TY - BOOK AU - Krajewski,Lee TI - Operations management SN - 9780536474407 U1 - 658.5 PY - 2007/// CY - New Jersey PB - Pearson pub. N1 - CHAPTER 1 Operations As a Competitive FedEx 3 Weapon 3 Operations Management Across the Organization 4 A Process View 5 How Processes Work 5 Nested Processes 6 Customer-Supplier Relationships 7 Service and Manufacturing Processes 7 Adding Value: The Value Chain 8 Core Processes 9 Support Processes 10 Adding Value with Processes 10 Operations Management As a Set of Decisions 10 Managerial Practice 1.1 Operational Innovation Is a Competitive Weapon at Progressive insurance 11 Decis/on-Mafe;ng Tools 12 Supporting the Firm's Goals 12 Trends in Operations Management 12 Productivity Improvement 13 Global Competition 14 Rapid Technological Change 15 Ethical, Workforce Diversity, and Environmental Issues 16 Addressing the Challenges in Operations Management 17 Managerial Practice 1.2 High-Tech Operations Help Recycle High-Tech Equipment 17 Part 1: Using Operations to Compete 17 Part 2; Managing Processes 18 Part 3: Managing Value Chains Student CD-ROM and Internet Resources 18 Key Equation 18 Managerial Challenge Operations Asa Competitive Weapon at Starwood 19 Key Terms 19 Solved Problems 20 // Discussion Questions 20 Problems 21 Active Model Exercise 22 Case Chad's Creative Concepts 23 Selected References 24 CHAPTER 3 Project Management 69 Bechtel Group, Inc. 69 Project Management Across The Organization 70 contents xi L/smg Projects to Implement Operations Strategy 71 Cross-Functional Interaction 71 Defining and Organizing Projects 72 Defining the Scope and Objectives Of a Project 72 Select/ng the Project Manager and Team 72 Organizational Structure 73 Managerial Practice 3.1 Virtual Global Teaming at Baxter International 74 Planning Projects 75 Defining the Work Breakdown Structure 75 Diagramming the Network 76 Developing the Schedule 78 Analyzing Cost-Time Trade-Offs 84 Managerial Challenge Project Management at the Phoenician 85 Assessing Risks 91 Managerial Practice 3.2 Boston's Big Dig Project Poses Many Challenges 92 Critical Chain 97 Resource-Related Problems 97 The Critical Chain Approach 98 Monitoring and Controlling Projects 98 Monitoring Project Status 98 Monitoring Project Resources 99 Controlling Projects 100 Student CD-ROM and Internet Resources 101 Key Equations 101 Key Terms 102 Solved Problems 102 Discussion Questions 106 Problems 106 Active Model Exercise 113 Case The Pert Studebaker 115 ' " " Selected References 117 PART II Managing Processes 118 CHAPTER 4 Process Strategy 119 Duke Power 119 ProcessStrategy Across the Organization 120 Process Strategy 121 Major Process Decisions 121 Process Stojcture in Sen/ices 122 Nature of Sen/ice Processes: Customer Contact 122 Customer-Contact Matrix 125 Sen/ice Process Structuring 126 Embedding Strategy into Service Processes 127 CONTENTS IVIanageriai Practice 4.1 'Processes in the Front and Back Office • at the Ritz-Carlton 128 Process Structure in Manufacturing 128 Product-Process Matrix 129 Manufacturing Process Structuring 129 Production and Inventory Strategies 131 Embedding Strategy into Manufacturing Processes 132 Customer Involvement 133 Possible Disadvantages 133 Possible Advantages 134 Resource Flexibility 134 Workforce 135 Equipment 135 Capital Intensity 136 Automating Manufacturing Processes 136 Automating Service Processes 137 Managerial Practice 4.2 Flexible Automation at R.R. Donnelley 137 Economies ofScope 138 Strategic Fit 138 Decision Patterns for Service Processes 139 Decision Patterns for Manufacturing Processes 139 Gaining Focus 140 Strategies for Change 141 Process Reengineering 141 Process Improvement 142 Student CD-ROM and Internet Resources 142 Key Terms 143 Discussion Questions 143 Problems 143 Case Custom Molds, Inc. 145 Selected References 148 CHAPTER 5 Process Analysis 151 Omgeo 151 Process Analysis Across the Organization 153 A Systematic Approach 153 Step 1: Identify Opportunities 153 Step 2: Define the Scope 154 Step 3: Document the Process 154 Step 4: Evaluate Performance 154 Step 5: Redesign the Process 155 Step 6: Implement Changes 155 Documenting the Process 155 Flowcharts 155 Managerial Pra^ice 5.1 Evaluating Performance at McDonald's 156 Serv/ce Blueprints 158 Process Charts 159 Evaluating Performance 161 Data Analysis Tools 161 Managerial Challenge Process Analysis at Stanwood 162 Data Snooping 166 Simulation 168 Redesigning the Process 169 Generating Ideas: Questioning and Brainstorming 169 Managerial Practice 5.2 Redesigning Processesat Baptist Memorial Hospital 170 Benchmarking 171 Managing Processes 172 Student CD-ROM and Internet Resources 173 Key Terms 173 Solved Problems_173 Discussion Questions 176 Problems 177 Active Model Exercfse 183 Case Jose's Authentic Mexican Restaurant 184 Selected References 185 SUPPLEMENT B Simulation 187 Reasons for Using Simulation 188 The Simulation Process 188 Data Collection 188 Random-Number Assignment 190 Model Formulation 191 Analysis 192 Computer Simulation 193 Simulation w/'th Excel Spreadsheets 193 Simulation with More Advanced Software 196 Student CD-ROM and Internet Resources 198 Key Terms 193 Solved Problem 198 Problems 199 Selected References 203 CHAPTER 6 Process Performance and Quality 205 Crowne Plaza Christchurch 205 Process Performance and Quality Across the Organization 206 Costs of Poor Process Performance and Quality 206 Prev(snt/on Costs 207 Appraisal Costs 207 Internal Failure Costs 207 External Failure Costs 207 Total Quality Management 208 Customer Sat/sfact/on 208 Emp/oyee'/nvo/vement 270 Cont/nuous Improvement 211 Statistical Process Control 213 Variation of Outputs 213 Managerial Practice 6.1 TQM and SPC Help ADM Cocoa Maintain a Sweet Business 214 Managerial Practice 6.2 Quality Measures in the Health Care Industry 215 Control Charts 218 Statistical Process Control Methods 220 Control Charts for Variables 220 Control Charts for Attributes 224 Process Capability 227 Defining Process Capability 227 Using Continuous Improvement to Determine the Capability ofa Process 229 Quality Engineering 230 Six Sigma 230 Managerial Practice 6.3 Applying the Six-Sigma Process at Scottsdale Healthcare's Osborn Hospital 232 Six Sigma Improvement Model 233 Implementation 233 International Quality Documentation Standards 234 The /SO 9000 Documentation Standards 234 ISO 14000: AnEnvironmental Management System 234 Managerial Challenge Process Performance and Quality at Starwood 235 Benefits of/SO Cert/ficat/on 236 Malcolm Baldrige National Quality Award 236 Student CD-ROM and Internet Resources 237 Key Equat/'ons 237 Key Terms 237 Solved Problems 238 Discussion Questions 240 Problems 240 Active Model Exercise 248 Experiential Learning Statistical Process Control with a Coin Catapult 249 Selected References 251 CHAPTER 9 Lean Systems 347 Toyota Production System 347 Lean Systems Across the Organization 349 Characteristics of Lean Systems for Services and Manufacturing 349 Pu// /Wethod of Work Flow 349 Qua//ty at the Source 350 Small Lot Sizes 350 Uniform Workstation Loads 351 Standardized Components and Work Methods 351 Close Supplier Ties 352 Flexible Workforce 352 Line Flows 353 Automation 353 Five S 353 Preventive Maintenance 354 Continuous Improverrient Using a Lean Systems Approach 354 Managerial Practice 9.1 Lean Systems at New Balance Athletic Shoe Company 355 The Kanban System 356 Genera/ Operating Rules 357 Determining the Number of Containers 357 Other Kanbah Signals 359 Managerial Practice 9.2 CONTENTS Lean Systems at University of Pittsburgh Medical Center Shadyside 359 Value Stream Mapping 360 JIT II 362 Operational Benefits and Implementation Issues 362 Organizational Considerations 362 Managerial Practice 9.3 Implementing Manufacturing Principles at Cessna 363 Process Considerations 364 Inventoryand Scheduling 364 Student CD-ROM and Internet Resources 365 Key Equation 365 Key Terms 365 Solved Problem 365 Discussion Questions 366 Problems 366 y>. Case Copper Kettje Catering 368 \\ Selected References 369 V xiv CONTENTS PART III Managing Value Chains 370 CHAPTER,10 Supply Chain Strategy 371 Dell Inc. 371 Supply Chain Strategy Across the Organization 372 SupplyChainsfor Services and Manufacturing 373 Services 373 Manufacturing 374 Managerial Practice 10.1 Supply Chain Excellence at 7-Eleven Japan 375 Measures of Supply Chain Performance 376 Inventory Measures 376 Process Measures 379 Links to Financial Measures 379 Supply Chain Dynamics 380 External Causes 381 Internal Causes 382 Integrated Supply Chains 383 The Customer Relationship Process 383 E-Commerce and the Marketing Process 383 E-Commerce and the Order Placement Process 384 The Order Fulfillment Process 385 Inventory Placement 386 Vendor-Managed Inventories 386 Continuous Replenishment Program 387 Radio Frequency Identification 387 Distribution Processes 387 Managerial Practice 10.2 Continuous Replenishment at the Campbell Soup Company 388 Supplier Relationship Process 389 Supplier Selection and Certification 390 Supp//er Relations 390 Electronic Purchasing 391 Centralized Versus Localized Buying 392 ValueAnalysis 393 Supply Chain Strategies 393 Strategic Focus 393 Managerial Challenge Supply Chain Strategy at Starwood 394 Managerial Practice 10.3 AResponsive Supply Chain Helps a European Clothing Retailer DelightCustomers 396 Mass Customization 397 Managerial Practice 10.4 MassCustomization at Lands' End 399 Lean Supply Chains 400 Outsourcing and Offshoring 401 Virtual Supply Chains 403 Managerial Practice 10.5 HCL Corporation Provides Service Processes in Virtual Value Chains 405 Student CD-ROM and fnternet Resources 406 Key Equatfons 406 Key Terms 406 Solved Problem 406 Discussion Questions 407 Problems 408 Experiential Learning Sonic Distnbutors 410 Case 1 Wolf Motors 412 Case 2 Brunsw/ck D/str/but/'on, Inc. 412 Selected References 417 CHAPTER 12 Inventory Management 461 Inventory Management at W/al-Mart 461 Inventory Management Across the Organization A62 Inventory Basics 463 Pressures for Low Inventories 463 Pressures for High Inventories 464 Types of Inventory 465 Inventory Reduction Tactics 466 Managerial Practice 12.1 Improving Customer Service Through Inventory ManagementatAmazon.com 467 Placement ofInventories 468 identifying Critical Inventory Items with ABC Analysis 469 Economic Order Quantity 470 Ca/culating the EOQ 477 Understanding the Effectof Changes 474 EOQ and Lean Systems 475 Inventory Control Systems 475 Continuous Review System 475 Periodic Review System 484 Managerial Practice 12.2 Implementing a Periodic Review Inventory System at Hewlett-Packard 486 Comparative Advantages ofthe G and P Systems 488 Hybrid Systems 489 Inventory Record Accuracy 489 \ Student CD-ROM and Internet Resources 489 Key Equations 490 KeyTefms 490 Solved Problems 490 CONTENTS D/scuss/on Questfons 496 Problems 496 Active Model Exercise 501 Experiential Learning Swift Electronic 5upply„tnc. 502 Case Parts Emporium 504 Selected References 506 SUPPLEMENT D Special Inventory Models 507 Noninstantaneous Replenishment 508 Quantity Discounts 510 One-Period Designs 512 Student CD-ROM and Internet Resources 515 Key Equations 515 Key Term 515 Solved Problems 515 Problems 517 Selected References 519 CHAPTER 15 Resource Planning 623 Starwood 623 Resource Planning Acrossthe Organization 624 Enterprise Resource Planning 624 What an ERPSystem Does 624 How ERPSystems Are Designed 625 Planning and Controlling Systems for Manufacturers 626 Dependent Demand 626 Managerial Practice 15.1 ERP at VFCorporation 627 Possible Planning and Control Systems 628 Material Requirements Planning 629 6j7/of Materials 629 Master Production Scheduling 630 Inventory Record 636 Planning Factors 639 Outputs from MRP 642 MRP and the Environment 645 Drum-Butfer-Rope System 646 Resource Planning for Service Providers 647 Dependent Demand for Services 647 Managerial Practice 15.2 The Drum-Buffer-Rope System at a U.S. Marine Corps Maintenance Center 648 6/71of Resources 649 Student CD-ROM and Internet Resources 650 Key Terms 650 So/ved Prob/ems 65? ^ D/scuss/on Questions 655 ER -