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McGraw-Hill/Irwin Understanding Business, 8e. © 2008 The McGraw-Hill Companies, Inc., All Rights Reserved. Nickels McHugh McHugh. *. *. Producing World-Class Goods and Services. *. CHAPTER. 9. *. *. 1- 1. Leading U.S. Manufacturing States. Michigan. New York.

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  1. McGraw-Hill/Irwin Understanding Business, 8e © 2008 The McGraw-Hill Companies, Inc., All Rights Reserved. Nickels McHugh McHugh * * Producing World-Class Goods and Services * CHAPTER 9 * * 1-1

  2. Leading U.S. Manufacturing States Michigan New York Illinois Ohio California Pennsylvania Texas Source: Britannica Student Encyclopedia, 2006

  3. ExxonMobil Chevron General Motors ConocoPhillips Ford Motor General Electric Altria Group IBM Corp. Hewlett-Packard Valero Energy Top Ten US Manufacturers Source: Industry Week, June 1, 2006

  4. How Manufacturers Have Become More Effective • Focus on customers • Maintain close relationships • Continuous improvement • Focus on quality • Save costs • Rely on the Internet • New production techniques

  5. Labor Hours / Vehicle • Ford – 35.79 hours • Daimler/Chrysler – 33.71 hours • GM – 33.19 hours • Honda – 32.51 hours • Toyota – 29.4 hours • Nissan – 28.46 hours Source: Detroit Free Press, June 2, 2006

  6. From Production to Operations Management • Production • Production Management • Operations Management (OM)

  7. CHINA Driving Force: Manufacturing Largest Communist Country Population: 1.3 Billion Economic Growth Rate: 9% Financial/Commercial Capital: Shanghai INDIA Driving Force: Services Largest Democracy Population: 1.1 Billion Economic Growth Rate: 7% Financial/Commercial Capital: Mumbai Comparing Asian Giants Source: Kiplinger.com December 19, 2005, BBC News, In Depth, accessed July 15, 2006

  8. Production Processes • Form Utility • Process Manufacturing • Assembly Process • Continuous Process • Intermittent Process

  9. Three Requirements For Production • Build and deliver products in response to the demands of the customer at a scheduled delivery time • Provide an acceptable quality level • Provide everything at the lowest possible cost

  10. Production Efficiency • Krispy Kreme Doughnuts – 5,208 a minute • Twinkies – 972 a minute • LifeSavers 5 Flavor Roll – 100 rolls a minute • Jell-O Gelatin Boxes – 764 a minute • Chips Ahoy! – 4,000 a minute Source: World Features Syndicate

  11. What Is Increasing Productivity? Source: 2005 National Innovation Survey, Council on Competitiveness

  12. Product Improvements With Computer Technology • Computer-Aided Design - CAD • Computer-Aided Manufacturing - CAM • Computer-Integrated Manufacturing - CIM

  13. Top Ten Tech Spenders STATE$ in Billions • California 38.9 • New York 29.8 • Texas 24.6 • Illinois 15.1 • Florida 13.9 • Pennsylvania 12.8 • Ohio 11.8 • New Jersey 11.3 • North Carolina 9.4 • Georgia 9.3 Source: Business Week Online, December 5, 2005

  14. Production Techniques • Flexible Manufacturing • Lean Manufacturing • Mass Customization

  15. Operations Management Planning • Facility Location • Facility Layout • Materials Requirement Planning • Purchasing • J-I-T Inventory Control • Quality Control

  16. Quality Control • Six Sigma Quality • Statistical Quality Control (SQC) • Statistical Process Control (SPC) • The Baldrige Award • ISO 9000 • ISO 14000

  17. Baldrige Award Recipients • Sunny Fresh Foods, Inc.,Monticello, MN(Manufacturing) • DynMcDermott Petroleum Operations,New Orleans, LA (Service) • Park Place Lexus,Plano, TX (Small Business) • Richland College,Dallas, TX (Education) • Jenks Public Schools,Jenks, OK (Education) • Bronson Methodist Hospital,Kalamazoo, MI, (Health care) Source: NIST News Release, November 22, 2005

  18. ISO • ISO was founded in 1947 • At the end of 2004, the worldwide total of certificates: • ISO 9000 – 670,000 in 154 countries • ISO 14000 – 90,000 in 127 countries Source: Business Week Online, March 17, 2006

  19. Control Procedures • Program Evaluation & Review Techniques (PERT) • Gantt Chart

  20. PERT Steps • Analyzing and sequencing tasks that need to be done • Estimating the time needed to complete each task • Drawing a PERT network illustrating the information from steps 1 and 2 • Identifying the critical path

  21. Gantt Chart • Named for its developer, Henry Gantt • A bar graph that clearly shows what projects are being worked on and how much has been completed at any given time

  22. Learning from Failure • Formalize forums for analyzing failure • Move the goalposts • Share personal stories • Bring in outsiders • Prove yourself wrong, not right • Celebrate smart failures Source: Business Week Online, July 10, 2006

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