Operations management – Part 1
Christie Sarri 31.03.2010

Lesson 1: An Introduction to Operations Management
 Operations & Process management
 4Vs of processes
 Performance objectives

Lesson 2: High-level Process Design
 Process Types

Lesson 3: Process Analysis
Contents

HSBC Bank – Branches in London
One of the world's largest banks by assets, HSBC
Holdings is active throughout the UK and Europe,
North and South America, Asia/Pacific, Australia, the
Middle East, and Africa. All told, the company has
some 10,000 offices in more than 80 countries,
providing consumer and commercial banking services,
credit cards, asset management, private banking,
securities underwriting and trading, insurance, and
leasing.
Case Study
Direct
Design
Develop
Deliver
Operations management
Direct:
Separate
the branch
in sectors
Design:
Develop:
new ways
to improve,
internet
banking
Person in
the
entrance to
direct
Deliver
Offered
service to
clients as
they come
Operations management – case study
Volume
• High degree of repeatability = high volume
• Systemization, standardize procedures
Variety
• Wide range of activities, more complex= high variety
• Additional complexity of matching customer req.
Variation
in demand
Visibility
• Predictable demand over time = low variation
• Planned in advance = lower cost
• Process experienced directly by users
• Process exposed to clients
4Vs of processes
Low
Volume
High
High
Variety
Low
High
Variation
Low
High
Visibility
Low
4Vs of processes – case study
Operations Performance
Operations Performance
Operations Performance – study case
Low Variety
High Volume
Process Matrix

Manufacturing:
◦
◦
◦
◦
◦

Project: high customized projects, construction
Jobbing: project shares operation resources, specialist toolmakers
Batch: some periods repeating, gourmet frozen foods
Mass: repetittive and predictable, cd production
Continuous: endless flow, electricity utilities
Services:
◦ Professional: high levels of customization, architects
◦ Service: mix of front and back service activities, banks
◦ Mass: mainly back service activities, supermarkets
Process Types
Customer
enters
the bank
Application for
Cheque book
completed
Check
client’s
request
Check before
issue
.........
......
Process Maps –
Sent
customer to
appropriate
department
Queue
Ask a cheque
book
Deliver to
customer by
post
case study

Cycle time = Time available / numbers

Process capacity = Work content / cycle time

Process balancing = idle time / cycle time

Little’s law:
Throughput time= work in progress x cycle time
Cycle time, process capacity, process balancing