Operations Management and Value Chains

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Questions and Answers

What is required for effective service delivery systems in the face of demand fluctuations?

Standardized processes only

Use of mechanistic processes

Strong technical and behavioral skills (correct)

Physical inventory management

How do goods-producing firms typically manage demand variability?

Relying solely on predictive analytics

By using inventory to decouple demand from production (correct)

Through flexible service options

By recruiting more employees

What aspect of service employees is emphasized in maintaining availability?

Scheduling proficiency (correct)

Management and production skills

Profit maximization skills

Strong technical skills only

Which of the following statements is true about inventory in service firms?

Service firms do not have physical inventory to absorb demand fluctuations. Signup and view all the answers

What are the implications of having a mechanistic process in production?

It restricts adaptation to special circumstances. Signup and view all the answers

What is emphasized as a crucial aspect of product safety?

Ensuring consumer safety while using goods and services Signup and view all the answers

Which emerging technology is NOT mentioned as transforming operations management?

Blockchain technology Signup and view all the answers

What is a key focus for financial management within operations management?

Sound financial planning for long-term survival Signup and view all the answers

How should organizations approach workforce demands?

By embracing continuous learning and diverse talent Signup and view all the answers

What is the goal of energy optimization in operations management?

Reduce consumption during peak demand times Signup and view all the answers

Which of the following is NOT considered significant for achieving operational excellence?

Eliminating leadership roles Signup and view all the answers

In terms of waste management, what strategy is emphasized?

Reducing waste and managing recycling efforts Signup and view all the answers

What is a critical responsibility of operations managers regarding health and safety?

Ensure a healthy and safe work environment Signup and view all the answers

What is the main purpose of heat-treating and powder coating in the production process?

To add value to the products Signup and view all the answers

What benefit do distribution centers located near major metropolitan markets provide?

Faster service and reduced transportation costs Signup and view all the answers

Which of the following accurately describes the role of information systems in order fulfillment?

They manage product locations and create pick routes Signup and view all the answers

What is critical for a hospital to meet unanticipated patient demand?

A float pool of nurses Signup and view all the answers

What type of seller partnerships does Buhrke engage in to enhance their offerings?

Partnerships with third-party sellers and transportation firms Signup and view all the answers

What aspect of resource management is emphasized for service-providing firms?

Efficient scheduling of employees and equipment Signup and view all the answers

Which feature is NOT associated with Amazon Prime's shipping services?

Refund for late deliveries Signup and view all the answers

What is the purpose of customer pickup locations established by Buhrke?

To provide an alternative shipping option Signup and view all the answers

What happens to resources like airline seats or hotel rooms once they are sold?

They are lost revenue if not used Signup and view all the answers

How does the order tracking system benefit customers?

Enables viewing order status and history online Signup and view all the answers

How do goods-producing firms primarily differ from service-providing firms?

Goods-producing firms primarily focus on physical products Signup and view all the answers

Which resource management aspect is not typically prioritized in a service management context?

Length of supply chains Signup and view all the answers

Which aspect of the value chain focuses on confirming product quality before shipping?

Final audit inspection Signup and view all the answers

What does an adequate supply of beds in a hospital specifically ensure?

Meeting anticipated patient demand Signup and view all the answers

Why are service management skills considered paramount for success?

They improve scheduling and resource allocation Signup and view all the answers

What is a major challenge that service-providing firms face in comparison to goods-producing firms?

Recapturing lost service opportunities Signup and view all the answers

What is the primary focus of the supply chain?

Physical movement of goods and services Signup and view all the answers

How does the scope of the value chain compare to the supply chain?

The value chain is broader in scope than the supply chain. Signup and view all the answers

What is an essential component that operations management must balance within the value chain?

Cost, quality, service, and sustainability Signup and view all the answers

What is a key reason modern companies reconfigure their value chains?

To stay competitive and enhance customer service Signup and view all the answers

Which of the following statements about value chains is accurate?

Value chains include both preproduction and postproduction activities. Signup and view all the answers

What type of model can the value chain be described as?

A cradle-to-grave input-output model Signup and view all the answers

What aspect of operations management is crucial for success in value chains?

Coordination of activities within the value chain Signup and view all the answers

Why is it important for organizations to have a diverse value chain?

To cater to multiple markets in a global environment Signup and view all the answers

Study Notes

Value Chains

Value Chains can be viewed as a "cradle-to-grave" input-output model of the operations function.
Value Chains begin with suppliers providing inputs to a goods- or service-producing process or network of processes.
Value Chains are broader than Supply Chains.

Value Chain: Input-Output Framework

Inspection: Raw materials, work-in-process, and finished products are inspected to ensure zero defects.
Secondary Operations: Heat-treating, powder coating, and other finishing processes add value to the products.
Assembly: At customer request, components can be assembled with other components and necessary parts can be procured.
Packaging and Final Audit Inspection: Before shipping, products undergo final audit inspection.
Shipping: Flexibility is offered in shipping the finished product where and when customers want.
Seller and Distributor Partnerships: Partners with third-party sellers and transportation firms to expand offerings and provide competitive prices and services.
Order Fulfillment: Efficient picking and packaging at fulfillment centers using IT, barcode sorting, and order-matching.
- Information system manages product locations and creates pick routes.
Distribution Center Location: Centers near major metropolitan markets for faster service and reduced transportation costs.
Shipping Options: Free shipping for orders over a certain amount.
- Prime membership offers unlimited two-day shipping and optional next-day delivery.
Customer Pickup Locations: Pickup points at locations like college campuses for secure and convenient product collection.
Seller Support: Tools are provided for business customers to design and manage e-commerce businesses using the company's technology.
Order Tracking: E-mail updates and website access to view order status and history.

Value Chains: Preproduction & Postproduction Services Framework

This framework completes the ownership cycle for the good or service.

Operations Management & TQM

Organizations must balance cost, quality, service, and sustainability to create value for customers and stakeholders.
Coordination of activities within the value chain is crucial for success.
Modern companies deliver goods and services to multiple markets and operate in a global business environment.
Firms have reconfigured value chains by moving some operations abroad to stay competitive, improve profitability, and enhance customer service.

Performance Excellence

Build a high-performing organization with capable leadership and a workforce.
Ensure consumer safety in using goods and services.
Ensure a healthy and safe work environment.

Financial Management

Make sound financial plans to ensure long-term organizational survival.

Workforce Skills and Learning

There is a need for new skills, continuous learning, and diverse talent in the workforce.

Sustainability

Reduce waste and manage recycling efforts.
Reduce consumption during peak energy demand times.
Design transportation optimization.

Ethics & Governance

Ensure ethical decision-making in all operational activities.

Evolving Technology

Rapid Evolution: Technology advances in design, manufacturing, and IT impact operations management.
Future Technologies: Emerging technologies are anticipated to transform OM.
Leverage Technology: OM must continually adapt to and utilize technological advancements
Manage Evolving Workforce Demands: Operations managers are responsible for managing these evolving workforce demands.

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Description

This quiz explores the concept of value chains as an input-output model in operations management. You'll learn about various stages such as inspection, assembly, and shipping that contribute to product value. Test your knowledge on how value chains differ from supply chains and their broader implications in production.