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| Question | Answer |
| 10 Critical Decisions | 1. Design of Goods & Services 2. Managing Quality 3. Process & Capacity Design 4. Location Strategy 5. Layout Strategy 6. HR and Job Design 7. Supply Chain Management 8. Inventory MRP JIT 9. Scheduling 10. Maintenance |
| Dimensions of Quality | Performance Features Reliability Conformance Durability Serviceability Value Aesthetics Perceived quality |
| Costs of Quality | Prevention Costs - reduce the potential for defects Appraisal Costs - evaluate products, parts, and services Internal Failure - produce defective parts or service before delivery External Costs - defects discovered after delivery |
| Seven Concepts of TQM | 1. Continuous Improvement 2. Six Sigma 3. Employee Empowerment 4. Benchmarking 5. JIT 6. Taguchi concepts 7. Knowledge of TQM tools |
| Determinants of Service Quality | Reliability Responsiveness Competence Access Courtesy Communication Credibility Security Tangibles Understanding/knowing the customer |
| Service Design Questions: | What is the purpose of the process? How does it create customer satisfaction? What are the essential inputs/outputs? Describe as a flowchart - specify in detail the value-adding activities |
| Post-Service Design Questions | Are the process steps logically-ordered? Do all the steps add value? Are there bottlenecks in the process that increase customer waiting time? Should some steps be automated? Which bits of system likely to cause errors and thus dissatisfaction? Where/when to measure quality? What procedures/guidelines should employees follow when interacting with customers? |
| Service Process Matrix | |
| Lean Production (Nissan) *all personnel seen as Equally important | Flexibility - broadening of everyone's responsibilities to make full use of plant & equipment Quality - total commitment to "getting it right the first time" Teamwork - All pulling together |
| Business Process Reengineering (BPR) | discontinuous thinking strive for dramatic levels of improvement break away from conventional wisdom broad and cross-functional in scope use IT to enable new processes |
| How to... BPR | 1. Draw process flowchart of 'is' processes 2. Draw what they should look like after reengineering 'should be' processes |
| Principles for Effective BPR | - Critical Processes - Strong Leadership - Cross-functional Teams - Information Technology - Clean Slate Philosophy - Process Analysis |
| Break-even Analysis (total revenue - total variable costs) = zero profit | Drawbacks of method: Time not a critical value Revenues and Costs occur simultaneously Costs and prices constant over time Facilities and equipment have infinite capacity |
| Six Sigma Principles | Focus on the customer. Identify and understand how the work gets done (the value stream). Manage, improve and smooth the process flow. Remove Non-Value-Added steps and waste. Manage by fact and reduce variation. Involve and equip the people in the process. Undertake improvement activity in a systematic way. |
| Just-In-Time (JIT) | inventory strategy companies employ to increase efficiency and decrease waste by receiving goods only as they are needed in the production process, thereby reducing inventory costs. This method requires producers to forecast demand accurately. |
| JIT benefits | |
| Disadvantages of JIT | |
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