Operations and Supply Chain Management The Core

416 OPERATIONS AND SUPPLY CHAIN MANAGEMENT
Waste reduction The optimization of value-adding activities and elimination of non-valueadding
activities that are part of the value stream.
LO12–3 Analyze supply chain processes using value stream mapping.
∙ Value stream mapping is a flowcharting tool used to visualize flows through a process.
∙ Features of the tool are the identification of value adding and non-value-adding activities
together with a time line for each activity and the process as a whole.
∙ The tool can be applied to production, logistics, and distribution processes.
∙ The goal in using the tool is to identify ways to “lean” a process by eliminating waste and
creating value for the customer.
∙ A Kaizen event is a short-term project designed to quickly improve a process.
Value stream mapping (VSM) A graphical way to analyze where value is or is not being added
as material flows through a process.
Kaizen Japanese philosophy that focuses on continuous improvement.
LO12–4 Explain lean design principles.
∙ Key areas include production layout, the scheduling of production, and the design of the
supply chain.
∙ Flow throughout the supply chain can be managed using just-in-time systems that pull
material based on need.
∙ The kanban card is an example of this type of system.
Preventive maintenance Periodic inspection and repair designed to keep equipment reliable.
Group technology Philosophy in which similar parts are grouped into families, and the
processes required to make the parts are arranged in a specialized workcell.
Quality at the source Philosophy of making factory workers personally responsible for the
quality of their output. Workers are expected to make the part correctly the first time and to stop the
process immediately if there is a problem.
Level schedule A schedule that pulls material into final assembly at a constant rate.
Freeze window The period of time during which the schedule is fixed and no further changes
are possible.
Backflush Calculating how many of each part were used in production and using these
calculations to adjust actual on-hand inventory balances. This eliminates the need to actually track
each part used in production.
Uniform plant loading Smoothing the production flow to dampen schedule variation.
Kanban A signaling device used to control production.
Kanban pull system An inventory or production control system that uses a signaling device to
regulate flows.
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LO12–5 Apply lean concepts to service processes.
∙ Lean concepts can be successfully applied by service firms.
∙ Just as with production processes, waste elimination and customer value creation are also
goals of service processes.
∙ Often, services operate in an environment with more uncertainty, making them more difficult
to control.