Transcript Document

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Producing
World-Class
Goods
and
Services
Nickels
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McGraw-Hill/Irwin
Understanding Business, 8e
McHugh
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CHAPTER
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9
McHugh
1-1
9-1
© 2008 The McGraw-Hill Companies, Inc., All Rights Reserved.
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Leading U.S.
Manufacturing States
Michigan
WASHINGTON
MONTANA
New York
MAINE
NORTH DAKOTA
Illinois
OREGON
MICHIGAN
VT
MINNESOTA
IDAHO
SOUTH DAKOTA
WISCONSIN
NEW YORK
NH
MASS
CONN
RI
MICHIGAN
WYOMING
PENNSYLVANIA
IOWA
NEW
JERSEY
NEVADA
NEBRASKA
OHIO
DELAWARE
UTAH
ILLINOIS
DC
INDIANA
MARYLAND
COLORADO
WEST
VIRGINIA
KANSAS
CALIFORNIA
VIRGINIA
MISSOURI
KENTUCKY
Ohio
NORTH CAROLINA
TENNESSEE
OKLAHOMA
ARIZONA
SOUTH
CAROLINA
ARKANSAS
NEW MEXICO
California
ALABAMA
LOUISIANA
GEORGIA
Pennsylvania
MISSISSIPPI
TEXAS
ALASKA
FLORIDA
HAWAII
0
600 Miles
0
0
100
200 Miles
Texas
200 Miles
Source: Britannica Student Encyclopedia, 2006
9-2
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Top Ten US Manufacturers
1.
2.
3.
4.
5.
ExxonMobil
Chevron
General Motors
ConocoPhillips
Ford Motor
6. General Electric
7. Altria Group
8. IBM Corp.
9. Hewlett-Packard
10.Valero Energy
Source: Industry Week, June 1, 2006
9-3
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How Manufacturers Have
Become More Effective
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Focus on customers
Maintain close relationships
Continuous improvement
Focus on quality
Save costs
Rely on the Internet
New production techniques
9-4
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Labor Hours / Vehicle
• Ford – 35.79 hours
Ford
• Daimler/Chrysler –
33.71 hours
Chrysler
GM
• GM – 33.19 hours
Honda
Toyota
• Honda – 32.51 hours
Nissan
• Toyota – 29.4 hours
0
20
40
• Nissan – 28.46 hours
Source: Detroit Free Press, June 2, 2006
9-5
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From Production to
Operations Management
• Production
• Production
Management
• Operations
Management
(OM)
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Comparing Asian Giants
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CHINA
Driving Force:
Manufacturing
Largest Communist
Country
Population: 1.3
Billion
Economic Growth
Rate: 9%
Financial/Commercial
Capital: Shanghai
Source: Kiplinger.com December 19, 2005, BBC News, In Depth, accessed July 15, 2006
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INDIA
Driving Force:
Services
Largest Democracy
Population: 1.1
Billion
Economic Growth
Rate: 7%
Financial/Commercial
Capital: Mumbai
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Production Processes
• Form Utility
• Process Manufacturing
• Assembly Process
• Continuous Process
• Intermittent Process
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Three Requirements
For Production
1. Build and deliver products in
response to the demands of the
customer at a scheduled delivery time
2. Provide an acceptable quality level
3. Provide everything at the lowest
possible cost
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Production Efficiency
• Krispy Kreme Doughnuts – 5,208 a minute
• Twinkies – 972 a minute
• LifeSavers 5 Flavor Roll – 100 rolls a minute
• Jell-O Gelatin Boxes – 764 a minute
• Chips Ahoy! – 4,000 a minute
Source: World Features Syndicate
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What Is Increasing
Productivity?
8%
Innovation
11%
42%
12%
Capital
Improvement
Staff
Downsizing
Outsourcing
Other
14%
Source: 2005 National Innovation Survey, Council on Competitiveness
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Product Improvements With
Computer Technology
• Computer-Aided Design - CAD
• Computer-Aided Manufacturing - CAM
• Computer-Integrated Manufacturing - CIM
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Top Ten Tech Spenders
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STATE
California
New York
Texas
Illinois
Florida
Pennsylvania
Ohio
New Jersey
North Carolina
Georgia
$ in Billions
38.9
29.8
24.6
15.1
13.9
12.8
11.8
11.3
9.4
9.3
Source: Business Week Online, December 5, 2005
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Production Techniques
• Flexible
Manufacturing
• Lean
Manufacturing
• Mass
Customization
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Operations Management
Planning
• Facility Location
• Facility Layout
• Materials Requirement
Planning
• Purchasing
• J-I-T Inventory Control
• Quality Control
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Quality Control
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Six Sigma Quality
Statistical Quality Control (SQC)
Statistical Process Control (SPC)
The Baldrige Award
ISO 9000
ISO 14000
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Baldrige Award Recipients
• Sunny Fresh Foods, Inc.,
Monticello, MN (Manufacturing)
• DynMcDermott Petroleum Operations,
New Orleans, LA (Service)
• Park Place Lexus,
Plano, TX (Small Business)
• Richland College,
Dallas, TX (Education)
• Jenks Public Schools,
Jenks, OK (Education)
• Bronson Methodist Hospital,
Kalamazoo, MI, (Health care)
Source: NIST News Release, November 22, 2005
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ISO
• ISO was founded in 1947
• At the end of 2004, the worldwide
total of certificates:
• ISO 9000 – 670,000 in 154 countries
• ISO 14000 – 90,000 in 127 countries
Source: Business Week Online, March 17, 2006
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Control Procedures
• Program Evaluation &
Review Techniques
(PERT)
• Gantt Chart
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PERT Steps
1. Analyzing and sequencing tasks that
need to be done
2. Estimating the time needed to complete
each task
3. Drawing a PERT network illustrating the
information from steps 1 and 2
4. Identifying the critical path
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Gantt Chart
• Named for its developer,
Henry Gantt
• A bar graph that clearly
shows what projects are
being worked on and how
much has been
completed at any given
time
9-21
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Learning from Failure
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Formalize forums for analyzing failure
Move the goalposts
Share personal stories
Bring in outsiders
Prove yourself wrong, not right
Celebrate smart failures
Source: Business Week Online, July 10, 2006
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