M-P4

Best Practices: Product Design Systems

OM Practical Problem 4: Operations Management Systems Audit

To audit your selected organization, use any of the following documents (in the Handouts area of MyCC):

· Characteristics of a Well-Designed Service System

· Best Practices Product Design Systems

Comment on each section of the systems review outline.

· Services

· Products

If the organization you picked delivers both goods and services, then pick one to audit.

Refer to the section on Services (p. 215) in Chapter 11 in the text.

Best Practice Product Design Characteristics

1. Each step of the product process is consistent with the business purpose of the organization:

a. A. input

b. B. transformation

c. Output

2. Cycle Time is efficient and effective: Cycle time is the average time between completions of successive units in a process. It is directly related to the output capacity of the system – as cycle time is reduced, the process can produce more units in the same period of time, increasing the best operating level used in capacity analysis. Without an actual increase in production volume, capacity utilization will decrease as cycle time decreases but productivity remains the same. As the process produces more output per time period, productivity and capacity utilization will then increase.

3. Inventory Management is efficient and effective:

a. WIP

b. Waste

c. Rework

4. Bottlenecks and blockages are managed and in control

5. Employee training, enrichment and quality of life are managed

6. Quality is measured and assured

7. The system is adaptable to seasonal changes in demand or nature of products (made to order, of of a kind, mass produced)

8. The organization has a feedback system and is a learning organization in terms of assessing its own system and applying needed changes.