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Operations Management: Processes and Supply Chains, 12th Edition

by Lee J. Krajewski, Manoj K. Malhotra, Larry P. Ritzman

January 2018

Intermediate to advanced

480 pages

236h 9m

English

Pearson

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New to This EditionSolving Teaching and Learning ChallengesDeveloping Employability SkillsInstructor Teaching Resources
Learning Goals
Historical Evolution and Perspectives
How Processes WorkNested ProcessesService and Manufacturing ProcessesDifferencesSimilarities
Core ProcessesSupport ProcessesSupply Chain Processes

Corporate StrategyEnvironmental ScanningDeveloping Core CompetenciesDeveloping Core ProcessesDeveloping Global StrategiesMarket AnalysisMarket SegmentationNeeds Assessment
Order Winners and QualifiersUsing Competitive Priorities: An Airline ExampleIdentifying Gaps between Competitive Priorities and Capabilities
Productivity ImprovementMeasuring ProductivityThe Role of ManagementGlobal CompetitionComparative Cost AdvantagesDisadvantages of GlobalizationEthical, Workforce Diversity, and Environmental IssuesThe Internet of ThingsOperations Management ApplicationsConcerns and Barriers
Adding Value with Process Innovation
Learning Goals
Evaluating Services or ProductsEvaluating Processes
Decision Making under CertaintyDecision Making under UncertaintyDecision Making under Risk
Break-Even Analysis
Solution
Solution
Solution
Solution
Break-Even AnalysisPreference MatrixDecision TheoryDecision Trees
2 Process Strategy and AnalysisLearning Goals
Customer-Contact MatrixCustomer Contact and CustomizationProcess Divergence and FlowService Process StructuringFront OfficeHybrid OfficeBack Office
Product-Process MatrixManufacturing Process StructuringJob ProcessBatch ProcessLine ProcessContinuous-Flow ProcessProduction and Inventory StrategiesDesign-to-Order StrategyMake-to-Order StrategyAssemble-to-Order StrategyMake-to-Stock StrategyLayout
Customer InvolvementPossible AdvantagesPossible DisadvantagesResource FlexibilityWorkforceEquipmentCapital IntensityAutomating Manufacturing ProcessesAutomating Service ProcessesEconomies of Scope
Decision Patterns for Service ProcessesDecision Patterns for Manufacturing ProcessesGaining FocusFocus by Process SegmentsFocused Service OperationsFocused Factories
Process ReengineeringProcess ImprovementProcess AnalysisSix Sigma Process Improvement Model
FlowchartsSwim Lane FlowchartService BlueprintWork Measurement TechniquesTime Study MethodElemental Standard Data MethodPredetermined Data MethodWork Sampling MethodLearning Curve AnalysisProcess ChartsData Analysis ToolsChecklistsHistograms and Bar ChartsPareto ChartsScatter DiagramsCause-and-Effect DiagramsGraphs
Questioning and BrainstormingBenchmarkingImplementing
Learning Goals
Prevention CostsAppraisal CostsInternal Failure CostsExternal Failure CostsEthical Failure Costs
Total Quality ManagementCustomer SatisfactionEmployee InvolvementContinuous ImprovementSix Sigma
Variation of OutputsPerformance MeasurementsSamplingSampling DistributionsCommon CausesAssignable CausesControl ChartsControl Charts for VariablesR-Chartx ¯ -ChartControl Charts for Attributesp-Chartsc-Charts
Defining Process CapabilityProcess Capability IndexProcess Capability RatioUsing Continuous Improvement to Determine the Capability of a Process
The ISO 9001:2008 Documentation StandardsMalcolm Baldrige Performance Excellence Program
Learning Goals
Measures of Capacity and UtilizationOutput Measures of CapacityInput Measures of CapacityUtilizationEconomies of ScaleSpreading Fixed CostsReducing Construction CostsCutting Costs of Purchased MaterialsFinding Process AdvantagesDiseconomies of Scale
Sizing Capacity CushionsTiming and Sizing ExpansionExpansionist StrategyWait-and-See StrategyLinking Capacity and Other Decisions
Step 1: Estimate Capacity RequirementsUsing Output MeasuresUsing Input MeasuresStep 2: Identify GapsStep 3: Develop AlternativesStep 4: Evaluate the AlternativesQualitative ConcernsQuantitative Concerns
Waiting-Line ModelsSimulationDecision Trees
Learning Goals
Customer PopulationThe Service SystemNumber of Lines Arrangement of Service Facilities Priority RuleProbability DistributionsArrival DistributionService Time Distribution
Single-Server ModelLittle’s LawFinite-Source Model
SimQuick
Structure of Waiting-Line ProblemsUsing Waiting-Line Models to Analyze Operations
Solution
Structure of Waiting-Line ProblemsUsing Waiting-Line Models to Analyze Operations
Learning Goals
Key Principles of the TOC
Identifying BottlenecksRelieving BottlenecksDrum-Buffer-Rope Systems
Line BalancingPrecedence Diagram Desired Output Rate Cycle Time Theoretical Minimum Idle Time, Efficiency, and Balance Delay Finding a Solution Rebalancing the Assembly LineManagerial ConsiderationsPacing Behavioral Factors Number of Models Produced Cycle Times
Learning Goals
Supply Chain Considerations in Lean SystemsClose Supplier Ties Small Lot Sizes Process Considerations in Lean SystemsPull Method of Work Flow Quality at the Source Uniform Workstation Loads Standardized Components and Work Methods Flexible Workforce Automation Five S PracticesTotal Productive Maintenance Toyota Production SystemHouse of Toyota
One Worker, Multiple MachinesGroup Technology
General Operating RulesDetermining the Number of ContainersOther Kanban SignalsContainer System Containerless System
Current State MapFuture State Map
Organizational ConsiderationsThe Human Costs of Lean Systems Cooperation and Trust Reward Systems and Labor Classifications Process ConsiderationsInventory and SchedulingSchedule Stability Setups Purchasing and Logistics
Learning Goals
Defining the Scope and Objectives of a ProjectSelecting the Project Manager and TeamRecognizing Organizational Structure
Defining the Work Breakdown StructureDiagramming the NetworkEstablishing Precedence RelationshipsEstimating Activity Times
Critical PathProject ScheduleActivity SlackGantt Chart
Cost to CrashMinimizing Costs
Risk-Management PlansSimulationStatistical AnalysisAnalyzing ProbabilitiesNear-Critical Paths
Monitoring Project StatusOpen Issues and RisksSchedule StatusMonitoring Project ResourcesControlling Projects
Developing the Project ScheduleAnalyzing Cost–Time Trade-offsAssessing and Analyzing Risks
Solution
Solution
Developing the Project ScheduleAnalyzing Cost–Time Trade-offsAssessing and Analyzing Risks
Questions
8 ForecastingLearning Goals
Demand PatternsDemand Management OptionsComplementary ProductsPromotional PricingPrescheduled AppointmentsReservationsRevenue ManagementBacklogsBackorders and Stockouts
Deciding What to ForecastLevel of AggregationUnits of MeasurementChoosing the Type of Forecasting Technique
Cumulative Sum of Forecast ErrorsDispersion of Forecast ErrorsMean Absolute Percent ErrorComputer Support
Naïve ForecastHorizontal Patterns: Estimating the AverageSimple Moving AveragesWeighted Moving AveragesExponential SmoothingTrend Patterns: Using RegressionSeasonal Patterns: Using Seasonal FactorsCriteria for Selecting Time-Series MethodsUsing Statistical CriteriaUsing a Holdout SampleUsing a Tracking Signal
Big DataVolumeVarietyVelocityA Typical Forecasting ProcessUsing Multiple Forecasting MethodsAdding Collaboration to the ProcessForecasting as a Nested Process
Forecast ErrorCausal Methods: Linear RegressionTime-Series Methods
Solution
Solution
Solution
Solution
Causal Methods: Linear RegressionTime-Series Methods
In-Class Exercise—Part 1In-Class Exercise—Part 2In-Class Exercise—Parts 3 and Beyond
Learning Goals
Pressures for Small InventoriesCost of CapitalStorage and Handling CostsTaxes, Insurance, and ShrinkagePressures for Large InventoriesCustomer ServiceOrdering CostSetup CostLabor and Equipment UtilizationTransportation CostPayments to Suppliers
Accounting InventoriesOperational InventoriesCycle InventorySafety Stock InventoryAnticipation InventoryPipeline Inventory
Cycle InventorySafety Stock InventoryAnticipation InventoryPipeline Inventory
Calculating the EOQManagerial Insights from the EOQ
Selecting the Reorder Point when Demand and Lead Time are ConstantSelecting the Reorder Point when Demand Is Variable and Lead Time Is ConstantStep 1: Service Level PolicyStep 2: Distribution of Demand during Lead TimeStep 3: Safety Stock and Reorder PointSelecting the Reorder Point when Both Demand and Lead Time are VariableSystems Based on the Q SystemTwo-Bin SystemBase-Stock SystemCalculating Total Q System CostsAdvantages of the Q System
Selecting the Time Between ReviewsSelecting the Target Inventory Level when Demand is Variable and Lead Time is ConstantSelecting the Target Inventory Level when Demand and Lead Time are VariableSystems Based on the P SystemSingle-Bin SystemOptional Replenishment SystemCalculating Total P System CostsAdvantages of the P System
Types of InventoryEconomic Order QuantityContinuous Review SystemPeriodic Review System
Solution
Solution
Solution
Solution
Solution
Solution
Types of InventoryInventory Reduction TacticsABC AnalysisEconomic Order QuantityContinuous Review SystemPeriodic Review System
Questions
Industry and Company PreviewDRAMSimulation
Learning Goals
Noninstantaneous ReplenishmentQuantity DiscountsOne-Period Decisions
Solution
Solution
Solution
Noninstantaneous ReplenishmentQuantity DiscountsOne-Period Decisions
Learning Goals
Level 1: Sales and Operations PlanningAggregationInformation InputsRelated PlansLevel 2: Resource PlanningLevel 3: Scheduling
Chase StrategyLevel StrategyConstraints and CostsSales and Operations Planning as a Process
Spreadsheets for a ManufacturerSpreadsheeets for a Service Provider
Job and Facility SchedulingGantt Progress ChartGantt Workstation ChartWorkforce SchedulingConstraintsDeveloping a Workforce ScheduleSequencing Jobs at a WorkstationPriority Sequencing RulesPerformance MeasuresSoftware Support
Solution
Solution
Solution
S&OP StrategiesSpreadsheets for Sales and Operations PlanningScheduling
Questions
Learning Goals
Objective FunctionDecision VariablesConstraintsFeasible RegionParametersLinearityNonnegativity
Plot the ConstraintsIdentify the Feasible RegionPlot the Objective Function LineFind the Visual SolutionFind the Algebraic SolutionSlack and Surplus VariablesSensitivity Analysis
Simplex MethodComputer Output
Transportation Method for Sales and Operations Planning
Solution
Solution
Formulating a Linear Programming ModelGraphic AnalysisComputer AnalysisThe Transportation Method
Learning Goals
Dependent Demand
Developing a Master Production ScheduleAvailable-to-Promise QuantitiesFreezing the MPSReconciling the MPS with Sales and Operations Plans
Bill of MaterialsInventory RecordGross RequirementsScheduled ReceiptsProjected On-Hand InventoryPlanned ReceiptsPlanned Order ReleasesPlanning FactorsPlanning Lead TimeLot-Sizing RulesFixed Order QuantityPeriodic Order QuantityLot for LotComparing Lot-Sizing RulesSafety StockOutputs from MRPMaterial RequirementsAction NoticesResource Requirements ReportsPerformance ReportsMRP and the EnvironmentMRP, Core Processes, and Supply Chain Linkages
How ERP Systems Are Designed
Dependent Demand for ServicesRestaurantsAirlinesHospitalsHotelsBill of Resources
Solution
Solution
Solution
Solution
Master Production SchedulingMRP Explosion Resource Planning for Service Providers
Questions
12 Supply Chain DesignLearning Goals
Supply Chains for Services and ManufacturingServicesManufacturing
Inventory MeasuresFinancial MeasuresTotal RevenueCost of Goods SoldOperating ExpensesCash FlowWorking CapitalReturn on Assets
Efficient Supply ChainsCommon DesignsResponsive Supply ChainsCommon DesignsDesigns for Efficient and Responsive Supply Chains
Competitive AdvantagesSupply Chain Design for Mass CustomizationAssemble-to-Order StrategyModular DesignPostponement
Vertical IntegrationMake-or-Buy Decisions
Measuring Supply Chain PerformanceOutsourcing Processes
Solution
Measuring Supply Chain PerformanceOutsourcing Processes
Materials (available from instructor)SetupTasksCosts and ConditionsDelaysOrdering Delay.Delivery Delay.Run the Exercise
Learning Goals
Dominant Factors in ManufacturingFavorable Labor ClimateProximity to MarketsImpact on EnvironmentQuality of LifeProximity to Suppliers and ResourcesProximity to the Parent Company’s FacilitiesUtilities, Taxes, and Real Estate CostsOther FactorsDominant Factors in ServicesProximity to CustomersTransportation Costs and Proximity to MarketsLocation of CompetitorsSite-Specific Factors
Distance MeasuresCalculating a Load–Distance ScoreCenter of Gravity
Setting Up the Initial TableauDummy Plants or WarehousesFinding a Solution
Using GISThe GIS Method for Locating Multiple Facilities
Load–Distance Method
Solution
Solution
Solution
Solution
Load–Distance MethodBreak-Even AnalysisTransportation MethodA Systematic Location Selection Process
Questions
Learning Goals
Causes of Supply Chain DisruptionsExternal CausesInternal CausesSupply Chain DynamicsIntegrated Supply Chains
Supply Chain Implications of AMEnablers of Adopting AM
DesignAnalysisDevelopmentFull Launch
SourcingSupplier SelectionSupplier Certification and EvaluationDesign CollaborationNegotiationCompetitive OrientationCooperative OrientationBuyingElectronic Data InterchangeCatalog HubsExchangesAuctionsLocus of ControlInformation ExchangeRadio Frequency IdentificationVendor-Managed Inventories
Customer Demand PlanningSupply PlanningProductionLogistics
MarketingBusiness-to-Consumer SystemsBusiness-to-Business SystemsOrder PlacementCustomer Service
Operational RisksFinancial RisksSecurity RisksPerformance Measures
Supplier Relationship ProcessOrder Fulfillment Process
SolutionKramerSunrise
Solution
SolutionOne Team In-HouseExpected Value
Supplier Relationship ProcessOrder Fulfillment ProcessSupply Chain Risk Management
Learning Goals
Supply Chain Design for Reverse LogisticsFinancial Implications
Transportation DistanceFreight DensityTransportation Mode
Organizing for Disaster ReliefManaging Disaster Relief Operations
Buyer–Supplier RelationshipsFacility LocationInventory Management
Energy Efficiency
Solution
Solution
Energy Efficiency
Learning Goals
Data CollectionRandom-Number AssignmentModel FormulationAnalysis
Generating Random NumbersRandom-Number AssignmentSimulation with Two Uncontrollable Variables
Solution
Solution
The Monte Carlo Simulation ProcessSimulation with Excel SpreadsheetsTable of Random Numbers
Learning Goals
Future Value of an InvestmentPresent Value of an InvestmentPresent Value FactorsAnnuities
Depreciation and TaxesStraight-Line Depreciation Accelerated Depreciation Taxes Analysis of Cash FlowsNet Present Value MethodInternal Rate of Return MethodPayback MethodComputer Support
Time Value of MoneyMethods of Financial Analysis
Learning Goals
Single-Sampling PlanDouble-Sampling PlanSequential-Sampling Plan
Drawing the OC Curve
Sample Size EffectAcceptance Level Effect
Average Outgoing Quality
Solution
Operating Characteristic CurvesSelecting a Single-Sampling PlanAverage Outgoing Quality
Learning Goals
Developing a Work StandardMethods for Measuring Output Rates
Step 1: Selecting Work ElementsStep 2: Timing the ElementsStep 3: Determining Sample SizeStep 4: Setting the StandardOverall Assessment of Time StudyElemental Standard Data Method
Work Sampling ProcedureSample SizeSampling ScheduleOverall Assessment of Work SamplingManagerial Considerations in Work Measurement
Time Study MethodWork Sampling Method
Solution
Solution
Time Study MethodWork Sampling Method
Learning Goals
BackgroundLearning Curves and Competitive Strategy
Bid PreparationFinancial PlanningLabor Requirement Estimation
Developing Learning Curves
Developing Learning CurvesUsing Learning Curves
Learning Goals
Priority Sequencing RulesScheduling Jobs for One WorkstationSingle-Dimension Rules Multiple-Dimension Rules Scheduling Jobs for Multiple Workstations
Performance Measures for Scheduling ProcessesJob Shop Scheduling
Solution
Solution
Solution
Job Shop SchedulingFlow Shop Scheduling
Questions
Learning Goals
Space RequirementsCloseness FactorsConstraints
Weighted-Distance MethodEvaluating Block Plans
Step 2: Develop a Block Plan
Solution
Step 2: Develop a Block Plan
Questions

Content preview from Operations Management: Processes and Supply Chains, 12th Edition

S&OP Supply Options

Developing sales and operations plans means making decisions. In this section, we concentrate on the supply options that ultimately are combined to develop a sales and operations plan. Given demand forecasts, operations managers must develop a plan to meet the demand. There are six options that can be used singly or in combination to arrive at a plan.

Anticipation Inventory Anticipation inventory can be used to absorb uneven rates of demand or supply. For example, a plant facing seasonal demand can stock anticipation inventory during light demand periods and use it during heavy demand periods. Manufacturers of air conditioners, such as Whirlpool, can experience 90 percent of their annual demand during just 3 months of a year. ...

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Publisher Resources

ISBN: 9780134741062