2.%20Managing%20operations

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2. Managing operations

• b. Product, service, process design, and
  reliabilities
• Mgt 300
• Ken Thompson
• Session 6

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Todays problem,,,,, How do we make a product or
design a process that can save dollars while
better meeting the needs of the customer...
Examples of good or bad product design?
Examples of good or bad service before, after,
and during the sale.
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2. Managing the organizationa. Product, Service,
Process Design

• Session Overview
• Product Design
• Service Design
• Process Design
• process mapping
• use of reliabilities

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This session focuses on cat 6 of the Baldrige
criterion Process Management
The category examines how key processes are
designed, effectively managed, and improved to
achieve better performance. Key aspects of
process management are examined including
customer-focus design, product and service
delivery processes, support processes, supplier
and partnering processes involving all work units.
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What are our goals in this section?

• Meeting the needs of the market thru...
• improved design
• improved quality
• improved reliability
• accelerate error detection
• reduced cycle time

We look at product and system design here!
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What are our goals in this section?

• Meeting the needs of the market
• Reducing costs thru
• product design
• reduced cycle time
• improve quality
• component reliability
• accelerate error detection
• expanded paradigm of the organization

You got it-- House of Quality strikes again
But...
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How can we know customer needs?

• customer visits gets designers and the rest of
  the team involved in really understanding needs
  and product uses
• focus groups
• consumption patterns

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1. Product Design
What are we trying to do here...
Have a product that meets the needs of the
customer
Meaning high value ease of use having desired
features high reliability low maintenance
cost and low down time
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Product design

• Some companies estimate that the major frontier
  on cost reduction is thru product design.
• consider Siemens and the gas injector in the
  Quality or Else video

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Reducing costs thru......Product design

• Motorola estimates
• it wastes 30 cents
• per each dollar on
• poor product design

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Reducing costs thru...... product design
Get the supplier involved Get the customer
involved Get manufacturing involved Get as
much input as possible expert and
non-expert to generate ideas for
improvement Value-added analysis and value-added
engineering
How to improve product design?
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What do we mean by improving quality?
Reliability is related to improving quality
We will look at reliabilities in detail after we
introduce the notion of processes, but generally
we can..
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Improve quality through.....component reliability

• engineer reliability
• reduce variability in operation
• self-correcting operation
• exceeding min specs
• design for worst maintenance conditions

Reliability Rs r1r2r3
Hence for an engine with1000 parts, each part
must have high reliability for the whole
engine to have high reliability
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Why is accelerated error detection a big deal?
Hence, with product design, one of the goals is
to improve reliability accelerate error detection
rate.
This also relates to service design and process
design.
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2. Service Design
Service design relates to the design of each
system that will be used to interface with the
customer. Normally we create process maps to
consider service design issues. However, there
are some basic considerations in process design
and service design that we will consider after
presenting the concept of process design.
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3. Process Design
There are three issues we will consider in
process design. - process mapping
- use of reliabilities and cycle time
- process choice - parametric or
sensitivity analysis - capacity
considerations.
Next session
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A basic way to analyze processes is to draw out
the process.
This is called process mapping
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Example of a Process Chart for a small package
delivery service
See text pg. 388
Receive notification of package pickup
Driver Picks-up package wands it into computer
Truck to local hub
Key in request, assign computer package
Dispatcher Notifies Driver
Notify Dispatcher
Code in invoice Add to computer tracking program
If local
to regional hub
If International
Unload truck, wand all packages
Separate by Local, National and International
Wand Load on Containers
to Indi hub
If National
to Memphis hub
Sort to local hub containers wand
Local sort and load on delivery trucks wand
Sort and resort for local hubs wand
Unload at Memphis and wand
Ship from Memphis to local hubs
Unload at local hub and wand
to cust. wand
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In-practice 4-1 Constructing and using a process
map
Do step 1 now
Not a food place
1. Make a process map of 5-10 steps 2. Now
include reliabilities and times for each step. 3.
Show an example of adding a redundant
process and what its affect will be on the step
and system. 4. Show an example of a non-redundant
process change and its affect on the step and
system reliability. 5. Show an example of a
concurrent process on the map how that would
affect system reliability time.
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Let look at reliability for a minute...
What is it? How can it be translated into a
meaningful standard?
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Now lets relate reliabilities to process design
Component reliability
Reliability of a system R1 x R2 x R3
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1. Fuel aircraft .99 2. Due
routine maintenance check .99 3. Close
baggage doors .99 4. Do pre-flight
system check .99 5. Close passenger
doors .99
For example, a system with 5 components at 3
sigma reliability only has a system reliability
of 2 sigma.
System Reliability .95
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Take order .9 Fill order
.7 Food cooked correctly .9 Take
cash 1.0 Make correct change
.8 System
reliability .45
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In P step 2
Take order .9 Fill order
.7 Food cooked correctly .9 Take
cash 1.0 Make correct change
.8 System
reliability .45
.9 x .7 x .9 x 1.0 x .8 .45
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To improve reliability
We add back up systems to catch failures for
e.g., we repeat food orders. This is call a
redundant process as it is only needed when the
primary process fails.
Take order .9 Fill order
.7 Food cooked correctly .9 Take
cash 1.0 Make correct change
.8 System
reliability .45
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Now lets see how a redundant process affect
component and system reliability
Component reliability
Reliability of a system R1 x R2 x R3
Let say we are going to apply a redundant process
to component reliability, R2
Redundant component reliability J which
affects component reliability R2 by...
R2 (new) R2 (old) ((1-R2(old)) x J)
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To improve reliability
.995
Take order .9 Fill order
.7 Food cooked correctly
.9 Take cash 1.0 Make correct
change .8
System reliability .45
This improve reliability using the
following equation .9 (redundant process
reliability x (1-initial component
reliability)) new component reliability .9
(.95 (1 - .9)) .9 .095
.995
J
This is the initial component reliability
This is called applying a redundant process
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In P step 3
To improve reliability
.995
Take order .9 Fill order
.7 Food cooked correctly
.9 Take cash 1.0 Make correct
change .8
System reliability .45
This improve reliability using the
following equation .9 (redundant process
reliability x (1-initial component
reliability)) new component reliability .9
.95 (1 - .9) .9 .095 .995
.50
.995 x .7 x .9 x 1.0 x .8 .50
This is the initial component reliability
Calculating the new system reliability
This is called applying a redundant process
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In P step 4
To improve reliability
We look at other changes in the product, service,
or process design to improve the reliability of
the whole system.
Take order .9 Fill order
.7 Food cooked correctly .9 Take
cash 1.0 Make correct change
.8 System
reliability .45
.95
For example how can we improve on the
reliability of filling the order right?
.62
This is called a process change. Note how the
changed reliability is posted.
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In P step 5
Reducing cycle time focuses on the time it take
for each process and how to speed that step or
redesign the step to reduce the whole process
time to make one cycle of the process (ergo cycle
time).
We can also use process maps to look at capacity
flows (how much one step can handle over a given
period of time). This helps us to look at
capacity management which we will cover next
session.