Operations Management Overview
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Questions and Answers

What was the main focus of the Hawthorne studies?

  • The relationship between technology adoption and efficiency.
  • How environmental changes affected worker productivity. (correct)
  • The effectiveness of team collaboration in a workplace.
  • The impact of management techniques on employee motivation.

Which concept emphasizes the timely arrival of materials in operations management?

  • Business process reengineering
  • Time-Based Competition
  • Total Quality Management (TQM)
  • Just-In-Time (JIT) (correct)

What is the primary objective of Total Quality Management (TQM)?

  • To improve employee satisfaction through engagement.
  • To reduce operational costs significantly.
  • To innovate new products rapidly.
  • To enhance product quality and eliminate defects. (correct)

What does Supply Chain Management (SCM) primarily oversee?

<p>The flow of materials and information from suppliers to customers. (D)</p> Signup and view all the answers

Which concept refers to adapting business practices to meet global market demands?

<p>Global Marketplace (B)</p> Signup and view all the answers

What is a key characteristic of Time-Based Competition?

<p>Emphasizing the speed of innovation and service delivery. (C)</p> Signup and view all the answers

What was the significance of F.W. Harris in management science?

<p>He created the first mathematical model for inventory management. (B)</p> Signup and view all the answers

Which of the following best describes Business Process Reengineering?

<p>Restructuring methods to increase efficiency and reduce costs. (C)</p> Signup and view all the answers

What is the main focus of Total Quality Management (TQM)?

<p>Improving quality at every level of the organization (A)</p> Signup and view all the answers

Which type of cost relates to discovering poor quality before the product reaches customers?

<p>Internal Failure Cost (B)</p> Signup and view all the answers

What does the concept of 'Fitness for Use' emphasize in quality assessment?

<p>Job performance of a product (D)</p> Signup and view all the answers

What is the primary role of operations management in a company?

<p>To oversee the transformation of resources into products or services (A)</p> Signup and view all the answers

Which individual is known as the 'father of quality control'?

<p>Walter A. Shewhart (C)</p> Signup and view all the answers

Which of the following best describes tactical decisions in operations management?

<p>Routine decisions made frequently that focus on specific tasks (C)</p> Signup and view all the answers

What does 'Value for Price Paid' indicate in terms of quality?

<p>Quality is directly linked to the price paid for a product (B)</p> Signup and view all the answers

What significant concept did Adam Smith introduce in 1776?

<p>Division of labor (B)</p> Signup and view all the answers

In environmental scanning, what should companies primarily focus on?

<p>Monitoring changes in market trends, economy, politics, and society (D)</p> Signup and view all the answers

Which invention by James Watt in 1764 greatly influenced manufacturing processes?

<p>The steam engine (D)</p> Signup and view all the answers

Which of the following best describes 'Support Services Provided' in the context of quality?

<p>Includes processes and personnel supporting the product (D)</p> Signup and view all the answers

Which statement is true regarding Prevention Costs?

<p>They are costs related to training and improving processes to avoid quality issues. (C)</p> Signup and view all the answers

How did Henry Ford contribute to the field of operations management?

<p>Through the development of the moving assembly line (C)</p> Signup and view all the answers

What is a quasi-manufacturing organization characterized by?

<p>Offering intangible products that cannot be pre-made (D)</p> Signup and view all the answers

What criticism did the scientific management approach face?

<p>It was seen as a method to manipulate worker productivity without fair compensation (C)</p> Signup and view all the answers

Which statement best describes the difference between manufacturing and service organizations?

<p>Manufacturing organizations produce tangible goods that can be stocked, whereas service organizations create intangible products that cannot be pre-made. (D)</p> Signup and view all the answers

What is a characteristic of the Delphi Method in forecasting?

<p>It keeps the identities of experts anonymous. (B)</p> Signup and view all the answers

Which of the following forecasting methods is based on mathematical principles?

<p>Quantitative Forecasting (B)</p> Signup and view all the answers

What is a limitation of the Naïve Method of forecasting?

<p>It assumes future forecasts depend solely on current actuals. (D)</p> Signup and view all the answers

Which feature is essential to consider when selecting forecasting software?

<p>Customization options (B)</p> Signup and view all the answers

Statistical packages are known for being what in relation to forecasting?

<p>Powerful tools for statistical analysis. (D)</p> Signup and view all the answers

What is the main focus of the Just-in-Time (JIT) philosophy?

<p>Eliminating waste (D)</p> Signup and view all the answers

Which of the following accurately describes a pull system?

<p>Manufacturing products in response to customer demand (B)</p> Signup and view all the answers

Which element of Total Quality Management (TQM) emphasizes solving quality problems at their source?

<p>Quality at the source (D)</p> Signup and view all the answers

Which of these is NOT a key role people play in JIT?

<p>Maximizing inventory turnover (A)</p> Signup and view all the answers

What does 'continuous improvement' mean in the context of TQM?

<p>Striving to enhance performance in all organizational areas (C)</p> Signup and view all the answers

Which of the following best describes a push system in manufacturing?

<p>Products are made in anticipation of demand (D)</p> Signup and view all the answers

How does JIT impact accounting functions within a company?

<p>It streamlines understanding of production costs. (D)</p> Signup and view all the answers

Which statement about forecasts is accurate?

<p>Forecasts provide predictions that are rarely perfect. (B)</p> Signup and view all the answers

What is the primary purpose of cause-and-effect diagrams in quality management?

<p>To identify potential causes of quality problems (A)</p> Signup and view all the answers

Which quality management tool is best suited for displaying the frequency distribution of data?

<p>Histogram (A)</p> Signup and view all the answers

What does the ISO 9000 Standards certification process require from a company?

<p>Detailed documentation of quality management practices (B)</p> Signup and view all the answers

What is the focus of the Malcolm Baldrige National Quality Award?

<p>Rewarding companies excelling in high-quality standards (A)</p> Signup and view all the answers

In quality control, what distinguishes assignable causes of variation from common causes?

<p>Common causes stem from inherent process variations. (D)</p> Signup and view all the answers

Which tool is primarily used to analyze the relationship between two variables in quality management?

<p>Scatter Diagram (B)</p> Signup and view all the answers

What does continuous improvement, or 'kaizen', emphasize in the context of quality management?

<p>Regular small improvements to processes (B)</p> Signup and view all the answers

Which statistical method helps decide whether to accept or reject an entire batch of goods?

<p>Acceptance Sampling (C)</p> Signup and view all the answers

Flashcards

Operations Management (OM)

The core function that transforms resources (people, facilities, materials, tech) into products/services.

Strategic Decisions

High-level decisions setting the direction for tactical decisions.

Tactical Decisions

Short-term decisions focused on specific departments/tasks.

Industrial Revolution

Major historical period impacting manufacturing through new technology and efficiency.

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Division of Labour

Breaking down tasks to increase efficiency among workers, described by Adam Smith.

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Interchangeable Parts

Parts that are identical, allowing for easy replacement, introduced by Eli Whitney.

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Scientific Management

Approach to improve efficiency and production through systematic improvements, often criticized as exploitative.

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Moving Assembly Line

Process developed by Henry Ford, improving manufacturing through efficiency.

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Hawthorne Studies

Studies investigating how work environment changes (e.g., lighting) impact worker productivity.

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Management Science

Using quantitative methods to address operational issues in business.

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Just-In-Time (JIT)

An operations approach where materials arrive precisely when needed.

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Total Quality Management (TQM)

Focusing on quality improvements by eliminating defects and integrating quality into company culture.

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Business Process Reengineering

Restructuring a company's methods to boost efficiency, quality, and lower costs.

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Mission

Statement defining a company's purpose and goals.

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Supply Chain Management (SCM)

Managing the flow of materials and information from suppliers to customers.

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Operation Managers

Individuals responsible for ensuring smooth company operations.

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Environmental Scanning

Watching for trends in the market, economy, politics, and society to anticipate changes and adapt.

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Supply Chain

The network of activities involved in delivering a product or service to the customer.

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Total Quality Management (TQM)

Improving quality at every level of an organization, aiming for perfection.

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Prevention Cost

Costs incurred to prevent poor quality from happening.

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Internal Failure Cost

Costs of discovering poor quality before reaching customers.

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External Failure Cost

Costs of quality problems after reaching customers.

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Quality Conformance to Specifications Definition

How well a product meets its design requirements.

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Walter A. Shewhart

Statistician who recognized variability in manufacturing processes and developed quality control charts.

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Just-in-Time (JIT) Philosophy

A manufacturing strategy focusing on producing products only when needed by customers.

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Pull System

A manufacturing strategy where production is triggered by customer demand.

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Push System

A manufacturing strategy where products are made in advance of customer demand.

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Descriptive Statistics

Measures that describe characteristics of a product/process.

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Mean

A statistic measuring the central tendency of a data set.

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Distribution of Data

Shape of observed data, a descriptive statistic assessing quality.

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Forecasts

Predictions about future demand.

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Six Sigma

A quality improvement methodology aimed at reducing defects and improving processes.

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Quantitative Forecasting

Forecasting methods based on mathematical models to predict future values.

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Qualitative Forecasting

Forecasting methods using expert opinions or market research to predict future values.

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Naïve Method

A simple forecasting method assuming the next period's value equals the current period's value.

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Forecast Accuracy

How well a forecast matches actual results over time, measured through evaluation.

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Delphi Method

A forecasting technique using expert opinions anonymously to reach a consensus.

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Cause-and-effect diagrams

Tools used to identify potential causes for quality problems, also known as fishbone or Ishikawa diagrams.

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Malcolm Baldrige National Quality Award

An award recognizing companies excelling in quality standards, established in 1987.

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Control Charts

Tools for quality control, tracking process variations over time.

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Common Causes of Variation

Uncontrollable variations in a process stemming from natural factors.

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Customer Focus (TQM)

Understanding and meeting customer needs to enhance products or services.

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Continuous Improvement (TQM)

Process of perpetually enhancing processes and procedures.

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Descriptive Statistics (SQC)

Statistical tools that describe quality data (like average, standard deviation).

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Pareto Analysis

An approach identifying the most significant problems impacting quality.

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Study Notes

Operations Management

  • Finance handles cash flow, current assets, and capital investments.
  • Marketing focuses on sales, customer demand, understanding customer needs.
  • Operations Management is the backbone of a company, like an orchestra conductor.
  • Operations Management transforms resources into products/services.

Effective Operations Management

  • Short-term decisions focus on specific departments and tasks (tactical decisions).
  • Long-term decisions guide tactical decisions (strategic decisions).
  • Manufacturing produces tangible goods, and service organizations produce intangible services.

Historical Milestones

  • Operations management is as old as civilization.
  • Industrial Revolution had a profound impact on manufacturing.
  • James Watt invented steam engines (1764).
  • Adam Smith introduced division of labor (1776).
  • Eli Whitney introduced interchangeable parts (1790).

Scientific Management

  • Scientific management approach faced criticism for exploitation of workers.

The Human Relations Movement

  • Hawthorne studies (1930s) investigated work environment impact on productivity.

Management Science

  • Management science focused on quantitative techniques for operational issues.
  • F.W. Harris created the first mathematical inventory model (1913).

The Computer Age

  • Business operations were transformed by widespread computer adoption (1970s).

Just-in-Time (JIT)

  • An important approach to coordinate material flow.
  • Parts arrive exactly when needed.

Total Quality Management (TQM)

  • Focuses on enhancing product quality.
  • Eliminates defects to enhance quality.

Business Process Reengineering

  • Reshapes company methods for efficiency, quality, and cost reduction.
  • Highly personalized products/services on a large scale.

Time-Based Competition

  • A trend to deliver products/services faster than competitors.

Supply Chain Management (SCM)

  • Oversees material and information flow from suppliers to customers.

Globalization

  • Companies consider customers, competitors, and suppliers worldwide.

Sustainability and Green Options

  • Waste reduction, recycling, and reusing products/parts are key concepts.

E-commerce

  • Doing business online, vital for companies.
  • Outsourcing is when a company contracts with an outside provider.

Strategy and Productivity

  • Mission statement defines a company's purpose.
  • Environmental scanning monitors trends in market, economy, etc.

Ethics in Supplier Management

  • Supply chain coordinates activities to deliver finished products/services.
  • Supply chains coordinate suppliers, transporters, internal depts, and 3rd party companies.

Total Quality Management (TQM)

  • Aims to improve quality across all levels.
  • Quality is subjective, defined differently by different individuals.
  • Conformance to specifications measures a product's meeting of requirements.
  • Fitness for use focuses on proper functionality.

Cost of Quality

  • Prevention costs minimize quality issues.
  • Appraisal costs are incurred during inspection.
  • Internal failure costs are discovered before customer receipt.
  • External failure costs occur after customer receipt.
  • Walter A. Shewhart, W. Edwards Deming, Joseph M. Juran, Philip B Crosby are key quality figures.

Quality Awards and Certifications

  • Malcolm Baldrige National Quality Award aims to promote quality.
  • Deming Prize is a Japanese award for quality improvement.
  • ISO 9000 & ISO 14000 standards certify quality systems and environmental standards.

Quality Control and Six Sigma

  • Descriptive statistics describe quality characteristics.
  • Acceptance sampling randomly inspects goods.
  • Two main types of variation exist: common cause and assignable cause.

Lean Systems

  • Core beliefs include waste elimination, broad operations view, simplicity, continuous improvement, visibility, and flexibility.
  • JIT philosophy emphasizes making products only when customers need them (pull system).
  • JIT manufacturing focuses on the production system to enable just-in-time (JIT) manufacturing.
  • Respect for people, ensuring empowerment for employees.
  • Quality at the source identifies and corrects problems at the source.

Forecasting and Demand Planning

  • Forecasts are predictions about the future, but they are often imperfect.
  • Quantitative forecasts use mathematical methods.
  • Qualitative forecasts use subjective insights, like executive opinion.

Forecasting Software

  • Spreadsheets and statistical packages are common tools.
  • Choosing software depends on features, compatibility, ease of use, customization, and data size.

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OM Midterm Reviewer PDF

Description

Explore the fundamentals of Operations Management, including the key roles it plays within a company. Understand the historical milestones that shaped this field and the importance of effective management strategies for both manufacturing and services. Dive into concepts such as tactical and strategic decisions that guide operations.

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