CHAPTER 3 Supply Chain - CHAPTER 3 MANAGING PROCESSES AND...

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CHAPTER 3 MANAGING PROCESSES AND CAPABILITIES I. Processes and Process Thinking a. Process - system of structured activities that use resources to transform inputs into valuable outputs i. Means by which customer’s needs are satisfied ii. Example: energy, material s and info iii. Every process has structural and resource constraints that limit range of outputs it can produce iv. Each one has a structure that defines, orders and links the activities included in the operation v. Has procedures, monitoring and control structures and feedback mechanisms b. Process thinking – a way of viewing activities in an organization as a collection of processes i. outputs viewed as a result of the process 1. causes managers and workers to view operational activities from a customer’s perspective ii. operations managers design, document, manage and change business processes located throughout the supply chain to ensure that processes make desired results inevitable iii. causes managers to address critical process elements including activities, inputs, outputs, flows, structure, resources and metrics iv. helps managers to break down organizational barriers that can impede operational performance 1. managers can better ensure that operational capabilities and outcomes they create are more consistent w/ the firm’s strategy II. Anatomy of a Process a. A process can be defined by its activities, inputs/outputs/flows, process structure, mgmt policies i. See Table 3-1 in book b. Activities of a Process i. 5 categories: 1. Operation – any activity that transforms an input (can be physical) a. Example: operations occur when a person is physically transformed when info is organized, transaction is made or when planning and calculations take place 2. Transportation – activity that moves an input from one place to another without transforming its other characteristics 3. Inspection – checks/verifies results of another activity 4. Delay – flow of an input is unintentionally stopped as a result of interference a. Occurs when there is an insufficient operating capacity or b/c other inputs or resources needed to execute an operation are not available 5. Storage – inventory stored under formal control ii. GET REAL: STATES REDUCE WAITING TIMES FOR LICENSE RENEWALS AND REGISTRATIONS
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1. State officials want to reduce amount of time customers spend waiting for license renewals and car registrations 2. Michigan: renewals done online or by fax 3. Extended operation hours and greeters to reduce wait times 4. Result: reduction in delay and wait times iii. Inputs, Outputs, and Flows 1. Processes create outputs form inputs through a series of flows 2. 2 basics of types of flows: a. Info flows - data communicated in many forms b.
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