Professional Documents
Culture Documents
Dr Nazrul Islam
East west University
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Unit Costs
Minimum Efficient
Scale
Volume
Production and Efficiency: Learning
Effects
.A Economies
of Scale
.
B
. B
.A
Accumulated
Output
Production and Efficiency:
The Experience Curve
• Flexible Manufacturing
Technology (Lean Production)
• Mass Customization
• Flexible Machine Cells
Production and Efficiency:
Lean Production
Lean Production technology covers a range of
manufacturing technologies designed to:
Promotion Product
Design
Pricing Distribution
Marketing and Efficiency (Continued)
The Relationship Between Average Unit Costs and
Customer Defection Rates
High
Average Unit Costs
Customer
Low
Defection Rates
Low High
Materials Management, JIT,
and Efficiency
• Materials Management
• Just-In-Time (JIT)
R&D Strategy and Efficiency
• Design Easy-to-Manufacture Products
• Pioneer Process
Innovations
• Implementing TQM
The Role Played by Different Functions in
Achieving Superior Quality
Value Creation Primary Roles
Function
Provide
1. leadership and commitment to quality.
2.
Find ways to measure quality.
Infrastructure
3.
Set goals and create incentives.
(Leadership) 4. Solicit input from employees.
Encourage
5. cooperation between functions.
1.
Shorten production runs.
Production
2.
Trace defects back to source.
1.Focus on the customer.
Marketing Provide
2. customer feedback on quality.
1.Rationalize suppliers.
Material
2.
Help suppliers implement TQM.
Management 3. Trace defects back to suppliers.
Design
1. products so that they are easy to
R&D
manufacture.
Human 1.
Institute TQM training programs.
Relations Organize
2. employees into quality teams.
Achieving Superior Quality
(Continued)
✔Implementing TQM
(Continued)
– Focus on the Customer
Achieving Superior Quality
(Continued)
✔Implementing TQM
(Continued)
– Find Ways to Measure
Quality
Achieving Superior Quality
(Continued)
✔Implementing TQM
(Continued)
– Set Goals and
Create Incentives
Achieving Superior Quality
(Continued)
✔Implementing TQM
(Continued)
– Solicit Input from
Employees
Achieving Superior Quality
(Continued)
✔Implementing TQM
(Continued)
– Identify Defects and
Trace Them to
Source
Achieving Superior Quality
(Continued)
✔Implementing TQM (Continued)
– Supplier Relations
Achieving Superior Quality
(Continued)
✔Implementing TQM
(Continued)
– Design for Ease of
Manufacture
Achieving Superior Quality
(Continued)
✔Implementing TQM (Continued)
– Break Down Barriers Between
Functions
Achieving Superior
Innovation
✔The High Failure Rate of Innovation
– Uncertainty
– Poor Commercialization
– Poor Positioning Strategy
– Technological Myopia (Marketing
technology that has little demand)
– Slow to Market
Achieving Superior
Innovation (Continued)
✔ Building Competencies in Innovation
– Building Skills in Basic and Applied
Research
– Achieving close integration between R & D
and Marketing
– Achieving close integration between R&D
and manufacturing
– An ability to minimize time to market, and
– Good project Selection and Management
The Development Funnel
Gate 1
Phase 1:
Idea Generation
The Development Funnel
Gate 1 Gate 2
Phase 2:
Phase 1: Project
Idea Generation Refinement
The Development Funnel
Gate 1 Gate 2
Market
Phase 2: Phase 3:
Phase 1: Project Project
Idea Generation Refinement Execution
Achieving Superior
Innovation (Continued)
✔Building Competencies in
Innovation (Continued)
– Building Skills in Basic and Applied
Research
– Project Selection and Management
– Cross-Functional Integration
– Product Development Teams
– Partly Parallel Development Process
Sequential Development
Process
Opportunity
Identification
Opportunity
Identification R&D and Manufacturing
Concept
Development
Product
Design
Process
Design
Commercial
Production
The Role Played by Various Functions in
Achieving Superior Innovation
Value Creation Primary Roles
Function
Overall
1. project management (i.e. managing the
Infrastructure development function)
Facilitating
2. cross-functional cooperation
Cooperate
1. with R&D on designing products that are
Production easy to manufacture.
Work
2. with R&D on developing process innovations.
Provide
1. market information to R&D. Work with R&D
Marketing on developing new products.
Material No Primary
Management Responsibility
1.
Develop new products and processes
Cooperate
2. with other functions, particularly
R&D
marketing and manufacturing, in the development
process.
Human 1. Hire talented scientists and engineers.
Relations
Achieving Superior Customer
Responsiveness
• Customer Focus
– Leadership
– Employee Attitudes
– Bringing Customers into the
Company
• Satisfying Customer Needs
– Customization
– Response Time
The Primary Role of Different Functions in
Achieving Superior Customer Responsiveness
Value Primary
Functio
Creation Roles
n 1. Through leadership by example, build a
Infrastructu
wide commitment to customer
company
re 1.responsiveness.
Achieve customization through
flexible
implementation of
Producti
2.manufacturing.
Achieve rapid response through
on manufacturi
flexible
1.ng.
Know the
Marketi 2. Communicate customer feedback to
customer.
ng appropriate
Materi functions.
1. Develop logistics systems capable of
Manageme
al quickly to unanticipated customer
responding
nt R& demands.
1. Bring customers into the product
development
D
Huma process.
1. Develop training programs that get
Relatio
n think of to
employees themselves as
ns customers.
Ch a p t e r S u m m a r y
✔ACHIEVING SUPERIOR
EFFICIENCY
G S UP E RIO R Q U A LITY
✔ACHIEVIN
✔ACHIEVING SUPERIOR
INNOVATION
✔ACHIEVING SUPERIOR
E R R E S PO NS IVE N ES S
CUSTOM