Interacting with the Prospect – Customer

Selling Process - Skills - Article - Series

The main goal of interaction with the prospect many times is to sell the product or service. As a part of the interaction, a salesman is going to intensify the need of the prospect, convert it into a want, and create a favorable attitude for the specific product he is offering.

Goal of interaction

The main goal of interaction with the prospect many times is to sell the product or service. The first few minutes of the meeting with any customer is spent in determining the prospect’s mood and situation, his need and effort is made to capture his attention and interest in the conversation that is going to follow about the product or service.



As a part of the interaction, a salesman is going to intensify the need of the prospect, convert it into a want, and create a favorable attitude for the specific product he is offering. To create the want for his company product, the sales man presents the features, advantages and benefits of his product, and his business proposal for the transaction.



The salesman has also the job of convincing the prospect that not only he has to buy the product, but also that he has to buy from the salesman himself, because he is the best source or salesman to buy from and get service from.

SPIN – Series of questions

SPIN is a questioning technique in which series of questions are asked to bring out the need of the customer, intensify and convert it into a want for the product the salesman is offering.



In SPIN, ‘S’ stands for situation questions. These questions aim at the situation that gives rise to the need. For example, a salesman for children education product may talk of children the prospect is having, their current education and their plan for future education.





‘P’ stands for problem questions. IN this group of questions fall, questions that bring out the problems or difficulties perceived by the prospect relative to the situation questions. In regard to the education plans of children, these questions bring out the need for funds in the future and the difficulties the prospect is facing to plan for them.



‘I’ stands for implication questions. The implication if the problem is not solved is brought out in this group of questions. The fact that the child has to forego the preferred course or the family getting into financial difficulties in the absence of a financial plan for education is brought out in this group of questions.



‘N’ stands for need payoff questions. In this group of questions, the effort is to make the prospect agree that he has an important explicit need and he is interest in listening to the solution to the problems.



Thus SPIN questions set the background for a presentation of the features, advantages and benefits of the salesman’s offer.

Presentation

The presentation of the salesman’s offer has to follow three essential steps.



Step 1. Full discussion of the features, advantages, and benefits of the offer (product or service).



Step 2. Customer value plan: Explanation of how the customer is going to use the product.



Step 3. Business proposition: Relating the value of the product to the cost of the product. The general recommendation is to discuss the price of the product last, as you want the prospect to listen to the benefits and value first and cost later.



The presentation of the offer needs to include apart from the persuasive communication from the salesman, participation of the prospect, visual aids, proofs or proof statements, demonstration of the working of the product, and some dramatization.

A survey of sales managers brought out the importance of three factors in sales presentations - enthusiasm, persuasive communication, and verbal skills.

Persuasive communication is discussed in detail in a separate knol.

Trial close

In the presentation at various points of time whenever the prospect shows strong conviction about the merits of the product or offer, salesman needs to try for a close.

Marketing Strategy - Marketing Process - Kotler's Description

http://nraomtr.blogspot.com/2011/12/marketing-strategy-marketing-process.html

Ud. 16.9.2024

Pub. 26.11.2011  Transfer from Google Knol

Prospect Objections During Sales Presentations

Selling Skills Article Series

Objection or resistance to the request of the salesperson is labeled a sales objection. Salesmen have to welcome the objections because toughest prospects are those who do not say anything. One cannot make out whether they are interested, bored or just being polite. An objection shows that prospect is involved in the conversation.

Objection – the Concept

Objection or resistance to the request of the salesperson is labeled a sales objection. Salesmen have to welcome the objections because toughest prospects are those who do not say anything. One cannot make out whether they are interested, bored or just being polite. An objection shows that prospect is involved in the conversation.



Salesmen have to be prepared for giving a satisfactory reply to the objections raised by prospects.

Objections - Classification

The usual objections encountered during sales process are categorized as:



Hidden objections

Stalling objections

No-need objections

Money objection

Techniques to Reply to Objections

There are several techniques mentioned in books on salesmanship to respond to objections.





Pass up the objection

Anticipate the objection

Forestall the objection

Rephrase the objection as a question

Ask questions regarding the objection

Boomerang the objection

Directly deny the objection

Compensate for the objection

Obtain a third-party answer to the objection

Trial Close

The salesman has to try to do the trial close as he gives a satisfactory response to an objection. Many objections come up only after the salesman tries trail close.

Originally posted in http://knol.google.com/k/narayana-rao/prospect-objections-during-sales/2utb2lsm2k7a/ 79# Knol traffic rank 104

Marketing Strategy - Marketing Process - Kotler's Description

http://nraomtr.blogspot.com/2011/12/marketing-strategy-marketing-process.html

Ud. 16.9.2024

Pub. 26.11.2011 Transfer from Google Knol

Sales Closing Techniques

Selling Skills Article Series

Closing is the process of helping people make a purchase decision that will benefit them. Salesmen help people make that decision by asking them to buy.

Closing a Sale



Closing is the process of helping people make a purchase decision that will benefit them. Salesmen help people make that decision by asking them to buy.



The very fact that a prospect is meeting a seller and having a conversation with him means the prospect has an interest to buy the product. Hence many times the prospect may be ready to make the buying decision very early in the meeting.

When to Try to Close the Sale

The simple answer is when the prospect is ready. To decide the point when the prospect is ready, salesmen have to observe for buy signals or willing-to-buy signals from the prospect.


Buy Signals



A buying signal or buy signal or willing-to-buy signal refers to anything prospects say or do to indicate that they are ready to buy.



Some of them are:



Prospect asks questions regarding price and delivery dates.



Prospect asks the opinions of others.



Prospect relaxes and becomes friendly.



Prospect pulls out the purchase order form.


Prospect looks carefully the product on offer

Closing Techniques

Alternative choice close

Assumptive close

Compliment close

Summary of benefits close

Continuous yes close

Minor points close

T-account or balance sheet close

Standing-room-only close

Marketing Strategy - Marketing Process - Kotler's Description

http://nraomtr.blogspot.com/2011/12/marketing-strategy-marketing-process.html

16.9.2024

Pub. 26.11.2011 - Transferred from Google Knol

Manufacturing Process Design - Work Flow

 

Proposed Procedure for  Process Design and Communication

1. First Specify the output required. Find out indicated volume for annual production.

2. Determine possible inputs.

3. For each input determine the material transformation stages (Find out  the best machine available in the market for various volume levels. Incorporate existing machines in the company also in the proposal. Incorporate pure manual method also as an alternative).

4. Subject the initial proposal to technical feasibility analysis.

5. Do cost analysis for each alternative.

6. Select techno-economically feasible alternative for each operation in the process.

7. Decide quality related inspection activities for each material transformation operation.

8. Find out the best possible instruments for the inspection and related data processing. Incorporate existing instruments and pure manual alternatives also.

9. Subject the initial proposal to technical feasibility analysis.

10. Do cost analysis for each alternative.

11. Select techno-economically feasible alternative for each operation in the process.

12. Determine tentative batch quantity for manufacture.

13. Determine working process storage provision required. Determine the storage facility after  techno-economic analysis including best facility currently available and existing facilities.

14. Determine the transport of material required between machine, inspection station and storage location.

15. Indicate the equipment to be used for transportation. Incorporate best possible equipment, existing equipment, and pure manual alternatives also.

16. Subject the initial proposal to technical feasibility analysis.

17. Do cost analysis for each alternative.

18. Select techno-economically feasible alternative for each operation in the process.

19. Present the complete process as a flow process chart.

This flow process chart is still a high level chart.

Each operation has to be designed and documented further. At the lowest level each element of machine work and manual motion are to be specified and even the motion patter needs to be specified.

WHAT OBJECTIVES SHOULD PROCESS DESIGN HAVE? 

The whole point of process design is to make sure that the performance of the process is appropriate for whatever it is trying to achieve. For example, if an operation competed primarily on its ability to respond quickly to customer requests, its processes would need to be designed to give fast throughput times.

Similarly, if an operation competed on low price, cost-related objectives would be likely to dominate its process design.

More ‘micro’ and detailed set of objectives. 

These are largely concerned with flow through the process. When whatever are being ‘processed’ enter a process they will progress through a series of activities where they are ‘transformed’ in some way. Between these activities they may dwell for some time in inventories, waiting to be transformed by the next activity. This means that the time that a unit spends in the process (its throughput time) will be longer than the sum of all the transforming activities that it passes through. Also the resources that perform the process’s activities may not be used all the time because not all items will necessarily require the same activities and the capacity of each resource may not match the demand placed upon it. So neither the items moving through the process, nor the resources performing the activities may be fully utilized. Because of this the way that items leave the process is unlikely to be exactly the same as the way they arrive at the process. It is common for more ‘micro’ performance flow objectives to be used that describe process flow performance. For example: 

● Throughput rate (or flow rate) is the rate at which items emerge from the process, i.e. the number of items passing through the process per unit of time. 

‘Paced’ processes like moving belt assembly lines. It is the ‘beat’, or tempo, of working required to meet demand. 

● Throughput time is the average elapsed time taken for inputs to move through the process and become outputs. 

● The number of items in the process (also called the ‘work in progress’, or in-process inventory), as an average over a period of time. 

● The utilization of process resources is the proportion of available time that the resources within the process are performing useful work.

Standardization is also an important objective in the design of some services and products, for similar reasons. The practical dilemma for most organizations is how to draw the line between processes that are required to be standardized, and those that are allowed to be different.

SELECTED FURTHER READING 

 Chopra, S. , Anupindi, R. , Deshmukh, S.D. , Van Mieghem, J.A. and Zemel, E. ( 2012 ) Managing 

Business Process Flows, 2nd edn , Prentice Hall, Upper Saddle River, NJ. An excellent, although 

mathematical, approach to process design in general. 

 Hammer, M. ( 1990 ) Reengineering Work: Don’t automate, obliterate, Harvard Business Review , July–August. This is the paper that launched the whole idea of business processes and process management in general to a wider managerial audience. 

Smith, H. and Fingar, P. ( 2003 ) Business Process Management: The Third Wave , Meghan-Kiffer Press, Tampa, FL. A popular book on process management from a BPR perspective.

The Basics of Process Mapping, 2nd Edition

By Robert Damelio

https://books.google.co.in/books?id=I6O_Z-dTap8C

Design and management of service processes

by Ramaswamy, Rohit, 

Publication date 1996

Includes bibliographical references (pages 411-414) and index

Ch. 1. Designing Services -- an Introduction -- Ch. 2. The Service Design and Management Model -- A Methodological Overview -- Ch. 3. Developing Design Specifications -- Part 1: Defining Design Attributes -- Ch. 4. Developing Design Specifications -- Part 2: Setting Design Performance Standards -- Ch. 5. Generating and Evaluating Design Concepts -- Ch. 6. Performing Detailed Process Design -- Part 1: Generating Design Alternatives -- Ch. 7. Performing Detailed Process Design -- Part 2: Evaluating and Testing Alternatives -- Ch. 8. Implementing the Design -- Ch. 9. Measuring Performance -- Ch. 10. Assessing Customer Satisfaction -- Ch. 11. Improving Service Performance -- Ch. 12. Conclusion

Essentials Of Service Design

November 2011Journal of Service Science (JSS) 4(2):43

Jr. Harry Katzan

https://www.researchgate.net/publication/292952356_Essentials_Of_Service_Design

Bitner, M., Ostrom, A., and F. Morgan. 2007. Service Blueprinting: A Practical Technique for Service 

Innovation. Center for Service Leadership, Arizona State University.

Service blueprinting: A practical technique for service innovation

M J Bitner, Amy Ostrom, Felicia N. Morgan

Journal California Management Review

Volume50

Issue number 3, 2008

Process Strategy and Analysis - Important Points - Summary - Krajewski - 12th Edition

https://nraomtr.blogspot.com/2019/08/process-strategy-and-analysis-important.html

Process Design - A Note - Nigel Slack et al. - Chapter 4 in 7th edition

https://nraomtr.blogspot.com/2022/05/process-design-note-nigel-slack-et-al.html

Process Analysis - Chase, Aquilano, Chase Book - Operations Management, 11th Ed.

https://nraomtr.blogspot.com/2011/12/process-analysis.html

Manufacturing Process Selection and Design - Review Notes - 11th Edition Chase & Jacobs & Aquilano

https://nraomtr.blogspot.com/2011/12/manufacturing-process-selection-and.html

Process Design - Summary of Chapters from Books on Operations Management

 

Process Strategy and Analysis - Important Points - Summary - Krajewski - 12th Edition

https://nraomtr.blogspot.com/2019/08/process-strategy-and-analysis-important.html

Process Design - A Note - Nigel Slack et al. - Chapter 4 in 7th edition

https://nraomtr.blogspot.com/2022/05/process-design-note-nigel-slack-et-al.html

Process Analysis - Chase, Aquilano, Chase Book - Operations Management, 11th Ed.

https://nraomtr.blogspot.com/2011/12/process-analysis.html

Manufacturing Process Selection and Design - Review Notes - 11th Edition Chase & Jacobs & Aquilano

https://nraomtr.blogspot.com/2011/12/manufacturing-process-selection-and.html

Process Design - A Note - Nigel Slack et al.

Chapter 4 in 7th edition

10.5.2022

All operations managers are designers, because design is the process of satisfying people’s requirements through shaping or configuring products, services and processes.

Definition of ‘design’, we take it to mean ‘the process by which some functional requirement of people is satisfied through the shaping or configuration of the resources and/or activities that comprise a product, or a service, or the transformation process that produces them’. All operations managers are designers. When they purchase or rearrange the position of a piece of equipment, or when they change the way of working within a process, it is a design decision because it affects the physical shape and nature of their processes. 

WHAT IS PROCESS DESIGN? 

To ‘design’ is to conceive the looks, arrangement, and workings of something before it is created . In that sense it is a conceptual exercise. Yet it is one which must deliver a solution that will work in practice.

At the start of the process  of design activity it is important to understand the design objectives, especially at first, when the overall shape and nature of the process is being decided. The most common way of doing this is by positioning it according to its volume and variety characteristics. Eventually the details of the process must be analysed to ensure that it fulfils its objectives effectively. Yet, it is often only through getting to grips with the detail of a design that the feasibility of its overall shape can be assessed. But don’t think of this as a simple sequential process. There may be aspects concerned with the objectives, or the broad positioning of the process, that will need to be modified following its more detailed analysis.

WHAT OBJECTIVES SHOULD PROCESS DESIGN HAVE? 

The whole point of process design is to make sure that the performance of the process is appropriate for whatever it is trying to achieve. For example, if an operation competed primarily on its ability to respond quickly to customer requests, its processes would need to be designed to give fast throughput times.

Similarly, if an operation competed on low price, cost-related objectives would be likely to dominate its process design.

More ‘micro’ and detailed set of objectives. 

These are largely concerned with flow through the process. When whatever are being ‘processed’ enter a process they will progress through a series of activities where they are ‘transformed’ in some way. Between these activities they may dwell for some time in inventories, waiting to be transformed by the next activity. This means that the time that a unit spends in the process (its throughput time) will be longer than the sum of all the transforming activities that it passes through. Also the resources that perform the process’s activities may not be used all the time because not all items will necessarily require the same activities and the capacity of each resource may not match the demand placed upon it. So neither the items moving through the process, nor the resources performing the activities may be fully utilized. Because of this the way that items leave the process is unlikely to be exactly the same as the way they arrive at the process. It is common for more ‘micro’ performance flow objectives to be used that describe process flow performance. For example: 

● Throughput rate (or flow rate) is the rate at which items emerge from the process, i.e. the number of items passing through the process per unit of time. 

‘Paced’ processes like moving belt assembly lines. It is the ‘beat’, or tempo, of working required to meet demand. 

● Throughput time is the average elapsed time taken for inputs to move through the process and become outputs. 

● The number of items in the process (also called the ‘work in progress’, or in-process inventory), as an average over a period of time. 

● The utilization of process resources is the proportion of available time that the resources within the process are performing useful work.

Standardization is also an important objective in the design of some services and products, for similar reasons. The practical dilemma for most organizations is how to draw the line between processes that are required to be standardized, and those that are allowed to be different.

There is a continuum from low volume/high variety through to high volume/low variety, on which we can position processes. For each operation to be done in a process there could be processes with very different positions on this volume–variety spectrum.

Process types

Project processes

Jobbing processes

Batch processes

Mass and Bulk processes

Mass and Lean Processes

Continuous processes

● Cycle time, or takt time, is the reciprocal of throughput rate – it is the time between items emerging from the process. The term ‘takt’ time is the same, but is normally applied to 

The product–process matrix 

The most common method of illustrating the relationship between a process’s volume– variety position and its design characteristics is  the ‘ product–  process’ matrix. It can  be used for any type of process whether producing products or services. The underlying idea of the product–process matrix is that many of the more important elements of process design are strongly related to the volume–variety position of the process. So, for any process, the tasks that it undertakes, the flow of items through the process, the layout of its resources, the technology it uses, and the design of jobs, are all strongly influenced by its volume–variety position.

 DETAILED PROCESS DESIGN 

After the overall design of a process has been determined, its individual activities must be configured. At its simplest, this detailed design of a process involves identifying all the individual activities that are needed to meet the objectives of the process, and deciding on the sequence in which these activities are to be performed and who is going to do them. There will, of course, be some constraints to this. Some activities must be carried out before others and some activities can only be done by certain people or equipment. Nevertheless, for a process of any reasonable size, the number of alternative process designs is usually large. Because of this, process design is often done using some simple visual approach, such as process mapping.

Process mapping 

Process mapping simply involves describing processes in terms of how the activities within the process relate to each other. There are many techniques which can be used for process mapping (or process blueprinting, or process analysis, as it is sometimes called).

Different levels of process mapping 

 For a large process, drawing process maps at this level of detail can be complex. This is why processes are often mapped at a more aggregated level, called high-level process mapping, before more detailed maps are drawn.

 At the highest level the process can be drawn simply as an input–transformation–output process with materials and customers as its input resources and lighting services as outputs. No details of how inputs are transformed into outputs are included. At a slightly lower or more detailed level, what is sometimes called an outline process map (or chart) identifies the sequence of activities but only in a general way.

At the more detailed level, all the activities are shown in a ‘detailed process map’ Although not shown in Figure 4.8, an even more micro set of process activities could be mapped within each of the detailed process activities. Such a micro-detailed process map could specify every single motion involved in each activity.

Some activities, however, may need mapping in more detail to ensure quality or to protect the  company’s interests. For example, the activity of safety-checking the customer’s site to ensure that it is compliant with safety regulations will need specifying in some detail to ensure that the company can prove it exercised its legal responsibilities.

 Throughput time, cycle time and work in progress 

 So far we have looked at the more conceptual (process types) and descriptive (process mapping) aspects of process design. We now move on the equally important analytical perspective.

Little’s law

This mathematical relationship (throughput time = work-in-progress * cycle time) is called Little’s law. It is simple but very useful, and it works for any stable process. Little’s law states that the average number of things in the system is the product of the average rate at which things leave the system and average time each one spends in the system. Or, put another way, the average number of objects in a queue is the product of the entry rate and the average holding time.

 Throughput efficiency 

This idea that the throughput time of a process is different from the work content of whatever it is processing has important implications.

Percentage throughput efficiency = [Work content/Throughput time] * 100

Value-added throughput efficiency restricts the concept of work content to only those tasks that are literally adding value to whatever is being processed. This often eliminates activities such as movement, delays and some inspections.

 Workflow 

 When the transformed resource in a process is information (or documents containing information), and when information technology is used to move, store and manage the information, process design is sometimes called ‘workflow’ or ‘workflow management’.

 SUMMARY - KEY QUESTIONS

What is process design?

 What objectives should process design have?

 How do volume and variety affect process design?

 How are processes designed in detail?

Proposed Procedure for  Process Design and Communication

1. First Specify the output required. Find out indicated volume for annual production.

2. Determine possible inputs.

3. For each input determine the material transformation stages (Find out  the best machine available in the market for various volume levels. Incorporate existing machines in the company also in the proposal. Incorporate pure manual method also as an alternative).

4. Subject the initial proposal to technical feasibility analysis.

5. Do cost analysis for each alternative.

6. Select techno-economically feasible alternative for each operation in the process.

7. Decide quality related inspection activities for each material transformation operation.

8. Find out the best possible instruments for the inspection and related data processing. Incorporate existing instruments and pure manual alternatives also.

9. Subject the initial proposal to technical feasibility analysis.

10. Do cost analysis for each alternative.

11. Select techno-economically feasible alternative for each operation in the process.

12. Determine tentative batch quantity for manufacture.

13. Determine working process storage provision required. Determine the storage facility after  techno-economic analysis including best facility currently available and existing facilities.

14. Determine the transport of material required between machine, inspection station and storage location.

15. Indicate the equipment to be used for transportation. Incorporate best possible equipments, existing equipments, and pure manual alternatives also.

16. Subject the initial proposal to technical feasibility analysis.

17. Do cost analysis for each alternative.

18. Select techno-economically feasible alternative for each operation in the process.

19. Present the complete process as a flow process chart.

This flow process chart is still a high level chart.

Each operation has to be designed and documented further. At the lowest level each element of machine work and manual motion are to be specified and even the motion patter needs to be specified.

SELECTED FURTHER READING 

 Chopra, S. , Anupindi, R. , Deshmukh, S.D. , Van Mieghem, J.A. and Zemel, E. ( 2012 ) Managing 

Business Process Flows, 2nd edn , Prentice Hall, Upper Saddle River, NJ. An excellent, although 

mathematical, approach to process design in general. 

 Hammer, M. ( 1990 ) Reengineering Work: Don’t automate, obliterate, Harvard Business Review , July–August. This is the paper that launched the whole idea of business processes and process management in general to a wider managerial audience. Slightly dated but worth reading. 

 Hopp, W.J. and Spearman, M.L. ( 2001 ) Factory Physics, 2nd edn, McGraw-Hill, New York. Very technical so don’t bother with it if you aren’t prepared to get into the maths. However, some fascinating analysis, especially concerning Little’s law.

 Smith, H. and Fingar, P. ( 2003 ) Business Process Management: The Third Wave , Meghan-Kiffer Press, Tampa, FL. A popular book on process management from a BPR perspective.

The Basics of Process Mapping, 2nd Edition

By Robert Damelio

https://books.google.co.in/books?id=I6O_Z-dTap8C

Design and management of service processes

by Ramaswamy, Rohit, 

Publication date 1996

Includes bibliographical references (pages 411-414) and index

Ch. 1. Designing Services -- an Introduction -- Ch. 2. The Service Design and Management Model -- A Methodological Overview -- Ch. 3. Developing Design Specifications -- Part 1: Defining Design Attributes -- Ch. 4. Developing Design Specifications -- Part 2: Setting Design Performance Standards -- Ch. 5. Generating and Evaluating Design Concepts -- Ch. 6. Performing Detailed Process Design -- Part 1: Generating Design Alternatives -- Ch. 7. Performing Detailed Process Design -- Part 2: Evaluating and Testing Alternatives -- Ch. 8. Implementing the Design -- Ch. 9. Measuring Performance -- Ch. 10. Assessing Customer Satisfaction -- Ch. 11. Improving Service Performance -- Ch. 12. Conclusion

Essentials Of Service Design

November 2011Journal of Service Science (JSS) 4(2):43

Jr. Harry Katzan

https://www.researchgate.net/publication/292952356_Essentials_Of_Service_Design

A Collection of Service Essays: A Practical Approach

Harry Katzan Jr

iUniverse, 23-Feb-2018 - Business & Economics - 248 pages

This book is a collection of papers written by the author on the subject of service. They all have been peer reviewed and written for a diverse variety of reasons. Some papers have been modified to suit a general audience, and others have simply been improved. There are some formatting differences due to the basic requirements of the various venues. The subject matter can be viewed as three separate sections: introductory, foundational, and applicative. The introductory papers are quite simple and give a gentle introduction to what the discipline of service is all about. The foundational papers provide a basis for the study of the concepts and methods of the service discipline. The applicative papers are general in nature so as to provide insight to what does and can go on in the world of service. Papers 1 and 2 fall into the first category. Papers 3, 4, and 5 are in the second category, and the remainder are in the third group. The table of contents is unique in that the entries give an abstract to the respective paper. This is an aid to a selection and gives a summary of the subject matter. The papers were assembled to support two recent books on the subject of service.

https://books.google.co.in/books?id=7qhPDwAAQBAJ

Bitner, M., Ostrom, A., and F. Morgan. 2007. Service Blueprinting: A Practical Technique for Service 

Innovation. Center for Service Leadership, Arizona State University.

Service blueprinting: A practical technique for service innovation

M J Bitner, Amy Ostrom, Felicia N. Morgan

JournalCalifornia Management Review

Volume50

Issue number3

StatePublished - 2008

Ud.  15.9.2024, 30.7.2023, 11.7.2023

Pub 10.5.2022

Process Strategy and Analysis - Important Points - Summary - Krajewski - 12th Edition

Process Structure in Manufacturing 

Important Point. A new line is suggested. For a line in the chapter, I suggested a new line.

The manufacturing manager has four process choices, which form a continuum, to choose from: (1) job process, (2) batch process, (3) line process, and (4) continuous-flow process (Krajewski et al).

Needs to be changed to 

The manager has five process choices, which form a continuum, to choose from: (1) job process (lean job process?), (2) batch process, (3) line process, (4) lean line process and (5) continuous-flow process (Narayana Rao  29 August 2019  https://nraomtr.blogspot.com/2019/08/add-lean-to-manufacturing-processes.html ).

Lean job process - Modern Industrial Engineering and Lean in Low Volume - High Mix Production - Shahrukh Irani, Narayana Rao and Others

https://nraoiekc.blogspot.com/2021/09/lean-in-low-volume-high-mix-production.html

-------------------------------

Learning Goals -  Process Strategy and Analysis

Process Structure in Manufacturing 
Understand the process structure in manufacturing and how to position a manufacturing process on the product process matrix.

Process Structure in Services 

Understand the process structure in services and how to position a service process on the customer-contact matrix.

Process Strategy Decisions
Explain the major process strategy decisions and their implications for operations.

Strategic Fit 
Discuss how process decisions should strategically fit together.

Strategies for Change
Compare and contrast the two commonly used strategies for change, and understand a systematic way to analyze and improve processes.

Defining, Measuring, and Analyzing the Process
Discuss how to document and analyze/evaluate processes.

Redesigning and Managing Process Improvements 
Identify the commonly used approaches for effectively redesigning and managing processes.

Chapter Contents and Important Points - Process Strategy and Analysis

CVS Pharmacy

Processes use the organization’s resources to provide something of value. The output is a product or service.

Process strategy  specifies the pattern of decisions to be made in planning and managing processes so that the processes will achieve their competitive priorities. Process analysis  is the documentation and detailed understanding of the existing process about how work is performed and how it can be redesigned. Process decisions directly affect the process itself by changing process inputs and methods of using them and indirectly the services and the products that it provides. All parts of an organization, as well as external suppliers and customers across the supply chain, need to be involved in process design to ensure that processes are providing the most value to their internal and external customers.

Three principles  are particularly important in process strategy making.
1. The key to successful process decisions is to make choices that fit the situation and that make sense together. In an effective enterprise process, or process chain, each process must have a close strategic fit with the business strategy and also with other processes with which it has interaction.

2. The individual processes are the building blocks that eventually create the firm’s whole supply chain. The cumulative effect of proper design of each process on customer satisfaction and competitive advantage is huge.

3. Whether processes in the supply chain are performed internally or by outside suppliers and
customers, management must pay special attention to the interfaces between processes. Dealing
with these interfaces underscores the need for cross-functional (process) coordination.

Process Structure in Services 

Customer-Contact Matrix
Service Process Structuring


The customer-contact matrix brings together three elements: 

(1) the degree of customer contact in the process serving him, 

(2) customization, and

 (3) service process characteristics. 

The matrix is the starting point for evaluating and improving a process.

A flexible flow means that the customers, materials, or information move in diverse ways,
with the path of one customer or job often crisscrossing the path that the next one takes.

A line flow means that the customers, materials, or information move linearly from one operation to the next in the process,  according to a fixed sequence. When diversity is low and the process standardized, line flows are a natural consequence.

The manager has three service process structures, which form a continuum, to choose from: (1) front office, (2) hybrid office, and (3) back office.

Process Structure in Manufacturing 
Product-Process Matrix
Manufacturing Process Structuring

In the case of manufacturing good, the product–process matrix brings together three elements:
(1) volume, (2) product customization, and (3) process characteristics.

The manufacturing manager has four process choices, which form a continuum, to choose from: (1) job process, (2) batch process, (3) line process, and (4) continuous-flow process (Krajewski et al).

Needs to be changed to 

The manager has five process choices, which form a continuum, to choose from: (1) job process, (2) batch process, (3) line process, (4) lean process and (5) continuous-flow process (Narayana Rao  29 August 2019  https://nraomtr.blogspot.com/2019/08/add-lean-to-manufacturing-processes.html ).

Lean is a line process for multiple products with batch size approaching one. Lean process can be used in various manufacturing processes. A lean index with most desirable value of 1 can be created. Value of 1 is given to a process which used a batch quantity of one. A weighting scheme can be generated to give lean index to a factory.

By defining lean also as a process alternative, design of lean system right from the start of a new production line or system comes into existence. The operation of such greenfield lean process factories or production plants will give ideas on how to convert more legacy processes into lean processes.

Layout  design is based on the manufacturing process. Job and batch processes use process layout. Line and lean processes use line layout or product layout. Continuous processes many times contain flow through pipes.


Production and Inventory Strategies

Design-to-order, make-to-order, assemble-to-order, and make-to-stock strategies are
four approaches to production and inventory creation.

Process Strategy Decisions

• Customer Involvement

• Resource Flexibility

• Capital Intensity

Three other major process strategy decisions are customer involvement, resource flexibility, and capital intensity

Strategic Fit 
Decision Patterns for Service Processes
Decision Patterns for Manufacturing Processes
Gaining Focus
Managerial Practice 2.1 Plants-within-a-Plant at Ford Camacari

The four strategic decisions with respect to process: process structure, Customer Involvement, Resource Flexibility, and Capital Intensity need to have fit with competitive strategy or business strategy.

Gaining focus: Plants within plants, focused factories.

Strategies for Change

• Process Reengineering

• Process Analysis

• Process Improvement

Process Reengineering

Reengineering is the fundamental rethinking and radical redesign of processes to improve performance dramatically in terms of cost, quality, service, and speed based on developments in science, technology or process management. Process reengineering is about engineering redesign and is done undertaken as a major project. It would normally involve substantial capital investment as number of new facilities including machines and equipment are acquired. It is normally undertaken by the facilities engineering and process engineering (process planning) department.

Process Analysis

Process analysis leads to process improvement. To analyze the process, documentation of the process needs to be done of the working of the existing process as taking place in the shop now. This activity of recording and analyzing existing processes is the main task undertaken by industrial engineers. It is incremental improvement of the process at planned periods to capture new developments in engineering and creative ideas to apply the existing knowledge to processes inside the company. In this exercise effort is made to involve many in the company by circulating existing process charts.  Examining  the strategic issues also can help identify opportunities for improvement apart from operational issues. A gap analysis can be done between a process’s competitive priorities and its current competitive capability requirements.

In engineering and manufacturing process, industrial engineers carry out process improvement to improve productivity. Process improvement is based on the systematic study of the activities and flows of each process to improve it. Productivity science, engineering and management activities are involved in process productivity improvement.

Process Improvement Based on Operator/Supervisor/Engineer Suggestions and Shop-floor Based Improvements

Process improvement is based on the   understanding of  the process, and digging out the details. Hence frontline operators have significant ideas to contribute to process improvement. Through seeking their suggestions, process improvement is made a continuous process and incremental improvements at small and micro level keep taking place. In Toyota Motors, Ohno gave responsibility to shop floor personnel also for process improvement apart from process planning and industrial engineering.

In more detail

Processes involve the use of an organization’s resources to provide something of value.  No service can be provided and no product can be 

made without a process, and no process can exist without at least one service or product. A firm cannot gain competitive advantage with faulty processes. Process decisions as

such are strategic in nature. They have to designed to  further a company’s long-term competitive 

goals. In making process decisions, managers focus on controlling such competitive priorities as quality, 

flexibility, time, and cost. Process management is an ongoing activity, with the same principles applying to both first-time and redesign choices. Many different choices are available in 

selecting  equipment, outsourced services, human resources, materials, work flows, and methods that transform inputs into outputs. Another choice is which processes are to be done in-house and which processes 

are to be outsourced—that is, done outside the firm and purchased as materials and services. This decision 

helps to define the supply chain. 

Process strategy  specifies the pattern of decisions made in managing processes so that the processes will achieve their competitive priorities.

Process analysis includes the documentation and understanding of how work is performed based on observation the documentation and how it can be 

redesigned. Process decisions directly affect the process itself and indirectly the services and the products that it provides. All parts of an organization, as well as external suppliers and customers across the 

supply chain, need to be involved to ensure that processes are providing the most value to their internal 

and external customers.

Process strategy guides a variety of process decisions. It is in turn, guided by operations strategy 

and the organization’s ability to obtain the resources necessary to support them. 

Four basic process decisions are: 

(1) process structure, 

(2) customer involvement, 

(3) resource flexibility, and 

(4) capital intensity. 

These decisions  have to fit together, depending on factors such as competitive priorities, customer contact, and volume.

There are two basic change strategies for analyzing and modifying processes: 

(1) process reengineering and 

(2) process improvement. 

Both these approaches need process analysis to identify and implement changes.

Three principles concerning process strategy are particularly important:

1. The key to successful process decisions is to make choices that fit the situation and that make sense 

together. They should not work at cross-purposes, with one process optimized at the expense of 

other processes. A more effective process is one that matches key process characteristics and has a 

close strategic fit.

2. Individual processes are the building blocks that eventually create the firm’s whole supply chain. The cumulative effect on customer satisfaction and 

competitive advantage is huge.

3. Whether processes in the supply chain are performed internally or by outside suppliers and 

customers, management must pay particular attention to the interfaces between processes. Dealing 

with these interfaces underscores the need for cross-functional coordination.

Whether dealing with processes for offices, service providers, or manufacturers, operations 

managers must consider four common process decisions. Figure 2.1 shows that they are all important 

steps toward an effective process design. These 

four decisions are best understood at the process 

or subprocess level rather than at the firm level.

▪ Process structure determines the process type relative to the kinds of resources needed, 

how resources are partitioned between them, and their key characteristics. A layout is the 

physical arrangement of operations (or departments) relative to each other.

▪ Customer involvement reflects the ways in which customers become part of the process 

and the extent of their participation.

▪ Resource flexibility is the ease with which employees and equipment can handle a wide 

variety of products, output levels, duties, and functions.

▪ Capital intensity is the mix of equipment and human skills in a process. The greater the cost 

of equipment relative to the cost of labor, the greater is the capital intensity.

The concepts that we develop around these four decisions establish a framework within which 

we can address the appropriate process design in every situation. We need to  create a good fit between the four decisions. 

Process structures can range from process layout or job shop to line layout or product layout dedicated to the production of one product.

Three Examples of New Process Strategy

by Brad Power

December 06, 2012

Harvard Business Review

https://hbr.org/2012/12/in-my-last-post-i-1

There are three fundamental ways that companies can improve their processes in the coming decade: (1) expand the scope of work managed by a company to include customers, suppliers, and partners; (2) target the increasing amount of knowledge work (increase social collaboration to make knowledge gathering and sharing easy); and (3) reduce cycle times of developing new changes to durations previously considered impossible (agile product and process changes. Do quickly and test with the consumers).

https://hbr.org/2012/12/in-my-last-post-i-1

Defining, Measuring, and Analyzing the Process
Flowcharts
Work Measurement Techniques
Process Charts
Data Analysis Tools


Documenting and Evaluating the Process

Three major techniques for effectively documenting and evaluating processes are (1) flowcharts, (2) work measurement techniques, and (3) process charts. They allow you to document  and see how an organization does its work in team discussion. The process operation is recorded to the lowest level and  how well it is performing is also recorded through measurements. Thus, techniques for documenting the process facilitate finding performance gaps, generating ideas for process improvements, and also documenting the look of a redesigned process.

Flowcharts
A flowchart traces the flow of information or  customers or  equipment, or materials through the various steps of a process. Flowcharts are also known as flow diagrams, process maps, relationship maps, or blueprints.

Work Measurement Techniques
Process documentation needs estimates of the average time each step in the process would take. Reduction of time is process improvement and hence time estimates or measurements are needed. Time estimates are also needed for  capacity planning, constraint management, performance appraisal, and scheduling.

Estimating task times may be done as reasoned guess, asking a knowledgeable person, or taking notes while  observing the process. There are well developed procedures for the purpose. Measurements can also be ascertained from shop data collected for  cost  accounting and  data recorded in information systems.

Process Charts
A process chart is an organized way of documenting all the activities performed by a person or group of people at a workstation, with a customer, or working with certain materials. It analyzes a process using information about each step in the process. Time estimates are included in process charts.

Redesigning and Managing Process Improvements 
Questioning and Brainstorming
Benchmarking
Implementing

After the process analysis team or design team comes out with conceptual design of redesign of a process, people directly involved in the process are to be brought in to get their ideas and inputs. Frank Gilbreth who initiated the idea of process charts recommended showing process chart of existing process to as many people as possible to get their inputs. Involving process owners and process team members right from the inception of the redesign project by indicating the potential for improvement of the desirable outputs from the process will motivate more persons to contribute their ideas.

Raising questions about each operation of the process in a systematic way to a brainstorming group will give creative ideas to improve the process in the form of alternatives.

The questions in the case an operation of a process are:

What is being done?

Why is it being done?

What equipment is being used?

What tools and workholding are used?

Who is doing it?

How is it being done?

Where is being done?

When is being done?

How well the operation/process being done in comparison to desired measures of performance?

The above questions are followed by why questions and the alternatives that will give better performance. In the case of manufacturing processes, adequate engineering knowledge is essential to get better answers, operations and processes.

Benchmarking is knowing and understanding the operations used by competitors and comparing those operations with internal operations. The idea is to identify concepts that can be profitably employed and make the process superior by the unique ways embedded in the internal process.

The chapter gives seven mistakes that are to be avoided in process improvement implementation. The mistakes are identified by Geary Rummler and Alan Brache.

Learning Goals in Review

Reflect what have you learned? What are the gaps now?

Learning Goals -  Process Strategy and Analysis

Process Structure in Manufacturing 
Understand the process structure in manufacturing and how to position a manufacturing process on the product process matrix.

Process Structure in Services 

Understand the process structure in services and how to position a service process on the customer-contact matrix.

Process Strategy Decisions
Explain the major process strategy decisions and their implications for operations.

Strategic Fit 
Discuss how process decisions should strategically fit together.

Strategies for Change
Compare and contrast the two commonly used strategies for change, and understand a systematic way to analyze and improve processes.

Defining, Measuring, and Analyzing the Process
Discuss how to document and analyze/evaluate processes.

Redesigning and Managing Process Improvements 
Identify the commonly used approaches for effectively redesigning and managing processes.

Chapter Contents of  Krajewski - 12th Edition

2 PROCESS STRATEGY AND ANALYSIS 

Process Structure in Services

Customer-Contact Matrix 

Service Process Structuring 

Process Structure in Manufacturing

Product-Process Matrix

Manufacturing Process Structuring

Production and Inventory Strategies

Layout

Process Strategy Decisions

Customer Involvement

Resource Flexibility

Capital Intensity

Strategic Fit

Decision Patterns for Service Processes

Decision Patterns for Manufacturing Processes

Gaining Focus

Managerial Practice 2.1 Plants-within-a-Plant at Ford Camacari 

Strategies for Change

Process Reengineering

Process Improvement

Process Analysis

Defining, Measuring, and Analyzing the Process

Flowcharts 66

Work Measurement Techniques

Process Charts

Data Analysis Tools

Redesigning and Managing Process Improvements

Questioning and Brainstorming

Benchmarking

Implementing

 

Learning Goals in Review
MyLab Operations Management Resources
Key Terms
Solved Problems
Discussion Questions
Problems
Active Model Exercise
Video Case Process Analysis at Starwood
Case Custom Molds, Inc.
Case José’s Authentic Mexican Restaurant


Process Improvement - Process Industrial Engineering - Relevant Chapters in Operations Management

Process Strategy and Analysis - Important Points - Operations Management - Krajewski - 12th Edition

Quality and Performance - Important Points - Summary - Krajewski - 12th Edition

Lean Systems - Important Points - Summary - Krajewski - 12th Edition

Constraint Management - Important Points - Summary - Krajewski - 12th Edition

Process Improvement Literature - Bibliography

Process Mapping - Hugo Dimer - First Professor of Industrial Engineering

https://nraoiekc.blogspot.com/2022/02/process-mapping.html

ASME - Gilbreth Process Chart and Related Engineering and Management Subjects 

https://nraoiekc.blogspot.com/2021/02/asme-gilbreth-process-chart-and-ohnos.html

Process Analysis - Eliminate, Combine, Divide, Rearrange, Simplify - ECDRS Method - Barnes 

https://nraoiekc.blogspot.com/2013/09/eliminate-combine-rearrange-simplify.html

Ud. 14.9.2024,  5.5.2022

Pub 19.1.2021

Summary - Important Points - Book - The Goal - A Process Ongoing Improvement - Eliyahu Goldratt

Main Themes of the Book

“The future of our business depends upon our ability to increase productivity.”

What is Productivity?

How to improve it?

Summary of TOC Institute

https://www.tocinstitute.org/the-goal-summary.html

Important Ideas and Statements from Each Chapter

Ch. 2

But, hell, I’ve got an engineering degree. I’ve got an MBA.

 3

“And the answer is clear,” Peach is saying. “The future of our business depends upon our ability to increase productivity.”

Ch. 4

I’m on my way to Houston. We belong to a manufacturers’ association, and the association invited UniCo to be on a panel to talk about robotics at the annual conference. I got picked by UniCo, because my plant has the most experience with robots.”

 I crack open my briefcase on my lap and pull out the advance copy of the program the association sent me.

“Here we are,” I say, and read the listing to him. “ ‘Robotics: Solution to America’s Productivity Crisis in the new millenium … a panel of users and experts discusses the coming impact of industrial robots on American manufacturing.’”

“You say your plant uses robots?” he asks.

“In a couple of departments, yes,” I say.

“Have they really increased productivity at your plant?”

“Sure they have,” I say. 

“I think it was a thirty-six percent improvement in one area.”

“Really … thirty-six percent?” asks Jonah. “So your company is making thirty six percent more money from your plant just from installing some robots? Incredible.”

“Well…no,” I say.  It was just in one department that we had a thirty-six percent improvement.”

“Then you didn’t really increase productivity,” he says.

He says. “Forget for just a minute about the formulas and all that, and just tell me in your own words, from your experience, what does it mean to be productive?”

Ch. 5

The plant wasn’t built just so it could break even. UniCo is not in business just so it can break even. The company exists to make money.

I see it now.

The goal of a manufacturing organization is to make money.

Ch. 6

Think of it. We’d really be making money if we could have all of the measurements go up simultaneously and forever.

So this is the goal:

To make money by increasing net profit, while simultaneously increasing return on investment, and simultaneously increasing cash flow.

Chapter 8

 “Throughput,” he says, “is the rate at which the system generates money through  sales.

 “Inventory is all the money that  the system has invested in purchasing things which it intends to sell.”

 “Operational expense,” he says. “Operational expense is all the money the  system spends in order to turn inventory into throughput.

 how do I use these measurements to evaluate productivity?”

Chapter 9

 One of them, I remember as I’m driving, was whether we had been able to sell  any more products as a result of having the robots. Another one was whether we had  reduced the number of people on the payroll. Then he had wanted to know if  inventories had gone down. Three basic questions.

 So the way to express the goal is this?

 Increase throughput while simultaneously reducing both inventory and  operating expense.

Ch. 11

He says. “A plant in which everyone is working all the time is very inefficient.”

He says, “A balanced plant is essentially what every manufacturing manager in the whole western world has struggled to achieve. It’s a plant where the capacity of each and every resource is balanced exactly with demand from the market."

Says Jonah,  no resource is idle, and everybody has something to work on.”

For one thing, there is a mathematical proof which could clearly show that when capacity is trimmed exactly to marketing demands, no more and no less, throughput goes down, while inventory goes through the roof,” he says. “And because inventory goes up, the carrying cost of inventory—which is operational expense—goes up. 

“Because of the combinations of two phenomena which are found in every plant,” he says. “One phenomenon is called ‘dependent events.’"

“The big deal occurs when dependent events are in combination with another phenomenon called ‘statistical fluctuations,’” he says.

Alex. Call me when you can tell me what the combination of the two phenomena mean to your plant.”

Ch. 12

I look at the chart. I still can hardly believe it. It was a balanced system. And yet throughput went down. Inventory went up. And operational expense? If there had been carrying costs on the matches, operational expense would have gone up too.

What if this had been a real plant—with real customers? How many units did we manage to ship? We expected to ship thirty-five. But what was our actual throughput? It was only twenty. About half of what we needed. And it was nowhere near the maximum potential of each station.

Chapter 18

He says, “What you have to do next, Alex, is distinguish between two types of resources in your plant. One type is what I call a bottleneck resource. The other is, very simply, a non-bottleneck resource.”

“A bottleneck,” Jonah continues, “is any resource whose capacity is equal to or less than the demand placed upon it. And a non-bottleneck is any resource whose capacity is greater than the demand placed on it. Got that?”

“But, Jonah, where does market demand come in?” Stacey asks. “There has to be some relationship between demand and capacity.”

He says, “Yes, but as you already know, you should not balance capacity with demand. What you need to do instead is balance the flow of product through the plant with demand from the market. This, in fact, is the first of nine rules that express the relationships between bottlenecks and non-bottlenecks and how you should manage your plant. So let me repeat it for you: Balance flow, not capacity.”

We’re defining a work center as any group of the same resources. Ten welders with the same skills constitute a work center. Four identical machines constitute another. The four machinists who set up and run the machines are still another, and so on. Dividing the total of work center hours needed, by the number of resources in it, gives us the relative effort per resource.

Ch. 19

Jonah raises a finger and says, “Make sure the bottleneck works only on good parts by weeding out the ones that are defective. If you scrap a part before it reaches the bottleneck, all you have lost is a scrapped part. But if you scrap the part after it’s passed the bottleneck, you have lost time that cannot be recovered.”

 “Be sure the process controls on bottleneck parts are very good, so these parts don’t become defective in later processing.”

Says Jonah. “Whatever the bottlenecks produce in an hour is the equivalent of what the plant produces in an hour. So … an hour lost at a bottleneck is an hour lost for the entire system.”

“Then how much would it cost for this entire plant to be idle for one hour?” asks Jonah.

“The actual cost of a bottleneck is the total expense of the system divided by the number of hours the bottleneck produces,” says Jonah. 

Says Jonah. “If your bottlenecks are not working, you haven’t just lost $32 or $21. The true cost is the cost of an hour of the entire system. And that’s twenty seven hundred dollars.”

“And with that in mind, how do we optimize the use of the bottlenecks? There are two principal themes on which you need to concentrate …

“First, make sure the bottlenecks’ time is not wasted,” he says. “How is the time of a bottleneck wasted? One way is for it to be sitting idle during a lunch break. Another is for it to be processing parts which are already defective—or which will become defective through a careless worker or poor process control. A third way to waste a bottleneck’s time is to make it work on parts you don’t need.”

“I mean anything that isn’t within the current demand,” he says.

“Then make the bottlenecks work only on what will contribute to throughput today… ” says Jonah. “That’s one way to increase the capacity of the bottlenecks. The other way you increase bottleneck capacity is to take some of the load off the bottlenecks and give it to non-bottlenecks.”

 “Do all of the parts have to be processed by the bottleneck? If not, the ones which don’t can be shifted to non-bottlenecks for processing. And the result is you gain capacity on your bottleneck. A second question: do you have other machines to do the same process? If you have the machines, or if you have a vendor with the right equipment, you can offload from the bottleneck. And, again, you gain capacity which enables you to increase throughput.”

Ch. 26

“Okay, enough!” I say. “What’s your idea, Sharon?”

Sharon says, “A drummer.”

“Pardon me?”

“You know…like in a parade,” she says.

“Oh, I know what you mean,” I say, realizing what she has in mind. “There

aren’t any gaps in a parade. Everybody is marching in step.

 “Okay, wise guy, what’s your idea?”

“Tie ropes to everyone,” says Dave.

“Ropes?”

“You know, like mountain climbers,” he says. “You tie everyone together at the waist with one long rope. So, that way, no one could get left behind, and nobody could speed up without everybody speeding up.”

Ch. 28

Part of what Jonah told me last night over the phone had to do with the time a piece of material spends inside a plant. If you consider the total time from the moment the material comes into the plant to the minute it goes out the door as part of a finished product, you can divide that time into four elements.

One of them is setup, the time the part spends waiting for a resource, while the resource is preparing itself to work on the part.

Another is process time, which is the amount of time the part spends being modified into a new, more valuable form.

A third element is queue time, which is the time the part spends in line for a resource while the resource is busy working on something else ahead of it.

The fourth element is wait time, which is the time the part waits, not for a resource, but for another part so they can be assembled together.

As Jonah pointed out last night, setup and process are a small portion of the total elapsed time for any part. But queue and wait often consume large amounts of time —in fact, the majority of the elapsed total that the part spends inside the plant.

Last night, Jonah told me that although he didn’t have time over the phone to go into all the reasons, EBQ has a number of flawed assumptions underlying it. Instead, he asked me to consider what would happen if we cut batch sizes by half from their present quantities.

If we reduce batch sizes by half, we also reduce by half the time it will take to process a batch. That means we reduce queue and wait by half as well. Reduce those by half, and we reduce by about half the total time parts spend in the plant. Reduce the time parts spend in the plant, and….

Ch. 36

The process was written clearly on the board:

STEP 1.

Identify the system’s bottlenecks.

(After all it wasn’t too difficult to identify the oven and the NCX10 as the bottlenecks of the plant.)

STEP 2.

Decide how to exploit the bottlenecks.

(That was fun. Realizing that those machines should not take a lunch break, etc.)

STEP 3.

Subordinate everything else to the above decision.

(Making sure that everything marches to the tune of the constraints. The red and green tags.)

STEP 4.

Elevate the system’s bottlenecks.

(Bringing back the old Zmegma, switching back to old, less “effective” routings….)

STEP 5. 

If, in a previous step, a bottleneck has been broken go back to step 1.

Ch. 37

When she returns to her seat the board has the following:

1. IDENTIFY the system’s constraint(s).

2. Decide how to EXPLOIT the system’s constraint(s).

3. SUBORDINATE everything else to the above decision.

4. ELEVATE the system’s constraint(s).

5. WARNING!!!! If in the previous steps a constraint has been broken, go back to step 1, but do not allow INERTIA to cause a system’s constraint.

Ch. 38

The Socratic dialogues. They’re done in exactly the same way, through exactly the same relationship, IF … THEN. Maybe the only difference is that the facts do not concern material but human behavior.”

“Interesting, very interesting. Come to think about it,” I say, “my field, management, involves both material and people behavior. If the same method can be used for each then it’s probably the basis for Jonah’s techniques.”

She thinks about it for a while. “You’re probably right. But if you are then I’m willing to bet that when Jonah starts to teach you those techniques you’ll find that they are much more than techniques. They must be thinking processes.”

In the Book Race

67: REDUCING DISRUPTIONS TO GAIN A COMPETITIVE EDGE

Focused application of the right productivity improvement technique reduces disruptions and eliminates the most important holes in our buffers.

69: THE PRODUCTIVITY FLYWHEEL

The first step in establishing such a productivity flywheel is to implement synchronized manufacturing using the drum-rope-buffer approach. Then we need to manage the inventory buffers and to focus our process improvement efforts. Finally, Just-in-Time techniques, new technology and good management practices should be brought to bear where they will have the greatest impact. The result will be a continuous increase in net profit, return on investment and cash flow.

70: THERE IS NO FINISH LINE

This process of ongoing improvement is not the only or best way. We  must think even harder to find even better processes.

Good luck and much success in your efforts to win the race.

Ud. 14.9.2024,  7.9.2024

Pub. 3.9.2024

Theory of Constraints - Principle, Theory and Bundle of Practices in Productivity Management and Operations Management

The Purpose, Philosophy, Principles and Methods of Industrial Engineering.

#IndustrialEngineering   for   #SocietyProsperity  through #Productivity  #Improvement satisfying all constraints and limits. 

INTRODUCTION TO MODERN INDUSTRIAL ENGINEERING. 

460+ Downloads in the new academic year. 10000 downloads 2023-24 A.Y.

Free Download from:

https://academia.edu/103626052/INTRODUCTION_TO_MODERN_INDUSTRIAL_ENGINEERING_Version_3_0

Theory of Constraints is an important development in productivity management. It helps in planning productivity improvement projects on machines and operator on priority bases. It helps in budgeting of IE projects and studies. All productivity engineering outputs are to be used in TOC projects or improvements or injections.

My comments on a LinkedIn Post regarding TOC

Narayana Rao KVSS

Professor (Retired), NITIE - Now IIM Mumbai - Offering FREE IE ONLINE Course Notes

Productivity is the focus of TOC. If organizations are doing productivity management, TOC is an important principle and bundle of practices to be used. But it is dependent on all other productivity improvement methods like process chart analysis, operation analysis, productivity device design etc.

-----------

John Allan Loucks Thank you for the comment and question. The focus of the book "Goal" is on explaining what is productivity and how to increase it. I am developing an essay on TOC now and revising my earlier notes. May be I can present a better case of my statement after some time.

If productivity is to be improved, TOC provides a concrete focus. To improve a bottleneck facility or a process, you need to use all available productivity improvement methods. Goldratt did not argue against them. He highlighted that bottleneck facilities have to be improved first to derive the goal related benefit. If you improve other facilities or processes, no immediate benefit will accrue to the system.

 https://www.linkedin.com/posts/opexconsult_lean-activity-7236227018399346689-mRvZ

Has Industrial Engineering formally ignored Theory of Constraints Based Productivity Improvement?

https://www.linkedin.com/feed/update/urn:li:activity:7238549696183422976/

----------------

Theory of Constraints - Principle, Theory and Bundle of Practices in Productivity Management

Productivity Improvement and Productivity Management are not taking place effectively. So thought, Eliyahu Goldratt. He studied the issue and came out with a solution. The theory named, theory of constraints.

Goldratt actually helped a friend producing chicken coops to increase productivity.

He developed a computer package based on that solution name OPT. He explained the logic of OPT package through a novel - The Goal.

Important Points - Book - The Goal - A Process Ongoing Improvement - Eliyahu Goldratt. First Full Book on TOC.

https://nraomtr.blogspot.com/2024/09/summary-book-goal-process-ongoing.html

It's Not Luck - Goldratt - Summary - Lectures.

This is book is continuation of the book - Goal.

https://nraomtr.blogspot.com/2024/09/its-not-luck-goldratt-summary-lectures.html

Summary - Goldratt, E. M. - The Haystack Syndrome: Sifting Information Out of the Data Ocean.

How to find the constraint inside? How to find solution to the problem based on so much knowledge outside?

https://nraomtr.blogspot.com/2024/09/summary-goldratt-e-m-haystack-syndrome.html

Knowledge Management for Industrial Engineering.

Knowledge Management: A Basic Ingredient for #Productivity - Asian Productivity Organization.

https://nraoiekc.blogspot.com/2023/04/knowledge-management-for-industrial.html

Recent Case Study. Shared on LinkedIn on 13.9.2024

Alin Posteucă

Performance Improvement Consultant | Author of Strategic KAIZEN concept 

13.9.2024

🚀 𝐔𝐧𝐥𝐨𝐜𝐤𝐢𝐧𝐠 𝐎𝐩𝐞𝐫𝐚𝐭𝐢𝐨𝐧𝐚𝐥 𝐄𝐱𝐜𝐞𝐥𝐥𝐞𝐧𝐜𝐞: 𝐏𝐫𝐨𝐟𝐢𝐭𝐚𝐛𝐥𝐞 𝐒𝐲𝐧𝐜𝐡𝐫𝐨𝐧𝐢𝐳𝐚𝐭𝐢𝐨𝐧 𝐨𝐟 𝐄𝐪𝐮𝐢𝐩𝐦𝐞𝐧𝐭 𝐰𝐢𝐭𝐡 𝐭𝐡𝐞 𝐀𝐬𝐬𝐞𝐦𝐛𝐥𝐲 𝐋𝐢𝐧𝐞 🚀 

Did you know that over 𝟓𝟓% of companies focusing on cost improvement fail to meet their goals?

 (𝐇𝐚𝐫𝐯𝐚𝐫𝐝 𝐁𝐮𝐬𝐢𝐧𝐞𝐬𝐬 𝐑𝐞𝐯𝐢𝐞𝐰, 𝟐𝟎𝟐𝟑). 

It’s crucial to adopt strategies that truly deliver results. 

Strategic KAIZEN methodology does this to achieve Takt Profit targets.

One standout Strategic Kaizen project, 𝐏𝐫𝐨𝐟𝐢𝐭𝐚𝐛𝐥𝐲 𝐒𝐲𝐧𝐜𝐡𝐫𝐨𝐧𝐢𝐳𝐢𝐧𝐠 𝐄𝐪𝐮𝐢𝐩𝐦𝐞𝐧𝐭 𝐰𝐢𝐭𝐡 𝐭𝐡𝐞 𝐀𝐬𝐬𝐞𝐦𝐛𝐥𝐲 𝐋𝐢𝐧𝐞, demonstrates how strategic productivity improvements can yield significant financial and operational gains.

https://www.linkedin.com/posts/alin-posteuca_strategic-kaizen-case-study-by-alin-posteuca-activity-7240410881363197953-YvHF

Summaries of Book Chapters on TOC

Constraint Management - Important Points - Summary - Krajewski - 12th Edition

https://nraomtr.blogspot.com/2019/09/constraint-management-important-points.html

Synchronous Manufacturing and Theory of Constraints - Review Notes - Chase Aquilano Jacobs Book Chapter

https://nraomtr.blogspot.com/2011/12/synchronous-manufacturing-and-theory-of.html

Books on Theory of Constraints

The World of the Theory of Constraints: A Review of the International Literature

Victoria J Mabin, Steven J Balderstone

CRC Press, 29 Nov 1999 - Technology & Engineering - 240 pages

The Theory of Constraints (TOC) - as developed by Dr. Eliyahu Goldratt - has seen a rapid expansion since the publication of his book, The Goal. As with most fast growing areas, you can quickly feel out of touch with new developments. The World of the Theory of Constraints provides a summary of recently published research on TOC.

The authors explored databases, and sought out papers and books drawing on as wide a range as possible. Aside from the works by Dr. Goldratt himself, the authors focus on items published since 1990, highlighting the most recent developments in TOC. The scope of the material covers works containing specific reference to TOC, including Synchronous Manufacturing and Constraint Management.

The book is organized into three sections. The first section contains an analysis and interpretation of the results of the search. The second provides abstracts on all the material. The third supplies author, keyword, and subject indexes along with a list of books, journals, websites, and publishers.

Extensively researched and referenced, The World of the Theory of Constraints furnishes comprehensive material on TOC. The multi-search approach has made this arguably the most exhaustive bibliography on this subject available. If you are researching TOC, this is the best place to start. If you use or teach TOC, you will want this resource.

https://books.google.co.in/books?id=jdIyw1GMoW0C

Manufacturer's Guide to Implementing the Theory of Constraints

Mark Woeppel

Lulu.com, 3 Aug 2010 - Business & Economics - 174 pages

There are, today, many good books on the Theory of Constraints, or "TOC". These books, however, generally focus on explaining the details of TOC. But subject matter knowledge alone is not enough, if you want to actually use TOC in business. You must also have a valid roadmap for implementing it. This book provides it. Throughout the book, you have the concrete and actionable voice of a successful TOC consultant leading you to understand how to implement TOC in a manufacturing organization. The book also provides examples of various charts, forms and procedures that you can use as patterns for the materials you will need in your implementations.

https://books.google.co.in/books?id=YRRxAgAAQBAJ

Theory of Constraints: Creative Problem Solving

Umesh P. Nagarkatte, Nancy Oley

CRC Press, 27 Nov 2017 - Business & Economics - 314 pages

This book is on application of TOC in educational institutue. Especially in mathematics course - student retention.

This book was written to assist professionals and students to become proactive in their own education, improve thinking, resolve personal and interpersonal conflicts, improve pedagogy, manage departmental affairs and guide administrative decisions. The text captures the practical experience of the authors with and formal training in TOC to address many of the issues facing today’s education stakeholders.

The text is designed to teach methods for 1) "win-win" conflict resolution, 2) decision-making, 3) problem solving, and 4) analysis of systems using TOC’s powerful logic-based graphical Thinking Process tools. A creative thinker can identify, plan and achieve his or her goals just knowing the Thinking Process Tools.

https://books.google.co.in/books?id=pDgPEAAAQBAJ

Papers/Articles on Theory of Constraints

Index:  https://www.scoop.it/topic/theory-of-constraints-by-philip-marris

Lessons learnt from Eliyahu Goldratt the founder of the Theory Of Constraints and author of bestseller “The Goal”

Philip Marris

Theory Of Constraints and Lean expert. CEO of Marris Consulting based in Paris, France. Been “doing” TOC and Lean for +30 years in +350 organizations worldwide.

https://philip-marris.medium.com/lessons-learnt-from-the-founder-of-the-theory-of-constraints-and-author-of-bestseller-the-goal-3ed25d747961

Sep 24, 2021

Baxendale, S. J. and P. S. Raju. 2004. Using ABC to enhance throughput accounting: A strategic perspective. Cost Management (January/February): 31-38.

Summary by Erin Lagor

Master of Accountancy Program

University of South Florida, Fall 2004

https://maaw.info/ArticleSummaries/ArtSumBaxendaleRaju04.htm

https://www.tocico.org/

https://www.linkedin.com/company/tocico/

Interesting

https://www.bullantcreative.com/blog/theory-of-constraints-tools-and-their-applicability-to-the-process-industry/

Ud. 14.9.2024, 10.9.2024

Pub. 3.9.2024