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Fourth Edition

IntroductIon to operatIons and supply chaIn ManageMent

Cecil C. Bozarth North Carolina State University

Robert B. Handfield North Carolina State University

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A01_BOZA1777_04_SE_FM.indd 1 07/11/14 7:51 AM

  • Cover
  • Title Page
  • Copyright Page
  • About the Authors
  • Brief Contents
  • Contents
  • Preface
  • PART I
    • Creating Value through operations and supply Chains
      • Chapter 1 Introduction to operations and supply Chain management
        • Introduction
        • 1.1 Why Study Operations and Supply Chain Management?
          • Operations Management
          • Supply Chain Management
        • 1.2 Important Trends
          • Electronic Commerce
          • Increasing Competition and Globalization
          • Relationship Management
        • 1.3 Operations and Supply Chain Management and You
          • Professional Organizations
          • Cross-Functional and Interorganizational Linkages
        • 1.4 Purpose and Organization of This Book
        • Chapter Summary
        • Key Terms
        • Discussion Questions
        • Problems
        • Case Study
        • References
      • Chapter 2 Operations and supply Chain strategies
        • Introduction
        • 2.1 Elements of the Business
        • 2.2 Strategy
        • 2.3 Operations and Supply Chain Strategies
          • Customer Value
          • Four Performance Dimensions
          • Trade-Offs among Performance Dimensions
          • Order Winners and Order Qualifiers
          • Stages of Alignment with the Business Strategy
          • Core Competencies in Operations and Supply Chains
        • Chapter Summary
        • Key Formula
        • Key Terms
        • Solved Problem
        • Discussion Questions
        • Problems
        • Case Study
        • References
  • PART II
    • Establishing the operations environment
      • Chapter 3 Process Choice and layout decisions in manufacturing and services
        • Introduction
        • 3.1 Manufacturing Processes
          • Production Lines and Continuous Flow Manufacturing
          • Job Shops
          • Batch Manufacturing
          • Fixed-Position Layout
          • Hybrid Manufacturing Processes
          • Linking Manufacturing Processes across the Supply Chain
          • Selecting a Manufacturing Process
          • The Product-Process Matrix
        • 3.2 Product Customization within the Supply Chain
          • Four Levels of Customization
          • The Customization Point
        • 3.3 Service Processes
          • Service Packages
          • Service Customization
          • Customer Contact
          • Service Positioning
          • Services within the Supply Chain
        • 3.4 Layout Decision Models
          • Line Balancing
          • Assigning Department Locations in Functional Layouts
        • Chapter Summary
        • Key Formulas
        • Key Terms
        • Solved Problem
        • Discussion Questions
        • Problems
        • Case Study
        • References
      • Chapter 4 Business Processes
        • Introduction
        • 4.1 Business Processes
          • Improving Business Processes
        • 4.2 Mapping Business Processes
          • Process Maps
          • Swim Lane Process Maps
        • 4.3 Managing and Improving Business Processes
          • Measuring Business Process Performance
          • Productivity
          • Efficiency
          • Cycle Time
          • Benchmarking
          • The Six Sigma Methodology
          • Continuous Improvement Tools
        • 4.4 Business Process Challenges and the SCOR Model
          • How Standardized Should Processes Be?
          • Business Process Reengineering
          • Coordinating Process Management Efforts across the Supply Chain
          • The SCOR Model
        • Chapter Summary
        • Key Formulas
        • Key Terms
        • Solved Problem
        • Discussion Questions
        • Problems
        • Case Study
        • References
      • Chapter 5 Managing Quality
        • Introduction
        • 5.1 Quality Defined
        • 5.2 Total Cost of Quality
        • 5.3 Total Quality Management
          • TQM and the Six Sigma Methodology
        • 5.4 Statistical Quality Control
          • Process Capability
          • Six Sigma Quality
          • Control Charts
          • Acceptance Sampling
          • Taguchi’s Quality Loss Function
        • 5.5 Managing Quality across the Supply Chain
          • ISO 9000 Family
          • External Failures in the Supply Chain
        • Chapter Summary
        • Key Formulas
        • Key Terms
        • Using Excel in Quality Management
        • Solved Problem
        • Discussion Questions
        • Problems
        • Case Study
        • References
      • Chapter 6 Managing Capacity
        • Introduction
        • 6.1 Capacity
          • Measures of Capacity
          • Factors That Affect Capacity
          • Supply Chain Considerations
        • 6.2 Three Common Capacity Strategies
        • 6.3 Methods of Evaluating Capacity Alternatives
          • Cost
          • Demand Considerations
          • Expected Value
          • Decision Trees
          • Break-Even Analysis
          • Learning Curves
          • Other Considerations
        • 6.4 Understanding and Analyzing Process Capacity
          • The Theory of Constraints
          • Waiting Line Theory
          • Little’s Law
        • Chapter Summary
        • Key Formulas
        • Key Terms
        • Using Excel in Capacity Management
        • Solved Problem
        • Discussion Questions
        • Problems
        • Case Study
        • References
      • Chapter 6s Advanced Waiting line theory and simulation modeling
        • Introduction
        • 6S.1 Alternative Waiting Lines
          • Assumptions behind Waiting Line Theory
          • Waiting Line Formulas for Three Different Environments
        • 6S.1 Simulation Modeling
          • Monte Carlo Simulation
          • Building and Evaluating Simulation Models with SimQuick
        • Supplement Summary
        • Discussion Questions
        • Problems
        • References
  • PART III
    • Establishing supply Chain linkages
      • Chapter 7 Supply Management
        • Introduction
        • 7.1 Why Supply Management Is Critical
          • Global Sourcing
          • Financial Impact
          • Performance Impact
        • 7.2 The Strategic Sourcing Process
          • Step 1: Assess Opportunities
          • Step 2: Profile Internally and Externally
          • Step 3: Develop the Sourcing Strategy
          • Step 4: Screen Suppliers and Create Selection Criteria
          • Step 5: Conduct Supplier Selection
          • Step 6: Negotiate and Implement Agreements
        • 7.3 The Procure-to-Pay Cycle
          • Ordering
          • Follow-Up and Expediting
          • Receipt and Inspection
          • Settlement and Payment
          • Records Maintenance
        • 7.4 Trends in Supply Management
          • Sustainable Supply
          • Supply Chain Disruptions
        • Chapter Summary
        • Key Formulas
        • Key Terms
        • Solved Problem
        • Discussion Questions
        • Problems
        • Case Study
        • References
      • Chapter 8 Logistics
        • Introduction
        • 8.1 Why Logistics Is Critical
        • 8.2 Logistics Decision Areas
          • Transportation
          • Selecting a Transportation Mode
          • Multimodal Solutions
          • Warehousing
          • Logistics Information Systems
          • Material Handling and Packaging
          • Inventory Management
        • 8.3 Logistics Strategy
          • Owning versus Outsourcing
          • Measuring Logistics Performance
          • Landed Costs
          • Reverse Logistics Systems
        • 8.4 Logistics Decision Models
          • Weighted Center of Gravity Method
          • Optimization Models
          • The Assignment Problem
        • Chapter Summary
        • Key Formulas
        • Key Terms
        • Solved Problem
        • Discussion Questions
        • Problems
        • Case Study
        • References
  • PART IV
    • Planning and Controlling operations and supply Chains
      • Chapter 9 Forecasting
        • Introduction
        • 9.1 Forecast Types
          • Demand Forecasts
          • Supply Forecasts
          • Price Forecasts
        • 9.2 Laws of Forecasting
          • Law 1: Forecasts Are Almost Always Wrong (But They Are Still Useful)
          • Law 2: Forecasts for the Near Term Tend to Be More Accurate
          • Law 3: Forecasts for Groups of Products or Services Tend to Be More Accurate
          • Law 4: Forecasts Are No Substitute for Calculated Values
        • 9.3 Selecting a Forecasting Method
        • 9.4 Qualitative Forecasting Methods
        • 9.5 Time Series Forecasting Models
          • Last Period
          • Moving Average
          • Weighted Moving Average
          • Exponential Smoothing
          • Adjusted Exponential Smoothing
          • Linear Regression
          • Seasonal Adjustments
        • 9.6 Causal Forecasting Models
          • Linear Regression
          • Multiple Regression
        • 9.7 Measures of Forecast Accuracy
        • 9.8 Computer-Based Forecasting Packages
        • 9.9 Collaborative Planning, Forecasting, and Replenishment (CPFR)
        • Chapter Summary
        • Key Formulas
        • Key Terms
        • Solved Problem
        • Discussion Questions
        • Problems
        • Case Study
        • References
      • Chapter 10 Sales and operations Planning (aggregate Planning)
        • Introduction
        • 10.1 S&OP in the Planning Cycle
        • 10.2 Major Approaches to S&OP
          • Top-Down Planning
          • Level, Chase, and Mixed Production Plans
          • Bottom-Up Planning
          • Cash Flow Analysis
        • 10.3 Organizing for and Implementing S&OP
          • Choosing between Alternative Plans
          • Rolling Planning Horizons
          • Implementing S&OP in an Organization
        • 10.4 Services Considerations
          • Making Sales Match Capacity
          • Making Capacity Match Sales
        • 10.5 Linking S&OP throughout the Supply Chain
        • 10.6 Applying Optimization Modeling to S&OP
        • Chapter Summary
        • Key Formulas
        • Key Terms
        • Solved Problem
        • Discussion Questions
        • Problems
        • Case Study
        • References
      • Chapter 11 Managing inventory throughout the supply Chain
        • Introduction
        • 11.1 The Role of Inventory
          • Inventory Types
          • Inventory Drivers
          • Independent versus Dependent Demand Inventory
        • 11.2 Periodic Review Systems
          • Restocking Levels
        • 11.3 Continuous Review Systems
          • The Economic Order Quantity (EOQ)
          • Reorder Points and Safety Stock
          • Quantity Discounts
        • 11.4 Single-Period Inventory Systems
          • Target Service Level
          • Target Stocking Point
        • 11.5 Inventory in the Supply Chain
          • The Bullwhip Effect
          • Inventory Positioning
          • Transportation, Packaging, and Material Handling Considerations
        • Chapter Summary
        • Key Formulas
        • Key Terms
        • Using Excel in Inventory Management
        • Solved Problems
        • Discussion Questions
        • Problems
        • Case Study
        • References
      • Chapter 12 Managing Production across the supply Chain
        • Introduction
        • 12.1 Master Scheduling
          • The Master Schedule Record
          • Using the Master Schedule
        • 12.2 Material Requirements Planning
          • The MRP Record
          • The Advantages of MRP
          • Special Considerations in MRP
        • 12.3 Production Activity Control and Vendor Order Management Systems
          • Job Sequencing
          • Monitoring and Tracking Technologies
        • 12.4 Synchronizing Planning and Control across the Supply Chain
          • Distribution Requirements Planning
        • Chapter Summary
        • Key Formulas
        • Key Terms
        • Solved Problem
        • Discussion Questions
        • Problems
        • Case Study
        • References
      • Chapter 12s supply Chain information systems
        • Introduction
        • 12S.1 Understanding Supply Chain Information Needs
          • Differences across Organizational Levels
          • Direction of Linkages
        • 12S.2 Supply Chain Information Systems
        • 12S.3 Trends to Watch
          • BPM Tools
          • Cloud Computing
        • Supplement Summary
        • Key Terms
        • Discussion Questions
        • References
      • Chapter 13 jit/lean Production
        • Introduction
        • 13.1 The Lean Perspective on Waste
        • 13.2 The Lean Perspective on Inventory
        • 13.3 Recent Developments in Lean Thinking
        • 13.4 Kanban Systems
          • Controlling Inventory Levels Using Kanbans
          • Synchronizing the Supply Chain Using Kanbans
          • Using MRP and Kanban Together
        • Chapter Summary
        • Key Formula
        • Key Terms
        • Solved Problem
        • Discussion Questions
        • Problems
        • Case Study
        • References
  • PART V
    • Project management and Product/service development
      • Chapter 14 Managing Projects
        • Introduction
        • 14.1 The Growing Importance of Project Management
        • 14.2 Project Phases
          • Concept Phase
          • Project Definition Phase
          • Planning Phase
          • Performance Phase
          • Postcompletion Phase
        • 14.3 Project Management Tools
          • Gantt Charts
          • Network Diagrams
          • Constructing a Network Diagram
          • Crashing a Project
        • 14.4 Project Management Software
        • 14.5 PMI and the Project Management Body of Knowledge (PMBOK®)
        • Chapter Summary
        • Key Formulas
        • Key Terms
        • Solved Problem
        • Discussion Questions
        • Problems
        • Case Study
        • References
      • Chapter 15 Developing Products and services
        • Introduction
          • Product Design and the Development Process
          • Four Reasons for Developing New Products and Services
        • 15.1 Operations and Supply Chain Perspectives on Design
          • Repeatability, Testability, and Serviceability
          • Production Volumes
          • Product Costs
          • Match with Existing Capabilities
        • 15.2 The Development Process
          • A Model of the Development Process
          • Sequential Development versus Concurrent Engineering
        • 15.3 Organizational Roles in Product and Service Development
          • Engineering
          • Marketing
          • Accounting
          • Finance
          • Designers
          • Purchasing
          • Suppliers
          • Who Leads?
        • 15.4 Approaches to Improving Product and Service Designs
          • DMADV (Define–Measure–Analyze– Design–Verify)
          • Quality Function Deployment (QFD)
          • Computer-Aided Design (CAD) and Computer Aided Design/Computer-Aided Manufacturing (CAD/CAM)
          • The “Design for …” Approaches
          • Target Costing and Value Analysis
        • Chapter Summary
        • Key Terms
        • Discussion Questions
        • Case Study
        • References
  • Appendices
    • Appendix I Normal Curve Areas
    • Appendix II Poisson Distribution Values
    • Appendix III Values of e-l for Use in the Poisson Distribution
    • Appendix IV Table of Random Numbers
  • Glossary
  • Index
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    2. Preflight Ticket Signature