Operations Management


Andrew Greasley

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  • Glossary

    Acceptance sampling Taking a random sample from a lot of material to be inspected.

    Appraisal costs Costs associated with controlling quality through the use of measuring and testing products and processes to ensure conformance to quality specifications.

    Batch process A process type where products are grouped into batches where size can range from one to over 100.

    Benchmarking The continuous measurement of an organisation's products and processes against a company recognised as a leader in that industry.

    Business process simulation The use of computer software, in the context of a process-based change, that allows the operations of a business to be simulated.

    Cell layout A layout type where cells are created from placing together resources which serve a subset of the total range of products or services.

    Chase demand A capacity planning strategy that seeks to match output to the demand pattern over time.

    Computer-integrated manufacture (CIM) The automation of the product and process design, planning and control and manufacture of the product.

    Concurrent design When contributors to the stages of the design effort provide their expertise together throughout the design process as a team. Continuous improvement A philosophy which believes that it is possible to get to the ideals of JIT by a continuous stream of ideas over time.

    Continuous process An operation that produces a very high volume of a standard product, usually by a continuous flow.

    Cost The finance required to obtain the inputs and manage the transformation process which produces finished goods and services.

    Cumulative representation A running total of inventory, which should always meet or exceed cumulative demand.

    Demand management A capacity planning strategy that attempts to adjust demand to meet available capacity.

    Dependability Consistently meeting a promised delivery time for a product or service to a customer.

    Economies of scale Savings that result if a facility is expanded and fixed costs remain the same, so that the average cost of producing each unit will fall.

    Economies of scope Savings that result from the ability to produce many products in one highly flexible production facility more cheaply than in separate facilities.

    Enterprise Resource Planning (ERP) An IT system that provides a single solution from a single supplier with integrated functions for the major business areas.

    Ergonomics A collection of information about human characteristics and behaviour to understand the effect of design methods and environment.

    Failure Mode and Effect Analysis (FMEA) A systematic approach to identifying the cause and effect of product failures.

    Fixed position layout Used when the product or service cannot be moved and the transforming process must take place at the location of product creation or service delivery.

    Flexibility The ability of an organisation to change what it does quickly. In terms of products or services this can relate to introducing new designs, changing the mix, changing the overall volume and changing the delivery timing.

    Focus The alignment of particular market demands with individual facilities to reduce the level of complexity generated when attempting to service a number of different market segments from an individual organisation.

    Group technology The process of grouping products for manufacture or services for delivery.

    Job characteristics model Links job characteristics with the desired psychological state of the individual and the outcomes in terms of motivation and job performance.

    Jobbing process The process of making a low volume product to a customer specification

    JIT and Lean Operations Integration of a philosophy and techniques designed to improve performance.

    Lag capacity When capacity is added only when extra demand is present that would use the additional resources.

    Lead capacity To maintain extra capacity above forecast demand and so maintain a capacity ‘cushion’.

    Learning curves Provide an organisation with the ability to predict the improvement in productivity that can occur as experience is gained of a process.

    Level capacity A capacity planning strategy that sets processing capacity at a uniform level throughout the planning period regardless of fluctuations in forecast demand.

    Line balancing Aims to ensure that the output of each production stage in a line/mass layout is equal and maximum efficiency is achieved.

    Loading Involves determining the available capacity for each stage in a process and allocating a work task to that stage.

    Mass/Line process A process that produces products of high volume and low variety.

    Mass service Service process type that operates with a low variety and high volume.

    Match capacity A capacity planning strategy that aims to obtain capacity to match forecast demand.

    Materials Requirements Planning (MRP) An information system used to calculate the requirements for component materials needed to produce items.

    Optimised Production Technology (OPT) An operations control system that is based on the identification of bottlenecks within the production process.

    Process layout A layout in which resources that have similar processes or functions are grouped together.

    Product layout A layout in which the resources required for a product or service are arranged around the needs of that product or service.

    Production flow analysis A group technology technique that can be used to identify families of parts.

    Professional service Service process type characterised by high levels of customisation and customer contact.

    Project process A process that is used to make a one-off product to a customer specification. A feature of a project process is that the location of the product is stationary.

    Quality How well the product or service meets customer needs.

    Quality Functional Deployment (QFD) Translates the voice of the customer into technical design requirements.

    Scheduling The allocation of a start and finish time for an order.

    Sequencing The sequential assignment of tasks to individual processes.

    Service blueprinting A charting device for processes which documents the interaction between the customer and service provider.

    Service package The combination of goods and services that comprise a service.

    Service shop Service process type which operates with a medium amount of variety and volume.

    Six Sigma A company-wide initiative to reduce costs through process efficiency and increase revenues through process effectiveness.

    Speed The time delay between a customer request for a product or service and receipt of that product or service.

    Statistical Process Control (SPC) A sampling technique that checks the quality of an item which is engaged in a process.

    Supply chain he series of activities that move materials from suppliers, through operations to customers.

    Total Preventative Maintenance (TPM) A programme of routine maintenance that will help to reduce breakdowns.

    Total Quality Management (TQM) A philosophy that aims to make high quality, as defined by the customer, a primary concern throughout the organisation.

    Value engineering (VE) Eliminates unnecessary features and functions that do not contribute to the value or performance of the product.

    Yield management The use of demand management strategies aimed at maximising customer revenue in service organisations.

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