Understanding Business Chapter 9

ISO 14000

A collection of the best practices for managing an organization's impact on the environment

Materials requirement planning (MRP)

A computer-based operations management system that uses sales forecasts to make sure that needed parts and materials are available at the right time and place

Program evaluation and review technique (PERT)

A method for analyzing the tasks involved in completing a given project, estimating the time needed to complete each task, and identifying the minimum time needed to complete the total project

Enterprise resource planning (ERP)

A newer version of MRP that combines the computerized functions of all divisions and subsidiaries of the firm (finance, human resources) into a single integrated software program that uses a single database

Just-in-time inventory control

A production process in which a minimum of inventory is kept on the premises and parts, supplies and other needs are delivered just in time to go on the assembly line

Continuous process

A production process in which long production runs turn out finished goods over time

Intermittent process

A production process in which the production run is short and the machines are changed frequently to make different products

Six sigma quality

A quality measure that allows only 3.4 defects per million opportunities

Operations management

A specialized area in management that converts or transforms resources into goods and services

Grantt chart

Bar graph showing production managers what projects are being worked on and what stage they are in at any given time

Quality

Consistently producing what the customer wants while reducing errors before and after delivery to the customer

Flexible manufacturing

Designing machines to do multiple tasks so that they can produce a variety of products

1. Computer-aided design and computer-aided manufacturing 2. Flexible manufacturing 3. Lean manufacturing 4. Mass customization

Four major developments for companies to be more competitive

Critical path

In a PERT network, the sequence of tasks that takes the longest time to complete

Mass customization

Tailoring products to meet the needs of individual customers

ISO 9000

The common name given to quality management and assurance standards

Production

The creation of finished goods and services using the factors of production: land, labor, capital, entrepreneurship, and knowledge

Purchasing

The function in a firm that searches for high-quality materials resources, finds the best suppliers, and negotiates the best price for goods and services

Assembly process

The part of production process that puts together components

Facility Layout

The physical arrangement of resources (including people) in the production process

Facility location

The process of selecting a geographic location for a company's operations

Statistical process control (SPC)

The process of testing statistical samples of product components at each stage of the production process and plotting those results on a graph. Any variances from quality standards are recognized and can be corrected if beyond the set standards

Statical quality control (SQC)

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

Lean manufacturing

The production of goods using less of everything compared to mass production

Production management

The term used to describe all the activities managers do to help their firms to create goods.

Computer-integrated manufacturing (CIM)

The uniting of computer-aided design with computer-aided manufacturing

Computer-aided design (CAD)

The use of computers in the design of products

Computer-aided manufacturing (CAM)

The use of computers in the manufacturing of products

Form utility

The value producers add to materials in the creation of finished goods and services

Telecommuting

Working from home via computer and modem

fixed-position layout

allows workers to congregate around the product to be completed

operations management planning

helps solve many of the problems in the service and manufacturing sectors

process layout

similar equipment and functions are grouped together

1. analyze and sequence the tasks that need to be done 2. estimate the time needed to complete each task 3. draw a PERT network illustrating the information from steps 1 and 2 4. identify the critical path

steps used in PERT

modular layout

teams of workers combine to produce more complex units of the final product

Process manufacturing

that part of the production process that physically or chemically changes materials