Operations Management

Process Strategy

PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-1 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Dell Computer Company “How can we make the process of buying a computer better?”

    

Sell custom-build PCs directly to consumer Integrate the Web into every aspect of its business Operate with six days inventory Build computers rapidly, at low cost, and only when ordered Focus research on software designed to make installation and configuration of its PCs fast and simple

PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-2 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Fit of Process, Volume, and Variety

Low-Volume (Intermittent) Repetitive Process (Modular) High-Volume (Continuous) High Variety One or few units per run, high variety (allows customization) Changes in modules Modest runs, standardized modules Changes in attributes (such as grade, quality, size, thickness, etc.) Long runs only Process focus projects, job shops,(machine, print, carpentry)

Standard Register

Repetitive (autos, motorcycles)

Harley Davidson

Poor strategy Mass Customization (difficult to achieve, but huge rewards)

Dell Computer Co.

Product focus (commercial baked goods, steel, glass)

Nucor Steel

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Production Process Flow Diagram

Accounting Purchasing (order inks, paper, other supplies) Vendors Receiving Warehousing (ink, paper, etc.) Information flow Material flow PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e Customer Customer sales representative (take order) Prepress Department (Prepare printing plates & negatives) Printing Department 7-4 Collating Department Gluing, binding, stapling, labeling Polywrap Department Shipping © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Process Strategies

 Involve determining how to produce a product or provide a service  Objective  Meet or exceed customer requirements  Meet cost & managerial goals  Has long-run effects   Product & volume flexibility Costs & quality PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-5 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Types of Process Strategies

 Process strategies that follow a continuum  Within a given facility, several strategies may be used  These strategies are often classified as:

Process-Focused Repetitive Focused Product-Focused

PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e

Continuum

7-6 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Process-Focused Strategy

 Facilities are organized by process  Similar processes are together  Example: All drill presses are together  Low volume, high variety products  ‘Jumbled’ flow  Other names

Operation 1

 Intermittent process  Job shop

Product A Product B 2

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© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Process Focus

PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-8 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Process-Focused Strategy Examples Bank Hospital

© 1995 Corel Corp.

© 1995 Corel Corp.

Machine Shop

PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-9 © 1995 Corel Corp.

© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Process Focused Strategy Pros & Cons

 Advantages  Greater product flexibility   More general purpose equipment Lower initial capital investment  Disadvantages     High variable costs More highly trained personnel More difficult production planning & control Low equipment utilization (5% to 25%) PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-10 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Repetitive Focused Strategy

  Facilities often organized by assembly lines Characterized by

modules

 Parts & assemblies made previously  Modules combined for many output options  Other names   Assembly line Production line PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-11 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Repetitive Focus

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Repetitive Focused Strategy Considerations

 More structured than process-focused, less structured than product focused  Enables quasi-customization  Using modules, it enjoys economic advantage of continuous process, and custom advantage of low-volume, high-variety model PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-13 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Repetitive-Focused Strategy Examples

Clothes Dryer McDonald’s over 95 billion served Fast Food Truck

© 1995 Corel Corp.

© 1984-1994 T/Maker Co.

© 1995 Corel Corp.

PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-14 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Flow Diagram Showing the Production Process for Harley Davidson, York, PA.

PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-15 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Product-Focused Strategy

 Facilities are organized by product  High volume, low variety products  Where found   Discrete unit manufacturing Continuous process manufacturing  Other names   Line flow production Continuous production

Products A & B 1 Operation 2

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© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Product Focus

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Product-Focused Strategy Pros & Cons

 Advantages   Lower variable cost per unit Lower but more specialized labor skills   Easier production planning and control Higher equipment utilization (70% to 90%)  Disadvantages    Lower product flexibility More specialized equipment Usually higher capital investment PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-18 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Product-Focused Examples

Soft Drinks (Continuous, then Discrete) Light Bulbs (Discrete)

© 1995 Corel Corp.

© 1995 Corel Corp.

© 1984-1994 T/Maker Co.

Paper (Continuous)

PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-19

Mass Flu Shots (Discrete)

© 1995 Corel Corp.

© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Flow Diagram Showing the Steelmaking Process at NUCOR

PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-20 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

A Comparison (1)

Process Focus

(Low volume, High variety)

Repetitive Focus

(Modular)

Product focus

(High-volume, low-variety) 1. Small quantity, large variety of products 2. General purpose equipment Long runs, standardized product, from modules Special equipment aids in use of assembly line Large quantity, small variety of products Special purpose equipment

Mass Customization

(High-volume, high-variety Large quantity, large variety of products Rapid changeover on flexible equipment PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-21 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

A Comparison (2)

Process Focus

3 Broadly skilled operators 4 Many instructions because of change in jobs 5 Raw material high relative to product value

Repetitive Focus Product focus

Modestly trained employees Reduced training and number of job instructions JIT techniques used Operators less broadly skilled Few work orders and job instructions Raw material low relative to product value

Mass Customization

Flexible operators trained for customization Custom orders require many instructions Raw material low relative to product value PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-22 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

A Comparison (3)

Process Focus

6 WIP high relative to output 7 Units move slowly thru plant 8 Finished goods made to order, not stored

Repetitive Focus

JIT techniques used Movement measured in hours & days Finished goods made to frequent forecasts

Product focus Mass Customization

WIP low relative to output Units move swiftly thru facility Finished goods made to forecast, then stored WIP driven down by JIT, kanban, lean production Goods move swiftly thru facility Finished goods made to order PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-23 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

A Comparison (4)

Process Focus Repetitive Focus Product focus

9 Scheduling complex and concerned with trade-off between inventory, capacity, and customer service 10 Fixed costs low, variable costs high Scheduling based on building models from a variety of forecasts Fixed costs dependent on flexibility of facilities Scheduling relatively simple, concerns establishing sufficient rate of output to meet forecasts Fixed costs high, variable costs low

Mass Customization

Scheduling sophisticated to accommodate customization Fixed costs high; variable costs must be low PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-24 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

A Comparison (5)

Process Focus

11 Costing, done by job, is estimated prior to doing job but only known after doing job

Repetitive Focus

Costs usually known based on experience

Product focus

Because of high fixed costs, cost dependent on utilization of capacity

Mass Customization

High fixed costs and dynamic variable costs PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-25 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Process Continuum

Process Focused (intermittent process) Repetitive Focus (assembly line) Product Focused (continuous process)

Continuum

High variety, low volume Low utilization (5% - 25%) General-purpose equipment Modular Flexible equipment Low variety, high volume High utilization (70% - 90%) Specialized equipment PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-26 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Volume and Variety of Products

Volume and Variety of Products One or very few units per lot Very small runs, high variety Modest runs, modest variety Long runs, modest variations Very long runs, changes in attributes Equipment utilization Low Volume High Variety Process (Intermittent) Repetitive Process (Modular) High Volume Low Variety Process (Continuous) Projects Job Shops Poor Strategy (High variable costs) Mass Customization Disconnected Repetitive Connected Repetitive Continuous 5%-25% 20%-75% 70%-80% PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-27 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Mass Customization

 Using technology and imagination to rapidly mass-produce products that cater to sundry unique customer desires.

 Under mass customization the three process models become so flexible that distinctions between them blur, making variety and volume issues less significant.

PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-28 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Mass Customization - More Choices Than Ever

Item Vehicle models Vehicle styles Bicycle types Software titles Web sites Movie releases New book titles Houston TV channels Breakfast cereals Item SKUs in supermarkets PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-29 Number of Choices Early 1970s Early 21 st 140 Century 260 18 8 0 0 267 40,530 5 160 14,000 1,212 19 300,000 30,727,296 458 77,446 185 340 150,000 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Process Strategies

Repetitive Focus

Modular design Flexible equipment Modular techniques

Mass Customization

Effective scheduling techniques

Process-focused

High variety, low volume Low utilization (5% - 20%) General purpose equipment PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-30 Rapid throughput techniques

Product-focused

Low variety, high volume High utilization (70% - 80%) Specialized equipment © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Questions for Process Analysis and Design

 Is the process designed to achieve competitive advantage in terms of differentiation, response, or low cost?

 Does the process eliminate steps that do not add value?

 Does the process maximize customer value as perceived by the customer?

 Will the process win orders?

PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-31 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Crossover Charts

Fixed cost Variable cost $ $ $ Process A $ 400,000 300,000 200,000 V 1 (2,857) V 2 (6,666) PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e Process B Process C Fixed cost – Process A Volume 7-32 Fixed cost – Process B Fixed cost – Process C © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Tools for Process Design

 Flow Diagrams  Process Charts  Time-Function/Process Mapping  Work Flow Analysis PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-33 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Production Process Flow Diagram

Purchasing (order inks, paper, other supplies) Customer Customer sales representative take order Accounting Vendors Receiving Warehousing (ink, paper, etc.) Prepress Department (Prepare printing plates and negatives) Printing Department Collating Department Gluing, binding, stapling, labeling Information flow Material flow Polywrap Department Shipping PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-34 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Time Function Map (Baseline)

Customer Sales Order Product Process Order Production control Wait Print Plant A Wait Warehouse Wait Wait Receive product Plant B Extrude Transport 12 days 13 days 1 day

PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e

Move 4 days

52 days 7-35

1 day 10 days 1 day 9 days Move 1 day

© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Time Function Map (Target)

Customer Sales Order Product Process Order Production control Wait Plant Warehouse Transport 1 day 2 days Print

WIP 6 days

1 day Extrude Wait 1 day Receive product Move 1 day

PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-36 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Process Chart Example

SUBJECT: Request tool purchase Dist (ft) 75 Time (min) Symbol  D   D   D   D  Description Write order On desk To buyer Examine  = Operation;  = Transport;  D = Delay;  = Storage = Inspect; PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-37 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Process Chart – Hamburger Assembly

Dist. (Ft) Time (Mins) Chart Symbols Process Description  

Meat Patty in Storage 1.5

.05

 

Transfer to Broiler 1.0

.5

.5

3.5

2.50

.05

.05

.15

.10

.20

.05

3.15

                2 4 1 - 2

Broiler Visual Inspection Transfer to Rack Temporary Storage Obtain Buns, Lettuce, etc.

Assemble Order Place in Finish Rack

TOTALS Value-added time = Operation time/Total time = (2.50+.20)/3.15=85.7% PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-38 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Service Blueprint for Service at Ten Minute Lube, Inc.

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Work Flow Analysis - Four Phases



Request

from a customer or an offer to provide services by a performer 

Negotiation

, allowing the customer and the performer to agree on how the work should be done and what will constitute customer satisfaction  

Performance Acceptance

were met.

of the assignment and completion , closing the transaction provided the customer expresses satisfaction and agrees that the conditions PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-40 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Attaining Lean Production

         Focus on inventory reduction Build systems that help employees Reduce space requirements Develop close relationships with suppliers Educate suppliers Eliminate all but value-added activities Develop the workforce Make jobs more challenging Set sights on perfection!

PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-41 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Customer Interaction and Process Strategy

Low High Mass Service Professional Service Commercial Banking Personal banking General purpose law firms Full-service stockbroker Retailing Boutiques Service Factory Limited service stockbroker Warehouse and catalog stores Law clinics Fast food restaurants Airlines No frills airlines Service Shop For-profit hospitals Fine dining restaurants Hospitals Degree of Interaction and Customization

PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-42 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Techniques for Improving Service Productivity



Strategy

Separation  Self-service  Postponement  Focus 

Technique

Structure must go where service is offered service so customers  Self-service so customers examine, compare and evaluate at their own pace 

Customizing

at delivery 

Restricting

the offerings PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-43 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Techniques for Improving Service Productivity - Continued

 Modules  Automation  Scheduling  Training  Modular selection of service. Modular production  Separating services that lend themselves to automation    Precise personnel scheduling Clarifying the service options Explaining problems  Improving employee flexibility PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-44 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

More Opportunities to Improve Service Processes

 Layout  Human Resources  Technology PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-45 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Production Process & Technology Alternatives

# Different Products or Parts High General Purpose, NC, CNC CIM Flexible Manufacturing System Dedicated Automation Low Low Volume of Products or Parts High PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-46 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Areas of Technology

 Machine technology  Automatic identification systems (AIS)  Process control  Vision system  Robot  Automated storage and retrieval systems (ASRS)  Flexible manufacturing systems (FMS)  Computer-integrated manufacturing (CIM) PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-47 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Machine Technology

 Increased precision  Increased productivity  Increased flexibility  Decreased pollution  Decreased size  Decreased power requirements PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-48 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Process Control

 Increased process stability  Increased process precision  Real-time provision of information for process evaluation  Multi-mode information presentation PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-49 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Automatic Identification Systems (AIS)

 Improved data acquisition  Increased scope of process automation PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-50 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Vision Systems

 Particular aid to inspection  Consistently accurate  Never bored  Modest cost  Superior to individuals performing the same tasks PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-51 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Robots

 Perform monotonous, or dangerous tasks, or those requiring significant strength or endurance  Enhanced consistency, accuracy, speed strength, power when substituted for human effort PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-52 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Automated Storage and Retrieval Systems (ASRS)

 Automated placement and withdrawal of parts and products  Particularly useful in inventory and test areas of manufacturing firms PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-53 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Automated Guided Vehicle (AGV)

 Electronically controlled movement of products and/or individuals PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-54 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Flexible Manufacturing Systems (FMS)

 Computer controls both the workstation and the material handling equipment  Computer control enhance flexibility  Can economically produce low volume at high quality  Reduced costs of changeover and low utilization  Stringent communication requirement between components within it PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-55 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Computer Integrated Manufacturing (CIM)

 Extension of flexible manufacturing systems  Backwards to engineering and inventory control  Forward into warehousing and shipping  Can also include financial and customer service areas  Reducing the distinction between low volume/high-variety, and high-volume/low-variety production  Heavy reliance on information technology PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-56 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Computer Integrated Manufacturing

PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-57 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Technology in Services

Service Industry Example

Financial services Debit cards, electronic funds transfer, ATMs, Internet stock trading Education Utilities and government Restaurants and foods Electronic bulletin boards, on-line journals Automated one-man garbage trucks, optical mail sorters, scanners, flood warning systems Wireless orders from waiters to kitchen, robot butchering, transponders on cars to track drive-thrus Communication Hotels Wholesale/retail trade Electronic publishing, interactive TV Electronic check-in/check-out, electronic key/lock systems Point-of-sale terminals, e-commerce, electronic communication between store and supplier, bar coded data PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-58 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Technology in Services - Continued

Service Industry Example

Transportation Health care Airlines Automatic toll booths, satellite-directed navigation systems, route planning, progress monitoring On-line patient monitoring, on-line medical information systems, robotic surgery, expert system diagnosis assistance Ticketless travel, scheduling, Internet ticket sales, improved navigation and route planning PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-59 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Process Reengineering

 The fundamental rethinking and radical redesign of business processes to bring about dramatic improvements in performance  Relies on reevaluating the purpose of the process and questioning both the purpose and the underlying assumptions  Requires reexamination of the basic process and its objectives  Focuses on activities that cross boundaries PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-60 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Showing Sensitivity to the Environment

 Make products recyclable  Use recycled materials  Use less harmful ingredients  Use light components  Use less energy  Use less materials PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-61 © 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458

Factors Affecting Process Alternatives

 Production flexibility   Product volume Product variety  Technology  Cost  Human resources  Quality  Reliability

These factors reduce the number of alternatives!

© 1984-1994 T/Maker Co.

© 2004 by Prentice Hall, Inc., Upper Saddle River, N.J. 07458 PowerPoint presentation to accompany Heizer/Render – Principles of Operations Management, 5e, and Operations Management, 7e 7-62