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46 Cards in this Set
- Front
- Back
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commodity
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a good for which there is a demand, but which is supplied without qualitative differentiation across a market
+manufacturers turn to services to differentiate themselves and grow revenue |
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operations management
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the set of activities that relate to the creation of goods and services through the transformation of inputs to outputs
+planning for, organizing, and controlling production +decision areas=product design, quality mgmt, process and capacity planning, location strategies, layout strategies, job design, supply chain mgmt, inventory mgmt, scheduling, maintenance, and reliability |
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production
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the creation of goods and services through the transformation of inputs to outputs
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productivity
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ratio of outputs to inputs
+single factor-uses only one input +multifactor-uses multiple inputs |
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service
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"the application of specialized competencies through deeds, processes, and performances for the benefit of another entity or the entity itself"
+economic activities that typically produce an intangible product +infrastructure, financial, distribution, professional, personal, hospitality, entertainment, healthcare, education, maintenance/repair |
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benchmarking
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comparing own performance to another organization who is known to be best in class
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continuous improvemen (kaizen)
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the implementation of a large number of small incremental improvements over time
+ongoing process of unending improvement +the setting and achieving of ever-higher goals |
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fail-safing (poka-yoke)
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any mechanism that helps people avoid mistakes
+can't put diesel fuel nozzle into an unleaded fuel tank +beeping sound when car is turned off but keys are still in ignition |
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gap analysis (card 1 of 2)
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uses surveys to measure differences between customers' expected and perceived service
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gap analysis (card 2 of 2)
+categories of perceptions commonly surveyed |
1-tangibles
(physical facilities and equipment; employee appearance) 2-reliability (ability to perform service) 3-responsiveness (willingness to help) 4-assurance (knowledge, competence, courtesy, and ability to inspire trust) 5-empathy (caring and understanding of customer situation) |
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ISO 9000
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a series of quality standards defined by the International Standard Organization, comprised of representatives of different member nations
+doesn't prescribe specific practices but focuses on the requirements for a quality management system +European Economic Community-requires ISO certification to do business in the European nations |
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service recovery
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empowering employees to immediately solve customer problems and/or give something of value
+when mistakes are made, it is possible to avoid losing customer goodwill |
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statistical process control
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involves taking measurements of some aspect of a service and comparing to performance standards
+uses control charts to distinguish natural and assignable sources of variation |
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control chart
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a graphical presentation of process data over timed
+used to distinguish between natural and assignable sources of variation |
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natural variation
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normal variation which cannot be eliminated in current process
+"common" +variability that affects every production process to some degree and is to be expected +the many sources of variation that occur within a process that is in statistical control |
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assignable variation
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attributable to some cause
+machine wear, misadjusted equipment, fatigued or untrained workers, new batches of raw materials |
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process distribution
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known only by measuring 100% of output relative to some measure with perfect accuracy
+usually too expensive so we use samples to estimate parameters of the processs distribution and evaluate its performance |
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sample
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some fraction of total output
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competitive advantage (slide 1 of 2)
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superiority on some competitive dimension(s) relative to industry rivals
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operations frontier (slide 1 of 2)
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defined by best-in-class firms at a given point in time
+not possible to be all things to all people +implication-use focused processes which optimize a limited set of performance objectives + |
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positioning
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the product space that a firm wants to occupy where space is measured along competitive dimensions of product attribute
+choosing the direction of improvement in the operations frontier |
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strategic fit (slide 1 of 2)
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the consistency between the competitive advantage the firm seeks and the design of processes used achieve that advantage
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strategic fit (slide 2 of 2)
+how to achieve |
+market driven strategy-start with market positioning and competitive priorities and then design processes to support them
+process driven strategy-start with process competencies adn then identify market position best served by these competencies |
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strategy
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some have argued that building blocks of strategy are not markets and products but rather processes which attain are the core competencies and capabilities used to attain competitive advantage
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corporate strategy
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a unique position chosen to achieve competitive advantage and ensure long-term organizatinal success
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process(operations) strategy
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the choice of operations performance objectives and the design of processes (especially the arrangement of resources within processes) to achieve performance objectives
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value added map
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gives the customer something they want or need
+value stream mapping-a tool used to analyze and design the flow of materials and information required to provide value to a consumer +goal-to make the process "lean" by removing non-value added activities from the process |
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Little's Law
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in a stable process, there is a fundamental relationship between the averages of flow time(T), flow rate(R), and inventory(I)
+stable process-the average inflow rate is the same as the average outflow rate over the long run I=R x T |
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inventory(I)
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the number of units in the process
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flow rate(R)
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the number of units that flow through the process per unit of time
+"throughput rate" |
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flow time(T)
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the time spent by a unit in the process
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flow unit
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a patient, a car, an insurance claim, a customer order, a dollar, a project
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strategy
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units enter process as input, flow through various activities, and then exit as output
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distinctive characteristics of services
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1-customer participation-customer is an active player in the service
2-intangibility-services are performances and ideas 3-heterogeneity-delivered service varies from customer to customer 4-simultaneity-services are produiced and consumed at the same time 5-perishability-services are time perishable and cannot be inventoried for later use |
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common dimensions of a service business (slide 1 of 2)
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1-degree of customer contact and interaction
2-type of customer contact 3-degree of service customization and variety 4-degree of labor vs capital intensity 5-type of recipient |
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common dimensions of a service business (slide 2 of 2)
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6-type of relationship with customer
7-degree of employee discretion in meeting customer demands 8-degree of demand fluctuation over time 9-mode of delivery 10-number of service outlets |
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single factor productivity
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units produced/
input used |
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multifactor productivity
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output/
(labor+material+energy+capital+misc) |
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service operations model
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total quality management (TQM)
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a philosophy about managing quality that emphasizes:
+customer satisfaction +continuous improvement +employee involvement +management of an entire organizatin so that it excels in all aspects of products and services that are important to the customer |
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quality
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the ability of an offering to satisfy customer needs
+customer based view-the extent to which customer perceptions of an offering meet or exceed their expectations +provider based view-the extent to which the offering conforms to predefined standards |
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costs of quality
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1-prevention costs-costs of reducing the potential for quality problems
2-appraisal costs-costs of evaluating and detecting quality problems 3-internal failure costs-costs of fixing quality problems +guarantees, warranties, rework 4-external failure costs-cost of lost customer goodwill and negative word of mouth effects |
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W. Edwards Deming
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insisted that managemetn take responsibility for quality problems which result from poor organizational processes not low performing employees
+famous for his 14 points |
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Deming's PDCA Cycle
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continuous vs discrete measures
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+continuous-between any two values, there are an infinite numer of other values (height, elapsed time, weight, distance)
+discrete-there are a finite or countable number of values(the legs on an animal, gender, whether or not a package is damaged) |
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steps for creating control charts
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1-collect samples from a stable process
2-compute control limits 3-graph the sample statistics 4-investigate any points that are outside of control limits 4a-if they have assignable causes, correct problem and go to step 1 5-use control limits to monitor process |
