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Operations Management in Asia
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Student Edition
Instructor Edition
Operations Management : An Asian Perspective

William J. Stevenson, Rochester Institute of Technology
Chee Chuong Sum, National University of Singapore

ISBN: 0071270620
Copyright year: 2010

Asian Content



A summary of the topics covered in each chapter is presented below, with Asian content highlighted.

Chapter 1. This chapter introduces the field of operations management. It highlights the importance and relevance of operations in today's organizations. It explains operations as a core function, and how it is related to other parts of the organization. It also describes the nature and scope of operations management, and the trends in business that relate to operations.

Chapter 2. This chapter presents the issues of competition, strategy, and productivity. It describes how operations can be aligned to support organization strategy. It also discusses the linkages between organization strategy and operations strategy, and how operations capabilities can contribute to strategic advantage for an organization.
     The chapter opens with a reading on Haier, which reveals how globalization has raised competition by yet another notch, evidenced by the Chinese company's expansion into South Carolina in a bid to respond faster to its American customers. The reading on Hyundai Translead shows how improving efficiency sometimes means reducing, and not increasing, the level of automation in the production line. Readers will also read about how Lenovo's technology solutions have helped a Chicago-based provider of investigative services, E.L. Johnson Investigations, reduce overtime and IT service costs and increase business efficiency.

Chapter 3. This chapter examines forecasts as the basis for a wide range of operations decisions. It describes techniques and provides insights on the development and use of forecasts. Evaluation and control of forecasts are also covered. Factors to consider when selecting forecasting techniques are examined.
     The readings in this chapter include one on how companies such as Qualcomm, Seven-Eleven Japan, and Proctor and Gamble had to change their forecasting strategies and identify the gaps in their supply chains to facilitate perfect orders.

Chapter 4. This chapter explains the strategic importance of product and service design in achieving customer satisfaction. The impact of product and service design on operations and organizational performance is discussed. The chapter also covers key design issues and commonly used tools in manufacturing and service design.
     As the opening reading illustrates, companies in Asia and elsewhere are quickly learning to (re-)design their product and services to cash in on the latest trends. The chapter features examples such as South Korean mobile phone manufacturers LG and Samsung, whose designs have made them leaders in the United States, and LG Electronics, whose localized product designs have enabled the company to expand into new global markets. The chapter ends with a reading on the challenges Sony faces in revamping its designs, and hence its image, in China.

Chapter 5. This chapter deals with the definition, measuring, and planning of capacity. Different approaches to developing and evaluating capacity alternatives are presented. Readers will learn about how Singapore hospitals are reviewing their outsourcing options, and about Europe's TPCA assembly plant, a joint venture between PSA Peugeot Citroën of France and Toyota of Japan, which creates capacity alternatives for the two companies.

Chapter 6. This chapter examines process selection and facility layout. The advantages and disadvantages of various process types are described. The role of technology in process planning is discussed. The different types of layout are presented for both manufacturing and service environments.

Chapter 7. This chapter looks at work design in terms of job design, work measurement, and worker motivation and compensation. The basic approaches to job design are described, together with their advantages and disadvantages. Different ways of measuring work such as the time study approach and work sampling are examined. The chapter also covers key approaches to compensating employees such as time-based, output-based, and knowledge-based systems. The importance of transition strategies is highlighted by the example from Malaysia, where some companies are suffering lowered productivity due to poor staff morale after mergers.

Chapter 8. This chapter relates location decisions with the strategic planning process of an organization. The strategic importance of location decisions to organizational and operational performance is highlighted. The major factors that affect location decisions and techniques for solving location problems are presented.

Chapter 9. This chapter describes how quality is managed in an organization. This chapter defines product and service quality, and explains the benefits of having quality products as well as the costs associated with enhancing and maintaining quality. The chapter discusses the different approaches to managing quality, quality awards, and quality tools. Process improvement is also examined.
     The chapter opens with the success story of Hyundai, and how its efforts at addressing quality issues have paid off in the form of high customer loyalty and increased sales. Similarly, Samsung saw a substantial increase in its total operating income after it initiated and developed its corporate R&D center to improve product development and manufacturing. Also on the track of quality improvement is Thailand's Bumrungrad International, the first hospital in Asia to deploy Swisslog's state-of-the-art pharmacy robot, which packs, dispenses, stores, and barcodes medication to improve the care and safety of its patients.

Chapter 10. This chapter covers the quality control process. The concepts of quality control and process control charts are described, and different types of control charts and their uses are presented. We also introduce the concept of process capability in this chapter.
     The reading on Cervélo Cycles illustrates how quality control helped the Canadian bicycle manufacturer beat its competition when lowering prices was not a viable option—although the prices of Cervélo bicycles are considerably higher than its China-made counterparts, their professional standards have translated into encouraging sales figures.

Chapter 11. This chapter introduces the importance and complexities of managing supply chains. The benefits of effective supply chain management are highlighted. Strategic, tactical, and operations issues related to supply chain management are discussed. These include outsourcing, partnering, coordination, collaboration, technology, supplier relationships, and purchasing.
     The chapter features Li & Fung, the Hong Kong factory sourcer that is helping its client companies such as Liz Claiborne, Toys “R” Us, and Sanrio save costs on having their own buying office. In the wake of the global financial crisis, good supply chain management has enabled this company to use economies of scale to drive down prices for its customers. The reading on BSR presents an example of the growing interest in green supply chains, and how a company with global operations or supply chains can multiply the impact of energy efficient on-site operations to many sites through central coordination. The story of traditional business rivals Sony and Sharp joining efforts to produce and sell LCD TV displays shows the importance of strategic partnering; this move will develop Sharp's technological expertise in LCD manufacturing and Sony's reach in the TV market. The last reading, “The Road Ahead,” highlights key imperatives that are pertinent to the supply chain environment in the Asia-Pacific region, especially ASEAN.

Chapter 12. This chapter describes the importance and role of inventories in operations. The major reasons for carrying inventories are presented. The chapter also defines the components of an inventory management system, and introduces models used to solve inventory problems in various environments.

Chapter 13. This chapter addresses aggregate planning as an approach in managing intermediate range capacity requirements. Basic aggregate planning strategies for meeting different types of demand are outlined. The chapter also describes the methods for generating and evaluating aggregate plans.

Chapter 14. This chapter provides an overview of Material Requirements Planning (MRP), Manufacturing Resource Planning (MRP II), and Enterprise Resource Planning (ERP), and how these systems can be used to manage inventories in dependent-demand environments. The main components and logic of an MRP system are described. The chapter also outlines the benefits and managerial challenges of implementing MRP, and covers the use of MRP in services.

Chapter 15. This chapter examines the principles of Just-in-Time (JIT) and lean operations, and how they can enhance efficiency and performance in repetitive production environments. A historical perspective of JIT and lean operations is provided. The chapter also examines the building blocks of JIT, and the use of JIT in services.
     The chapter opens with the story of Japan Post turning to Toyota efficiency experts to learn from the Toyota Production System. Likewise, computer makers such as NEC and Fujitsu are also adopting the Toyota Production System to cut costs and increase efficiency. Later in the chapter, students will read about Mobis' just-in-sequence system — touted to be more advanced than Toyota's JIT system — which can improve ordering, manufacturing, and distribution systems. Singapore's Alexandra Hospital presents an example of how medical facilities can use communications technology to help implement a JIT approach to bed allocation. The example from die design and metal manufacturing companies in the Philippines shows how switching to simpler equipment can sometimes better process design, reduce set-up time, and enhance efficiency, Students also learn how Australian companies are facing challenges in implementing lean manufacturing due to their shorter production runs and greater product variability.

Chapter 16. This chapter explains the importance of scheduling in increasing customer service and providing a competitive advantage for the organization. The scheduling needs in different environments are discussed. Techniques are presented to solve scheduling problems in the various environments, including service settings.

Chapter 17. This chapter addresses key managerial issues in project management. The unique nature and behavioral aspects of projects are highlighted. The project life cycle is examined and project scheduling techniques are presented.
     The opening story outlines the challenges encountered by the BraviSEAmo! production team at Tokyo Disney-Sea, and how they were overcome.


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