3-1 Operations Management Business Processes Chapter 3 - Hanfield.
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3-1 Operations Operations Management Management Business Processes Business Processes Chapter 3 - Hanfield Chapter 3 - Hanfield
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Transcript of 3-1 Operations Management Business Processes Chapter 3 - Hanfield.
3-1
Operations Operations ManagementManagement
Business ProcessesBusiness ProcessesChapter 3 - HanfieldChapter 3 - Hanfield
3-2
Proctor & Gamble – Old ProcessProctor & Gamble – Old Process
3-3
Proctor & Gamble – New ProcessProctor & Gamble – New Process
3-4
Business ProcessesBusiness Processes Primary processes
Providing a service, producing a product Support processes
Cost accounting, supplier management, etc. Development processes
Developing new products, training new workers, etc.
3-5
Business ProcessesBusiness Processes Cut across functions and organizations For many business processes, no single
functional area or supply chain partner has a complete view or control
General Manager
R&D Operations Marketing Controller
Product Mgmt SalesProduction Purchasing
Fabrication
Assembly
Test
Product A
Product B
Product C
West
East
South
Electronics
Mechanical
Chemical
HR
Cost General
New product development
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Improving Business ProcessesImproving Business Processes
Improving business processes is at the core of operations and supply chain management Performance level of most processes decreases
over time unless forces are exerted to maintain it Competitive pressures often force improvement Customer demands are continually increasing
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Mapping Business ProcessesMapping Business Processes Relationship maps
Process maps
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Mapping Business ProcessesMapping Business Processes Relationship maps Process maps
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Guidelines for Process ImprovementGuidelines for Process Improvement
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Improving Process PerformanceImproving Process Performance Quality Cost
productivity, efficiency Time
cycle time Flexibility
Utilize benchmarking to identify, understand, and adapt outstanding practices to improve performance
3-11
Cycle Time DriversCycle Time Drivers Waiting time Nonessential process steps Serial vs. parallel process steps Repeated steps Batching Excessive controls Outdated technology Lack of information Lack of or ineffective training
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Rummler-Brache Process Mapping
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Continuous ImprovementContinuous Improvement Small, incremental
improvements that can add up to significant performance improvements over time
Business Process ReengineeringBusiness Process Reengineering Fundamental rethinking and radical redesign of business processes to achieve dramatic organizational improvements
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Operations Operations ManagementManagement
Process ManagementProcess Management
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Low Moderate High
Volume
High
Moderate
Low
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Process DesignProcess Design
How do I produce my goods and services - meeting customer requirements - meeting specifications - within cost and other constraints
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Low Moderate High
Volume
High
Moderate
Low
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Product – Process MatrixProduct – Process Matrix
Job process• Machine shop• Hospital emergency room• King Soopers custom cakes
Batch process• Textbook printing• Forging process• King Soopers pastries
Line process• Auto assembly• Cafeteria line• King Soopers bread line
Continuous process• Oil refining process• Telephone line access• Paper production
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Low Moderate High
Volume
High
Moderate
Low
Va
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Job process• Machine shop• Hospital emergency room• King Soopers custom cakes
Batch process• Textbook printing• Forging process• King Soopers pastries
Line process• Auto assembly• Cafeteria line• King Soopers bread line
Continuous process• Oil refining process• Telephone line access• Paper production
Mass customization• Dell Computer• Benneton sweaters• Sherwin-Williams paint
Product – Process MatrixProduct – Process Matrix
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Low Moderate High
Volume
High
Moderate
Low
Va
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Job process Process-focused
Batch process Process-focused
Line process Repetitive (modular) focus
Continuous process Product-focused
Mass customization Customization at high volume
Product – Process MatrixProduct – Process Matrix
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Low Moderate High
Volume
High
Moderate
Low
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Process DesignProcess DesignLow volume, make-to-order process• Less vertical integration
• More resource flexibility
• More customer involvement
• Less capital intensity / automation
High volume, make-to-stock process• More vertical integration
• Less resource flexibility
• Less customer involvement
• More capital intensity / automation
3-20
King Soopers BakeryKing Soopers Bakery
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King Soopers BakeryKing Soopers Bakery7000
loaves/hr
1000 pastries/hr
50 cakes/hr
Bread line
Pastry line
Cake line
High Low
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Low Moderate High
Volume
High
Moderate
Low
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Process DesignProcess Design
The choice of process for any activity affects: - how expensive it is to buy & operate - how fast it is - the quality of the outputs - the ability to customize outputs - how easy it is to change (flexibility) - the need for human resources
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