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Operations Management: An Integrated Approach, 6th Edition

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Operations Management: An Integrated Approach, 6th Edition

R. Dan Reid, Nada R. Sanders

ISBN: 978-1-118-95256-6 October 2015 704 Pages

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In the 6th Edition of Operations Management, Dan Reid and Nada Sanders have strengthened their commitment to improve the teaching and learning experience in the introductory operations management course. The text provides a solid foundation of Operations Management with clear, guided instruction and a balance between quantitative and qualitative concepts. Through an integrated approach, the authors illustrate how all business students will interact with Operations Management in future careers.

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Preface v

About the Authors xv

Chapter 1 Introduction to Operations Management 1

What is Operations Management? 2

Differences between Manufacturing and Service Organizations 5

Operations Management Decisions 6

Historical Development 10

Today’s OM Environment 18

Operations Management in Practice 19

Within OM: How It All Fits Together 20

OM Across the Organization 20

Chapter 2 Operations Strategy and Competitiveness 28

The Role of Operations Strategy 29

Developing a Business Strategy 30

Developing an Operations Strategy 34

Strategic Role of Technology 40

Productivity 41

Operations Strategy Within OM: How it All Fits Together 45

Operations Strategy Across the Organization 46

Chapter 3 Product Design and Process Selection 54

Product Design 55

The Product Design Process 56

Factors Impacting Product Design 60

Process Selection 64

Designing Processes 67

Process Performance Metrics 69

Linking Product Design and Process Selection 72

Technology Decisions 77

Designing Services 82

Product Design and Process Selection Within OM: How It All Fits Together 86

Product Design and Process Selection Across the Organization 87

Chapter 4 Supply Chain Management 98

Basic Supply Chains 99

Issues Affecting Supply Chain Management 106

The Role of Purchasing 116

Sourcing Decisions 120

The Role of Warehouses 130

Implementing Supply Chain Management 135

Supply Chain Management Within OM: How It All Fits Together 139

SCM Across the Organization 140

Chapter 5 Total Quality Management 151

Defining Quality 152

Cost of Quality 154

The Evolution of Total Quality Management (TQM) 156

The Philosophy of TQM 160

Quality Awards and Standards 171

Why TQM Efforts Fail 174

Total Quality Management (TQM) Within OM: How It All Fits Together 175

Total Quality Management (TQM) Across the Organization 175

Chapter 6 Statistical Quality Control 185

What Is Statistical Quality Control? 186

Sources of Variation: Common and Assignable Causes 187

Descriptive Statistics 187

Statistical Process Control Methods 189

Control Charts for Variables 191

Control Charts for Attributes 197

Process Capability 203

Six Sigma Quality 208

Acceptance Sampling 210

Implications for Managers 216

Statistical Quality Control in Services 217

Statistical Quality Control (SQC) Within OM: How It All Fits Together 219

Statistical Quality Control (SQC) Across the Organization 219

Chapter 7 Just-in-Time and Lean Systems 234

The Philosophy of JIT 235

Elements of JIT 237

Just-in-Time Manufacturing 241

Total Quality Management 249

Respect for People 251

Benefits of JIT 255

Implementing JIT 256

JIT in Services 258

JIT and Lean Systems Within OM: How It All Fits Together 259

JIT and Lean Systems Across the Organization 259

Chapter 8 Forecasting 267

Principles of Forecasting 268

Steps in the Forecasting Process 268

Types of Forecasting Methods 269

Time Series Models 272

Causal Models 289

Measuring Forecast Accuracy 293

Selecting the Right Forecasting Model 296

Collaborative Planning, Forecasting, and Replenishment (CPFR) 299

Forecasting Within OM: How It All Fits Together 300

Forecasting Across the Organization 301

Chapter 9 Capacity Planning and Facility Location 316

Capacity Planning 317

Making Capacity Planning Decisions 323

Decision Trees 325

Location Analysis 328

Making Location Decisions 332

Capacity Planning and Facility Location Within OM: How It All Fits Together 343

Capacity Planning and Facility Location Across the Organization 343

Chapter 10 Facility Layout 355

What Is Layout Planning? 356

Types of Layouts 356

Designing Process Layouts 360

Special Cases of Process Layout 366

Designing Product Layouts 370

Group Technology (Cell) Layouts 377

Facility Layout Within OM: How It All Fits Together 378

Facility Layout Across the Organization 378

Chapter 11 Work System Design 392

Work System Design 393

Job Design 393

Work Measurement 402

Compensation 415

Work System Design Within OM: How It All Fits Together 418

Work System Design Across the Organization 418

Chapter 12 Inventory Management 432

Basic Inventory Principles 433

Inventory Management Objectives 436

Relevant Inventory Costs 440

ABC Inventory Classification 442

Inventory Record Accuracy 445

Determining Order Quantities 446

Determining Safety Stock Levels 463

The Periodic Review System 466

Inventory Management within OM: How It All Fits Together 468

Inventory Management across the

Organization 469

Chapter 13 Aggregate Planning 483

Business Planning 484

Aggregate Planning Options 486

Aggregate Plan Strategies 490

Developing the Aggregate Plan 492

Aggregate Planning Within OM: How It All Fits Together 502

Aggregate Planning Across the Organization 502

Chapter 14 Resource Planning 517

Enterprise Resource Planning 518

The Benefits and Costs of ERP 522

Material Planning Systems 524

How MRP Works 532

Capacity Requirements Planning (CRP) 538

Resource Planning Within OM: How It All Fits Together 540

Resource Planning Across the Organization 540

Chapter 15 Scheduling 553

Basic Scheduling Concepts 554

Developing a Schedule of Operations 560

Optimized Production Technology 569

Scheduling Issues for Service Organizations 572

Scheduling Within OM: Putting It All Together 576

Scheduling Across the Organization 576

Chapter 16 Project Management 589

The Project Life Cycle 590

Project Management Concepts 591

Estimating the Probability of Completion Dates 604

Reducing Project Completion Time 606

The Critical Chain Approach 609

Project Management Within OM: How It All Fits Together 611

Project Management OM Across the Organization 611

Appendix A Solutions to Odd-Numbered Problems 625

Appendix B The Standard Normal Distribution 647

Appendix C p-Chart 648

Name index 651

Subject index 654

• Company Examples: In order to offer the most current text we have made updates in company examples across all chapters.
• Technology: updated discussions with regard to the latest technologies that impact operations management. This includes discussions of 3-D printing, new generation robotics and automation, and advancements in RFID, in Chapter 3.
• Big Data and Analytics: incorporated the latest on big data and analytics, in Chapters 1 and 3. In Chapter 8, we have added an entire section on Predictive Analytics and Forecasting.
• Supply Chain Management Issues: discuss the ramifications on materials being shipped from Asia to the United States – for example, the cancellation of the shipping facility in Mexico and the widening of the Panama Canal.
• Chapters Reorganized: better integration of topics added over previous editions into each chapter.
• Integrated Approach: Integrated coverage of why and how Operations Management is integral to all organizations helps business students connect Operations Management to future business careers.
• Balanced Coverage: The coverage of quantitative and qualitative concepts is balanced, and further supports student comprehension; applications of these concepts are woven throughout the text with relevant business examples.
• Virtual Company Interactive Consulting Cases: Two web-based cases featuring a cruise company and a medical consulting company provide assignments for students to solve operations problems, tying all the topics in the book together in a real-life environment.
• WileyPLUS Learning Space: WileyPLUS Learning Space provides instructors and students a dynamic learning environment in which to interact at the point of learning. Both students and instructors can utilize the system or bring in outside resources to aid in learning. The Executive Summary Animation, housed exclusively within WileyPLUS Learning Space, uniquely summarize each chapter’s key concept. Offering instructors a new methodology for engaging and assessing their students and/or flipping the classro