Card Set Information

2013-10-17 18:53:17

Week 6
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  1. Operations management- what is it?
    a field of management that specialises in the production of goods and services and uses special tools and techniques for solving manufacturing problems
  2. Product design
    Four objectives of product design +1
    • Design for manufacturability and assembly 
    • 1. Producibility - degree to which a product or service can actually be produced within existing capacity
    • 2. Cost - sum of materials, labour, design, transportation and overhead expense associated with product and service
    • 3. Quality - excellence of product/service- the serviceability and value that customers gain by purchasing a product.
    • 4. Reliability - degree to which customer can count product/service to fulfil intended purpose
    • Also: Timing
  3. Most common approach to location slection
    • Cost - benefit analysis
    • Benefits and costs are analysed and best option is selected with highest ratio
  4. Four most common types of facilities layout + 3 others
    • Process Layout
    • Product Layout
    • Cellular Layout (both process and product)
    • Fixed Position Layout

    office layout, warehouse and storage layout and retail layout
  5. Process layout
    • Equipment that performs a similar process are grouped together
    • Suitable for LOW volume and HIGH variety products
    • Drawback- a complex product may need several different processes performed on it
  6. Product Layout
    • Machines and tasks are arranged according to progressive steps in producing a single product
    • Assumes high volume production and high demand 
  7. Cellular Layout 
    • Machines dedicated to sequences of operations are grouped into cells
    • Advantages:
    • Provides efficiencies of both product and processes layout
    • Workers can work in clusters that facilitate teamwork and joint problem solving
    • Staffing flexibility- one person can operate all machines and walking distance is small
  8. Fixed Position Layout
    • Product remains in one location and tasks and equipment are brought to it
    • Advantage: Used for large or special products e.g aircraft
    • Disadvanatage
    • Not suitable for high volume but necessary for large bulky products
    • Limited space
  9. Supply chain management
    managing the sequence of supplies and purchasers, covering all stages of processing from obtaining raw materials to distributing finished goods to final customers
  10. Supply Chain Management
    Arm's length approach
    Organisation spreads purchases among many suppliers encouraging them to compete to provide the best quality at the lower prices
  11. Supply Chain Managment
    Cultivating relationships with selected suppliers to meet unique needs.
  12. Logistics and Distribution Management
    • Efficient integration of material acquisition, movement and storage activities. 
    • Some organisations use contract logistics firms such as Linfox. 
    • Some companies share transportation information and resources with other companies so they share truckspace and avoid waste of resources to save money
  13. Supply chain management strategies
    • Many Suppliers
    • Few Suppliers
    • Vertical integration
    • Kiretsu
    • Partnering
    • Arm's length approach
  14. Inventory: Pressures to reduce inventory (4)
    • Interest or opportunity cost: Firms may borrow or not undertake another investment in order to purchase inventory
    • Storage and handling cost: Inventory takes up space and must be moved in and out of storage 
    • Insurance: Higher levels of stock incur higher insurance costs
    • Reduction in value: Obsolescence and deterioration may reduce value of stock and theft could occur.
  15. Types of Inventory (4)
    • Raw materials
    • Work in progress
    • Maintenance
    • Finished Goods
  16. Pressures to increase inventory (5)
    • 1. Customer service: speedy delivery avoid stock outs
    • 2. Administration costs: reduced paper work, negotiation time
    • 3. Labour and equipment utilisation: 'economies of scale,' stabilises output when demand is seasonal
    • 4. Transportation costs: Handling and mileage 
    • 5. Payments to suppliers: Incentives, preferential treatment
  17. Vertical integration
    • Ability to produce goods/services previously purchased or actually buying supplier or distributor
    • Can forward or backward integrate
    • can yield cost reduction and timely delivery 
  18. Ways quality improves profitability
    Sales gains 
    Reduced Costs
    • Sales gains: 
    • Improved response 
    • Higher prices
    • Improved reputation
    • Reduced Costs:
    • Increased productivity
    • Lower rework and scrap
    • Lower warranty costs
  19. Customer driven definitions of quality (5)
    • 1. Conformance to specifications
    • 2. Value 
    • 3. Fitness for use
    • 4. Support
    • 5. Psychosocial impressions
  20. Techniques for inventory accuracy and control (3)
    • 1. Good personnel selection and training
    • 2. Tight control of incoming shipments
    • 3. Effective control of all goods leaving facility