Question

The Human Cost of Improving Productivity

Efficient operations management is critical in order to create a high-performing organization. Companies continually try many methods to improve efficiency, raise quality, and increase consumer satisfaction. But what is the effect on the worker? Can companies go too far in their search for efficiency? Are there ethical boundaries involved in operations management?

In this exercise, you will read a short case concerning the human cost of improved productivity and consider the ethics involved. This process should encourage you to think not only of the increased profits to be gained through constant improvements in efficiency, but also about management's responsibility to one of its core stakeholder groups, its employees. Take a moment to review what you learned about ethics throughout the text before completing this activity.

Read the case below and answer the questions that follow.

Hisashi Tomiki is the leader of a four-man self-managed team in a Toyota production plant, 200 miles south of Tokyo, Japan. Tomiki and his team work at a grueling pace to build cowls (steel chambers onto which windshields and steering columns are attached). Consider this description of Tomiki at work:

In two minutes, Tomiki fits 24 metal pieces into designated slots on three welding machines, runs two large metal sheets through each of the machines that weld on the parts, and fuses the two sheets together with two spot welds. There is little room for error. Once or twice an hour a mistake is made or a machine sticks, causing the next machine in line to stop. A yellow light flashes. Tomiki runs over. The squad must fix the part and work faster to catch up. A red button halts the production line if a problem is severe, but there is an unspoken rule against pushing it. Only once this day does Tomiki call in a special maintenance worker.

The experience of workers like Tomiki has become increasingly common. Workers are heard to complain that constant attempts to increase quality and reduce costs really mean continuous speedup and added job stress from the increased pressure on employees to perform. Although some pressure is good, past a certain point it can seriously harm employees. Moreover, consider the following comment by Jerry Miller, a former employee of US West, whose team of billing clerks reengineered themselves out of a job.

"When we first formed our teams, the company came in talking teams and empowerment and promised that we wouldn't lose any jobs. It turns out all this was a big cover. The company had us all set up for reengineering. We showed them how to streamline the work, and now 9,000 people are gone. It was cut-your-own-throat. It makes you feel used.

Because employees are stressed by increasing demands for increased efficiency, managers should

Multiple Choice

increase their pay.

decrease their hours worked.

seek to balance their concerns in a just manner.

hire workers who are more resistant to stress.

never attempt reengineering.

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Operations Management at Home Run Inn Pizza

Operations management focuses on techniques that can increase the quality of an organization's products, the efficiency of its production, and its responsiveness to customers. Attention to operations management is a vital part of an organization's overall strategy if it intends to grow, enter new markets, and develop competitive advantage. This video presents the operations management strategy that enabled a small pizza restaurant to become the fastest-growing frozen pizza supplier in the country and the largest supplier in Chicago.

Home Run Inn began producing frozen pizza in their single restaurant in South Chicago in the 1950s. They did this because their customers wanted this product. Today, businesses use IT to track customer tastes and desires in order to both attract new customers and retain current ones. Today this customer/business interaction is called

Multiple Choice

quality assurance.

process management.

customer reengineering.

customer relationship management.

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The use of conveyor belts at Home Run Inn's manufacturing facility is an example of a ______ layout.

Multiple Choice

product

process

fixed-position

flexible

reengineered

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The change from freezing pizzas in a normal refrigerator to using a cryogenic freezer and other improved automation techniques is an example of ______ in that Home Run Inn was able to achieve dramatic improvements in lowering costs while increasing supply and speed of manufacturing.

Multiple Choice

just-in-time inventory management

process reengineering

reinvestment

retro-processed manufacturing

government regulation

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Home Run Inn has developed its ______ based on quality rather than on price. As a result they are the fastest-growing pizza company in the country and number one in Chicago.

Multiple Choice

manufacturing policy

production philosophy

competitive advantage

marketing strategy

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The decision to engage in self-distribution had many benefits for Home Run Inn including the ability to manage inventory. They could deliver pizza as it was needed to the stores rather than having their product sitting in storage facilities. This is an example of a(n) _____ inventory system.

Multiple Choice

rapid distribution

flexible

process

just-in-time

product

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Joe Perrino has been responsible for deciding how to set up and run Home Run Inn's pizza business. He designed the production and distribution systems and determined how to improve operations in order to increase efficiency. Joe Perrino typifies a(n)

Multiple Choice

tactical manager.

bureaucratic manager.

operations manager.

transformational manager.

direct-to-market manager.

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Please answer if you are completely sure. thank you

Answer 1

Answer 1:

Because employees are stressed by increasing demands for increased efficiency, managers should seek to balance their concerns in a just manner.

Answer 2:

Today this customer/business interaction is called customer relationship management.

Answer 3:

The use of conveyor belts at Home Run Inn's manufacturing facility is an example of a product layout.

Answer 4:

The change from freezing pizzas in a normal refrigerator to using a cryogenic freezer and other improved automation techniques is an example of process reengineering in that Home Run Inn was able to achieve dramatic improvements in lowering costs while increasing supply and speed of manufacturing.

Answer 5:

Home Run Inn has developed its marketing strategy based on quality rather than on price. As a result they are the fastest-growing pizza company in the country and number one in Chicago.

Answer 6:

The decision to engage in self-distribution had many benefits for Home Run Inn including the ability to manage inventory. They could deliver pizza as it was needed to the stores rather than having their product sitting in storage facilities. This is an example of a just-in-time inventory system.

Answer 7:

Joe Perrino has been responsible for deciding how to set up and run Home Run Inn's pizza business. He designed the production and distribution systems and determined how to improve operations in order to increase efficiency. Joe Perrino typifies an operations manager.