Characteristics of Effective Control PDF

# Characteristics of Effective Control * **Integration with planning:** the more control is linked to planning, the more effective the control system. * **Flexibility:** the control system must be flexible enough to accommodate change. * **Accuracy:** Inaccurate information results in bad decision...

# Characteristics of Effective Control * **Integration with planning:** the more control is linked to planning, the more effective the control system. * **Flexibility:** the control system must be flexible enough to accommodate change. * **Accuracy:** Inaccurate information results in bad decision making and inappropriate managerial actions. * **Timeliness:** a control system should provide information as often as necessary. * **Objectivity:** a control system must be free from bias and distortion. # Chapter 15: Managing Operations, Quality and Productivity * **Operations management:** the total set of managerial activities used by an organization to transform resource inputs into products, services, or both. * **Importance of operations:** it is necessary for competitiveness and overall organizational performance, creates value and utility through the production of products and services. * **Manufacturing:** a form of business that combines and transforms resource inputs into tangible outcomes such as cars, technology tools, clothing, or furniture. * **Service operations:** service organization: an organization that transforms resources into an intangible output and creates time and place utility for its customers, such as a hair salon, restaurant, or dog walker. * **Operations management has a direct impact on competitiveness, quality, productivity and effectiveness.** * **Operations management and organizational strategy have reciprocal effects on each other.** Strategic goals cannot be met if there are deficiencies and insufficiencies in operations resources. ## Facilities Decisions **Facilities:** the physical locations where products or services are created, stored and distributed. * **Location:** the physical positioning or geographic site of facilities. * **Layout:** the physical configuration of facilities; the arrangement of equipment within facilities, or both. ### Types of Facilities * **Product layout:** a physical configuration of facilities arranged around the product; used when large quantities of a single product are needed. * **Process layouts:** a physical configuration of facilities arranged around the process; used in facilities that create or process a variety of products. * **Fixed-position layout:** a physical configuration of facilities arranged around a single work area; used for the manufacture of large and complex products. * **Cellular layouts:** a physical configuration of facilities used when families of products can follow similar flow paths. ## Implementing Operating Systems ### Operations Management as Control * **Supply chain management:** the process of managing operations control, resource acquisition and purchasing, and inventory so as to improve overall efficiency and effectiveness. * **Operations management as control:** coordinating operations management with other functions to help ensure the system focuses on the elements crucial to goal attainment. ### Purchasing and Inventory Management * **Purchasing management:** buying materials and resources needed to produce products and services. * **Inventory control:** managing the organization’s raw materials, work-in-process, finished goods, and products in transit * **Just-in-time (JIT) method:** an inventory system that has necessary materials arriving as soon as they are needed (just in time) so that the production process is not interrupted ## Managing Total Quality * **Quality:** the totality of features and characteristics of a product or service that bear on its ability to satisfy stated or implied needs. It is both a relative and absolute concept. Quality is relevant to both products and services. * **Difference in quality is based in design and other features.** ### Eight Dimensions of Quality 1. **Performance:** a product’s primary operating characteristic; examples are automobile acceleration and a television’s picture clarity 2. **Features:** supplements to a product’s basic functioning characteristics, such as power windows on a car. 3. **Reliability:** a probability of not malfunctioning during a specified period 4. **Conformance:** the degree to which a product’s design and operating characteristics meet established standards 5. **Durability:** a measure of product life 6. **Serviceability:** the speed and ease of repair 7. **Aesthetics:** how a product looks, feels, tastes, and smells 8. **Perceived quality:** as seen by a customer. ### Total Quality Management (TQM) (Quality Assurance) * A strategic commitment by top management to change its whole approach to business and to make quality a guiding factor in everything the organization does. **TQM Tools and Techniques** * **Value-added analysis:** the comprehensive evaluation of all work activities, materials flows, and paperwork to determine the value that they add for customers. * **Benchmarking:** the process of learning how other firms do things in an exceptionally high-quality manner. **Other Quality Terms:** * **Outsourcing:** subcontracting services and operations to other firms that can perform them cheaper or better. * **Reducing cycle time:** cycle time: the time needed by the organization to develop, make, and distribute products or services. ### Quality Standards * **ISO 9000:** a set of quality standards created by the International Organization for Standardization and revised in 2000. * **ISO 14000:** a set of standards for environmental performance. * **Statistical quality control (SQC):** a set of specific statistical techniques that can be used to monitor quality; includes acceptance sampling and in-process sampling. * **Six Sigma:** involves making corrections until errors disappear. ## The Meaning of Productivity * **Productivity:** an economic measure of efficiency that summarizes what is produced relative to the resources used to produce it. * **Aggregate productivity:** total level of productivity for a country * **Industry productivity:** total productivity of all the firms in an industry * **Company productivity:** level of productivity of a single company. * **Unit productivity:** the productivity level of a unit or department * **Individual productivity:** productivity attained by a single person * **Total factor productivity:** an overall indicator of how well an organization uses all of its resources (i.e., labor, capital, materials, and energy) to create all of its products and services. * **Labor productivity:** a partial productivity ratio that uses only one category of resource (labor) to gauge the organization's productivity in utilizing that resource.