improving its manufacturing processes to reduce defects and increase efficiency. 2. A business integrates customer feedback into its production system, regularly refining its products to better meet customer expectations and maintain high quality.

Monitoring Supplier Performance

Evaluating and tracking a supplier's ability to meet quality, delivery, and cost expectations through methods such as audits, inspections, and performance metrics. Examples: 1. A company ______ by conducting regular audits of its suppliers' facilities to ensure that they meet quality standards and comply with delivery schedules. 2. A business tracks key metrics such as defect rates and on-time delivery percentages to assess its suppliers' reliability and make informed decisions about future partnerships.

Quality Profile

How an organization implements and manages quality in its operations, focusing on strategies such as process control, continuous improvement, and meeting customer expectations to ensure high standards are maintained. Examples: 1. Boeing Aerospace (see image) focuses on delivering high-quality aerospace services by maintaining strict control over processes, continuously improving operations, and ensuring alignment with customer requirements and safety standards. 2. An organization regularly benchmarks its ______ against industry leaders to improve its processes and ensure continuous quality enhancements.

Process Mapping & Analysis

Involve visually documenting the steps of a process to understand and evaluate its efficiency, identify bottlenecks, and find opportunities for improvement. Examples: 1. A company uses ______ to visualize its production workflow, identifying delays and reconfiguring tasks to improve overall efficiency. 2. A business maps out its customer service process to spot redundancies, enabling faster response times and enhanced customer satisfaction.

Process Management

Involves designing, controlling, and improving organizational processes to ensure they consistently meet performance standards, enhance efficiency, and deliver value to customers. Examples: 1. A company uses ______ to streamline its order fulfillment process, reducing delivery times and increasing customer satisfaction. 2. A business monitors and adjusts its production line processes to minimize defects and improve overall product quality.

Reengineering

Involves fundamentally rethinking and radically redesigning business processes to achieve dramatic improvements in performance measures such as cost, quality, service, and speed. Examples: 1. A company applies ______ by overhauling its entire order fulfillment process, reducing delivery times from weeks to days and improving customer satisfaction. 2. A healthcare provider redesigns its patient intake and treatment processes, significantly lowering wait times and enhancing the quality of care provided.

Process Management: Process Design

Involves planning and structuring activities to meet efficiency, safety, cost, and quality goals, aligning with both organizational and customer requirements. Examples: 1. A company improves its ______ by reconfiguring its production line to minimize waste and reduce lead times, leading to more efficient manufacturing. 2. A business redesigns its customer service process to reduce response times and improve customer satisfaction, ensuring that calls are handled quickly and effectively.

Processes

Sequences of linked activities designed to achieve a specific result, such as creating products or delivering services, often focused on efficiency, effectiveness, and customer satisfaction. Examples: 1. A company optimizes its manufacturing ______ by streamlining the assembly line to reduce production time and improve output quality. 2. A restaurant refines its service ______ to ensure faster order delivery and better customer experience, leading to higher customer satisfaction.

Production/Delivery Processes

The activities involved in creating and delivering products or services to customers, focusing on efficiency, quality, and meeting customer expectations. Examples: 1. A company optimizes its ______ by streamlining its manufacturing workflow to ensure faster delivery times and higher product quality. 2. A restaurant improves its food preparation and ______ to provide quicker service without compromising the quality of the dishes served.

Design Processes

The activities involved in creating product specifications and developing new products or services, ensuring they meet customer needs, quality standards, and performance requirements. Examples: 1. A smartphone manufacturer's ______ focus on creating sleek, user-friendly designs that incorporate the latest technology while meeting customer expectations for performance and aesthetics. 2. A car company develops a new model by working through detailed ______, including safety testing, material selection, and ergonomic features to ensure high-quality production.

Process Management: Process Control

The activities involved in ensuring that a process conforms to its specifications and requirements, and includes taking corrective action when necessary to maintain stable and consistent performance. Examples: 1. A company uses statistical ______ (SPC) to monitor production and quickly address any deviations from quality standards, ensuring consistent output. 2. A food manufacturer regularly tests product samples to ensure that the production process meets safety and quality regulations, adjusting parameters if needed.

Process Type: Support Processes

The activities that assist and enable an organization's value-creation processes, such as human resources, IT, and maintenance, ensuring smooth operations and contributing indirectly to delivering products and services. Examples: 1. The IT department provides critical _______ by maintaining the company's network and ensuring all systems function properly to allow production to run smoothly. 2. A company's HR department manages recruitment, training, and employee development, which are essential ______ that help sustain the organization's overall performance.

Process Management: Process Improvement

The continuous effort to enhance a process's efficiency, effectiveness, and quality by identifying areas for change, reducing waste, and optimizing performance. Examples: 1. A company implements ______ by analyzing customer feedback and reducing steps in its service delivery, leading to faster response times and higher satisfaction. 2. A manufacturer adopts lean manufacturing techniques to eliminate bottlenecks in production, improving workflow and reducing production costs.

Process Type: Value-Creation Processes

The core activities that are essential for delivering products or services to customers, directly contributing to an organization's success by creating customer value, driving profitability, and ensuring sustainability; those most important to "running the business". Examples: 1. A company focuses on its ______, such as product design and manufacturing, to ensure that it consistently meets customer demands for high-quality, innovative products. 2. A service provider optimizes its ______ by improving customer service and support systems, enhancing customer satisfaction and retention.

Process Practices

The methods and strategies an organization uses to manage and improve its processes, focusing on efficiency, reducing variability, and ensuring that key activities align with organizational goals. Examples: 1. A company uses ______ like standardization and automation to streamline its production and reduce errors, increasing overall efficiency. 2. A business regularly reviews and updates its core processes to ensure they meet customer expectations and maintain high quality.

Continuous Improvement

The ongoing efforts to make small, incremental changes or significant breakthroughs in processes to enhance efficiency, quality, and value over time. Examples: 1. A company applies ______ by regularly refining its production process to reduce waste and improve product quality, leading to greater customer satisfaction. 2. A retail business gathers feedback from employees and customers to make incremental changes that streamline operations and enhance the shopping experience.

Benchmarking

The process of comparing an organization's processes, performance, or practices to those of industry leaders or competitors to identify areas for improvement and adopt best practices. Examples: 1. A company uses ______ to evaluate its production efficiency against top competitors, identifying ways to reduce costs and improve output. 2. A retail business analyzes customer service practices of leading companies in its industry and implements similar strategies to enhance its own customer experience.

Control

The process of ensuring that operations and outcomes meet specified requirements by monitoring performance and taking corrective actions when deviations occur. Examples: 1. A manufacturing company uses quality ______ checks at various stages of production to ensure that all products meet the established standards before reaching customers. 2. A software development firm monitors the progress of a project, making adjustments to team workloads to ensure that deadlines and quality targets are met.