1 / 4

Limits of Operational Effectiveness

Explore how implementing Just-in-Time (JIT), Total Quality Management (TQM), and Lean principles can help businesses transcend trade-offs and achieve high productivity, quality, and low costs.

rhearn
Download Presentation

Limits of Operational Effectiveness

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Limits of Operational Effectiveness High Productivity Frontier (state of best practice) Quality or Lead-Time JIT TQM LEAN Low High Low Cost

  2. Transcending Trade-offs • Skinner suggests separate “focused factories” for volume versus flexibility • Achieve simultaneity by building capability successively - first quality, then lead-time, etc. • Simultaneity is indicative of slack in existing processes • Organizational and technological innovation can shift the productivity frontier upwards

  3. Investment Strategy and Manufacturing Capabilities • Invest in capital • High fixed costs • Allows speed • Invest in people • Labor becomes a fixed cost • Allows high quality and innovative solutions • Minimal investment in resources - outsource • Capital and labor are variable costs • Allow low cost production • Investment in capital and people?

  4. Types of Trade-offs • Speed and volume flexibility, but high fixed cost and low work force commitment (Capital) • High quality and innovative solutions (range flexibility), and high work force commitment, but volume inflexibility (Lifetime) • Low cost and volume flexibility, but long lead- times and low work force commitment (Overtime)

More Related