WK3 Submission: Process Strategy Response

This assignment aligns with the following course objective: Solve an operations management problem using process strategy.

• Read Chapter 7 in the textbook by WK3 Submission: Process Strategy Response

This assignment aligns with the following course objective: Solve an operations management problem using process strategy.

• Read Chapter 7 in the textbook by "Operations Management" Heizer, Render & Munson
• Complete problems 7.1-7.3 in your textbook

Problem 7.1: "The vast majority of global production is devoted to making low-volume, high-variety products in places called "job shops." Such facilities are organized around specific activities or processes. In a factory, these processes might be departments devoted to welding, grinding, and painting. In an office, the processes might be accounts payable, sales, and payroll. In a restaurant, they might be bar, grill, and bakery. Such facilities are process focused in terms of equipment, layout, and supervision. They provide a high degree of product flexibility as products move between the specialized processes. Each process is designed to perform a variety of activities and handle frequent changes. Consequently, they are also called intermittent processes."

Problem 7.2: "Process-focused facilities have high variable costs with extremely low utilization of facilities, as low as 5%. This is the case for many restaurants, hospitals, and machine shops. However, facilities that lend themselves to electronic controls can do somewhat better."

Problem 7.3: "In an ongoing quest for efficiency, industrialized societies continue to move toward specialization. The focus that comes with specialization contributes to efficiency. Managers who focus on a limited number of activities, products, and technologies do better. As the variety of products in a facility increases, overhead costs increase even faster. Similarly, as the variety of products, customers, and technology increases, so does complexity. The resources necessary to cope with the complexity expand disproportionately. A focus on depth of product line as opposed to breadth is typical of outstanding firms, of which Intel, L.M. Ericsson, and Bosch are world-class examples. Focus, defined here as specialization, simplification, and concentration, yields efficiency. Focus also contributes to building a core competence that fosters market and financial success. The focus can be:

CUSTOMERS (such as Winterhalter Gastronom, a German company that focuses on dishwashers for hotels and restaurants for whom spotless glasses and dishes are critical)

PRODUCTS with similar attributes (such as Nucor Steel's Crawford, Ohio, plant, which processes only high-quality sheet steels, and Gallagher, a New Zealand company, which has 45% of the world market in electric fences) SERVICE (such as Orlando's Arnold Palmer Hospital, with a focus on children and women; and Shouldice Hospital, in Canada, with a focus on hernia repair)

TECHNOLOGY (such as Texas Instruments, with a focus on only certain specialized kinds of semiconductors; and SAP, which despite a world of opportunities, remains focused on software)"

• Provide a 2 to 4-paragraph response on when you think the process strategy is best utilized in an organization. Consider what the advantages and disadvantages of its utilization are.