Operations Management Review Flashcards

This set of flashcards covers key concepts in operations management, including definitions and examples.

Operations Management

The systematic design, direction, and control of processes that transform inputs into services and products.

Process Strategy

The pattern of decisions made in managing processes to achieve competitive priorities.

Supply Chain Management

The synchronization of a firm’s processes with those of its suppliers and customers to match the flow of materials, services, and information with customer demand.

Break-even Analysis

Analysis used to determine the volume at which total revenues equal total costs.

Competitive Priorities

Critical dimensions such as cost, quality, time, and flexibility that a process or supply chain must possess to satisfy customers.

Capacity

The maximum rate of output of a process or a system.

Utilization

The percentage of design capacity that is actually used.

Efficiency

The ratio of actual output to effective capacity.

Cost of Quality

Costs associated with preventing defects, appraising quality, and failures.

Total Quality Management

A philosophy that stresses customer satisfaction, employee involvement, and continuous improvement.

Six Sigma

A comprehensive system aimed at minimizing defects and variability in processes.

Process Capability

The ability of the process to meet design specifications for a service or product.

Statistical Process Control (SPC)

The application of statistical techniques to monitor and control a process.

Decision Theory

A general approach to decision making when outcomes associated with alternatives are uncertain.

Decision Tree

A model used to compare alternatives and their possible outcomes.

Order Winners

Criteria that customers use to differentiate services or products of one firm from those of another.

Order Qualifiers

The minimum level required from a set of criteria for a firm to do business in a market segment.

Process Divergence

The extent to which a process is highly customized with considerable latitude in how tasks are performed.

Break-even Quantity Formula

Q = F / (p-c) where F is fixed cost, p is price, and c is variable cost per unit.

Process Reengineering

The fundamental rethinking and radical redesign of business processes to improve performance dramatically.

Lean Manufacturing

An approach to production that emphasizes the minimization of waste within manufacturing systems.

Demand Forecasting

Estimation of the demand for a product or service.

Make-or-Buy Decision

Decision to make a product internally or buy it from an external supplier.

Job Process

A process used to produce low-volume, customized goods.

Line Process

A process used to produce high-volume, standardized goods.

Flexible Automation

Automation that is capable of handling various types of products.

Fixed Automation

Automation designed to produce a narrowly defined range of products.

Process Improvement

The systematic study of activities and flows of a process to improve it.

Root Cause Analysis

Process of identifying the underlying reasons for a problem.

Histogram

A graphical representation of the distribution of numerical data used in SPC.

Pareto Chart

A bar graph where the lengths of the bars represent frequency or cost, arranged in descending order.

Control Chart

A time-ordered diagram used to determine whether observed variations are abnormal.

Fishbone Diagram

A cause-and-effect diagram that identifies potential factors causing an overall effect.

Service Blueprint

A flowchart specifically for service processes, showing which steps have high customer contact.

Time Study

A work measurement technique used to determine how long it takes to complete a task.

Quality Audit

A systematic examination to determine whether quality activities comply with planned arrangements.

Scrap

Defective product or material that cannot be repaired or used.

Rework

The correction of defective material or errors.

Internal Failure Costs

Costs resulting from defects that are discovered during the production of a service or product.

External Failure Costs

Costs that arise when a defect is discovered after the customer receives the service or product.

Prevention Costs

Costs incurred to prevent defects before they happen.

Appraisal Costs

Costs incurred when assessing performance levels of processes.

Quality Planning

Establishment of specifications for incoming materials, processes, finished products, and services.

Statistical Techniques

Mathematical methods used to analyze data and inform decision-making.

Forecasting Method

A systematic approach to predicting future events based on historical data.

Production Effectiveness

A measure of how effectively production goals are met.

Resource Management

Strategic allocation of resources to maximize efficiency and minimize waste.

Work Sampling

A technique for estimating the proportion of time spent on different activities.

Multifactor Productivity

A measure of the efficiency of all inputs to a production process.

Capacity Planning

The process of determining the production capacity needed by an organization to meet changing demands for its products.

Ramp-Up Time

The period required to fully begin operations at optimal production levels.

Session Reports

Documentation of activities and outcomes during specified operations.

Value Chain

The full range of activities that businesses engage in to bring a product or service to the market.