Operations Consulting and Reengineering - Chapter Review Notes

Operations' consulting assists clients in developing operations strategies and improving production processes. In strategy development, the focus is on analyzing the capabilities of operations in light of the firm's competitive strategy. In process improvement, the focus is on employing analytical tools and methods to help operating managers enhance the performance of their departments. Regardless of where one focuses, an effective job of operations consulting results in an alignment between strategy and process dimensions in a way that enhances the business performance of the client firm.

The management consulting industry can be categorized in three ways: by size, by specialization, and by in-house and external consultants. Most consulting firms are small, generating less than $500,000 in annual billings. Consulting firms are also frequently characterized according to whether their primary skill is in strategic planning or in tactical analysis and implementation.

Some of the major strategic and tactical areas where companies typically seek operations consulting can be classified in five key areas. In the plant area, assistance is provided for adding and locating new plants, expanding, contracting or refocusing existing facilities. In the people area, the consultants focus on quality including quality improvement, setting or revising work standards, and learning curve analysis. Make or buy decisions and vendor selection decisions are key parts decisions. Process decisions for consultants include technology evaluation, process improvement, and reengineering. Finally, planning and control systems analyzed by consultants include supply chain management, MRP, shop floor control, and warehousing and distribution.

Consultants are needed when companies are faced with major investment decisions or when they believe they are not realizing maximum effectiveness from their productive capacity. Operations consulting tools can be categorized as tools for problem definition, data gathering, data analysis and solution development, cost impact and payoff analysis, and implementation.

Business process reengineering (BPR) is a way of rethinking and redesigning business processes for improvements of performance, including cost, quality, service, and speed. BPR uses many of the same tools used in consulting. Principles of reengineering include: organize around outcomes, not tasks, have those who use the output of the process perform the process, merge information-processing work into the real work that produces the information, treat geographically dispersed resources as though they were centralized, link parallel activities instead of integrating their results, put the decision point where the work is performed and build control into the process, and capture information once - at the source.

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Chapter outline

What is Operations Consulting?
Operations Consulting Defined

The Nature of the Management Consulting Industry
"Finders," "Minders," and "Grinders" Defined

Economics of Consulting Firms

When Operations Consulting Is Needed
When Are Operations Consultants Needed?

The Operations Consulting Process

Operations Consulting Tool Kit
Problem Definition Tools
Data Gathering
Data Analysis and Solution Development
Cost Impact and Payoff Analysis
Implementation

Business Process Reengineering (BPR)
Reengineering Define

Principles of Reengineering

Guidelines for Implementation

Conclusion

Case: A California Auto Club Reengineers Customer Service

Appendix: RPA Questionnaire and Rating Sheet

Source:
http://highered.mcgraw-hill.com/sites/0072983906/student_view0/chapter9/
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