Knowledge that Transforms

Several authors have suggested that a focus on manufacturing capability and on continued process improvement may be a powerful source of competitive advantage, yet many firms appear to have encountered great difficulties in taking advantage of this insight. This paper reports on the results of five these conducted under the auspices of the MIT Leaders for Manufacturing program at the Microwave Technology Division of the Hewlett‐Packard Company. We found considerable evidence that the marginal returns to process development within the division were probably considerably higher than the division's cost of capital, suggesting that process improvement probably was underfunded despite the fact that improving manufacturing capability had been identified as a key strategic priority. We found no evidence that this “underfunding” reflected either a failure to recognize the problem or an overly hierarchical or rigid organization. Rather it appeared to flow from the historical strengths of the division. A devotion to leading‐edge technical solutions and to immediate customer service at almost any price had created barriers to the effective funding of process improvement that were deeply rooted in the organizational structures, information systems, and formal and informal incentive structures that had evolved to support the division's historical emphasis on excellence on product design. Our results highlight the problems that very successful product‐driven companies may encounter in attempting to make continual process improvement central to their strategic mission.

Computer‐based manufacturing planning and control (MPC) systems are widely used in industry to gain competitive advantage through integration and coordination of managerial activities. In collegiate business schools, important operations management activities are taught and studied, often by sequential examination of discrete topics such as aggregate production planning, master production scheduling, capacity planning, material planning, and production activity control. This paper explores the potential use of industrial MPC software in the classroom to create experiential learning activities that address the dynamic and integrative nature of operations management. Experiences with this pedagogical approach over the past decade are reported.

We show how a simple normal approximation to Erlang's delay formula can be used to analyze capacity and staffing problems in service systems that can be modeled as M/M/s queues. The numbers of servers, s, needed in an M/M/s queueing system to assure a probability of delay of, at most, p can be well approximated by s ≅ p + z ***I‐ p +, where z 1‐ p , is the (1 ‐ p)th percentile of the standard normal distribution and ρ, the presented load on the system, is the ratio of Λ, the customer arrival rate, to μ, the service rate. We examine the accuracy of this approximation over a set of parameters typical of service operations ranging from police patrol, through telemarketing to automatic teller machines, and we demonstrate that it tends to slightly underestimate the number of servers actually needed to hit the delay probability target—adding one server to the number suggested by the above formula typically gives the exact result. More importantly, the structure of the approximation promotes operational insight by explicitly linking the number of servers with server utilization and the customer service level. Using a scenario based on an actual teleservicing operation, we show how operations managers and designers can quickly obtain insights about the trade‐offs between system size, system utilization and customer service. We argue that this little used approach deserves a prominent role in the operations analyst's and operations manager's toolbags.

This paper postulates that the perception among students that operations management is a tedious, irrelevant subject is a symptom of the lack of a conceptual framework that effectively communicates the importance and relevance of the operations function in a firm. The first half of this paper discusses traditional frameworks, those most frequently found in introductory production and operations management (pom) textbooks, and several alternative approaches to teaching an introductory POM course. The discussion questions whether any of these existing frameworks is sufficient to meet the challenges faced while teaching POM in today's environment and identifies what characteristics an effective framework should possess. These characteristics include defining the scope and bounds of the field, capturing its integrative and system aspects, providing a visible depiction of the framework to aid comprehension, and promoting higher‐level thinking (i.e., analysis, synthesis, and criticism) to deepen understanding. This discussion concludes that no current framework meets all of these criteria, therefore there remains a need for a more effective approach for introducing POM. The remainder of the paper describes one approach to conceptualizing the field that satisfies these criteria.

The assembly of aircraft is a labor‐intensive process that exhibits a significant learning‐curve effect and that requires long flow times and costly work‐in‐process inventories. This paper describes the production context, the cost of flow time in this context, and some of the causes for the long flow times. We then develop an argument for a firm to use improvements in labor productivity to reduce flow times. Boeing has implemented the recommendations from this research and has obtained significant benefits from reducing flow times.

Having added total quality management (tqm), operations strategy, new product development, and many other topics to its repertoire over the past two decades, operations management is being pushed‐by practitioners and students alike‐to extend its reach both horizontally (to encompass the whole supply chain and the interface with other functions) and internationally. Moreover, the increasing sophistication of computer technology and the growth of the intemet are expanding the teaching and research methodologies that can be used to address these complex issues. Meeting the challenges posed by this ever‐broadening conceptualization of our mission and the new tools available to us will require more than simply new knowledge and new courses. It also will require an influx of new people having very different backgrounds than in the past. We have to learn how to attract such people, how to prepare them to be effective teachers and researchers in production and operations management (pom), and how to work effectively with them. The locations of faculty, students, and potential partners in the learning experience also will be transformed, forcing us to reconsider how we organize to do our work and when and where we do it.

This paper, addressed to professors of operations management (om) in research institutions, suggests that the long‐term academic viability of our discipline requires the generation of a theory uniquely associated with the practice of OM. Such a theory will rest on foundations laid by other disciplines, but must find its own unique synthesis that attends to the problems of OM practice. The paper proposes a framework that recognizes physics, social psychology and philosophy as foundational disciplines for an integrative theoryof OM and suggests which concepts from those disciplines may find voice in such a theory.

In recent years there has been an increased emphasis on the development of manufacturing and business strategies. In spite of that high level of emphasis, limited empirical research has been published on the linkage between manufacturing strategy, business strategy, and organizational performance. Our study examines that linkage. Our main contribution lies in (i) building constructs for some important elements of manufacturing strategy and business strategy and (ii) testing the impact of linkage between manufacturing strategy and business strategy on organizational performance. The study is based on 175 responses from senior executives in manufacturing organizations.

This paper considers a model for decentralized control of an inventory system consisting of 1 central warehouse and a number of retailers. The cost structure includes holding costs at both echelons and shortage costs proportional to the time until delivery at the retailers. We analyze a procedure for coordinated but still decentralized control of the system. The procedure is based on a simple approximation, in which the stochastic lead times perceived by the retailers are replaced by their correct averages. The approximation enables us to decompose the considered multiechelon inventory problem into a number of single echelon problems, 1 for each installation. The information about how a certain decision at the warehouse affects the retailers is conveyed through the marginal cost increase with respect to a change of the expected lead time. This information about the retailer costs is used as a shortage cost at the warehouse. We show that a coordination procedure based on this information can be used for finding near‐optimal reorder points for the system and provide bounds for the approximation errors.

Competitive pressures and changing production management paradigms have, in recent years, increased the importance of reliable and consistent production equipment. Initially, the Japanese, and now others, have espoused the virtues of a management philosophy known as total productive maintenance (TPM). We are interested in the maintenance‐investment decisions for TPM. This paper (1) describes the basic elements of TPM programs, (2) categorizes the relevant research literature using a practitioner's framework for autonomous and planned maintenance activities, and (3) identifies the current gaps between practitioner needs and academic research in the area of TPM and offers suggestions to close the gaps.