QUESTIONS, PROBLEMS, ANSWERS, SOLUTIONS TO PROBLEMS

QUESTIONS

1. What is production/operations?

2. What factors distinguish between production and service operations?

3. What are the major decision areas in P/OM?

4. What are the major components of a production system? Give two examples.

5. List four basic operations strategies.

6. Explain the difference between total and partial productivity.

7. What is continuous improvement (CI)? What are the major tools for this philosophy?

8. How does productivity measurement differ between manufacturing and service operations?

9. Contrast the world class view with the traditional view in quality control.

10. List the types of quality costs.

11. Describe total quality management (TQM).

12. What is ISO-9000 Series Standards? List key quality awards.

13. What is the logic of Taguchi methods?

PROBLEMS

1. Donovan Furniture Company provided the following data. Compare the labor, materials, and total productivity of 20X1 and 20X2.

20X1

20X2

Output:

Sales

$22,000

$35,000

Inputs:

Labor

10,000

15,000

Materials

8,000

12,500

Capital equipment

700

1,200

Energy

2,200

4,800

Total inputs

$20,900

$33,500

2. Identify specific productivity and quality measures that would be useful in each of the following operations:

(a) Bus system.

(b) Department store.

(c) Post office.

(d) Hotel.

ANSWERS

1. Production/operations is the process by which goods and services are created.

2. Distinction between manufacturing and service operations is based on the following features:

the nature and consumption of output; nature of work (jobs); degree of consumer contact; uniformity of output; quality assurance; measurement of performance.

3. Major decision areas in P/OM include: capacity planning, aggregate production planning and master scheduling, locational planning, material requirement planning and inventory management, project management and control, scheduling, queuing, quality assurance, product and service design, facilities layout, design of work systems.

4. The major components of the production system are inputs, a conversion or creation process, and outputs. Examples are as follows:

System

Inputs

Conversion Process

Outputs

Auto assembly plant

Labor

Energy

Robots

Parts

Welding

Manual assembly

Painting

Automobiles

Hospital

Patients

Staff

Beds

Drugs

Medical equipment

Doctors

Operations

Drug administration

Health-status monitoring

Healthy individuals

Lab results

5. Four basic operations strategies are: cost, quality, speed of delivery, and flexibility.

6. Total productivity is the ratio of total output to all resources used in production: labor, capital, material, management, energy, while partial productivity centers on only a single or a subset of these input variables.

7. Continuous improvement (CI) is a management philosophy that seeks endless pursuit of improvement of machinery, materials, labor utilization, and production methods through application of suggestions and ideas of team members. The CI utilizes two major approaches: Internal tools. Using very structured programs such as Statistical Process Control (SPC) benchmarking. Examining excellent performers outside the industry and seeing how you can use their best practices.

8. In manufacturing, physical input and outputs are easy to identify and quantity. For services, intangibles such as health, social benefits, and customer satisfaction are more difficult to define and measure. Quality measures such as waiting time per patient and response to treatment are often used as surrogates.

9. The traditional approach uses an acceptable quality level (AQL) that permits a predetermined level of defective units to be produced and sold, whereas the world-class view uses total quality control and views the optimal level of quality costs as the level where zero defects are produced.

10. Quality costs are classified into three broad categories: prevention, appraisal, and failure costs.

11. Total quality management (TQM) is a system for creating competitive advantage by focusing the organization on what is important to the customer. Total quality management can be broken down into: "Total": that is the whole organization is involved and understands that customer satisfaction is everyone`s job. "Quality": the extent to which products and services satisfy the requirements of internal and external customers. "Management": the leadership, infrastructure and resources that support employees as they meet the needs of those customers.

12. They are Deming Prize-Japan (named after W. Edwards Deming); Malcolm Baldrige National Quality Award-U.S.; Canada Awards for Business Excellence-Canada.

13. The Taguchi method focuses on assuring quality through proper process and product design. Taguchi views any deviation from the "ideal quality" as a loss to society. Taguchi emphasizes minimization of variability in processes and robust design.

SOLUTIONS TO PROBLEMS

1.

20X1

20X2

Partial productivities:

Labor

2.20

2.33

Materials

2.75

2.80

Total productivity

1.05

1.04

2.

(a) Bus system: passengers per route, percent on schedule.

(b) Department store: sales per week, mistagged merchandise.

(c) Post office: delivery days per letter, percent lost items.

(d) Hotel: rooms cleaned, complaints per guest.

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