Chapter 09 – Production and Operations Management
F. MASS CUSTOMIZATION means tailoring products to
meet the needs of individual customers.
1. FLEXIBLE MANUFACTURING SYSTEMS let
manufacturers custom-make goods as quickly as
IV. OPERATIONS MANAGEMENT PLANNING
A. Many of the issues covered in operations manage-
ment planning are the same in both service and manu-
facturing sectors.
B. FACILITY LOCATION
1. FACILITY LOCATION is the process of selecting
Chapter 09 – Production and Operations Management
9-22
SPOTLIGHT ON
small
business
(Text page 243)
PPT 9-31
Mass Customization
of Candy
(See complete PowerPoint slide notes on page 9.53.)
progress
assessment
(Text page 243)
PPT 9-32
Progress Assessment
(See complete PowerPoint slide notes on page 9.53.)
PPT 9-33
Operations Management
(See complete PowerPoint slide notes on page 9.54.)
PPT 9-34
Facility Location
(See complete PowerPoint slide notes on page 9.54.)
bonus case 9-2
A SMALL HOMECOMING BY
AMERICAN MANUFACTURERS
Caterpillar is one of several U.S. companies that are bringing
factories back to American soil. (See the complete case, discus-
sion questions, and suggested answers beginning on page 9.80
of this manual.)
Chapter 09 – Production and Operations Management
9-23
c. The most successful service-sector business–
es are conveniently located.
C. FACILITY LOCATION FOR MANUFACTURERS
1. Automobile production is shifting from Detroit to
southern cities, creating both pockets of unem-
ployment and pockets of rapid growth.
2. Manufacturers consider:
a. Labor costs
Chapter 09 – Production and Operations Management
lecture link 9-7
URBAN AGRICULTURE IN
DETROIT
bonus case 9-3
ORECK: AFTER THE STORM
MAKING
ethical
decisions
(Text page 246
PPT 9-35
Stay or Leave
9-25
OVERSEAS to get closer to international
engineering, design, manufacturing, and other
Chapter 09 – Production and Operations Management
9-26
PPT 9-36
Operations Management on the
Internet
(See complete PowerPoint slide notes on page 9.55.)
critical thinking
exercise 9-3
SITE SELECTION
This exercise explores the factors managers consider in
choosing the site for manufacturing plants. (See complete exer-
cise on page 9.74 of this manual.)
Chapter 09 – Production and Operations Management
giving firms and employees more FLEXIBILITY in
choosing locations.
cess.
a. The facility layout depends on what processes
9-28
PPT 9-37
Future Facility Location
(See complete PowerPoint slide notes on page 9.55.)
lecture link 9-8
WYETH BIOTECH
Wyeth’s Biotech unit is using flexible manufacturing and per-
formance bonuses to change the way it produces drugs. (See the
complete lecture link on page 9.68 in this manual.)
PPT 9-38
Setting Up the Facility
(See complete PowerPoint slide notes on page 9.55.)
critical thinking
exercise 9-4
DESIGNING PLANT LAYOUT
Students are asked to research and design a plant layout for a
production firm. (See complete exercise on page 9.77 of this
manual.)
PPT 9-39
Facility Layout Options
(See complete PowerPoint slide notes on page 9.56.)
PPT 9-40
Assembly Line Layout
TEXT FIGURE 9.2
Typical Layout Design
(Text page 248)
(See complete PowerPoint slide notes on page 9.56.)
Chapter 09 – Production and Operations Management
together.
G. MATERIALS REQUIREMENT PLANNING
1. MATERIALS REQUIREMENT PLANNING (MRP)
is a computer-based production management sys-
tem that uses sales forecasts to make sure the
needed parts and materials are available at the
right time and place.
best suppliers, and negotiates the best price for
quality goods and services.
2. In the past, manufacturers dealt with many differ-
ent suppliers.
3. Today, they rely more heavily on one or two ven-
dors, and the relationship between suppliers and
Chapter 09 – Production and Operations Management
PPT 9-41
Modular Layout
(See complete PowerPoint slide notes on page 9.56.)
PPT 9-42
Process Layout
(See complete PowerPoint slide notes on page 9.57.)
PPT 9-43
Fixed-Position Layout
(See complete PowerPoint slide notes on page 9.57.)
PPT 9-44
MRP and ERP
(See complete PowerPoint slide notes on page 9.57.)
PPT 9-45
Purchasing
(See complete PowerPoint slide notes on page 9.58.)
9-31
4. INTERNET-BASED PURCHASING SERVICES
allow companies to find the best supplies at the
best price.
I. JUST-IN-TIME INVENTORY CONTROL
1. Holding parts and other items in warehouses is
one major cost of production.
2. JUST-IN-TIME (JIT) INVENTORY CONTROL is
a production process in which a minimum of in-
ventory is kept on the premises and parts, sup-
ter delivery to the customer.
Chapter 09 – Production and Operations Management
lecture link 9-9
SPYING ON THE GREEN GIANT
In the early years of production, Green Giant managers re-
sorted to spying to learn the secrets of canning. (See the com-
plete lecture link on page 9.69 in this manual.)
PPT 9-46
Inventory Control
(See complete PowerPoint slide notes on page 9.58.)
bonus case 9-4
KAIZEN: REDESIGNING THE
MANUFACTURING PROCESS
Manufacturing consultant Anand Sharma advises manufac-
turers on how to utilize the Japanese concept of kaizen with an
American flavor. (See the complete case, discussion questions,
and suggested answers beginning on page 9.83 of this manual.)
PPT 9-47
Quality Control
(See complete PowerPoint slide notes on page 9.58.)
Chapter 09 – Production and Operations Management
a. Historically, quality control was often done at
the END OF THE PRODUCTION LINE by a
that allows only 3.4 defects per million oppor-
Chapter 09 – Production and Operations Management
9-34
lecture link 9-10
MOTOROLA AND SIX SIGMA
The philosophy of Six Sigma is most closely identified
with Jack Welch and GE, but Motorola invented it in the late
1970s. (See the complete lecture link on page 9.45 of this
manual.)
PPT 9-48
Statistical Quality Control and
Statistical Process Control
(See complete PowerPoint slide notes on page 9.59)
Chapter 09 – Production and Operations Management
K. THE BALDRIGE AWARDS
1. One standard for quality was set with the intro-
duction of the MALCOLM BALDRIGE NATION-
AL QUALITY AWARDS in 1987.
2. To qualify, a company has to show quality in
SEVEN KEY AREAS:
a. Leadership
b. Strategic planning
1. The INTERNATIONAL ORGANIZATION FOR
STANDARDIZATION (ISO) is a worldwide feder-
global measures for the quality of individual
products.
2. ISO 9000 is the common name given to quality
Chapter 09 – Production and Operations Management
PPT 9-49
The Baldrige Awards
(See complete PowerPoint slide notes on page 9.59.)
PPT 9-50
The Winners Are . . .
(See complete PowerPoint slide notes on page 9.60.)
PPT 9-51
What Is ISO?
(See complete PowerPoint slide notes on page 9.60.)
3. The latest standards are called ISO 9001:2008.
4. The EUROPEAN UNION is demanding that
CHARTS
A. The production manager’s job is to ensure that prod-
ucts are manufactured and delivered on time.
B. PROGRAM EVALUATION AND REVIEW TECH-
NIQUE (PERT)
1. PROGRAM EVALUATION AND REVIEW
TECHNIQUE (PERT) is a method for analyzing
the tasks involved in completing a given project,
Chapter 09 – Production and Operations Management
9-38
progress
assessment
(Text page 251)
PPT 9-52
Progress Assessment
(See complete PowerPoint slide notes on page 9.61.)
PPT 9-53
PERT
(See complete PowerPoint slide notes on page 9.62.)
PPT 9-54
Steps Involved in PERT
(See complete PowerPoint slide notes on page 9.62.)
Chapter 09 – Production and Operations Management
c. Step 3: Drawing a PERT network illustrating
the information from steps 1 and 2
sic video.
5. The GANTT CHART is a bar graph showing pro-
duction managers what projects are being worked
on and what stage they are in at any given time.
Chapter 09 – Production and Operations Management
9-40
critical thinking
exercise 9-5
DRAWING A PERT DIAGRAM
This exercise lets students design a PERT diagram for vari-
ous production processes. (See complete exercise on page 9.78
of this manual.)
PPT 9-55
PERT Chart for a Music Video
TEXT FIGURE 9.3
PERT Chart for a Music Video
(Text page 252)
(See complete PowerPoint slide notes on page 9.63.)
PPT 9-56
Gantt Charts
(See complete PowerPoint slide notes on page 9.63.)
PPT 9-57
Gantt Chart for a Doll Factory
TEXT FIGURE 9.4
Gantt Chart for a Doll Manufacturer
(Text page 253)
(See complete PowerPoint slide notes on page 9.63.)