TWM weeks 4-6

operations strategy

a long-term plan aligning operations with business goals to deliver customer value through competitive priorities and strategic capabilities

• long term plan that defines how an org will use its operations like facilities, people, and tech

• determines what the firm can reliably promise to the customers (e.g. fastest delivery or lowering the cost and giving the highest quality)

• must align with corporate strategy

• Heinz Wilright Stage Model internally neutral to externally supportive

operations strategy

• OPERATIONAL IS DIFF FROM OPERATIONS

• providing high-level objectives

• planning the direction

• thinking long term

• laying out big picture

process design

how work is organized to transform inputs into outputs by selecting process types, layouts, and controls that align with strategy to optimize efficiency, quality, and responsiveness

• activity of deciding how work is organized so that the inputs like materials, info and customers can transform into products and services

• encompasses choices abt process type, material, info flow, facility layout, human roles to perform to work

• technical and human blueprint on how an org creates value

job shop

handles highly variety of low volume

customized ang product

batch processing

groups similar items for periodic production

ex bakery

assembly line or repetitive processes

suited to moderate to high standardized products

paggawa ng kotse

continuous flow

supports very high volumes of low variety output

non-stop output so like oil refinery

competitive priorities

operations must choose which priorities to excel at (cost, quality, delivery, flexibility, innovation) and make coherent choices across capacity, process, technology, and workforce to support those priorities.

strategic fit

operations decisions reinforce each other and align with corporate strategy

• org moves in a single consistent direction

process selection

choose job shop/batch/line/continuous based on product variety and volume. each type implies a different skill mix, equipment and layout

• departmental layout works with job shop

• product or line layout suits production

layout

e.g., functional (departmental) layout suits job shops; product/line layout suits repetitive production. good layout reduces transport, wait and motion wastes

• degrade qulity and avoid increased cost

flow metrics

• throughput

• cycle time

• work-in-progress (WIP)

• improves quality and reduces lead and cost

• how work moves

throughput (rate)

units produced per time unit

measures output rate

ilang products natapos

cycle time

time to complete one unit at a workstation

time it takes to process one unit

ilang oras sa isang item

WIP

items inside the process

lead time

total time from order to delivery

utilization

shows how much capacity is being used

how busy resources are, fast efficient or slow ba

flow metrics

central to TQM because improving quality and flow reduces lead time and cost

bottleneck

the slowest resource

must be improved in its capacity or reduce load on it to raise throughput

limits the overall process

managing constraints

key in improving overall flow and quality (theory of constraints, lean thinking)

targets the place where improvement will produce the greatest system level effect

PDCA/PDSA (Plan-Do-Check/Study-Act)

iterative (repeating) improvement cycle popularized by Deming

doing, checking, acting

Statistical Process Control (SPC)

control charts and statistics to monitor process stability (key TQM tool)

monitors whether a process is stable or drifting

root cause analysis

5 Whys, fishbone diagrams

help teams find the true sources of defects

5 whys

keep asking why to find root cause

fiashbone diagram

identify the causes of the problems

Kaizen/continuous small improvements

employee involvement and standardized work

emphasizes small continuous improvements through ^

lean and waste elimination

Lean focuses on eliminating non-value-adding activities and shortening lead times through just in time productive, kanban, 5s, and standardized work

by removing waste, lean improves efficiency and quality

examples of wastes

waiting time, extra movement, overproduction, defects

just in time ginagamit na tool — produce only when needed

kanban

visual signals for workflow

5s

organize the workplace

Lean

originated from the Toyota Production System

Six Sigma

complements lean by using data and statistical methods to reduce variation and defects— a TQM staple for process redesign and control

uses DMAIC cycle

DMAIC

define, measure, analyze, improve, control

complements lean by providing statistical tools and structured problem-solving framework that helps orgs redesign processes and lack in gains

value-stream mapping

diagrams material and information flow across the whole value stream to identify waste and improvement opportunities; it’s a practical Lean/TQM tool for process redesign

expose waste delays and opportunities for improvements

more granular level

the big picture, the entire process

service process design tools

Service blueprinting (maps customer actions, front stage and back-stage processes). Crucial for designing repeatable, quality service experiences (banks, hospitals, restaurants).

essential for designing repeatable high quality service experiences in sector such as banking, healthcare, and hospitality

when combined with TQM principles, hekps orgs standardize critical interaction while preserving the flexibility needed to response to individual customer needs

how to build an operations strategy and design a process

1. understand the market/customer requirements

2. choose competitive priorities

3. select process type and tech

4. design the layout and information flows

5. set capacity and workforce plans

6. define metrics and control systems

7. map the value stream and run experiments (PDCA)

capacity planning

the process of determining the production capacity (or more broadly, service capacity) needed by an organization to meet changing demands for its products or services over time.

• helps orgs meet demand avoid stockouts or long lead times

• support cost control and inventory

• capacity decision must align with business strategy

techniques for forecasting demand

1. Qualitative Methods (for new products or historical data are limited)

Expert Opinion

Delphi method

Market research, customer surveys

Scenario planning

2. Quantitative Methods (use historical data to project future demand)

Moving averages

Exponential smoothing

Trend projection

Seasonal indices

3. Judgmental + adjustments

4. Smoothing vs responsiveness tradeoff

5. Aggregated / hierarchical forecasting

resource allocation

The process of distributing and assigning available resources (labor, machines, time, money) to competing activities, projects, tasks or products, in order to optimize performance

prioritization

balancing

flexibility

fairness or equity

Capacity Constraints and Bottlenecks

A resource whose capacity is lower than demand placed on it; it limits the throughput of the entire system

theory of constraints

the throughput of a system is determined by its slowest link so you need to manage and identify the bottleneck

Strategies to manage constraints and bottlenecks

1. Subordinate/buffer upstream/downstream

2. Elevate capacity of the bottleneck

3. Restructure/redesign the process

4. Control the workload/release rate

5. Increase flexibility

6. Make improvements/continuous improvement (TQM) at the bottleneck

7. Outsource/subcontract/offload

8. Use lead strategy/lag strat/match or tracking strat