OP MGT #1

Internal Customers

One or more employees that rely on inputs from other employees or processes to perform their work

Lean Systems

Operations systems that maximize the value added by each of a company's activities by removing waste and delays from them

Process Capability

The ability of the process to meet the design specifications for a service or product

Statistical Process Control (SPC)

The application of statistical techniques to determine whether a process is delivery what the customer wants

External Suppliers

The businesses or individuals who provide the resources, services, products, and materials for the firm's short-term and long-term needs

Competitive Capabilities

The cost, quality, time, and flexibility dimensions that a process or supply chain actually possesses and is able to deliver

Competitive Priorities

The critical dimensions that a process or supply chain must possess to satisfy its internal or external customers, both now and in the future

Resource Flexibility

The ease with which employees and equipment can handle a wide variety of products, output levels, duties, and functions

Internal Suppliers

The employees or processes that supply important information or materials to a firm's processes

Customer Contact

The extent to which the customer is present, is actively involved, and received personal attention during the service process

Process Divergence

The extent to which the process is highly customized with considerable latitude as to how its tasks are performed

Continuous-flow Process

The extreme end of high-volume standardized production and rigid line flows, with production not starting and stopping for long intervals

Operations Strategy

The means by which operations implements corporate strategy and helps build a customer-driven firm

Capital Intensity

The mix of equipment and skills in a process

Process Strategy

The pattern of decisions made in managing processes so that they will achieve their competitive priorities

Continuous Improvement (Kaizen)

The philosophy of continually seeking ways to improve processes

Process Structure

The process type relative to the kinds of resources needed, how resources are partitioned between them, and their key characteristics

Upper Control Limit

Upper bound set for normal statistical behavior of a process

Core competencies reflect the collective learning of the organization. Core competencies include:

a well trained, flexible workforce

D

characteristics of a process that can be measures

attributes

characters of a process that can be assessed (primarily defects)

5 aspects of customer satisfaction

conformance to specifications value fitness for use support psychological impressions

kaizen

continuous improvement: plan, do, study, act

c-chart

control chart for attributes, used to monitor the number of defects per unit

keys to employee involvment

culture team formation motivation

8 types of waste (DOWNTIME)

defects, overproduction, waiting, not utilizing staff talent, transportation, inventory, motion, excess processing

target value

desired output level of the process

Selecting the transportation mode​ (train, ship,​ truck, airplane, or​ pipeline) and scheduling both​ in-bound and outbound shipments is typically accomplished by which supply chain​ process?

logistics

R-chart

measure spread of process (variability)

TQM

plan, do, study, act

assignable casue

variation that can be identified and eliminated

common cause

variation that is random, unidentifiable and unavoidable

production-inventory strategies

we need inventory to service customer demand, and to make products - design to order - make to order - assemble to order - make to stock

critical value

# of sigma / 3

Core vs Support Processes

- Support processes provide vital inputs to core processes - Core processes deliver value to the external customer

How are TQM core principles accomplished through Six Sigma?

- customer satisfaction - employee involvement - continuous improvement

Competitive Priorities CQTF

1. Cost 2. Quality - consistence and top quality 3. Time - delivery speed - on-time delivery - development speed 4. Flexibility - customization - volume - variety

Core Functions

1. Marketing 2. Finance 3. Operations

key decisions in process strategy

1. process structure 2. customer involvement 3. resource flexibility 4. capital intensity (ratio of capital to ppl)

5S Method - avoiding waste

1. sort 2. straighten 3. shine 4. standardize 5. sustain

R Chart

A chart used to monitor process variability

X-bar Chart

A chart used to see whether or not the process is generating output, on average, consistent with the target value set by management for the process or whether its current performance, with respect to the average of the performance measure, is consistent with past performance

Order Winner

A criterion customer use to differentiate the services or products of one firm from those of another

External Customers

A customer who is either an end user or an intermediary (e.g., manufacturers, financial institutions, or retailers) buying the firm's finished services or products

Operation

A group of resources performing part of one or more processes

five S (5S)

A methodology consisting of five workplace practices - sorting, straightening, shining, standardizing, and sustaining - that are conducive to visual controls and lean production

Total Quality Management (TQM)

A philosophy that stresses three principles for achieving high levels of process performance and quality: (1) customer satisfaction, (2) employee involvement, and (3) continuous improvement

Batch Process

A process that differs from the job process with respect to volume, variety, and quantity

Line Process

A process that lies between the batch and continuous processes on the continuum; volumes are high and products are standardized, which allows resources to be organized around particular products

Support Process

A process that provides vital resources and inputs to the core processes and therefore is essential to the management of the business

Job Process

A process with the flexibility needed to produce a wide variety of products in significant quantities, with considerable divergence in the steps performed

Core Process

A set of activities that delivers value to the external customer 1. supplier relationship 2. new source/product development 3. order fulfillment 4. customer relationship

Automation

A system, process, or piece of equipment that is self-acting and self-regulating

Nominal Line

A target for design specifications

Quality

A term used by customers to describe their general satisfaction with a service or a product

A back office service structure is most similar to... A. a line process B. a large batch process C. a job process in manufacturing D. a small batch process

A. a line process

A high customer-contact service process typically indicates all of the following EXCEPT: A. low complexity B. diverse work flows C. a front-office process structure D. more resource flexibility

A. low complexity

A diseconomy of scale is realized when... A. the average cost per unit increases as the facility's size increases B. it becomes cheaper to produce fewer items per production period C. the average cost per unit increases as the facility's size decreases D. the average cost per unit decreases as the facility's size increases

A. the average cost per unit increases as the facility's size increases

Capability Index

An index that measures the potential for a process to generate defective outputs relative to either upper or lower specifications

Supply Chain

An interrelated series of processes within and across firms that produces a service or product to the satisfaction of customers

Process

Any activity or group of activities that takes one or more inputs, transforms them, and provides one or more outputs for customers - a set of actions that gives you a result

Defect

Any instance when a process fails to satisfy its customer

Jidoka

Automatically stopping the process when something is wrong and then fixing the problems on the line itself as they occur

A high-volume manufacturing process typically means all of the following EXCEPT: A. less resource flexibility B. more customer involvement C. greater capital intensity D. a line, or continuous process

B. more customer involvement

A one-worker, multiple machine cell... A. increases inventory but reduces labor requirements B. reduces inventory and labor requirements C. increases inventory and labor requirements D. reduces inventory but increases labor requirements

B. reduces inventory and labor requirements

Low manufacturing volumes typically dictate the following process decision: A. Less resource flexibility B. A line process C. Less capital intensity and automation D. More vertical integration

C. Less capital intensity and automation

Input measures of capacity are preferred when there... A. are high-volume processes B. are service processes C. are flexible flow processes D. is low customization

C. are flexible flow processes

When designing a flexible flow layout, the designer allocates space and indicates placement of each department with a... A. CRAFT B. closeness matrix C. block plan D. zone diagram

C. block plan

When evaluating alternative capacity decisions, qualitative concerns exclude A. uncertainties about demand B. competitive reaction C. cash flow D. technology change

C. cash flow

D

C. expansion will lead to economies of scale

p-chart

Chart used to monitor the fraction of defectives in the output of a process.

Prevention Costs

Costs associated with preventing defects before they happen

Appraisal Costs

Costs incurred when the firm assesses the performance level of its processes

Internal Failure Costs

Costs resulting from defects discovered during the production of a service or a product

External Failure Costs

Costs that arise when a defect is discovered after the customer receives the service or product

Economies of scope are characterized by A. low capital intensity and high resource flexibility B. high capital intensity and low resource flexibility C. low capital intensity and low resource flexibility D. high capital intensity and high resource flexibility

D. high capital intensity and high resource flexibility

The foundation for managing processes and value chains is A. project management B. a market orientation C. globalization D. operations strategy

D. operations strategy

______ are fundamental activities that organizations use to work and achieve their goals. A. Inputs B. Tasks C. Operations D. Processes

D. processes

Six Sigma acronym

DMAIC - define - measure - analyze - improve - control A comprehensive and flexible system for achieving, sustaining, and maximizing business success by minimizing defects and variability in processes

All of the following are core competencies except: A. workforce B. competitive priorities C. facilities D. market and financial know-how

B. competitive priorities

The common denominator for decisions on service process is _______, but for manufacturing processes it is ______. A. customer variety; output volume B. customer contact; output volume C. customer variety; product variety D. customer contact; product variety

B. customer contact; output volume

A credit card-processing firm would be likely to list the following competitive priorities for its external customers: A. Concurrent engineering B. Consistent quality C. Mass customization D. Posponement

B. Consistent quality

Which of the following considerations is NOT involved in developing a corporate strategy? A. Responding to pressures for flexibility B. Developing a staffing plan for the upcoming production period C. Monitoring and adjusting to changes in the bussiness environment D. Identifying and developing the firm's core competencies

B. Developing a staffing plan for the upcoming production period

A major supplier to an auto manufacturer would most likely adopt which production and inventory strategy? A. Make-to-order strategy B. Make-to-stock strategy C. Assemble-to-order strategy D. Postponement strategy

B. Make-to-stock strategy

Which of the following are characteristics of service provider operations? A. Low customer contact B. Perishable outputs C. Tangible out D. Low labor requirements

B. Perishable outputs

The core processes in a value chain must add value for the external customers, while support processes A. do not add value to the customer B. are also part of the value chain C. include the order-fulfillment process D. are directly involved in service to the external client

B. are also part of the value chain

Which of the following conditions is generally associated with a job process? A. Resources are allocated to specific products B. High product or service volume C. Relatively standardized products D. High resource flexibility

D. High resource flexibility

Core competencies reflect the collective learning of the organization. Core competencies include A. employee benefits B. an abundance of competitors C. an abundance of customers D. a well-trained, flexible work force

D. a well-trained, flexible work force

Which of the following statements is false regarding Control Charts and Process Capability?

If there is evidence of assignable cause variation in a control chart then automatically, the process will not be capable, regardless of the target value, margin of error, and desired level of capability

Lower Control Limit

Lower bound set for normal statistical behavior of a process

Order Qualifier

Minimal level required from a set of criteria for a firm to do business in a particular market segment

Supply Chain Management

The synchronization of a firm's processes with those of its suppliers and customers to match the flow of materials, services, and information with customer demand

Operations Management

The systematic design, direction, and control of processes that transform inputs into services and products for internal, as well as external, customers

Capability Ratio

The tolerance width divided by three standard deviations. Used to determine whether or not process variability is capable.

Core Competencies

The unique resources and strengths that an organization's management considers when formulating strategy 1. Market/Financial Know-how 2. Systems and Technologies 3. Facilities 4. Workforce

Customer Involvement

The ways in which customers become part of the process and the extent of their participation

costs of quality

prevention costs appraisal costs internal failures external failures ethical failures

sigma

standard deviation

When plotting values on a control​ chart, the first point that falls outside of the lower control limit​ (LCL) means...

the cause should be investigated