CHAPTER 13
Planning Startup Operations
SUMMARY AND AUTHOR’S NOTE
This is another chapter that is left out of most entrepreneurship books, yet manufacturing and
production are making a big comeback in the United States. Because of technology and the
global marketplace, more and more entrepreneurs are trying their hands at product development
CHAPTER OBJECTIVES
After reading this chapter, students will be able to:
• Identify the components of the production process for products and services.
CHAPTER OUTLINE
OPENING CASE: Finding Gold in Someone Else’s Garbage
I. Producing Products and Services—building a production system
II. Supply Chain Management—providing exactly what the customer wants at minimal
cost
• Figure 13.1—Example of a Supply Chain
56 Chapter 143: Managing Operations
• Figure 13.2—The Production Process
i. Production Scheduling
RELEVANT CASE STUIDES
Case 5 B2P
Case 6 Potion Inc.
ANSWERS TO QUESTIONS ON KEY ISSUES
1. Why is it important to consider your manufacturing plan in the earliest stages of your new
venture?
Building a complex production system, even if it’s outsourced, while the company is in
2. What are three factors that an entrepreneur must take into consideration when choosing
vendors to meet materials requirements?
Factors to consider when choosing vendors include: 1) Can the vendor deliver enough
3. Suppose you had a new advertising firm. How could you schedule activities to create more
efficiency in your operations?
Two methods that could be used to analyze and improve scheduling of processes are Gantt
Chapter 143: Managing Operations 57
4. What are some of the key factors that must be considered when setting up a quality control
system?
Today thousands of manufacturers and producers have embraced the philosophy of quality
5. Characterize the critical aspects of an effective supply chain for any business.
Entrepreneurs must have a clear understanding of what is important to their customers—
SUGGESTIONS FOR EXPERIENCING ENTREPRENEURSHIP
1. Visit a manufacturing facility that is using technology to facilitate its processes. Develop a
flowchart of the manufacturing process. Can you see any ways to improve the process?
2. Interview an entrepreneur with a product company about his or her views on quality. How
is this entrepreneur implementing quality control in his or her organization?
Students should be aware that the entrepreneur may not describe his or her quality system in
3. Choose a young company that has a global supply chain. Develop a process flow chart
depicting the supply chain, and analyze it for efficiency and flexibility based on information
provided in the chapter.
Ask students to do this assignment using a product in which they’re interested. They should