Operations Management: Processes and Supply Chains 13th global edition by Lee J. Krajewski Solution
Chapter
1
Using Operations to Create Value
DISCUSSION QUESTIONS
Using Operations to Create Value CHAPTER 1
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1. Answering this question demonstrates that processes underlie all of our jobs. What might
be surprising is how many students would put their job in the category of “other,”
suggesting that many jobs do not fall neatly into any one functional area. Perhaps many
in the “other” category might best be called “operations” on further reflection.
Customers, both internal and external, are part of each process, and the goal is to manage
the processes to add the most value for them.
2. Mining companies produce commodities and are heavily cost-driven. Hence their
competitive priorities would be delivery time, low variety, and low-cost operations. They
should focus on keeping costs down while investing in continuous research to find new
mining sites and use technology for reducing the operational costs. Since commodity
prices fluctuate, they should also focus on developing capabilities to vary their output.
3. The hospital’s commitment to provide attention to patients arriving to the emergency
unit in less than 15 minutes and never to turn away patients who need to be hospitalized
implies that the facility must be designed to have extra capacity in both beds and
emergency room facilities. It must plan on having extra personnel in the emergency
room and also plan on having additional emergency personnel on call to take care of
unprecedented heavy loads. In line with the mission statement, maximum utilization of
the facilities (i.e., beds and emergency room personnel) would not be one of the
performance objectives for the hospital.
4. FedEx traditionally has competed on the basis of fast, dependable delivery. Before the
boom in Internet applications, many businesses relied on FedEx to get things to other
businesses overnight. Now, this need is beginning to diminish as sophisticated systems
are being installed to assist companies in planning operations better. And, the Internet
based companies are adding more demands for low cost ground deliveries to specific
customer doors. FedEx, in order to remain competitive with companies such as UPS, has
moved into the door-to-door delivery business, perhaps through acquisition.
Nonetheless, it will require changes to this company’s competitive priorities.
5. Technology Management. To identify a market segment, we need to determine
answers to questions such as: Which colleges and departments currently offer the
subject? What do instructors desire in the way of textbook support? Is there a trend
toward Technology Management courses? Are there other Technology Management
texts? Some needs assessment can be accomplished by survey, but the response rate
may be low. A high-investment strategy would be to ask or hire instructors to
review and critique a list of topics, then an outline, then a draft. Explicit services
include supplying information about the subject in the form of a textbook and
instructor support in the form of ancillary publications.
6. It is often not a good idea for a company to try to excel in all of the competitive
priorities because it is generally impossible to do so. Mediocrity is a predictable
result. The choice and the minimum level of one or more of the competitive
priorities are set by the order qualifiers for the particular product or service. The
Using Operations to Create Value CHAPTER 1
Copyright © 2022 Pearson Education, Ltd.
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choice of the competitive priorities that the company should emphasize is usually
governed by the company’s strategy driven by its mission statement and the core
competencies that the company wants to harness to seek the best competitive
advantage.
7. Core processes should link to a firm’s core competencies. Core processes are those
processes that provide the firm the best competitive advantage. Essential to the
definition a firm’s core processes is the concept of “interaction costs.” These costs
include the time and money that are expended whenever people and companies
exchange services, products, or ideas. If the transaction costs are higher to retain a
process within the firm’s organization than to outsource the process, the process
should be outsourced.
8. Wendy’s assembles hamburgers to order. When materials are held at the stage just
before final assembly, they can be used to complete a wide variety of different
sandwiches. Because no finished-goods stock exists, when customers say, “Hold the