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The plain language guide to getting things running smoothly in the world of business
Operations management is all about efficiency, and Operations Management For Dummies is all about efficiently teaching you what you need to know about this business hot topic. This book tracks typical operations management MBA courses, and it will help you un-muddle concepts like process mapping, bottlenecks, Lean Production, and supply chain management. Learn to step into a business, see what needs improving, and plug in the latest tools and ideas to shape things up in any industry.
This latest edition covers, you guessed it, digital transformation. Technology is completely upending operations management, and Dummies walks you through the latest, so you can stay at the front of the pack. Other new stuff inside: supply chain traceability, ethical sourcing and carbon footprint, business resiliency, and modularizing the supply chain. It's all here!
Optimize operations and increase revenue with strategies and ideas that make businesses run better and cheaper Get easy-to-understand explanations of complex topics and theories in operations management Learn how operations management is affected by digital transformation and sustainability concerns Evaluate, design, improve, and scale all sorts of processes, regardless of business size or area of operationBusinesses can't operate successfully without effective operations and supply management. That makes Operations Management For Dummies a must--for MBA students and business professionals alike.
Author Notes
Geoffrey Parker is the author or editor of more than twenty-five books. He is Andreas Dorpelan Professor of History at Ohio State University.
(Bowker Author Biography)
Table of Contents
| Introduction | p. 1 |
| About This Book | p. 1 |
| Conventions Used in This Book | p. 3 |
| Foolish Assumptions | p. 3 |
| Icons Used In This Book | p. 4 |
| Beyond the Book | p. 4 |
| Where to Go from Here | p. 4 |
| Part 1 Getting Started with Operations Management | p. 7 |
| Chapter 1 Discovering the Fundamentals of Operations Management | p. 9 |
| Defining Operations Management | p. 10 |
| Getting beyond the smokestack | p. 10 |
| Seeing the relevance of operations management | p. 11 |
| Understanding the Process of Operations | p. 12 |
| Driving the business model | p. 12 |
| Recognizing the diversity of processes | p. 13 |
| Managing processes | p. 15 |
| Handling special situations | p. 17 |
| Meeting the Challenges | p. 18 |
| Firefighting | p. 18 |
| Technology | p. 18 |
| Complacency | p. 19 |
| Metrics | p. 19 |
| Perspective | p. 19 |
| Outsourcing | p. 20 |
| Chapter 2 Defining and Evaluating Processes | p. 21 |
| Mapping Processes | p. 22 |
| Distinguishing between operations and delays | p. 24 |
| Identifying waste | p. 24 |
| Developing a process map | p. 26 |
| Evaluating the Elements of a System | p. 28 |
| Checking productivity | p. 28 |
| Considering capacity | p. 28 |
| Clocking cycle time | p. 29 |
| Getting a handle on constraints | p. 29 |
| Talking thruput and takt time | p. 30 |
| Going with the flow time | p. 31 |
| Monitoring utilization | p. 32 |
| Accounting for variability | p. 35 |
| Chapter 3 Designing Processes to Meet Goals | p. 37 |
| Getting Started with Process Improvement | p. 38 |
| Planning Operations | p. 38 |
| Considering a serial process | p. 39 |
| Placing operations in parallel | p. 39 |
| Improving Processes According to a Goal | p. 42 |
| Reducing customer flow time | p. 43 |
| Increasing system capacity | p. 44 |
| Balancing the line | p. 46 |
| Utilizing flexible resources | p. 48 |
| Improving a process that has excess capacity | p. 49 |
| Managing Bottlenecks | p. 50 |
| Getting tripped up by overproduction | p. 50 |
| Increasing process capacity | p. 52 |
| Chapter 4 Dealing with Shared Resources, Batches, and Rework | p. 55 |
| Sharing Resources | p. 56 |
| Assigning a resource to more than one operation | p. 56 |
| Allocating resources to more than one process | p. 57 |
| Batching Parts and Setting Up Operations | p. 58 |
| Working with batches | p. 59 |
| Maximizing operation batch size | p. 60 |
| Optimizing transfer batch size | p. 62 |
| Optimizing batch size with operation setups | p. 65 |
| Handling Poor Quality | p. 68 |
| Putting rework back in the process that created it | p. 69 |
| Pulling rework out of the main process | p. 71 |
| Chapter 5 Designing Your Process to Match Your Product or Service | p. 73 |
| Considering Costs, Standardization, Volume, and Flexibility | p. 74 |
| Balancing operating costs | p. 75 |
| Blurring the lines: Making standardized stuff customizable | p. 79 |
| Improving Face-to-Face and Back-Office Operations | p. 80 |
| Strengthening the customer interface | p. 81 |
| Improving efficiencies behind the scenes | p. 83 |
| Fulfilling Customer Demand: Making to Stock or Making to Order | p. 84 |
| Making to stock | p. 84 |
| Making to order | p. 85 |
| A tale of two companies: Making either method work | p. 86 |
| Getting It to Your Customer | p. 87 |
| Ordering Online and Pickup in Store or Curbside | p. 87 |
| Ordering Online with Delivery | p. 88 |
| Designing for X: Designing Products with Operations in Mind | p. 89 |
| Part 2 Managing Variability and Risk | p. 91 |
| Chapter 6 Forecasting Demand | p. 93 |
| Getting Savvy about Forecasts | p. 94 |
| Building a Forecast to Predict Demand | p. 95 |
| Recognizing demand variation | p. 95 |
| Looking to the past to predict the future | p. 96 |
| Lacking data: No problem | p. 101 |
| Acknowledging the Error of Your Ways | p. 103 |
| Hunting down the source of your error | p. 103 |
| Measuring how inaccurate you are | p. 105 |
| Chapter 7 Planning Capacity | p. 107 |
| Considering Capacity | p. 108 |
| Matching supply and demand | p. 109 |
| Timing adjustments just right | p. 110 |
| Balancing Capacity and Inventory | p. 111 |
| Producing to match demand | p. 113 |
| Producing at capacity | p. 113 |
| Increasing capacity | p. 115 |
| Addressing Wait Time for Services | p. 116 |
| Getting the why of waiting | p. 116 |
| Estimating waiting time with queuing theory | p. 119 |
| Altering customer perceptions | p. 126 |
| Chapter 8 Managing Inventory | p. 129 |
| Dealing with the Business of Inventory | p. 130 |
| Recognizing inventory's purposes | p. 131 |
| Measuring the true cost of inventory | p. 132 |
| Managing Inventory | p. 133 |
| Continuous review | p. 135 |
| Periodic review | p. 137 |
| Single period review | p. 138 |
| Comparing the options | p. 139 |
| Getting Baseline Data on Performance | p. 139 |
| Assessing the inventory management?system | p. 140 |
| Evaluating the quality of customer service | p. 141 |
| Reducing Inventory without Sacrificing Customer Service | p. 141 |
| Multitasking inventory: The commonality approach | p. 142 |
| Holding on: The postponement strategy | p. 143 |
| Managing Inventory across the Supply Chain | p. 145 |
| Keeping track of the pipeline inventory | p. 145 |
| Setting service levels with multiple suppliers | p. 147 |
| Chapter 9 Planning for Successful Operations | p. 149 |
| Planning from the Top Down | p. 150 |
| Determining corporate strategy | p. 150 |
| Preparing for success | p. 151 |
| Executing the plan | p. 153 |
| Exploring the Components of an Aggregate Plan | p. 153 |
| Putting together a plan | p. 154 |
| Creating the master schedule | p. 154 |
| Considering Materials | p. 156 |
| Gathering information for the system | p. 156 |
| Getting system results | p. 157 |
| Planning for Services | p. 159 |
| Seeing the difference in services | p. 159 |
| Establishing the service plan | p. 160 |
| Applying Information to the Entire Organization | p. 161 |
| Part 3 Improving Operations | p. 163 |
| Chapter 10 Becoming Lean | p. 165 |
| Evolving to Lean | p. 165 |
| Mastering the craft | p. 166 |
| Producing in mass | p. 167 |
| Trimming the Fat | p. 170 |
| Eliminating the waste | p. 170 |
| Involving everyone | p. 171 |
| Leveling production | p. 171 |
| Embracing your supplier | p. 174 |
| Focusing on quality | p. 175 |
| Implementing continuous improvement | p. 176 |
| Producing Just in Time | p. 176 |
| Knowing when to work | p. 177 |
| Differentiating the customer interface | p. 178 |
| Implementing pull | p. 178 |
| Knowing when to JIT | p. 180 |
| Seeking the Silver Bullet | p. 181 |
| Chapter 11 Proofing against Disruption | p. 183 |
| Understanding Disruptions | p. 184 |
| Planning for Disruption | p. 187 |
| Knowing your supply chain and operations | p. 187 |
| Using new technology | p. 187 |
| Planning for scenarios collaboratively | p. 188 |
| Investing in Relationships | p. 188 |
| Fattening the Supply Chain | p. 189 |
| Stockpiling inventory | p. 189 |
| Maintaining stand-by capacity | p. 190 |
| Exploiting flexible capacity | p. 190 |
| Redesigning Your Product and Process | p. 191 |
| Designing for multiple parts | p. 191 |
| Designing for multiple processes | p. 191 |
| Replacing labor with autonomy | p. 191 |
| Protecting against Cyberhacking | p. 192 |
| Mixing and Matching Strategies | p. 192 |
| Chapter 12 Managing Quality | p. 193 |
| Deciding What Matters | p. 193 |
| Recognizing the Value of Quality | p. 196 |
| Assessing the cost of failure | p. 196 |
| Detecting defects | p. 197 |
| Getting the perks of high quality | p. 198 |
| Preventing defects in the first place | p. 199 |
| Addressing Quality | p. 199 |
| Considering the customer | p. 200 |
| Getting all hands on deck | p. 200 |
| Sticking to the improvement effort | p. 201 |
| Designing for Quality | p. 202 |
| Starting with the end in mind | p. 202 |
| Cascading to production | p. 205 |
| Measuring Quality | p. 205 |
| Understanding variation | p. 206 |
| Measuring "goodness" of a process | p. 207 |
| Controlling processes | p. 210 |
| Chapter 13 Creating a Quality Organization | p. 215 |
| Reaching Beyond Traditional Improvement Programs | p. 216 |
| Multiplying failures | p. 216 |
| Raising the bar | p. 218 |
| Varying skill levels | p. 218 |
| Adding to the Tool Box | p. 219 |
| Defining the problem | p. 220 |
| Measuring the process | p. 221 |
| Analyzing the problem | p. 221 |
| Implementing a solution | p. 227 |
| Maintaining the gain | p. 229 |
| Overcoming Obstacles | p. 230 |
| Failing to focus | p. 230 |
| Prioritizing into paralysis | p. 231 |
| Avoiding the lure of magical solutions | p. 231 |
| Lacking employee involvement | p. 232 |
| Knowing what to do | p. 232 |
| Learning from the experience | p. 232 |
| Calling it a program | p. 233 |
| Giving up | p. 233 |
| Part 4 Managing the Supply Chain | p. 235 |
| Chapter 14 Understanding Supply Chain Basics | p. 237 |
| Seeing the Structure of Supply Chains | p. 238 |
| Getting through the tiers | p. 239 |
| Linking in support services | p. 239 |
| Aligning the Supply Chain with Business Strategy | p. 240 |
| Defining product demand | p. 241 |
| Choosing the right supply chain strategy | p. 241 |
| Exploring the Bullwhip Effect | p. 243 |
| Finding the bullwhip triggers | p. 244 |
| Dodging the bullwhip | p. 247 |
| Improving Supply Chain Management | p. 249 |
| Communicating better | p. 249 |
| Outsourcing inventory management | p. 249 |
| Simplifying the chain by consolidating shipments | p. 250 |
| Chapter 15 Sourcing Strategically | p. 253 |
| Seeing the Upsides and Downsides of Outsourcing | p. 253 |
| Benefiting from the pros | p. 254 |
| Avoiding the cons | p. 255 |
| Getting Down to the Basics | p. 257 |
| Figuring out what to outsource | p. 258 |
| Choosing the right partner | p. 259 |
| Developing a lasting relationship | p. 262 |
| Integrating the product | p. 264 |
| Chapter 16 Digitaiizing the Supply Chain | p. 267 |
| Navigating the Digital World | p. 268 |
| Defining the difference between digitizing and digitaiizing | p. 268 |
| Realizing the benefits | p. 268 |
| Mapping a Digital Strategy | p. 269 |
| Undergoing a digital transformation | p. 270 |
| Selecting the best solution | p. 271 |
| Chapter 17 Scaling throughout the Product Life Cycle | p. 273 |
| Managing Operations Age-Appropriately | p. 273 |
| Swooning over the Baby | p. 275 |
| Keeping capacity flexible to minimize inventory during unpredictable demand | p. 275 |
| Designing a supply chain for a new product | p. 277 |
| Defining a market with no competitors | p. 278 |
| Avoiding failure in incubation | p. 278 |
| Surviving the Awkward Stage of Quick Growth | p. 279 |
| Balancing Capacity and inventory for growing demand | p. 279 |
| Growing your supply chain | p. 281 |
| Distinguishing your product from competitors' products | p. 281 |
| Getting Comfortable with Market Maturity | p. 282 |
| Exploiting capacity and optimizing inventory for steady demand | p. 282 |
| Balancing a mature supply chain | p. 283 |
| Preparing for the End | p. 283 |
| Emerging Anew | p. 284 |
| Repositioning | p. 284 |
| Making improvements | p. 285 |
| Changing the product portfolio | p. 285 |
| Managing Start-up Operations | p. 286 |
| Operating on a shoestring | p. 287 |
| Transitioning to growth | p. 287 |
| Part 5 Managing Projects | p. 289 |
| Chapter 18 Leading Successful Projects | p. 291 |
| Defining Success | p. 292 |
| Prioritizing criteria | p. 292 |
| Seeing the interaction of factors | p. 293 |
| Figuring Out Why Projects Fail | p. 295 |
| Laying Out the Project Management Life Cycle | p. 296 |
| Detailing the phases of the cycle | p. 296 |
| Deciding to go or not to go | p. 298 |
| Documenting the project | p. 300 |
| Leading a Project | p. 300 |
| Developing a project proposal with a team | p. 301 |
| Communicating with stakeholders | p. 302 |
| Keeping stakeholders in the loop | p. 303 |
| Managing the team | p. 303 |
| Chapter 19 Estimating and Scheduling Projects | p. 307 |
| Estimating Time and Cost | p. 308 |
| Compiling a list of tasks | p. 308 |
| Adding up the project costs | p. 312 |
| Timing: The critical path | p. 314 |
| Assigning tasks | p. 319 |
| Presenting the schedule | p. 320 |
| Working with Uncertainty | p. 321 |
| Estimating with ranges | p. 321 |
| Using historical data | p. 321 |
| Relying on expert knowledge | p. 326 |
| Putting It All Together | p. 328 |
| Avoiding the estimation dance | p. 328 |
| Accelerating the project | p. 329 |
| Chapter 20 Becoming Agile | p. 331 |
| Escaping the Waterfall | p. 332 |
| Deciding on Agile | p. 333 |
| Gearing Up for Agile | p. 334 |
| Sprinting through the Project | p. 335 |
| Planning the sprint | p. 336 |
| Standing up with scrum meetings | p. 339 |
| Rinsing, washing, and repeating | p. 340 |
| Avoiding Common Agile Mistakes | p. 342 |
| Starting without planning | p. 343 |
| Ignoring Waterfall skills | p. 343 |
| Combining Agile and Waterfall | p. 344 |
| Chapter 21 Responding to Risks That Threaten Your Project | p. 345 |
| Tracking Project Progress | p. 346 |
| Assessing earned value | p. 346 |
| Earning value over time | p. 349 |
| Monitoring the metrics: Who's responsible? | p. 351 |
| Realizing your project's in trouble | p. 351 |
| Planning Ahead with Risk Registers | p. 354 |
| Knowing what can go wrong | p. 355 |
| Prioritizing risks | p. 356 |
| Developing a contingency plan | p. 358 |
| Responding Productively to Risk | p. 361 |
| Staying productive: Parkinson's Law | p. 361 |
| Recovering from delays: Brook's Law and Homer's Law | p. 362 |
| Delay the project | p. 364 |
| Sacrificing functionality | p. 364 |
| Part 6 The Part of Tens | p. 365 |
| Chapter 22 Ten Pivotal Operations Management Developments | p. 367 |
| Logistics | p. 367 |
| Division of Labor | p. 368 |
| Interchangeable Parts | p. 368 |
| Scientific Management and Mass Production | p. 369 |
| Statistical Quality Control | p. 369 |
| Lean Manufacturing | p. 370 |
| Scientific Project Planning | p. 370 |
| Supply Chain Management | p. 371 |
| Computerized Supply Chain Coordination | p. 371 |
| Electronic Commerce | p. 372 |
| Chapter 23 Ten Mistakes that New Operations Managers Make | p. 373 |
| Beginning an Improvement Journey without Knowing your Process | p. 373 |
| Creating Overly Complex Processes | p. 374 |
| Missing the Real Bottleneck | p. 375 |
| Managing Based on Utilization | p. 375 |
| Not Standardizing | p. 375 |
| Automating Bad Processes | p. 376 |
| Misdefining Quality | p. 376 |
| Improving Process through "Big Bangs" rather than Continuous Improvement | p. 377 |
| Not Doing Enough Project Planning Upfront | p. 377 |
| Not Focusing on the Customer | p. 378 |
| Chapter 24 Ten Traits of World-Class Operations | p. 379 |
| Knowing Thyself | p. 379 |
| Possessing Profound Knowledge of the Customer | p. 380 |
| Focusing intensely on Quality | p. 380 |
| Adapting to Change | p. 381 |
| Getting Better All the Time | p. 381 |
| Appreciating Employees | p. 381 |
| Paying Constant Attention to Product Offerings | p. 382 |
| Using Relevant Process Metrics | p. 382 |
| Balancing Respect and Expectations for the Supply Chain | p. 382 |
| Avoiding Unnecessary Complexity | p. 383 |
| Index | p. 385 |
