1 BUSMGT 3230 Operations Management Key Questions for Midterm 1 Chapter 1 Using Operations to Compete 1 Why is operations supply chain management important to business survival Because it translates materials and services into output a In your own words what is operations supply chain management about Operations Supply Chain Management is about making decisions to deal with problems and issues that affect RIGHT6 quality quantity place customer time cost 2 What are key inputs into any process that produces a product or a service Workers managers equipement facilities materials land and energy a What is a product What is a service Product any tangible output Service any intangible output b Can there be services without products No 3 How are manufacturing and service processes different Manufacturing processes output physical tangible goods and have a low degree of customer contact Also has a long response time and is capital intensive Quality is easily measured Service processes produce intangible outputs and have a high degree of customer contact Also is labor intensive and has a short response time Quality is not easily measured 4 What 4 core processes do operations supply chain managers obsess over Order fulfillment customer relationship supplier relationship and new product service development a What decisions do operations supply chain managers typically make Decisions pertain to process capacity inventory quality logistics and workforce Safety Quality Delivery Productivity Cost and People 5 What is an operations strategy What is a strategy Operations strategy the means by which operations implements a firm s corporate strategy and helps to build a customer driven firm 6 What are core competencies and what do they include Core competencies the unique resources and strengths that an organization s management considers when formulating strategy They include workforce facilities market and financial know how and systems and technology 7 What are the four competitive priorities and competitive capabilities Time flexibility quality and cost a How are competitive priorities and competitive capabilities different Competitive priorities are the critical dimensions that a process must possess to satisfy its internal or external customers while competitive capabilities are the dimensions a process actually possesses and is able to deliver 8 What is an order winner What is an order qualifier Order qualifier is what a firm must have to be in the business Order winner is what a firm must have to win customers sales and beat out competition a Are competitive capabilities order winners or order qualifiers A competitive capability is an order qualifier if competitors also have it and it is an order winner if the firm has it to win customers sales and beat out competitors Chapter 3 Process Strategy 1 What the the four basic process strategy decisions Process structure Customer involvement Capital intensity and Resource flexibility a How are the four basic process strategy decisions defined Inter related Process structure the process type relative to the kinds of resources needed how resources are partitioned between them and their key characteristics 2 Customer involvement the ways in which customers become part of the process and the extent of their participation Resource flexibility the ease with which employees and equipment can handle a wide variety of products output levels and functions Capital Intensity the mix of equipment and human skills in a process They are inter related b How is a layout related to these process strategy decisions The layout is the physical manifestation of these decisions 2 What are the key attributes of the Product Process Matrix Volume product customization process characterists a How do process structures in manufacturing differ along these attributes In terms of the ability to use inventory to satisfy customer orders Differ in terms of volume product customization or variety and process divergence and flow These differences determine whether a firm uses Make to Order or Make to Stock b How do process structures in manufacturing relate to competitive priorities They help determine them 3 What are the key attributes of the Customer Contact Matrix Degree of customer contact customization process characteristics a How do process structures in services differ along these attributes Differ in terms of customer contact and customization and process divergence and flow b How does high customer contact differ from low customer contact in service processes In sale opportunity degree of contact and efficiency c How does the degree of customer contact relate to sales opportunity and efficiency in designing services How do process structures in services relate to the moment of truth Differ in terms of sales opportunity degree of customer server contact and efficiency These differences lead to low versus high moments of truths since they lead to physical separation of front office versus back office 4 What are the advantages and disadvantages of involving customers Possible Disadvantages It can lower the efficiency of a process be disruptive requires higher interpersonal skills from employees which come at a cost might have to change layout may need multiple locations hard to measure quality hard to manage timing and volume Possible Advantages Increase value of the process to the customer self service has high customer involvement but lowered costs final assembly by the customer also lowers costs customer involvement can also help manufacturers forecast demand etc Chapter 6 Capacity Planning 1 What is capacity How is capacity typically measured The maximum rate of output of a process or system No single measure is best for all situations in general capacity can be measured either in output or input a How are input measures different from output measures Input measures good when variety and process divergence is high product service mix are changing productiviy rates are changing and significant learning effects are expected Output measures good when the process has high volume and a small amount of standard products b What does the utilization rate tell a manager It indicates a need for adding eliminating extra capactiy Is a 100 utilization good or bad 100 utilization may be a goal but should never be realized 2 What is capacity management How are key decisions in capacity management related to operations i strategy or process strategy Capacity management entails