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Preface vii
• Use of Integrating Themes Three key themes are • Part 1 Supply Chain: A Perspective for
highlighted throughout the book: global issues, Operations Management provides an overview of
relationships, and sustainability. Because most operations management as a field, and describes the
organizations have supply chains that reach beyond a strategic role operations has in business from the
single country, we examine global issues associated perspective of supply chain management.
with operations and supply chain management. • Part 2 Foundations of Operations Management
Organizations must collaborate with customers discusses foundational process concepts and
and suppliers to accomplish many operations principles that govern all operational activities. This
activities. Thus, the book show-cases how to build, section examines concepts such as product/process
maintain, and benefit from cross-functional and innovation, quality, lean, and inventory fundamentals.
interorganizational relationships. To reduce costs • Part 3 Integrating Relationships Across the Supply
and be competitive, organizations today must Chain deals with the primary functional relationships
adapt sustainable business practices. We expect between internal operations management activities
sustainability to increasingly become a key metric and other operational functions both inside and
for operations and supply chain management outside the firm. This section describes customer
performance. Accordingly, we have dedicated relationship management, supply management, and
an entire chapter to sustainability, while also logistics management.
incorporating it throughout the book.
• Part 4 Planning for Integrated Operations Across
• Real, Integrated Examples The book brings the Supply Chain discusses planning approaches
operations and supply chain management to life and technologies used at different levels of operations
through opening vignettes, Get Real highlights, and decision making. Key topics such as demand
rich examples throughout the book. planning, forecasting, sales and operations planning,
Managing Operations Across the Supply Chain offers inventory management, and materials requirements
a new, global, supply chain perspective of operations planning are examined.
management-a treatment that embraces the foundations • Part 5 Managing Change in Supply Chain
of operations management but includes new frameworks, Operations discusses how operations managers use
concepts, and tools to address the demands of today and projects, change programs, and technologies to shape
changing needs of the future. The book is organized into a sustainable future for operations and supply chain
five major sections: management.
Acknowledgments
We would like to express our appreciation to the people Berry, Professor Emeritus, Queens College, and David
who have provided assistance in the development of this Weltman, Texas Christian University, for accuracy check-
textbook. We express our sincere thanks to the following ing; Frank Novakowski, Davenport University, and Jody
individuals for their thoughtful reviews and suggestions: Wolfe, Clarke University, for developing learning resource
videos; and Rene Ordonez, for updating the instructor
Samuel Chinnis, Guilford Technical Community College powerpoints and developing guided examples.
Madeleine Pullman, Portland State University We want to thank the outstanding McGraw-Hill/
John R. Grandzol, Bloomsburg University Irwin production and marketing team who made this book
Dennis McCahon, Northeastern University possible-including Britney Hermsen, marketing manager;
Edward D. Walker, Valdosta State University James Heine, managing director; Harvey Yep and Kristin
Brian Jacobs, Michigan State University Bradley, content project managers; Sandy Ludovissy,
Narendra K. Rustagi, Howard University buyer; Doug Ruby, digital content development director;
Andrew Borchers, Lipscomb University Egzon Shaqiri, designer; and Ann Marie Jannette and Beth
Sandra Obilade, Brescia University Thole, content licensing specialists.
Rick Bonsall, McKendree University A special thanks to our outstanding editorial team.
Helen Eckmann, Brandman University We greatly appreciate the support, encouragement, and
Nicoleta Maghear, Hampton University patience shown by Camille Corum, our product developer.
Kelwyn D’Souza, Hampton University Thanks for keeping us on track! Our brand manager, Dolly
Bruce A. Meyer, Bowling Green State University Womack, provided excellent guidance and leadership
Jeanetta Chrystie, Southwest Minnesota State University throughout the process. We truly appreciate it!
Jeff Brand, Marquette University Morgan Swink
Steven A. Melynk
We also want to express our sincere thanks to the follow- Janet L. Hartley
ing individuals for their exceptional contributions: William M. Bixby Cooper
viii
Walkthrough
The following section highlights the key features of the text and accompanying resources,
which have been developed to help you learn, understand, and apply operations concepts.
CHAPTER ELEMENTS
Within each chapter, of the text, you will find the following elements. All of these have
been developed to facilitate study and learning.
Chapter Opener
Each chapter begins with an opening vignette to help set the tone for the material that fol-
lows. Learning objectives provide a quick introduction to the material students will learn
and should understand before moving to the next chapter.
Opening Vignette
Each chapter opens with an introduction to the important operations topics covered in the
chapter. Students need to see the relevance of operations management in order to actively
engage in learning the material.
1 Introduction to Managing
Operations Across the Supply
Chain
LEARNING OBJECTIVES After studying this chapter, you should be able to:
LO1-1 Explain what operations LO1-4 Explain what the supply chain LO1-6 Define the planning activities
management is and why it is is and what it means to view associated with managing
important. operations management using a operations across the supply
LO1-2 Describe the major decisions “supply chain perspective.” chain.
that operations managers LO1-5 Identify the partners and
typically make. functional groups that work
LO1-3 Explain the role of processes together in operations
and “process thinking” in management.
operations management.
© Paul Faith/Press Association via AP Images It Takes More than
A
pple often receives praise for its user- manufacturers, helping Cool Products to Make
friendly and aesthetically pleasing product to tweak the indus- Apple Great
designs. But a less well-known contributor trial processes and
to Apple’s success is its prowess in managing oper- tools that translate
ations across its supply chain. This is the world of prototypes into mass-
manufacturing, procurement, and logistics in which produced devices.
the chief executive officer, Tim Cook, excelled, • Focus on a few product lines, with little cus-
earning him the trust of Steve Jobs. Apple has built tomization. Apple’s unified strategy allows it to
a closed ecosystem where it exerts control over eliminate complexity and cost, while maximizing
nearly every piece of the supply chain, from design volume-based economies in its supply chain.
to retail store.
• Ensure supply availability and low prices. Apple
This operational edge is what enables Apple to
makes big upfront payments to suppliers to
handle massive product launches without having
lock in their capacity and to limit options for
to maintain large, profit-sapping inventories. It has
competitors.
allowed a company often criticized for high prices to
sell its iPad at a price that very few rivals can beat, • Keep a close eye on demand. By selling through
while still earning a 25 percent margin on the device. its own retail stores, Apple can track demand
Some of the basic elements of Apple’s operational by specific store and by the hour; then it adjusts
strategy include: sales forecasts and production plans daily to
respond quickly to demand changes.
• Capitalize on volume. Because of its buying
power, Apple gets big discounts on parts, manu- Apple designs cool products. But its enormous
facturing capacity, and air freight. profit margins—two to four times the profit mar-
gins of most other hardware companies—come in
• Work closely with suppliers. Apple engineers
large part from its priority and focus on operations
sometimes spend months living out of hotel
management.
rooms in order to be close to suppliers and
ix
both inside and outsideProducer
Company the business firm.
to the first-tier supplier, and so on. • Operations management is about designing, and improving business
Find a description of digital moviemaking technology
processes.
Each tier of the upstream supply $4 of sales, management
Which of the stages invested only
and organizations
• Operations
$1 in assets.
management dealsdepicted
The net profit
in Figure
with processes
margin
1-3 are
that transform likely
inputs,
andto asset
including materi-
turnover
chain could involve multiple suppli- capture different aspects of
als, performance.
information, energy, Net
money, profit
and margin
even
be most affected by a shift to a completely digital process? How will the people, is
into influenced
goods and by
services. issues such as
ers for the same items or services. sales volume, structure operating •costs,
Within and
of the overall supplyexpenses.
a supply Asset
chain context,
chain be turnover
operations
changed? reflects
management issues
brings togethersuch as the amount
four major
sets of players: the firm, customers, suppliers, and stakeholders.
Also, a single supplier might pro- of inventory needed (a key concern of operations managers, and one of the major assets con-
vide inputs for multiple tiers of the trolled by operations). In general, the higher the ROA, the better the level of performance.
supply chain. For example, the director in The Figure
SPM1-3 is provides
useful
1
inputs
Supplyfor to Integrated
evaluating
Chain Council, both both
the casting
Supply operational and marketing-based
Chain Performance Measurement: plans and
A Multi-Industry Consortium
Recommendation, Supply Chain Council Report #5566, p. 1.
company and the movie production company.
actions and answering “what-if” questions such as: What if we reduced fixed expenses by
Downstream stages of the supply 10chain
Numbered percent? are made What upwould
Examplesof layersbe theof partners and custom-
overall impact on ROA? To answer this question, we would
ers commonly referred to as echelons. A single echelon might contain
enter the dollar values of operational changes partners in locations echelon A downstream stage of
in the categories shown on the right side of
all over the world. For example, Numbered
there are usually examples manyare integrated
distributors forinto chapters
a given movie. where analytic
supply techniques are introduced.
or consumption.
the SPM. The calculations in the SPM then reflect the impacts of these changes on finan-
These distributors can be thought Students learn how
ofswi44303_ch01_001-023.indd
as suppliers of to solve specific
distribution services problems
to the movie step-by-step and gain insight into general
cial measures 4shown on the left side of the SPM (which are of interest to 06/07/16 top 09:03
managers).
PM
production company. The downstream principles
supplyby chain seeing howbethey
can also broken areintoapplied.
different chan-
Consider the following example of this type of analysis.
nels of distribution; theaters, direct/home delivery, and retail DVD/Blu-Ray sales are three
channels shown in Figure 1-3.
Many different types of operations managers are needed in a movie production com-
pany. Supply managers help to identify EXAMPLE and negotiate 2-1contracts with supply sources such
as casting companies, directors, producers, equipment suppliers, film suppliers and so on.
Suppose that the director of marketing has approached you, as a member of the
top management team, with a suggestion that appears very attractive. The proposal
begins by noting that because demand is down, the firm (and its supply chain) has
much unused capacity. Happily, the marketing group has identified a new potential
customer segment. Unlike existing customers (who are price sensitive and who buy
large quantities of fairly standard products), these new customers will likely order
swi44303_ch01_001-023.indd 15 06/07/16 09:03 PM
smaller quantities more frequently. The new customers are also likely to want to
make last-minute changes to order sizes, due dates, and product mix. Your current
operating system is not really set up to accommodate such changes. However, the
marketing director feels that the prices these customers are willing to pay will pro-
vide gross margins (30 percent, as compared to the 10–15 percent currently being
given by existing customers) that should be high enough to offset any operational
problems. The chief financial officer has stated that, in order to enter any new mar-
ket, it must be expected to generate at least a 25 percent return on assets (ROA).
Given the information provided below, would you recommend accepting the
marketing director’s proposal?
Estimated First
Category Year Impact Comments
Sales $420,000
Cost of Goods Sold $294,000 30% gross margin
Variable Expenses $ 45,000 Need more for small batch shipping and
expediting
Fixed Expenses $ 40,000 More inspections needed
Inventory $200,000 Need safety stock to ensure timely
delivery
• Processes—specialized routines, procedures, and performance measurement systems
that guide operational activities.
• Planning systems—access and development of sources of information, and use of
proprietary decision support systems and processes.
• Technology—proprietary usage of hardware or software that enables the firm to doWalkthrough xi
things differently and/or better than competitors.
core capabilities The skills, • People and culture—skills, associated training programs, and cultural norms for the
Figures and Photosprocesses, and systems that are company that produce better motivation and performance. The impact of culture
unique to the firm and that enable must be recognized at both a corporate and at a national level.
The text includesitphotographs
to deliver products thatand graphic
are both illustrations
• Supply to support student
chain relationships—unique study relationships
and exclusive and pro- with customers and
valued by the customer and diffi-
vide interest and motivation.
cult for competitors to imitate. suppliers that are unmatched by competitors.
The Seven Cycles operation discussed in the Get
Real box presents a good example of how both company
culture (philosophy) and special technologies can create
unique capabilities.
Sometimes certain capabilities become so unique
and valuable to a firm that they are considered to be
“core,” that is, central to the very existence of the firm.
Core capabilities are the skills, processes, and systems
that are unique to the firm and that enable it to deliver
chapter 2 Operations and Supply Chain Strategy 31
products that are both valued by the customer and dif-
ficult for competitors to imitate. These are strategically
in contrast, result from custom- critical, and often the source of a stream of new products
ers’ actual experiences with the activity and market opportunities. For example, over the years
student
firm and its operations manage- Think about a recent purchase you made. What Honda hasthe
were developed successful products in a wide range
order-winning
ment processes. They represent of were
traits that influenced your decision? What traits very necessary
different for
markets—motorcycles,
you to power genera-
the gap between what the firm even consider buying tors, cars, marine engines, lawn mowers, snow blowers,
one product over another?
Honda
delivers and what customers airplane powered by Honda jet engine.
© Kyodo/Landov and now jet airplanes. In each market, Honda moved
expect. Second, order winners,
from being an outsider to become one of the major
order qualifiers, and order los-
ers vary by customer. An order chapter 2 Operations and Supply Chain Strategy 27
winner to one customer may be an order qualifier to another. Third, these traits vary
over time. An order Environment
winner at one time mayCorporate become
Culturean order qualifier at another point
FIGURE 2-1 Strategic
Strategic Questions Planning Hierarchy
in time. As can be seen in the Get Real box about the Bosch CS20 circular saw, being
able to identify and act on orderCorporate
winners offers the firm a critical
Strategy
Corporate: strategic advantage.
What business(es)
should we be in?
Untitled-5 36 06/08/16 07:58 PM
Value Propositions and
BusinessCompetitive
Strategies Priorities
Business:
How do we
To attract key customers,SBU the firm must SBU formulate SBU and a value proposition,
implement
compete? value proposition A collection of
a statement of product and service features that the firm offers to its customers. A value product and service features that
is both attractive to customers
proposition needs to be both attractive to customers and different
Operations Strategy from what is offered by
Functional:
How do we best and different than competitors’
the firm’s competitors. For example, Walmart’s value proposition has
support the SBUbeen to offer every- offerings.
day low prices on a wide variety of products. The value proposition
Finance, Marketing, etc. Strategies
strategy?
- Structure
is critical because it
not only defines how the firm competes, it also determines the types of products that the
- Infrastructure
firm will (and will not) offer.
A well-designed value proposition has four characteristics:
Corporate strategic planning addresses the portfolio of businesses owned by a firm. Of
Get1. Real
It offers the
ing to pay
a combination
Boxes of product features that customers find attractive and are will-
three levels of strategic planning, corporate strategic planning is the broadest in scope
andfor.
the least constrained. Decisions made at this level limit the choices that can be made at
lower strategic planning levels.
Throughout the
2. It differentiates chapters,
Essentially, a corporatereadings
the firm from strategy
its competition highlight
communicates
inthea way important
that is difficult
overall mission real-world
to
of the firm and
imitate. applications. They pro-
corporate strategy Determines the
vide3. examples
It satisfies the financial
identifies the types ofand strategic
businesses that theobjectives
firm wants toofbe the firm.
in. For a large, multidivisional
of operations issues and offer a picture of the concepts in practice. These
overall mission of the firm and the
types of businesses that the firm
firm, key decisions in corporate strategy address what businesses to acquire and what
4. It can bebusinesses
reliablytodelivered given
divest. Corporate the operational
strategy typically coverscapabilities of the
a long time horizon, firm
setting theand its sup-
wants to be in.
also provide a
porting supply basis chain.
overall values, for classroom discussion and generate
direction, and goals of the firm as a whole. It also establishes how business interest in the subject matter.
performance will be measured and how risks will be managed.
Logos
Logos are included throughout the text to point out relevant applications of relationships,
sustainability, and global issues.
Since most organizations have supply chains that reach beyond a single country, we
examine global issues associated with operations and supply chain management.
global
relationships
To reduce costs and be competitive, organizations today must adopt sustainable busi-
ness practices. In fact, we expect sustainability to become a key metric for operations and
supply chain management performance.
sustainability
END-OF-CHAPTER RESOURCES
For student study and review, the following items are provided at the end of each chapter:
Chapter Summary Chapters contain summaries that provide an overview of the mate-
rial covered.
CHAPTER
SUMMARY
This chapter has introduced the operations strategic planning process within the context
of supply chain management. In discussing this process, the following points were made
within this chapter:
1. Strategic planning defines the specific types of value that the firm will deliver to
its customers. It takes place at three levels. Corporate strategy identifies the busi-
ness units to be included in the firm. Business unit strategy defines how the business
will compete. Operations strategy identifies the priorities, capabilities, and resource
deployments needed to support the business strategy and associated value proposition.
These three levels of strategic planning should be integrated, with planning taking
place from the top down, while execution takes place from the bottom up.
2. Operations strategic planning is driven by the business model—an integrative, sys-
tematic view of how the SBU generates value. This planning process begins with the
critical customer. It translates the demands of this customer into meaningful terms,
using the concepts of order winners, order qualifiers, and order losers.
3. The business model and operations strategy bring together three critical elements: key
customers, value propositions, and operations capabilities. The fit between these ele-
ments defines the effectiveness of the strategy.
7. Critical to strategic success is the ability of the firm to effectively integrate and main-
tain fit among the desires of key customers, the firm’s value proposition, and its opera-
tional capabilities.
8. Strategic assessment tools like the strategic profit model (SPM) and supply chain Walkthrough xiii
operational reference model (SCOR) help link and integrate strategic plans, opera-
tions strategies, operational actions, and performance.
Key Terms Key terms are highlighted in the text, and then repeated at the end of the
chapter with page references.
KEY
TERMS
business model 27 flexibility 35 order-to-delivery
business unit strategy 27 functional strategy 28 lead time 33
capabilities 36 innovation 34 order winners 30
supply chain operational sustainability 35 time
quality 32 33
to market
core capabilities 36 key customer 29
reference model SWOT 28 triple
corporate riskbottom line 3535
management
(SCOR) strategy
43 27 lead time 33
timeliness 33 value proposition
strategic business31
unit
cost 33 operations strategy 26
Discussion Questions Each chapter has a list of discussion (SBU) questions.
27 These are
customers 29 order losers 30
intended to serve as a student self-review or as class discussion starters.
strategic profit model
fit 37 order qualifiers 30
(SPM) 40
4 DISCUSSION
QUESTIONS
1. Why should
13. In thisthechapter,
firm never
you were outsource
introduced its coreBicycles.
to Huffy capabilities?
You were What happens
also told that the if
keythe firm is
approached by a supplier
customers were storewho is willing
managers to supply
and purchasing goodsNow,
managers. and assume
services thatbased
Huffy on these
ntitled-5 44 core capabilities
decided toattarget
a significantly
first parents andlower thenprice?
childrenWhatas its should the firm(using
critical customers do? the06/08/16 07:51 PM
information provided below). What impact would this shift in critical customer have
2. Apply theoncorporate/SBU/functional planning hierarchy introduced
you—that is, how would you design the resulting operations management system in this chapter to
your university/college or business.
(including the supplier base)? What would be the equivalent to corporate plan-
ning? SBU planning? Functional planning?
3. How wouldCriticalyou define
Customercapabilities
Order Winners within a school or business? Order Qualifiers
Parent Acquisition price Safety
4. When can a consumer be a critical consumer? In other words, when does it make
Durability (has to be passed down) Availability
sense to focus on consumers Easesuch as retail(does
of maintenance stores,
not costdistributors,
much to or buyers, rather than
on the end consumer? maintain over the summer)
Child Style (colors) Availability
5. A critical concept introduced in this chapter was that of the value
Can be easily customized
proposition. Explore
Maintenance
two competing products (e.g., Newness RIM’s
(I have BlackBerry
the first one on theand Apple’s iPhone). Identify the
block)
underlying value propositions present
Imitation in these
(it is what products
I see others and describe how these propo-
having on
television)
sitions are evident in the resulting products.
6. Core
Solved capabilities
14. Using aSolved
Problems are critical
SWOT problems
analysis, issues
can theinare operations
provided
operations management.system beAre
to illustrate
management there any
aproblem
strength? Can instances
solving and the
in which athe
main concepts infirm’s coremanagement
the chapter.
operations capabilities
These can
systemhavebebe abeen
liability
a weakness? rather
carefully
Provide than an asset?
prepared
examples. to enhance student
7. Fit is critical
understanding as well to theas development
to provide additionaland maintenance examples of aofsuccessful
problemoperations
solving. strategy.
Suppose that we are faced with a firm in which there is a lack of fit between the out-
comes desired by the critical customer, the value proposition, and the firm’s capabili-
SOLVED
ties. What options are available to the firm in the short term when dealing with this
lack of fit? What PROBLEMis the impact of the lack of fit? What are the implications of the firm
trying to improve the fit?
8. Suppose that you
Suppose youhavearebeen
the asked
owner of a pizzeria
to determine thatonisnetlocated
the return worth fornear
Great a Northwest
university or col-
Canoe could
lege. How and Kayak, youa small
use themanufacturer
concepts of kayaks
of order and canoes,
winners,located near qualifiers,
order Seattle, Wash-and order
ington. For this task, you have been given the following information:
losers to help develop and implement an attractive business model?
9. Why should metrics beCategories regarded as primarily Values methods of communication? Think
about the relationship between Sales a metric, the strategy, and the task being carried out by
$32,000,000
an operations person. Cost of goods sold $20,000,000
10. A metric consists of three elements:
Variable expensesthe measure, the standard (what is expected), and
$ 4,000,000
the reward. Why are all three elements critical?$What
Fixed expenses happens to the effectiveness of a
6,000,000
metric when one of theseInventory three elements is missing? $ 8,000,000
Accounts receivable $ 4,000,000
11. What is the impact of sustainability on the business model? How does it affect issues
Other current assets $ 3,000,000
such as the order winners, order losers, and order qualifiers? How does it affect the
Fixed assets $ 6,000,000
identification of the critical customer? When addressing this question, look up such
products
1. as Chrome
What or Timbuk2
is the return on assets forforGreatbags or Teva
Northwest or Timberland
Canoe and Kayak? for shoes.
12. As North American firms increasingly turn to product innovation, the management
Solution:
and protection of intellectual property becomes an important issue. Discuss how intel-
lectualTo address this question, we must first calculate net profit margin and the asset turnover.
property considerations can affect the following areas in supply chain strategy:
This can be done using the structure for the SPM found in Figure 2-3.
a. Supplier relationships
Gross Margin = $32,000,000 − $20,000,000 = $12,000,000
b. Supplier contracts
Total Expenses = $6,000,000 + $4,000,000 = $10,000,000
c. Supplier
Net Profitlocation
= Gross Margin − Total Expenses = $2,000,000
Return on Assets = Net Profit Margin × Asset Turnover = 6.25 × 1.52 = 9.5
2. What areas should we as operations managers focus on if our goal is to improve ROA?
Solution:
xiv Walkthrough We can see that the largest asset under our control is inventory. By reducing inventory we
can improve the ROA. (It is left up to the student to prove this. One way of doing this is to
examine the impact on ROA of a $1 million reduction in inventory or a $1 million increase
in inventory.)
Problems Each chapter includes a set of problems for assignment. The problems are
intended to be challenging but doable for students.
PROBLEMS
1. Given the following information:
Categories Values
Sales $32,000,000
Cost of goods sold $20,000,000
Variable expenses $ 4,000,000
Fixed expenses $ 6,000,000
Inventory $ 8,000,000
Accounts receivable $ 4,000,000
Other current assets $ 3,000,000
Fixed assets $ 6,000,000
home that rides like a car. They are willing to pay for could enter that was consistent with its design strengths
innovations such as ABS (antilock breaking systems), and its reputation.
assisted steering, GPS, voice-activated control, and Many of TFC’s customers had noticed that there was
computer-balanced suspension. TFC produces a pusher a significant gap between the high-end motor homes that
type of chassis. This is one powered by a diesel engine TFC served and the low-end market. The high-end con-
INSTRUCTOR RESOURCES
in which the engine is located in the rear. While expen- sisted primarily of “pushers,” and it began at $150,000;
sive to build, this design offers the customer a large the low-end consisted of “pullers,” and these products sold
number of advantages (no tunnel for the transmission, for between $35,000 and $70,000. That is, a motor home
Online Learning Center (OLC) www.mhhe.com/swink3e
reduced engine noise, better handling). However, these manufacturer would take an existing truck body (which
chassis are used in motor homes that are very expensive consisted of the front end and the cab) and mount on it a
The ($150,000
Online Learning
and up). TFC Center
builds itsprovides
chassis forcomplete
the large materials
motor homefor study
body. and there
Obviously, review.was aAt this book’s
significant gap
website, instructors have access
manufacturers—companies such as to teachingAir-
Winnebago, supports
betweensuch asmarkets.
the two electronic files of the ancillary
stream, and Gulf Stream. In general, these companies One of TFC’s major customers, Gulf Stream,
materials: Solutions
place orders for small Manual,
quantitiesPowerPoint
(5 to 10 in a Lecture Slides,
batch). approached Digital
TFC with Image Library,
an interesting and Test
proposal. Bank.
It wanted
Many of the units in a batch are customized to a specific TFC to design and build a low-end pusher chassis for this
customer’s requirements.
Solutions Manual. Prepared by the authors,market. This chassis would go into a motor home that
this manual contains solutions to all the
TFC has become successful because of its ability to would cost between $75,000 and $90,000. In contrast
end-of-chapter
develop new lines problems
of designsand in a cases.
timely fashion. These to the current line of products, this chassis would not
designs build on TFC’s extensive experience with motor be customized. Rather, once the chassis was designed,
home users. They also build on TFC’s knowledge of new it would not be changed. Production runs would go up
Bank. Prepared
Testtechnological advances andby the authors,
its ability to incorporatethethese
Test from
Bank includes
batches of five totrue/false,
batch runs of multiple-choice,
100. Critical to suc-
and advances
discussion into itsquestions/problems
designs. As a result, TFC has atbecome
varying the levels
cess in of
thisdifficulty.
market would be cost and conformance to
technological leader in this market. It is generally recog- the schedule. If TFC could be the first to produce such
nized that no one in the industry can match TFC’s design a chassis, it would own the market. The financials were
EZ Test Online.
and marketing All base.
knowledge test bank questions are available in EZ
very attractive. Test Online,
Theoretically, it seemeda easy
flexible
for TFC elec-
to
TFC is proud of its ability to design and build highly enter this market. All that had to be done was to take an
tronic testing program. The answers to all questions are given, along with
customized chassis. As John Stickley, its young and aggres- existing chassis and to take out the “costs” by using less-
a rating of the
levelsive
ofchief
difficulty, chapter
operating officer, is proudlearning
of pointingobjective
out, “Trail met, Bloom’s
expensive taxonomy
components. While TFC question
had never type, and
built such
the AACSB knowledge
Frames has never category.
met a customized chassis it didn’t like.” a chassis, there was no reason why it should not work.
Complementing this focus on customization and speed, The only danger that the people at TFC could identify
TFC has developed a culture of doing anything necessary was that once it entered this market, it would be poten-
to meet the needs of the customer. Changes are often intro- tially competing with such firms as Ford, GM, and Toy-
duced on the fly with an engineer taking a change down to ota (major suppliers of the existing chassis). However,
the assembly line. In many cases, the bills of materials (the these firms supplied pullers (a chassis with the engine in
recipes for what goes into a given chassis) that were gener- front)—not pushers, like the proposed TFC product. In
Walkthrough xv
PowerPoint Lecture Slides. The PowerPoint slides draw on the highlights of each chapter
and provide an opportunity for the instructor to emphasize the key concepts in class discussions.
Digital Image Library. All the figures in the book are included for insertion in Power-
Point slides or for class discussion.
TECHNOLOGY
McGraw-Hill Connect® Operations Management
McGraw-Hill Connect® Operations Management is an online assignment and assessment
solution that connects students with the tools and resources they’ll need to achieve success
through faster learning, higher retention, and more efficient studying. It provides instructors with
tools to quickly pick content and assignments according to the topics they want to emphasize.
Online Assignments. Connect Operations Management helps students learn more efficiently
by providing practice material and feedback when they are needed. Connect grades homework
automatically and provides feedback on any questions that students may have missed.
xvi Walkthrough
Integration of Excel Data Sets. A convenient feature is the inclusion of an Excel data
file link in many problems using data files in their calculation. The link allows students
to easily launch into Excel, work the problem, and return to Connect to key in the answer.
Guided Examples. These narrated video walkthroughs provide students with step-by-
step guidelines for solving problems similar to those contained in the text. The student is
given personalized instruction on how to solve a problem by applying the concepts pre-
sented in the chapter. The narrated voiceover shows the steps to take to work through an
exercise. Students can go through each example multiple times if needed.
• View scored work immediately (Add Assignment Results Screen) and track indi-
vidual or group performance with assignment and grade reports.
• Access an instant view of student or class performance relative to learning objectives.
• Collect data and generate reports required by many accreditation organizations, such
as AACSB.
Walkthrough xvii
• eBook
• PowerPoint presentations
• Test Bank
• Instructor’s Solutions Manual
• Digital Image Library
Connect® Plus Operations Management includes a seamless integration of an eBook and
Connect Operations Management with rich functionality integrated into the product.
Dynamic Links. Dynamic links between the problems or questions you assign to your
students and the location in the eBook where that problem or question is covered.
Powerful Search Function. A powerful search function to pinpoint and connect key
concepts in a snap. This state-of-the-art, thoroughly tested system supports you in pre-
paring students for the world that awaits. For more information about Connect, go to
www.mcgrawhillconnect.com or contact your local McGraw-Hill sales representative.
efficiently find what they need, when they need it, across an entire semester of class
recordings. Help turn all your students’ study time into learning moments immediately
supported by your lecture. To learn more about Tegrity, watch a two-minute Flash demo at
http://tegritycampus.mhhe.com.
Part 4 PLANNING FOR INTEGRATED OPERATIONS ACROSS THE SUPPLY CHAIN 395
Demand Planning: Forecasting and Demand Management 396
12
Sales and Operations Planning 442
13
Materials and Resource Requirements Planning 470
14
xxi
Part 5 MANAGING CHANGE IN SUPPLY CHAIN OPERATIONS 507
Project Management 508
15
Supplement: Advanced Methods for Project Scheduling 542
15
Sustainable Operations Management—Preparing for the Future 558
16
Appendix A 586
Appendix B 587
Indexes 600
xxii
Contents
In the room from which Trevanion had rushed, Teresa put her hand
on her brother’s arm. Back of Gordon’s only words and his own
involuntary and unexpected action, she had divined some joyful
circumstance of which she was ignorant. What it was she was too
relieved to care.
“Come,” she said gently; “we have much to say to each other.”
She sent one swift glance at Gordon; then the door closed between
them.
CHAPTER L
CASSIDY FINDS A LOST SCENT
On Gordon, in the shock of the fatal news Teresa had brought, the
menace of that fateful onslaught had fallen numbly. No issue at that
moment would have mattered greatly to himself. But in her piteous
cry: “You are aiming at my heart,” he had awakened. That parting
glance, shining with fluctuant love, relief and assurance, told him
what that tragedy might have meant to her. Absorbed in his grief he
had scarcely cared, had scarcely reckoned, of her.
As he stood alone the thought stung him like a sword. He
remembered with what tenderness she had tried to blunt the edge of
her mournful message.
His reverie passed with the entrance of Fletcher, still uncertain on his
feet, and with a look of vast relief at the placid appearance of the
apartment. A messenger brought a request from the Rev. Dr. Nott, a
name well-known to Gordon in London. The clergyman, just arrived
in Pisa, asked the use of the ground floor of the Lanfranchi Palace—
he understood it was unoccupied—in which to hold service on the
following Sunday.
Over the smart of his sorrow, the wraith of a satiric smile touched
Gordon’s lips. He, the unelect and unregenerate, to furnish a
tabernacle for Pisan orthodoxy? The last sermon he had read was
one preached by a London divine and printed in an English
magazine; its text was his drama of “Cain,” and it held him up to the
world as a denaturalized being, who, having drained the cup of
sensual sin to its bitterest dregs, was resolved, in that apocalypse of
blasphemy, to show himself a cool, unconcerned fiend.
And yet, after all, the request was natural enough. The palace that
housed him was the most magnificent in Pisa, in proportions almost
a castle. And, in fact, the lower floor was empty and unused. Was he
to mar this saner existence, in which he felt waking those old
inspirations and ideals, with the crude spirit of combativeness in
which his bruised pride took refuge when popular clamor thrust him
from his kind? If he refused, would not the very refusal be made a
further weapon against him?
Had Gordon seen the mottled clerical countenance that waited for
answer in the street below he might have read a partial answer to
this question.
Cassidy’s ship having anchored at Leghorn, he had embraced the
opportunity to distribute a few doctrinal tracts among the English
residents of this near cathedral town. Of Gordon’s life in Pisa he
heard before he left the ship. In the Rev. Dr. Nott he had found an
accidental travelling companion with an eye single to the glory of the
Established Church, who was even then bemoaning the lack of
spiritual advantages in the town to which he was bound. His zealous
soul rejoiced in the acquaintance and fostered it on arrival. The idea
of Sabbath service in English had been the clergyman’s; that of the
Lanfranchi Palace as a place wherein to gather the elect, had been
Cassidy’s. The suggestion was not without a certain genius. To the
doctor’s uplifted hands he had remarked with unction that to ask
could do no harm; and the request, even if refused, might be
precious seed sown. Cassidy mentally presaged refusal—which
should make test and material for future discourse of his own.
Waiting at the Lanfranchi entrance he remembered a sermon of
which he had delivered himself years before at Newstead Abbey—
perched upon a table. He had never forgotten it. He touched his lips
with his tongue at the pious thought that he who had then been
master of the Abbey—host of that harebrained crew who afterward
made him a butt of egregious ridicule in London—was now spurned
of the righteous.
Gordon at that hour had no thought of Cassidy, whom he had not
seen in years. “Say to the messenger that Mr. Nott is very welcome
to the use of the floor,” was the answer he gave the valet.
A moment later Teresa and Count Pietro Gamba re-entered. Teresa’s
eyes were wet and shining. Her brother’s face was calm. He came
frankly to Gordon and held out his hand.
While the two men clasped hands, the naval surgeon was ruminating
in chagrin. Gordon’s courteous assent gave him anything but
satisfaction. He took it to Dr. Nott’s lodgings.
As Cassidy set foot in the street again he stopped suddenly and
unaccountably. At the Lanfranchi portal in the dusk he had had a
view of a swarthy face that roused a persistent, baffling memory. The
unanticipated reply to the message he had carried had jarred the
puzzle from his mind. It recurred again now, and with a sudden stab
of recollection. His teeth shut together with a snap.
He lay awake half that night. At sun-up he was on his way back to
Leghorn, with a piece of news for the commander of the Pylades.
CHAPTER LI
DR. NOTT’S SERMON