7.3 Operations decisions  (Page 2/5)

Capacity decisions also involve short-term situations. In a grocery store, the number of customers that need to pay for their groceries at any one point during the day will vary significantly. To provide good customer service, managers must make sure that sufficient cash registers and employees are on hand to meet check-out demand. Similarly, hotels must make sure that they have enough employees to register arriving guests, to clean hotel rooms, and to provide food and beverages to customers. These decisions must be made carefully to avoid excessive labor costs from having too many employees for the number of customers being served.

Quality decisions

The decision relating to quality is not “how much” quality to have. If asked whether they support high quality in their organization, virtually all managers will respond enthusiastically that they fully support high quality! Rather, the quality of goods and services is determined by numerous decisions throughout the organization that have both long-term and short-term consequences for the organization’s quality performance.

For example, while all managers may say they support quality, how many will support the capital expenditure to purchase new equipment that can meet tighter tolerance requirements more consistently? How many managers will spend money to send their engineers out into the field to talk to customers to better understand necessary product performance standards? How many managers will send teams of quality engineers to supplier facilities to assist suppliers with their quality programs? How much attention and resources does management give to employee skill development and training in the use of quality tools and in the philosophy of defect prevention? The outcome of these decisions will most certainly affect an organization’s ability to produce outstanding quality in products and services.

For example, in the air transportation industry, the prevention of crashes is obviously something that everyone supports. Yet, for the past two decades in the United States, the press has reported on the weaknesses and neglect of the US air traffic control technology that plays a critical role in air travel safety. One might conclude that although everyone supports safety in air travel, more investment in modern technology and better decision making is needed to ensure the long-term safety of air transportation. Virtually all organizations are faced with similar decision-making scenarios when it comes to the factors that determine quality performance.

Another example is in the health care industry where one critical measure is the number of surgeries where foreign objects (sponges, instruments, etc.) are left in surgery patients. Such incidents are considered to be a serious oversight and totally unacceptable. In recent years, hospitals have developed processes for preventing these mistakes. In one approach, a member of the surgical staff tracks every object that enters the body cavity during surgery, then checks that object off when it is removed from the cavity. Any object that can not be accounted for triggers an inspection of the cavity, and perhaps an x-ray to help find the item before the incision is closed.