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Summary Supply chain management 8th edition
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A summary of chapter 1, 2, 6, 9, 10, 11, and 16 of the book operations and supply chain management 8th edition written by Russel and Taylor.
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Table of ContentsChapter 1 Operations Management....................................................................................2
Chapter 2 Ensuring quality..................................................................................................4
Chapter 6 Designing processes............................................................................................7
Chapter 9 Managing projects............................................................................................12
Ch.10 Designing the supply chain......................................................................................17
.........................................................................................................................................25
Chapter 11 Global Procurement and Distribution..............................................................25
Chapter 16 JIT and lean production...................................................................................32
,Chapter 1 Operations Management
Operations management is the design, operation, and improvement of
productive systems.
Operations managers design systems, ensure quality, produce products, and
deliver services. They deal with people, technology and deadlines. These
managers need good technical, conceptual, and behavioral skills.
Operations is often defined as the transformation process. Inputs go into
‘black box’ and are transformed into outputs. Requirements and feedback
from customers are used to adjust factors in the transformation process,
which may in turn change the inputs.
The role of operations is to create value. The transformation process can be
viewed as a series of activities along a value chain extending from supplier
to customer.
Operations function:
Activities in for the operations functions include, organizing work, selecting
processes, arranging layouts, locating facilities, designing jobs, measuring
performance, controlling quality, scheduling work, managing inventory, and
planning production.
The four primary functional areas of a firm are marketing, finance, operations,
and human resources.
The evolution of O&SCM
1776- Adam Smith’s wealth of nation proposed the division of labor, in
which the production process was broken down into a series of small tasks,
each performed by a different worker. The specialization of the workers on
limited, repetitive tasks allowed them to become very proficient at those
tasks and further encouraged the development of specialized machinery.
1790’s- Eli Whitney introduces interchangeable parts, where the
manufacturer of firearms, clocks, watches, sewing machines, and other goods
to shift from customized one-at-a-time production to volume production of
standardized parts. This meant the factory needed a system of
measurements and inspection, a standard method of production, and
supervisors to check the quality of the worker’s production.
1930- Hawthorne studies introduced the idea that worker motivation, as well
as the technical aspects of work, affected productivity.
Lean production is a system that prizes flexibility (rather than efficiency)
and quality (rather than quantity).
Globalization;
Globalization can take the form of selling in foreign markets, producing on
foreign lands, purchasing from foreign suppliers, or partnering with foreign
firms. Companies ‘go global’ to take advantage of favorable costs, to gain
access to international markets, to be more responsive to changes in
demand, to build reliable sources of supply, to stay up to date of the latest
trends and technologies
Strategy deployment;
Strategy deployment helps the functional areas of a firm to get a better
understanding of the strategy.
,Strategy deployment translates a firm’s positioning strategy and resultant
order winners and order qualifiers into specific performance requirements.
Two planning systems which are policy deployment and balanced scorecard
could help a company to align day-to-day decisions with the corporate
strategy.
Policy deployment/hoshin planning tries to focus everyone in an
organization on common goals and priorities by translating corporate strategy
into measurable objectives. As a result, everyone should understand the
strategic plan, be able to derive several goals from the plan, and determine
how each goal ties into their own daily activities.
The outcome of the process is a cascade of action plans, aligned to complete
each functional objective, which will, in turn, combine to achieve the strategic
plan.
Balanced scorecard examines a firm’s performance in four critical areas;
Finances- how should we look to our shareholders?
Customers- how should we look to our customers?
Processes- At which business processes must we excel?
Learning and Growing- how will we sustain our ability to change and improve?
It is called balanced scorecard because more than financial measures are
used to assess performance. Identifying and understanding targeted
customers helps determine the processes and capabilities the organization
must concentrate on to deliver value to the customer. The firm’s ability to
improve those processes and develop competencies in new areas is critical to
sustaining competitive advantage. In a balanced scorecard the objectives
represent selected areas of the strategy map to incorporate in annual
objectives for the company. The objectives are operationalized wit key
performance indicators. The goals for the year are given, and the KPI
results are recorder. The score converts the different performance measures
into percentage completed. The mean performance column averages the
score for each dimension.
, Chapter 2 Ensuring quality
Quality has two meanings; the characteristics of a product or service that
bear on its ability to satisfy stated or implied needs. A product or service free
of deficiencies.
Dimensions of quality for manufactured products;
- Performance; operating characteristics of a product
- Features; the ‘extra’ items added to the basic features
- Reliability; the probability that a product will operate properly within an
expected time frame.
- Conformance; the degree to which a product meets preestablished
standards.
- Durability; how long the product lasts; its lifespan before replacement
- Serviceability; the ease of getting repairs, the speed of repairs, the
politeness and competence of the repair person
- Aesthetics; how a product looks, feels, smells, sounds, or tastes
- Safety; assurance that the customer will not suffer injury or harm from
a product
- Other perceptions; subjective perception based on brand name,
advertising, etc.
Dimensions of quality for services; more directly related to time and the
interaction between employees and the customer;
- Time and timeliness; how long must a customer
wait for service, and is it completed on time?
- Completeness; is everything the customer asked
for provided?
- Courtesy (politeness); how are the customers
treated by employees?
- Consistency; is the same level of service
provided to each customer each time?
- Accessibility and convenience; how easy is it to
get service?
- Accuracy; is the service performed right every
time?
- Responsiveness; how well does the company
react to unusual situations, which can happen frequently in
a service company?
PDCA cycle
7 quality tools;
Process flowchart; a diagram of the steps in a process. Helps focus
location of a problem in a process.
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