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88 Cards in this Set

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Goods-Service Continuum
Goods-Service Continuum
What are the three basic functions of an organization?
Finance, Operations, Marketing
None
What is finance responsible for?
Finance is responsible for securing financial resources and allocating those resources, as well as budgeting, analyzing investment proposals, and providing funds for operations.
What is operations responsible for?
Operations is responsible for producing the goods or providing the services offered by the organization and therefore, operations is the core of what the organization does.
None
What is marketing responsible for?
Marketing is responsible for assessing consumer wants and needs, and selling and promoting the organization’s goods or services.
None
Operations management is
The management of systems or processes that create goods and/or services
Operations management affects
Companies’ ability to compete
What is the value-added process?
The operations function involves the conversion of inputs into outputs.
_____ is the difference between the cost of inputs and the value or prices of outputs.
Value-Added
What are the types of operations?
Goods Producing
Storage/Transportation
Exchange
Entertainment
Communication
None
Goods Producing
Farming, mining, construction, manufacturing, power generation
Storage/Transportation
Warehousing, trucking, mail service, moving, taxis, buses, hotels, airlines
Exchange
Retailing, wholesaling, banking, renting, leasing, library, loans
Entertainment
Films, radio and television, concerts, recording
Communication
Newspapers, radio and television newscasts, telephone, satellites
Operations management includes
Forecasting, capacity planning, scheduling, managing inventories, assuring quality, motivating employees, deciding where to locate facilities, supply chain management, etc
Production of goods
Tangible output
Delivery of services
An act
Facilitating good
Tangible product produced by a service industry firm
Service job categories
Government, wholesale/retail, financial services, healthcare
What are key differences between products and services?
Customer contact, uniformity of input, labor content of jobs, uniformity or output, measuring of productivity, production and delivery, quality assurance, amount of inventory, evaluation of work, ability to patent design
Customer Contact
Low Goods, High Service
Uniformity of input
High Goods, Low Service
Labor content
Low Goods, High Service
Uniformity of output
High Goods, Low Service
Output
Tangible Goods, Intangible Service
Measurement of productivity
Easy Goods, Difficult Service
None
Opportunity to correct problems
High Goods, Low Service
Inventory
Much Goods, Little Service
Evaluation
Easier Goods, Difficult Service
Patentable
Usually Goods, Not Usual Service
Challenges of Managing Services
Service jobs are often less structured than manufacturing jobs
Customer contact is higher
Worker skill levels are lower
Services hire many low-skill, entry-level workers
Employee turnover is higher
Input variability is higher
Service performance can be affected by worker’s personal factors
None
What is a model?
A model is an abstraction of reality
(physical, schematic, mathematical)
None
Quantitative Approaches
Linear programming
Queuing techniques
Inventory models
Project models
Statistical models
None
Systems Approach
“The whole is greater than the sum of the parts.”
Systems approach is not _____.
Suboptimalization
Pareto Phenomenon
A few factors account for a high percentage of the occurrence of some event(s).
What is the 80/20 Rule?
80% of problems are caused by 20% of the activities.
What is competitiveness?
How effectively an organization meets the wants and needs of customers relative to others that offer similar goods or services.
Businesses compete using marketing in what ways?
Identifying consumer wants and needs, pricing, advertising and promotion, product and service design, cost, location, quality, quick response, flexibility, inventory management, supply chain management, service and service quality, managers and workers
Why do some organizations fail?
Too much emphasis on short-term financial performance
Failing to take advantage of strengths and opportunities
Neglecting operations strategy
Failing to recognize competitive threats
Too much emphasis in product and service design and not enough on process design and improvement
Neglecting investments in capital and human resources
Failing to establish good internal communications
Failing to consider customer wants and needs
None
Strategy
Mission
Mission Statement
Goals
Strategies
Tactics
None
The _____ is the reason for existence for an organization
Mission
The _____ states the purpose of an organization
Mission Statement
_____ provide detail and scope of mission
Goals
_____ plan for achieving organization goals
Strategies
_____ are the methods and actions taken to accomplish strategies
Tactics
Examples of Strategies
Low cost
Scale-based strategies (economy of scale)
Specialization
Flexible operations
High quality
Service
None
What are distinctive competencies?
The special attributes or abilities that give an organization a competitive edge.
What are strategy factors?
Price, quality, time, flexibility, service, location
What is the operation strategy for price?
Low Cost
Example: U.S. first-class postage, Wal-Mart, Southwest Airlines
None
What is the operation strategy for quality?
High-performance design and/or high quality
Example: Sony TV, Lexus, Disneyland, Five-start restaurants or hotels

Consistent Quality
Example: Coca-Cola, PepsiCo, Kodak, Xerox, Motorola, Electrical power
None
What is the operation strategy for time?
Rapid delivery
Example: McDonald’s restaurants, Express Mail, UPS, FedEx, One-hour photo
None
What is the operation strategy for service?
Superior customer service
Example: Disneyland, Hewlett-Packard, IBM, Nordstrom
None
What is the operation strategy for location?
Convenience
Example: Supermarkets, drycleaners, mall stores, service station, banks, ATMs
None
Strategy Formulation
Distinctive competencies
Environmental scanning
SWOT
Order qualifiers
Order winners
None
What are order qualifiers?
Order qualifiers are characteristics that customers perceive as minimum standards of acceptability to be considered as a potential purchase.
What are order winners?
Order winners are characteristics of an organization’s goods or services that cause it to be perceived as better than the competition.
Key External Factors
Economic conditions
Political conditions
Legal environment
Technology
Competition
Markets
None
What are quality-based strategies?
Quality-based strategies focus on maintaining or improving the quality of an organization’s products or services.
What are time-based strategies?
Time-based strategies focus on reducing the time needed to accomplish tasks.
_____ is a measure of the effective use of resources, usually expressed as the ratio of output to input.
Productivity
Productivity ratios are used for
Planning workforce requirements
Scheduling equipment
Financial analysis
None
Partial Measures of Productivity
Output/(single input)
Multi-Factor Measures of Productivity
Output/(Multiple Inputs)
Total Measure of Productivity
Outputs/Inputs
Productivity Growth
(Current period productivity – previous period productivity)
/Previous period productivity
None
What is the main focus of product and service design?
Customer satisfaction
Understand what the customer wants
None
What is the secondary focus of product and service design?
Function of product/service
Cost/profit
Quality
Appearance
Ease of production/assembly
Ease of maintenance service
None
What are the life cycles of products or services?
Introduction, Growth, Maturity, Saturation, Decline (S-Curve)
_____ is the extent to which there is an absence of variety in a product, service or process.
Standardization
_____ products are immediately available to customers.
Standardized
Advantages of Standardization
Fewer parts to deal with in inventory and manufacturing
Design costs are generally lower
Reduced training costs and time
More routine purchasing, handling, and inspection procedures
Quality is more consistent
Orders are fillable from inventory
Opportunities for long production runs and automation
Need for fewer parts justify increased expenditures on perfecting designs and improving quality control procedures
None
Disadvantages of Standardization
Designs may be frozen with too many imperfections remaining
High cost of design changes increases resistance to improvements
Decreased variety results in less consumer appeal
None
_____ is a form of standardization in which component parts are subdivided into modules that are easily replaced or interchanged.
Modular Design
Modular Design allows for
Easier diagnosis and remedy of failures
Easier repair and replacement
Simplification of manufacturing and assembly
None
_____ is the ability of a product, part or system to perform its intended function under a prescribed set of conditions.
Reliability
_____ is a situation in which a product, part, or system does not perform as intended.
Failure
_____ is the set of conditions under which an item’s reliability is specified.
Normal Operating Conditions
Three kinds of technology
Product and service technology
Process technology
Information technology
None
The three kinds of technology all have three major impacts on
Cost, Productivity, Competitiveness
Process Selection
Variety
Flexibility
Volume
Job shop
None
_____ compares different process options and their relationship to volume and variety.
Product-Process Matrix
Job Shop
Love Volume/Unique Product, Jumbled Flow
Batch
Low Volume/Multiple Products, Disconnected Line Flow
Assembly Line
High Volume/Standardized Product, Connected Line Flow
Continuous
Very High Volume/Commodity, Continuous Flow
What is the operation strategy for flexibility?
Variety
Example: Burger King (“Have it your way”),
VOLUME
Example: McDonald’s (“Buses welcome”), Toyota, Supermarkets (additional checkouts)
None