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Ch07 Manufacturing and Service Technologies.doc

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Joel Marcus

Chapter 7: Manufacturing and Service Technologies Core Technology: the work process that is directly related to the organization’s mission, such as teaching in high school, medical services, or manufacturing Non-core Technology: a department work process that is important to the organization but is not directly related to its central mission, such as HR, marketing, R&D, and accounting Core Organization Manufacturing Technology • They include traditional manufacturing processes and contemporary applications, such as flexible manufacturing and lean manufacturing Manufacturing Firms • Joan Woodward developed a scale and organized the firms according to technical complexity of the manufacturing process • Technical complexity is the extent of mechanization of the manufacturing process o Group 1: Small-batch and unit production  Job shop operations  human operator  Highly skilled employees  Organic o Group 2: Large-batch and mass production  long production runs of standardized parts  Lower skilled employees  Example: car assembly lines o Group 3: Continuous-process production  The entire process is mechanized, and there’s no starting and stopping  Highly skilled employees  Automated machines control the process ad outcomes are predictable  Examples: nuclear power plants and pharmaceuticals Flexible Manufacturing Systems (FMS) • Using computers to link together manufacturing components such as robots, machines, product design, and engineering analysis to enable fast switching from one product to another o Mass customization o It also enables small companies to go toe-to-toe with large factories • 3 subcomponents: o Computer-aided design (CAD) o Computer-aided manufacturing (CAM) o Integrated information network  A computerized system that links all aspects of the firm and is based on common data and info based, and it enables managers to make decisions and direct the manufacturing in a truly integrated fashion Product-life-cycle management (PLM) • PLM software can manage a product from idea through development, manufacturing, testing, and even maintenance in the field • PLM software has 3 primary advantages for product innovation: o Stores data from all parts of the company o Links product design to all departments o Provides three-dimensional images Lean Manufacturing • Uses highly trained employees at every stage of the production process who take a painstaking approach to details and continuous problem solving to cut waste and improve quality o CAD/CAM and PLM included but PEOPLE most important o Need culture to adapt o Mass customization Performance and Structural Implications • FMS has a narrow span of control, few hierarchical levels, adaptive tasks, low specialization, and decentralization, and the overall environment is characterized as organic and self-regulative Comparison of Organizational Characteristics Characteristic Mass Production FMS Structure: Span of control -Wide -Narrow Hierarchical levels -Many -Few Tasks -Routine, repetitive -Adaptive, craftlike Specialization -High -Low Decision making -Centralized -Decentralized Overall -Bureaucratic, mechanistic -Self-regulating, organic Human Resources: Interactions -Standalone -Teamwork Training -Narrow, one time -Broad, frequent Expertise -Manual, technical -Cognitive, social, solve problems Interorganizational: Customer demand -Stable -Changing Suppliers -Many, arm’s length -Few, close relationships Core Organization Service Technology • The service sector is growing 2 times as fast as the manufacturing sector in the North American economy Service Firms • Accomplish their primary purpose through the production and provision of services, such as education, healthcare, transportation, banking, and hospitality • Service technology is characterized by simultaneous production and consumption, customized output, customer participation, intangible output, and being labour intensive o customized output Differences between Manufa
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