Chapter 9- Producing World-Class Goods and Services

production
The creation of finished goods and services using the factors of production:land,labor,capital,entrepreneurship,and knowledge.
production management
The term used to describe all the activities managers do to help their firms create goods.
operations management
A specialized area in management that converts or transforms resources (including human resources) into goods and services.
form utility
The value added by the creation of finshed goods and services,such as the value added by taking silicon and making computer chips or putting services together to create a vacation package.
process manufacturing
That part of the production process that physically or chemically changes materials.
assembly process
That part of the production process that puts together components.
continuous process
A production process in which long production runs turn out finished goods over time.
intermittent process
A production process in which the production run is short and the machines are changed frequently to make different products.
computer-aided process (CAD)
The use of computers in the design of products.
computer-aided manufacturing (CAM)
The use of computers in the manufacturing of products.
computer-integrated manufacturing (CIM)
The uniting of computer-aided design (CAD) with computer-aided manufacturing (CAM).
flexible manufacturing
Designing machines to do multiple tasks so that they can produce a variety of products.
lean manufacturing
The production of goods using less of everything compared to mass production.
mass customization
Tailoring prodcuts to meet the needs of individual customers.
facility location
The process of selecting a geographic location for a company’s operations.
facility layout
The physical arrangement of resources (including people) in the production process.
materials requirement planning (MRP)
A computer-based production management system that uses sales forecasts to make sure that needed parts and materials are available at the right time and place.
enterprise resource planning (ERP)
A computer application that enables multiple firms to manage all of their operations (finance, requirements planning, human resources, and order fulfillment) on the basis of a single, integrated set of corporate data.
purchasing
The function in a firm that searches for quality material resources, finds the best suppliers, and negotiates the best price for goods and services.
just-in-time (JIT) inventory control
A production process in which a minimum of inventory is kept on the premises and parts,supplies,and other needs are delivered just in time to go on the assembly line.
quality
Consistency producing what the customer wants while reducing errors before and after delivery to the customer.
six sigma quality
A quality measure that allows only 3.4 defects per million oppurtunities.
statistical quality control (SQC)
The process some managers use to continually monitor all phases of the production process to assure that quality is being built into the product from the beginning.
statistical process control (SPC)
The process of taking statistical samples of product components at each stage of the production process and plotting those results on a graph. Any variances from quality standardsare recognized and can be corrected if beyond the set standards.
ISO 9000
The common name given to quality management and assurance standards.
ISO 14000
A collection of the best practices for managing an organization’s impact on the environment.
program evaluation and review technique (PERT)
A method for analyzing the tasks in completing a given project,estimating the time needed to complete each task,and identifying the minimum time needed to complete the total project.
critical path
In a PERT network, the sequence of tasks that takes the longest time to complete.
Gantt chart
Bar graph showing production managers what projects are being worked on and what stage they are in at any given time.