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What is Business Process Management? What are the benefits?
- A studies and systematic approach to incremental change for continuous process improvement in customer satisfaction. The org structure is based on processes rather than function.
- Benefits include improved efficiency, effectiveness, and agility in responding to changes
What are the 5 activities or techniques involved in BPM with a brief explanation?
- Define & Design = ID current processes and conceptualize the processes once improved; establish a baseline
- Model or Analyze = use modeling software to perform what-if variable analysis
- Execute = implement the design changes
- Monitor, Measure, Control = track against expected performance; use dashboards
- Optimize or Improve = refine the process
What are several measures that can be used with BPM to determine effectiveness?
- Gross Revenue
- Customer Contacts
- Customer Satisfaction
- Operational Statistics
What are shared services? What are the drawbacks?
- Seeking out and eliminating duplicate functions within the internal organization.
- (1) workflow disruption during the transition,
- (2) failure demand=failure to do something or do it right thus it must be done a 2nd time
What is outsourcing What are the drawbacks?
- Contracting services with an external provider, whether in the states or offshore.
- (1) quality risk of a product or service
- (2) reduced productivity
- (3) staff turnover, loss or insecurity
- (4) language barrier
- (5) security could be compromised
- (6) the qualifications of the supplier may be lower than for internal personnel
Irrational methods of selecting an improvement initiative focus on what types of decisions?
Emotional or intuitive based on fashion, fad, or trend
What key features are needed for successful implementation of an improvement program?
- Internal leadership and visible support from senior mgmt for direction and commitment of resources
- ** it’s impossible to implement without the resources
- Ongoing monitoring and measurement
- Internal process ownership by the individuals involved in the activities
What is Business Process Reengineering? What are the benefits?
- A clean-slate radical approach to reviewing the business to identify new process methods.
- Criticized for not producing the anticipated benefits
Give a brief explanation of specific performance improvement programs with a focus on managing resources?
- JIT Management = the belief that inventory does not add value; thus, materials are delivered just prior to manufacture.
- Lean Manufacturing=waste reduction and efficiency
- Demand Flow=resource allocation based on actual customer demand (not sales forecasts) - incorporates parts of the previous two
What are the JIT Management characteristics, requirements and benefits?
- CHARACTERISTICSlot sizes equal to 1
- insignificant set-up times and costs
- balanced and level workloads
- a "pull" approach (rather than push-thru)
- REQUIREMENTS: Synchronization of…
- production schedule w/customer demand
- supply delivery w/production schedule
- product delivery w/retailer’s market
- reduced set-up time
- efficient use of employees w/mult skills
- reduced warehouse space
What are the 7 critical factors regarding successful implementation of TQM?
- (1) customer focus=internal and external
- (2) continuous improvement
- (3) workforce involvement thru quality circles
- (4) senior management support via modeling
- (5) objective measures=taken & reported
- (6) timely recognition and reward
- (7) ongoing training
Lean Manufacturing includes which 4 components
- Waste reduction (expend only the min resources necessary w/o sacrificing quality)
- Kaisen seeking out small incremental benefits to improve efficiency
- Activity Based Costing (ABC) to identify which activities cost the most and can be pared
- Activity Based Management (ABM)
Which productivity system uses Kanban and what is it?
- The demand flow system
- Kanban uses an instruction card to regulate the supply of components through the production system
What are the 5 steps to the Theory of Constraints process
- (1) identify the constraint through process charts or interviews
- (2) exploit the constraint=get around the issue
- (3) subordinate everything else to the above issue=put all efforts into fixing the constraint
- (4) elevate the constraint=find a way to permanently eliminate the issue
- (5) return to step 1
What are some constraint examples for the Theory of Constraints
- equipment may be poorly maintained and inefficient
- people may lack skills and need addl training
- policies may prevent the efficient use of resources
- supply may outpace demand
What are the 5 steps to improving an existing product using Six Sigma?
- define the problem
- measure key aspects of the current process
- analyze the data
- improve/optimize the current process
- monitor and control
What are the 5 steps to using Six Sigma on a new product?
- define design goals
- measure Critical To Quality issues (the value chain)=what the customer deems valuable and how to ensure production makes that happen
- analyze product alternatives
- use modeling to optimize
- verify the design
Give a brief explanation of specific performance improvement programs with a focus on quality and process improvement?
- TQM=customer-focused continuous improvement
- Six-Sigma=metrics to evaluate goal achievement (PDCA=Plan, Do, Check, Act)
Give a brief explanation of specific performance improvement programs with a focus on how to eliminate problems?
- Theory of Constraints (TOC)=remove barriers to achieve objectives
- Quality Audits=strengths, weaknesses, improvements
- Gap Analysis=analyzes the difference between industry best practices and current practices in the org
What is the difference between an internal vs external constraint
- Internal: where the market's demand exceeds our production capability
- External: our production exceeds market demand
What types of cost changes would JIT benefit?
- If inventory unit carrying costs are increasing JIT reduces the holding cost
- And lower cost per purchase order
What are the 5 steps in a decision-making process
- (1) identify the problem and uncertainties
- (2) obtain information
- (3) use the info to make predictions about the future
- (4) choose among alternatives
- (5) implement, evaluate, learn, adjust