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All organizations have operations that produce some mix of products and services. The economic sector of an operation is less important in determining how it should be managed than its intrinsic characteristics. All parts of the business manage processes so all parts of the business have an operations role and need to understand operations management. All processes have inputs of transforming and transformed resources that they use to create products and services. Transformed resource inputs to a process are materials, information, or customers. All processes have transforming resources of facilities and people. A process perspective can be used at three levels: the level of the operation itself, the level of the supply network, and the level of individual processes. Most operations produce a mixture of tangible products and intangible services. Processes are defined by how the organization chooses to draw process boundaries. All operations should be expected to contribute to their business by controlling costs, increasing revenue, making investment more effective and growing long-term capabilities. The way in which processes need to be managed is influenced by volume, variety, variation and visibility. Operations management activities can be grouped into four broad categories: directing the overall strategy of the operation, designing the operations products, services and processes, planning and controlling delivery, and developing process performance.
Variability in a process acts to reduce its efficiency. Process variability results in simultaneous waiting and resource under-utilization. Process design involves some choice between utilization, waiting time, and variability reduction.
Chapter 13 Improvement
Performance improvement is the ultimate objective of operations and process management. Performance measurement is a prerequisite for the assessment of operations performance. Without strategic clarity, key performance indicators cannot be appropriately targeted. Performance measures only have meaning when compared against targets. Improvement is aided by contextualizing processes and operations. Breakthrough and continuous improvement are not mutually exclusive. Continuous improvement necessarily implies a never-ending cycle of analysis and action. Breakthrough improvement necessarily implies radical and/or extensive change. Improvement is facilitated by relatively simple analytical techniques. The popularity of an improvement approach is not necessarily an indicator of its effectiveness. There is no one universal approach to improvement.