powerpoint lecture presentation ii (om)
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DECISION MAKING IN OMChapter 1. 10-
• CORPORATE STRATEGY
• BUSINESS STRATEGY– COMPETITIVE PRIORITIES
• OPERATIONS STRATEGY
• OPERATING DECISIONS
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COMPETITIVE STRAGTEGIES AND OPERATIONS STRATEGY
Chapter 1
• Competitive priorities: P, Q, A, F 14-
• Planning areas in operations = Operations Strategy. These were listed in a previous slide.– Product/Service Design
– Process selection/ Vertical Integration decisions
– Technology selection
– Quality planning
– Work force/Human resources planning
– Capacity planning
– Location of facilities
– Layout of facilities
– Supplier Selection
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PLANNING AREA 1: PRODUCT/SERVICE DESIGN
Notes
• Information for design; QFD
• Product developing process – Technical-legal-environmental-ethical review
– Market feasibility
– Financial feasibility
• Manufacturabilty
• Service design– Service package
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Planning Area 2: Process Selection -Chapter 3
• Process Types/Choice 98-– Job, batch, line and continuous– Job/batch process v. Line process
• Volume and variety
• Product-Process matrix 98
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PROCESS SELECTION
• Process determines other dimensions
Line flow Flexible flow
• Volume High Low
• Variation
• Resource flexibility 106
• Cap.intensity/Automation107
• Vertical Integration
• Customer Involvement 105
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PROCESS SELECTION
• Additional Concepts– Fixed v. Flexible automation
• Modern technologies: CAD, CAM, Robotics, FMS
– Economies of scope 109– Process re-engineering 113– Process analysis and improvement 112 and chapter 6
• Systematic approach 124; Six sigma approach 182-• Documenting the process 126-
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PROCESS SELECTION
– Measurement and analysis tools 133-
– Benchmarking 139
– Simulation 137
• Process choice in services 95 chapter 3– Customer contact 95
– Degree of customization (divergence) 96
– Emphasis on front office/back office
– Customer contact matrix for service processes 97
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Planning Area 3: Quality Planning Chapter 5
– Evolution of Quality Management
• Inspection based quality control (QC)
• Statistical Quality Control (SQC)
• Inspection alone does not improve quality
• Quality must be managed: P, O, D/L, C
• Quality improvement is a long term strategy
• QI is a company-wide effort
• Customer focus and supplier involvement
• TQM; continuous improvement 180
• Deming, Juran and Crosby
• Malcolm Baldrige Award 201-
• ISO 9000 certification 200
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USING QUALITY AS A COMPETITIVE WEAPON
• Improved quality could increases market share
• ….. and fetch higher prices
• ….and reduce costs
• The result is higher profits.
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WHY WOULD COSTS DECREASE WHEN QUALITY IS IMPROVED ?
• Costs of quality 176
• Prevention costs 176
• Appraisal costs 177
• Internal failure costs 177
• External failure costs 177
• Short term effects
• Long term effects
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QUALITY PLANNING
• Customer perception of quality 178– Conformance to specifications – Value– Fitness for use– Aesthetics– Durability– Reliability
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QUALITY PLANNING
• Definition of Value: meeting or exceeding customer expectations– customer expectations– management understanding– design of products/services, processes– delivery to customer– customer perception
• Customer satisfaction:
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QUALITY PLANNING
• Elements of TQM
– Leadership (B1)
• Vision, cultural change
• Commitment, Involvement
• Strategic planning (B2)
– Employee Involvement (B3)180
• Participation
• Teams and teamwork 180 Types of teams
• Job design: enlargement, enrichment, rotation
• Empowerment
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QUALITY PLANNING
– Elements of TQM
• Customer Focus (B4)• Activities in customer focus• Process management (B5)• Measurement and Reporting (B6 and 7)
– Statistical Quality Control 183-• Variation in output 184• Control charts: attributes 193 variables 188• Acceptance sampling. Sampling plan and size 183• Process capability 195- PC Ratio 197