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PERT (program evaluation and review technique)

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1) analyzing and sequencing tasks that need to be done 2) estimating the time needed to complete each task 3) drawing a PERT network illustrating the information from steps 1 and 2 4) identifying the critical path critical path: the sequence of tasks that takes the longest time to complete, use PERT chart PERT : - when project managers analyze tasks involved in completing a project, estimate time needed for each task, and estimate the minimum time needed to complete the project, they are applying PERT to operations management

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Enterprise Resource Planning (ERP)

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- a newer version of MRP - combines the computerized functions of all the divisions and subsidaries of the firm--such as finance, HR, and order fullfillment--into a single integrated software program that uses a single database result is: - shorter time between orders and payment - less staff needed to do ordering and order processing - reduced inventories - better customer service - any department can see the status of an order at any time

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computer-aided manufacturing (CAM)

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the use of computers in the manufacturing of products ex of a production change through use of CAM: - using a computer program to tell machines how to cut patterns for clothing

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intermittent process

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a production process in which the production run is short and the machines are changed frequently to make different products when operations serve different customers with differing needs an intermittent process layout should be used in production ex: manufacturing a piece of custom designed furniture

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computer-aided design (CAD)

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the use of computers in the design of products allows workers to design products in three dimensions

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computer-integrated manufacturing (CIM)

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the uniting of computer-aided design with computer-aided manufacturing while CIM is extremely useful in combining the benefits of CAD and CAM, a negative is that it can be very * expensive * to implement.

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process manufacturing

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that part of the production process that physically or chemically changes materials ex: physically changing an egg during food preparation

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assembly process

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that part of the production process that puts together components ex: putting together parts of a car like the engine and frame

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continuous process

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a production process in which long production runs turn out finished goods over time ex: conveyor belt constantly lowering eggs into boiling water for three minutes and then lifting them out during meal preparation

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mass production

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- focuses on producing a limited variety of products

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developing countries are providing new markets for companies that can provide them with needed

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goods and services

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six sigma quality

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a quality measure that allows only 3.4 defects per million opportunities

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statistical quality control (SQC)

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the process some managers use to continually monitor all phases of the production process to assure that quality is being built into the product from the beginning

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statistical process control (SPC)

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the process of testing statistical samples of product components at each stage of the production process and plotting those results on a graph. any variances from quality standards are recognized and can be corrected if beyond the set of standards

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telecommuting

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benefits: - firms may choose less expensive locations - employees are in touch with company and customers right from home - less dependence on locating new sources of labor

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production

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the creation of finished goods and services using the factors of production: land, labor, capital, entrepreneurship, and knowledge historically meant manufacturing

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production management

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the term used to describe all the activities managers do to help their firms create goods the US has become a service economy that is dominated by the service sector nature of business has changed significantlly over last 20 years as the service sector, including internet services, has grown dramatically

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mass customization focuses on the needs of what type of customer

answer

individual

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customize

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to make a unique product or provide a specific service to specific individuals

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Data from the UN on global output from 1970 to 2009 show that America's manufacturing output has continued to increase since the 1970s.

answer

In fact, output is about twice as much as it was in 1970s. On its own, US manufacturing would rank as the sixth largest economy in the world. In 2009, US manufacturing output was over $2 trillion (including mining and utilities. That's more than 45% higher than China's.

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As the US service sector becomes a larger part of the overall economy, managers will be more occupied with service productivity, and with blending services and manufacturing through the internet. How can US manufacturers and service organizations maintain a competitive edge? Most of them are:

answer

- focusing more on customers * - maintaining closer relationships with suppliers and other companies - practicing continuous improvement * - focusing on quality * - saving on costs through site selection - relying on the internet to unite companies to work together - adopting production techniques such as enterprise resource planning, computer integrated manufacturing, flexible manufacturing, and lean manufacturing the US economy is no longer based on manufacturing, as about 70 percent of US GDP comes from the service sector

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operations management

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a specialized area in management that converts or transforms resources (including human resources) into goods and services in an automobile plant, O.M. transforms raw materials, HR, parts, supplies, paints, tools, and other resources into automobiles. in a college or university, O.M. takes inputs such as information, professors, supplies, buildings, offices, and computer systems and creates services that transform students into educated people through a process called education. operations management is so important because it is the implementation phase of management. the goal of operations management is to: - keep operations running efficiently, create a good experience for the customer is a specialized area of management that includes: - production scheduling - inventory management operations management planning in a service environment focuses on creating a good experience for those using the service

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form utility

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the value producers add to materials in the creation of finished goods and services ex: a baker making a specific type of cake from basic ingredients

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the production process

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consists of taking the factors of production (land, labor, capital, entrepreneurship, knowledge) and using those inputs to produce goods, services, and ideas. planning, routing, scheduling, and other activities are the means to accomplish the objective--the output aspects of control in the production process: - routing - planning - scheduling - distribution goods, services, and ideas are all OUTPUTS of the production process In a production process raw materials are considered INPUTS whereas the finished products are considered OUTPUTS ORDER in the production process: inputs > production control > outputs

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flexible manufacturing

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designing machines to do multiple tasks so that they can produce a variety of products

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lean manufacturing

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the production of goods using less of everything compared to mass production - less human effort, less manufacturing space, less investment in tools, less engineering time to develop a new product a company becomes lean by continuously increasing its capacity to produce high-quality goods while decreasing its need for resources. here are some characteristics of lean companies: - they take half the human effort - they have half the defects in the finished product or service - they require one-third the engineering effort - they use half the floor space for the same output - they carry 90 percent less inventory technological improvements are largely responsible for the increase in productivity and efficiency of US plants

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mass customization

answer

tailoring products to meet the needs of a large number of individual customers, now practiced widely ex of service: vacation package from a travel agency

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facility location

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the process of selecting a geographic location for a company's operations ex of facility location strategy: - locating a bank inside of a supermarket

question

facility location for manufacturers

answer

consider labor costs, availability of resources, including labor, access to transportation that can reduce time to market, proximity to suppliers, proximity to customers, crime rates, quality of life for employees, cost of living, need to train or retrain the local workforce

question

telecomuting

answer

working form home via computer information technology (IT): computers, modems, email, voice mail, text messaging, teleconferencing, etc.--is giving firms and employees increased flexibility to choose locations while staying in the competitive mainstream.

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facility layout

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the physical arrangement of resources (including people) in the production process - depends greatly on the processes that are to be performed - for services, the layout is usually designed to help the consumer find and buy things, including on the internet: a service facility layout, including on the internet, is usually designed to help customers find and buy things assembly line layout: workers do only a few tasks at a time modular layout: teams of workers combine to produce more complex units of the final product fixed position layout: allows workers to congregate around the product to be completed (i.e. bridge or airplane) * process layout: one in which similar equipment and functions are grouped together. the order in which the product visits a function depends on the design of the item. this allows for flexibility. because the layout of the plant changes so often, employees use scooters in order to more efficiently provide needed skills, supplies, and services to multiple workstations. *

question

materials requirement planning (MRP)

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a computer based operations management system that uses sales forecasts to make sure that needed parts and materials are available at the right time and place

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product layout (also called Assembly Line Layout)

answer

used to produce large quantities of a few types of products ex: vehicle manufacturing

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process layout

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frequently used in operations that serve different customers' different needs

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cellular or module layout

answer

can accommodate changes in design or customer demand ex: woodworking requiring differing designs of a product

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fixed position layout

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a major feature of planning is scheduling work operations ex: bridge construction

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purchasing

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the function in a firm that searches for high quality material resources, finds the best suppliers, and negotiates the best price for goods and services

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just in time (JIT) inventory control

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a production process in which a minimum of inventory is kept on the premises and parts, supplies, and other needs are delivered just in time to go on the assembly line (a major production expense is holding items in storage for later use) requires accurate production schedule (using ERP) and excellent coordination with carefully selected suppliers, who are usually connected electronically so they know what will be done and when the goal: - deliver the minimum amount of inventory just in time to go to the assembly line

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quality

answer

consistently producing what the customer wants while reducing errors before and after delivery to the customer problems in checking for quality: 1) the need to inspect work requires extra people and resources 2) if an error was found, someone had to correct the mistake or scrap the product. costly. 3) if the customer found the mistake, he or she might be dissatisfied and might even buy from another firm thereafter quality control is a never ending process of continually improving what a company produces. * should be part of the operations management planning process * rather than simply an end of the line inspection.

question

the Baldrige Awards

answer

in US in 1987, a standard was set for overall company quality with the introduction of this award. Malcolm Baldrige National Quality Awards to quality, an organization has to show quality in seven key areas: - leadership, strategic planning, customer and market focus, information and analysis, human resources focus, process management, and business results areas in which a company can apply for award: - services, healthcare, manufacturing, nonprofit/government, small business, education

question

International Organization for Standardization (ISO)

answer

is a worldwide federation of national standards bodies from more than 140 countries that set global measures for the quality of individual products. ISO is a nongovernmental organization established in 1947 to promote the development of world standards to facilitate the international exchange of goods and services. NOT an acronym, it comes from greek word isos, meaning "one-ness" ISO 9000 is a common name given to quality management and assurance standards. some of the latest standards are called ISO 9001: 2008. the EU (european union) uses this certification in order to do business with companies. ISO 14000 is a collection of best practices for managing an organization's impact on the environment. as an environmental management system, it does not prescribe a performance level. requirements for certification include having an environmental policy, having specific improvement targets, conducting audits of environmental programs, and maintaining top management review of the processes. certification in both ISO 9000 and ISO 14000 would show that a firm has a world-class management system in both quality and environmental standards. ISO is the name for the International Organization for Standardization, which is a: - federation whose purpose is to facilitate trade - worldwide federation of national standards bodies ISO 14000 is geared toward environmental impact of organizations while the focus of ISO 9000 is on * quality * .

question

GANTT chart

answer

enables a production manager to see at a glance when projects are scheduled to be completed and what the status is now; a bar chart reasons to use: - to determine stages of a project - to trace a production process - to identify projects in process

question

what is the current state of manufacturing in the US?

answer

activity in the nation's manufacturing sector has declined. the result has been an increase in joblessness. one cause of that increase is the fact that companies have become more productive, meaning they need fewer employees to do the same amount of work.

question

how will technological improvements in production-oriented companies affect the number of workers required?

answer

lower the number of workers required

question

which sector has suffered less from the economic slowdown than the manufacturing sector?

answer

service sector

question

production adds ___, or utility, to materials or processes

answer

value

question

according to Andrew Grove, the former chairmen of Intel, three basic requirements of production are

answer

1) timely delivery 2) an acceptable quality level 3) at the lowest possibly cost to the consumer

question

time to market

answer

moving products quickly and efficiently to customers in order to remain competitive

question

operations manager

answer

responsible for producing products, and delivering them on time, on budget, and to specifications

question

a company may decide to locate its production operations in order to:

answer

- use a skilled workforce - reduce transportation costs - reduce time to market

question

examples of a problem solved by operations management planning as it relates to manufacturing include:

answer

- time to market - inventory control - facility location

question

the main idea behind mass production is

answer

to produce a large number of a limited variety of products at a very low cost

question

PERT is a planning tool for projects, while

answer

GANTT chart is a tracking tool for measuring production progress

question

tremendous career opportunities exist in operations management as manufacturing and service companies attempt to remain ___ in the global market

answer

competitive

question

it is easier to design mass customization for services rather than products because

answer

there is no tangible good to be adapted

question

in the past, CAD and CAM systems could not communicate with one another. ___ solved this problem by marrying the two systems which cuts 80% of programming time during production today

answer

CIM - computer integrated manufacturing

question

the quality control steps of plan, do check, act are aimed at finding potential errors before they happen as part of:

answer

- statistical process control - the Deming cycle, quality control approach Plan Do Check Act (PDCA).. idea is to find potential errors before they happen

question

locating operations near a supplier can greatly reduce ___ costs and allow for easier communication

answer

transportation

question

global competition makes it necessary for manufacturers to consider time to market when choosing a

answer

facility location

question

production methods that use computer technology to make the US more competitive globally:

answer

- CAD - CAM - Lean manufacturing

question

Deming Cycle

answer

quality movement geared toward finding errors before they happen

question

Because services are more adaptable than products it is easier to design them for:

answer

mass customization

question

Economic indicators that led to President Obama's stimulus proposal:

answer

- Loss of jobs in housing and manufacturing - Anticipated decrease in home values - Increased joblessness in the Midwest president Obama's stimulus proposal was a result of economic indicators of joblessness showing we had entered a period of * recession *

question

the production process should be a sequence of steps starting with inputs, followed by production control, and ending with:

answer

- finished products - outputs

question

a hotel is an example of an organization that provides mostly

answer

services

question

a restaurant is an example of an organization that produces both

answer

services and goods

question

companies will relocate their production facilities to obtain less expensive:

answer

- electricity - water - natural resources

question

what is a positive aspect of ChildrenWear Industries relocating its operations to Asia?

answer

increased revenue for firm vacating

question

disadvantages of storing large quantities of items in inventory:

answer

- items can be pilfered or stolen - items become obsolete - increased costs associated with inventory management

question

innovation and competition in the hotel industry has led operations managers to provide an increased variety of amenities to satisfy the needs of their:

answer

customers

question

reasons why a company might relocate to where a resource is plentiful is to enjoy:

answer

- a lower cost of buying - a lower cost of shipping

question

developing and tracking schedules using monitoring methods such as PERT or GANTT charts during the production process is an example of applying:

answer

production control

question

the United States has been producing about how much of the world's manufactured goods?

answer

25 percent

question

when project managers create bar graphs showing production managers what projects are being worked on and what stage they are in at any given time, they are applying what tool to operations management?

answer

Gantt Chart

question

entrepreneurs building new green ventures will lead to:

answer

- more employment - a stronger economy

question

key reasons why producers move their plants are to:

answer

- find skilled labor - have a close proximity to customers - find cheaper labor - be closer to resources

question

international companies must identify their strengths and weaknesses to ___ successfully in global markets

answer

compete

question

the traditional goal of manufacturing organizations was to produce goods efficiently and inexpensively while the current goal of operations management is to

answer

respond rapidly to customers

question

foreign producers have become competitive in the global economy through the use of US ___ advances

answer

technological

question

in the past, manufacturers dealt with many suppliers such that if one could not deliver then another would be chosen. today, this is not so because:

answer

there is a greater emphasis on the relationship

question

a major benefit of CAD and CAM is that they make it possible to custom-design products to meet the needs of small markets with very little increase in ___.

answer

costs

question

some service organizations, such as hospitals, try to create efficiencies in layout much like a ___

answer

manufacturing facility

question

inter-firm process

answer

using an internet focused strategy, operations managers are outsourcing design, production, and shipping to other firms through this process

question

bundling inputs such as information, doctors, supplies, and offices that transform sick people into healthy ones in a hospital building is an example of applying operations management to the ____ industry.

answer

service industry

question

what are the computerized production methods that have made the US more competitive both domestically and globally?

answer

- CAD - flexible manufacturing - CAM - mass customization

question

free internet access, access to computer hardware and software, and concierge service are all examples of hotel amenities provided through effective ___.

answer

operations management

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