As previously discussed, operations is about improving efficiencies in an organisation. This module focuses on developing operations. Previously covered have been the direction and design. Operations managers must be continually seeking improvements. An improvement is defined in the textbook as “the activity of closing the gap between the current and the desired performance of an operation or process” (Slack & Brandon-Jones 2022, p. 416). Focusing on operations improvement facilitates an organisation in achieving maximum potential.
Identifying and prioritising improvement opportunities
Prior to looking to improve operations performance, an operations manager needs to do two things:-
- Measure the actual performance currently being achieved and then identify the desired performance. This becomes “the gap”.
- Work out the importance in relative terms of the opportunities that have been identified.
Measuring the performance gap
This can only be attempted once the performance has been measured. If it fall short of the required levels, then the gap needs to be examined. The questions can then be asked about what is actually failing to reach the required performance levels and by how much. This is not a matter of guesswork. You need to ensure that the metrics used are reliable and providing solid data.
Prioritising performance opportunities
Organisations are always under the pump for time and resources. The text suggests two methods of prioritising between processes. These are:-
- the sandcone theory
- the importance-performance matrix.
The sandcone theory
The sandcone theory argues that there is a fixed order of priorities when considering operations processes. The first is quality, then dependability, speed, flexibility and cost in that order. (This theory was developed by Ferdows and de Meyer)
The importance-performance matrix
This matrix is subjective and its success will depend on the experience of the manager making the assessment. The manager is looking for the most important improvement possibility. Will it be quality, customer satisfaction, profit or meeting strategic goals?
I prefer this model over the Sandcone Theory as it provides flexibility. The video describes how customers are surveyed to determine what is most important to them and how you fare against competitors. Any areas where you are lagging but are of high importance to customers are needing to be addressed.
Strategies for improving operations
After opportunities for improvement have been identified the projects need to be detailed. Essentially, there are two different approaches:-
- breakthrough improvement
- continuous improvement.
Improvement techniques and tools
Four methods exist to support performance improvements.
- Scatter diagrams
- Cause-effect diagrams
- Pareto diagrams
- Why-why analysis.
Quality management and control
Quality plays a critical role in operations management and indeed the organisation’s success generally. In the past, quality management referred to an item meeting the pre-determined product specifications. This has changed in recent years and quality is defined as “consistent conformance to customers’ expectations” (Slack & Brandon-Jones 2018, p. 460). The change in definition allows it to be applied across all sectors including service and not for profit. Instead of “top down” approach to quality where the organisation determined what constituted this aspect of the product, it is now “bottom up” where the customer determines what meets their expectation of quality.
Once quality standards are defined, you then need to measure them. Some are easy to measure and others are not. You can measure the number of calls answered in an hour, but then measuring the quality of service provided may be more difficult. Complexity of issues changes call rates as well. There are always challenges in measurements.
Total quality management (TQM)
The text does not have a chapter or area devoted to this subject as it is a given that this is the process by which all quality management is driven these days. The text does ask two questions however which cut to the quick.
- Does quality apply to all parts of the organisation?
- Does every person in the organisation contribute to quality?
In order to achieve consistent high quality, everyone in the organisation must be committed to achieving it.
The task for the capstone assessment is to develop an Operations Improvement Plan. The plan should be a building on Assessment 1 where you are required to take a process, break it down, develop a process map and look for means of improving the process. After doing so, the assessment requires you to develop two recommendations for improving the process. I am already finding this challenging in the concept that you are supposed to limit yourself to only two recommendations. In my experience, recommendations come with contingencies. In order to achieve one outcome, you might have to deploy five others.
This week has been quite interesting from a study perspective. Having had no manufacturing experience, I am constantly challenged by relating some of the learnings from manufacturing to service industries. The most significant of these however was when Lean Synchronisation refers to the reduction or elimination of waste. In the service sector, time is the largest area of waste and any opportunities to address those issues are both welcome and of benefit to an organisation.References
- Slack, N & Brandon-Jones, A 2021, Operations and Process Management., Pearson Education Limited, S.L.
- Ferdows, K. & De Meyer, A., Lasting Improvements in Manufacturing Performance: In Search of a New Theory. Journal of Operations Management, 1990, Vol. 9, No. 2, pp 168-184.