© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Chapter Ten Producing Quality Goods and Services 10 | 1 PRIDE HUGHES KAPOOR INTRODUCTION TO BUSINESS ELEVENTH EDITION

© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Learning Objectives 1.Explain the nature of production 2.Outline how the conversion process transforms raw materials, labor, and other resources into finished products or services 3.Describe how research and development lead to new products and services 5.Discuss the components involved in planning the production process. Explain how purchasing, inventory control, scheduling, and quality control affect production 6.Summarize how productivity and technology are related 10 | 2

© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. What Is Production?  Define Operations Management Operations Manager  What is Planning and when does it take place? 10 | 3

© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. How American Manufacturers Compete in the Global Marketplace  Be able to discuss the U.S. in terms of productivity and competitiveness post-WW II What are the factors that have led to increased productivity?  What are common traits of the most successful U.S. firms? What has been their focus?  What has happened to manufacturing employment levels in recent decades? 10 | 4

© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Careers in Operations Management  Be able to discuss the manufacturing process Mass Production Analytical Process Synthetic Process  What are traits of successful operations managers? What must they be able to do? 10 | 5

© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. The Conversion Process  What is the purpose of manufacturing?  Be able to discuss the Conversion Process  Define Utility Know the Four Types of Utility  Define Form Utility Focus Magnitude of Change 10 | 6

© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Services  What is a Service Economy?  Why are services increasing in importance in the United States?  How does the production of services vary from the production of goods? 10 | 7

© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Where Do New Products and Services Come From?  Be able to discuss where new products and services come from  Define Research and Development Basic Research Applied Research Development and Implementation 10 | 8

© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Where Do New Products and Services Come From? (cont’d)  Define and be able to discuss Product Life Cycle -What are the phases of the product life cycle? Product Refinement Product Extension 10 | 9

© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. How Do Managers Plan for Production?  Define Design Planning Product Line Product Design Capacity  What are the three phases a manager uses to convert an idea into a product or service? 10 | 10

© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Design Planning  Discuss how technology helps in Design Planning  What is the difference between Labor-Intensive Technology Capital-Intensive Technology 10 | 11

© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Facilities Planning  Define Facilities Planning  What are the factors that influence The decision to use an existing facility or to construct a new facility? The location decision for a production facility? 10 | 12

© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Human Resources Managers  What role do Human Resources Managers play in operations management? What relationship do human resources and operations managers have? 10 | 13

© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Plant Layouts  Know and be able to explain different Plant Layouts The Process Layout The Product Layout (Assembly Line) The Fixed Position Layout  When are each of these layouts used? 10 | 14

© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Operational Planning  Be able to discuss the Four Steps in Operational Planning Step 1: Selecting a planning horizon Step 2: Estimating market demand Step 3: Comparing market demand with capacity Step 4: Adjusting products or services to meet demand 10 | 15

© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Operations Control  Be able to name and discuss the Four Aspects of Operations Control Purchasing Inventory Control Scheduling Quality Control 10 | 16

© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Inventory Control  Name the different types of inventory Raw Materials Work-in-Process Finished Goods  What are the costs of inventory?  Know and be able to explain the inventory control methods Materials Requirements Planning (MRP) Manufacturing Resource Planning (MRP II) Enterprise Resource Planning (ERP) Just-In-Time Inventory System 10 | 17

© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Scheduling  Be able to discuss the significance of Routing of materials Timing of materials Follow-up  Be able to recognize and explain Gantt Chart PERT (Program Evaluation and Review Technique) 10 | 18

© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Quality Control  Define Statistical Process Control (SPC) Statistical Quality Control (SQC) Inspection  Know how the following improve quality Quality Circle Total Quality Management (TQM) Six Sigma  What is the International Organization for Standardization (ISO)? 10 | 19

© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Productivity Trends  Define Productivity  Be able to discuss Productivity Trends in the U.S. What was the effect of the most recent recession on productivity? How does government regulation affect productivity? How can productivity be improved? 10 | 20

© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Improving Productivity with Technology  Define Automation Robotics  How have robotics and technology increased productivity?  Be prepared to discuss the advantages and disadvantages of automation and robotics 10 | 21

© 2012 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. Computer Manufacturing Systems  Define and explain Computer-Aided Design (CAD) Computer-Aided Manufacturing (CAM) Computer-Integrated Manufacturing (CIM) Continuous Process Flexible Manufacturing Systems (FMS) Intermittent Process  What is Technological Displacement? 10 | 22