Business Chapter 6

Perishability

Seats at a speaker's presentation

Material-Requirements Planning

A planning system that schedules the precise quantity of materials needed to make the product.

Blockchain

A secure, public database that records all transactions and is spread across multiple computers.

Just-In-Time Inventory Management

A technique using smaller quantities of materials that arrive "just in time" for use in the transformation process and therefore require less storage space and other inventory management expense.

Scheduling

Assigning the tasks to be done to departments or even specific machines, worker, or teams.

Modular Design -

Building an item in self-contained units, or modules, that can be combined or interchanged to create different products.

CAD

Computer Assisted Design - helps engineers design components, products, and processes ion the computer instead of on paper. A CAD file can be sent to a specialized printer which is able to use layers of liquid, powder, paper, or metal to construct a 3D mode

CAM

Computer Assisted Manufacturing employs specialized computer systems to actually guide and control the transformation processes.

CIM

Computer Integrated Manufacturing - A complete system that designs products, manages machines and materials, and controls the operations function. An integration of CAD/CAM, Flexible Manufacturing and Robotics.

Flexible Manufacturing

Computers can direct machinery to adapt to different versions of similar operations. One machine can be programmed to carry out its function for several different version of an engine without shutting down the production line or refitting the machine.

Supply Chain Management

Connecting and integrating all parties or members of the distribution system in order to satisfy customers. (Part of Distribution)

Intangibility

Going to a concern or sporting event

Inseparability of production and consumption

Going to a doctor, air travel, veterinary services

Customization

Haircut, legal services, tax consultation

Layout

Highly technical task.

Program Evaluation and Review Technique (PERT)

Identifies all the major activities or events required to complete a project, arranges them in a sequence or path, determines the critical path, and estimates the time required for each event.

The Economic Order Quantity Model

Identifies the optimum number of items to order to minimize the costs of managing (ordering, storing, and using) them.

Location

Important because once decision is made and implemented the firm must live with it due to the high costs involved.

The Transformation Process

Inputs, Transformation or Conversion, Outputs

Service Characteristics

Intangible, Inseparability of production and consumption. Perishability, Customization, Customer Contact

Procurement

Involves the processes to obtain resources to create value through sourcing, purchasing, and recycling materials and information.

Customization -

Making products to meet a particular customer's needs or wants.

Service Providers -

Measurement is more difficult .• Variations in demand. • Variations in service requirements from job to job .• Product is intangible.

Manufacturing -

Measurement is straight-forward. • Tangibility of the output • High degree of uniformity.

Logistical Concerns

Physical distribution and selection of transportation models.

Customer Contact

Restaurants, retail stores

Sampling

Sampling is likely to be used when inspection tests are destructive. Determining the life expectancy of light bulbs by turning them on and recording how long they last would be foolish.

Typically, products are designed to be manufactured by one of three processes:

Standardization, Modular Design, or Customization.

Operations Management

The development and administration of the activities involved in transforming resources into goods and services.

Capacity

The maximum load that an organizational unit can carry or operate.

Inspection

The purpose of inspection is to find defects before the product is completed so that necessary corrections can be made.

Routing

The sequencing of operations through which the product must pass.

Sustainability

deals with conducting activities in such a way as to provide for the long-term well-being of the natural environment, including all biological entities. These issues are becoming increasingly important to stakeholders.

Service Providers

intangible

Standardization -

making identical, interchangeable components or even complete products.

Supply chain includes

purchasing, managing inventory, outsourcing, and scheduling, vital tasks in transforming raw materials into finished goods:

Managing supply chains

requires constant vigilance and the ability to make quick tactical changes.

Supply chains

should be diverse and companies must perform regular audits on its suppliers and take action if there are violations.

Manufacturers

tangible

Benchmarking

the primary tool of the continuous improvement process. It is the measuring and evaluating of the quality of the organization's goods and services or processes as compared with the quality produced by the best-performing companies in the industry.

Inventory Control

the process of determining how many supplies and goods are needed and keeping track of quantities on hand, where each item is, and who is responsible for it.

Three basic types of inventory:

• Finished-goods inventory • Work-in-process inventory • Raw materials inventory

Service providers are generally more labor-intensive.

• High level of customer contact. • Perishable output. • Variation of inputs and outputs.

Five basic classifications of :Service Providers

• Nature and Consumption of Output • Uniformity of Inputs • Uniformity of Output • Labor Required• Measurement of Productivity

Technology in operations is driving a more digital enterprise system and changing the landscape of operations:

• Robotics • Predictive analytics • The Internet of Things (IoT)

Service Organizations must build their operations around good execution, which comes from:

• hiring and training excellent employees • developing flexible systems • customizing services • maintaining adjustable capacity to deal with fluctuating demand.