Session 2 Process Fundamentals

Session 2 Process Fundamentals - OSCM356 Operations...

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1 OSCM356 Operations Management Session 2 Process Fundamentals Fuqiang Zhang Olin Business School Washington University in St. Louis Spring 2008 Session outline Process strategy Major process decisions Process flowcharts Tools for evaluating process performance Bar chart Pareto chart Fishbone diagram OSCM356, Spring 08, Prof. Zhang Session 2 Slide 2
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2 Process Strategy Recall… A process involves the use of an organization’s resources to provide something of value. A key question: How do you design the best business process? Process strategy is the pattern of decisions made in managing processes so that they will achieve their competitive priorities. OSCM356, Spring 08, Prof. Zhang Session 2 Slide 3 Major Process Decisions Process Structure determines how processes are designed relative to the kinds of resources needed, how resources are partitioned between them, and their key characteristics. Customer Involvement refers to the ways in which customers become part of the process and the extent of their participation. Resource flexibility is the ease with which employees and equipment can handle a wide variety of products, output levels, duties, and functions. Capital intensity is the mix of equipment and human skills in a process. OSCM356, Spring 08, Prof. Zhang Session 2 Slide 4
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Process Structuring in Manufacturing Process choice : A way of structuring the process by organizing resources around the process or organizing them around the products. Job Process : A process with the flexibility needed to produce a wide variety of products, with considerable complexity and divergence in the steps performed. (e.g., customized cabinet) Batch process : A process that differs from the job process with respect to volume, variety and quantity. (e.g., standard components for assemble) Line process : A process that lies between the batch and continuous processes on the continuum; volumes are high and products are standardized, which allows resources to be organized around particular products. (e.g., auto, computer, appliances, toys) Continuous flow : The extreme end of high-volume, standardized production and rigid line flows, with production not starting and stopping for long time intervals. (e.g., oil refinery, steel, food) OSCM356, Spring 08, Prof. Zhang Session 2 Slide 5 Process Complexity, Divergence, and Flow Process complexity : number and intricacy of the steps required to perform the process Process divergence : extent to which the process is highly customized with considerable latitude as to how it is performed High divergence involves much judgment and discretion. Consulting and law, for example Low divergence is more repetitive and standardized Process flow , related to divergence, may range from highly diverse to linear. Flexible flow means movements in diverse ways.
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Session 2 Process Fundamentals - OSCM356 Operations...

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