Professional Documents
Culture Documents
Shape
Functional Superior
Distinctive Value
Strategies Profitability
Competencies Creation
Low Cost
Capabilities
Build
ACHIEVING SUPERIOR EFFICIENCY
0
Q1
Output
EFFICIENCY AND LEARNING EFFECTS
Learning effects are cost savings that come
from learning by doing.
A
. Economies of
Unit Costs
scale
. B Time 1
C Learning effect
Time 2
0
Output
EFFICIENCY AND EXPERIENCE CURVE
The experience curve refers to the systematic lowering of
the cost structure and consequent unit cost reductions, that
have been observed to occur over the life of a product.
A
Unit Costs
B
.
0
Accumulated Output over time
EFFICIENCY, FLEXIBLE PRODUCTION SYSTEMS AND
MASS CUSTOMIZATION
MARKETING STRATEGY
Profit 0
Length of time customer stays with company
(-)
MATERIALS MANAGEMENT.
Materials management encompasses the activities
necessary to get inputs and components to a production
facility through production process and out through a
distribution system to the end user. Improving the
efficiency of the materials management function
typically requires JIT.
The principal tool that most managers now use to increase reliability
of their product offering is the six sigma quality improvement
methodology. It relates to TQM. it’s a direct descendant of the total
quality management (TQM) philosophy invented by Japanese
Companies then by American companies.
Philosophy of TQM ,articulated by Deming is based on 5 step
chain reaction-
1. Focusing on customer-
• Demonstrating leadership
• Shaping employee attitudes
• Bringing customers into the
company
• Customization
• Response time