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TABLE OF CONTENTS
Chapter 1: Introduction
Chapter 2: Strategy
Chapter 3: Design of Products and Services
Chapter 4: Projects
Chapter 5: Strategic Capacity Management
Chapter 6: Learning Curves
Chapter 7: Manufacturing Processes
Chapter 8: Facility Layout
Chapter 9: Service Processes
Chapter 10: Waiting Line Analysis and Simulation
Chapter 11: Process Design and Analysis
Chapter 12: Quality Management
Chapter 13: Statistical Quality Control
Chapter 14: Lean Supply Chains
Chapter 15: Logistics and Distribution Management
Chapter 16: Global Sourcing and Procurement
Chapter 17: The Internet of Things and ERP
Chapter 18: Forecasting
Chapter 19: Sales and Operations Planning
Chapter 20: Inventory Management
Chapter 21: Material Requirements Planning
Chapter 22: Workcenter Scheduling
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CHAPTER 1
OPERATIONS AND SUPPLY CHAIN MANAGEMENT
Discussion Questions
1. Using Exhibit 1.3 as a model, describe the source-make-deliver-
return relationships in the following systems:
a. An airline
Source: Aircraft manufacturer, in-flight food, repair parts, computer systems
Make: Aircraft and flight crew scheduling, ground services provided at airports, airc
raft maintenance and repair
Deliver: Outbound and arriving passenger service, baggage handling
Return: Resolve any post-
service issues such as lost or damaged luggage
b. An automobile manufacturer
Source: Suppliers of components and raw materials
Make: Manufacturing of vehicles and components or subassemblies to be sold as sp
areparts
Deliver: Delivery to and sales from dealerships, delivery of spare parts to the whole
sale system
Return: Warranty and recall repairs, trade-ins
c. A hospital
Source: Medical supplies, cleaning services, disposal services, food services, qualified
personnel
Make: Inpatient rooms, outpatient clinics, emergency room, operating rooms
Deliver: Scheduling patients, providing treatment, ambulance service, family counseli
ng Return: Billing errors, follow up visits
d. An insurance company
Source: Supplies needed for the office, underwriters, legal authority to operate
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, Operations and Supply Chain Management
Make: Establish policy guidelines and pricing, field agent/representative and facility
network, develop Internet service capabilities, establish preferred vehicle repair ser vice
network
Deliver: Meet with and advise clients, write policies, process and pay cla ims
Return: refund of overpayments
2. Define the service package of your college or university. What is its strongest element? Wh
at is its weakest one?
The categories with examples are:
Supporting facility -
location, buildings, labs, parking Facilitating goods –
class schedules, computers, books, chalk
Explicit services –
classes with qualified instructors, placement offices Implicit service
s – status and reputation (e.g., Ivy League schools)
At Indiana University and the University of Southern California, among their strongest el
ements are their business schools and their Operations Management programs (of cours
e). Both also have very dedicated alumni networks. A weak element of Indiana University
is its weak football program; for USC, weak elements are on-
campus parking and housing.
3. What service industry has impressed you the most with its innovativeness?
Our vote goes to cruise lines which have introduced such onboard innovations as wave
machines for belly boarding and rock climbing walls, as well as all sorts of other ameniti
es to keep cruisers involved. The industry is doing record business as well.
Some of the standout companies in less innovative industries are Bank of America (has a f
ormalized research program to try out new customer services/amenities such as video scre ens
in next to teller lines), Intuit (e.g., putting Quicken money management software online
), Ikea, JetBlue Airlines, and Progressive Insurance (discussed later in the book).
4. What is product-service bundling and what are the benefits to customers?
Product-service bundling is adding Value-
added services to a firm’s product offerings to create more value for the customer. This pr
ovides benefits in two areas. First, this differentiates the organization from the competitio
n. Secondly, these services tie customers to the organization in a positive way. Alternativel
y, bundling can also involve adding products to a service, for example, adding the sale of
convenience items and snacks at a hotel.
5. What is the difference between a service and a good?
A service is an intangible process (you can’t hold it in your hands), while a good is the p
hysical output of a process.
6. Look at the job postings at http://www.indeed.com and evaluate the opportunities fo
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