OM 300 1st EditionExam # 2 Study Guide: Chapters 6 - 9Chapter 6 – Managing QualityDifferent Views of Quality – this impacts…a. Company Reputationb. Product Liability c. Global ImplicationsCause and Effect Diagrams 4 M’s: Manpower, Machinery, Materials, and MethodsSix Sigma: Two Definitions1. Statistical – process that is 99.9997% capable, 3.4 defects per million opportunities2. Program – designed to decrease defects and costs, save time, and increase customer satisfactionDMAIC Approach: Defines, Measures, Analyzes, Improves, and ControlsTechniques for Employee Empowerment- Build open communication networks that include employees- Develop supportive supervisors that are accessible - Give responsibility to employees- Develop high-morale atmosphere- Create formal team structure within different groupsChapter 6 Supplement – Statistical Process ControlC charts & P ChartsP-chart is for discrete attribute data while C-chart requires equal sample sizes for each data pointAcceptance SamplingType of quality testing used for incoming materials or finished goods, does not drive quality improvement effortsChapter 7 - Process StrategyProcess Strategies1. Process Focus: facilities are centered around specific activities and processes2. Repetitive Focus: high usage of modules with parts and assemblies made previously, very efficient but less flexible than other strategies3. Product Focus: has a high volume, but low variety of products; this typically leads to high fixed costs but low variable cost4. Mass Customization: involves rapid, low-cost productions of goods/services to meet unique customer needs and desiresChapter 8 – Location StrategiesFedEx Location Choice and AdvantagesLocation Clustering – retail/restaurants try to locate near each other in locations that will build them up ex: downtown TuscaloosaLocation Factor Rating – Weighted Score- Widely used due to wide variety of factors that can be assessed in the analysis- Six Steps:o Develop list of relevant factors key to successo Assign a weight to each individual factoro Develop a scale for each individual factoro Score each location for each individual factoro Multiply score given by weights for each factor at each locationo Create recommendation based on scoresCenter of Gravity Method - method finds the location of distribution center that minimizes distribution costs- be able to calculate x and y coordinates for center of gravity – method assumes cost is directly proportional to the distance/volume shippedService Firm - 8 determinants of Revenue/Volume1. Purchasing power of customer-drawing area2. Service/image compatibility with demographics3. Competition4. Quality of competition in the area5. Uniqueness of locations6. Physical characteristics of facilities and neighborhood7. Operating policies of firm8. Quality of productChapter 9 – Layout StrategiesMcDonald’s “Seven Major Innovations” (Largely layout decisions for competitive advantage!)1. Indoor Seating2. Drive-through window3. Breakfast added to menu4. Children’s play areas added to layout5. Kitchen Redesign6. Self-Service Kiosk added7. 3 Separate Dining Sectionsa. Linger zone has comfortable seating with wifi capabilities, Grab and Go Zone offers tall counters, and the flexible zone is specifically for kids and familiesAdvantages of Work Cells: these reorganize people/machines into groups to focus on specific areas- Less floor space is required- Reduced inventory for raw materials and finished goods- Increased sense of employee participation- Increased equipment/machinery usage- Investment in equipment/machinery decreasedTakt Time – used for staffing and balancing work cellsTakt Time = Total Work Time Available / Units