Tips on using the video series that accompanies our textbooks.
When considering a late-night carton of ice cream, most people aren’t thinking about how it got on the shelf. But behind each freezer door is a secondary market that determines what you have the option to buy. “Slotting fees” (see Chapter 9) are fees that manufacturers pay retailers to appear on their scarce shelves. It can cost millions of dollars to launch a product in the nation’s groceries, and through that cost, these fees shape our supermarkets and diets.
Queuing (see Business Analytics Module D) is always a popular topic with students–and evidently with readers of the Wall Street Journal (Oct. 7, 2016) as well. This Journal article is a very basic tutorial on the history (Erlang discussion) and logic of waiting line modeling.
The piece writes: “You’ve probably participated in this familiar dance: Given a choice of checkout lines, you’ve somehow picked the slowest. You could wait it out. You could chassé to another queue. Or you could bail out altogether. After all, no one likes to wait. But are the other lines really faster? When parallel lines feed multiple cashiers, you may not be in the slowest one, but chances are, you also are not in the fastest.”
You dash into the supermarket for a few quick items. But when you get to the checkout lanes, they are full. Your plan for a quick exit evaporates. For anyone who has ever had to stand in line at a supermarket, here are some tips from The New York Times (Sept.8, 2016) for picking the line that will move the fastest.
Study the customers ahead of you. It is not just the number, but their age and what they are buying. Older people will take a bit longer because they can have technical difficulties that delay the process. Also consider the number of different items they are buying. Six bottles of the same soda will go faster than 6 totally different items, some of which cannot be scanned, such as vegetables.
Choose a line that leads to several cashiers. In Module D of the text, we show that this approach, known as a serpentine line, is the fastest. The person at the head of the line goes to the first available server in a system often seen at airports or banks. Getting into a single line also provides psychological relief because it eliminates the choice of where to go and second-guessing about the best line to choose. Your students will love this 90 second queuing video.
Over the past 21 years (7 editions of our OM texts), we have created a theme of sorts by focusing on an organization that we thought would be of interest to students. We did this by creating a series of customized videos and case studies featuring such firms as Hard Rock Café, Arnold Palmer Hospital, Frito-Lay, Darden (Red Lobster/Olive Garden), and the Orlando Magic. The videos are tailored directly to our book and terminology, so each fits perfectly in a specific chapter, with a goal of reinforcing content with exciting and well-known examples.
The new editions of OM 12/e and Principles of OM 10/e continue this tradition with a service firm that is consistently the highest ranked in the U.S. in its field–Alaska Airlines. Why did we select an airline? Over the years we discovered that faculty and students really enjoyed learning about OM in fields that they understand, especially service organizations. Although filming at Frito-Lay was one of my favorites ever, I think the 5 new videos and case studies on Alaska may become your favorites. Here they are:
Quality Counts at Alaska Airlines (Ch.6): “If it is not measured, it is not managed,” says one Alaska exec in this case that provides explicit performance metrics.
Alaska Airlines: 20-Minute Baggage Process–Guaranteed! (Ch.7): Students can flowchart the process a bag follows from kiosk to destination carousel after watching this video.
The People Focus: Human Resources at Alaska Airlines (Ch.10): The employee “Empowerment Toolkit” reminds me of Ritz Carlton’s famous customer service philosophy.
Lean Operations at Alaska Airlines (Ch.16): The company’s aggressive implementation of Lean includes its 6-sigma Green Belt training in-house, Kaizen events, Gemba Walks, and 5S applications.
Scheduling Challenges at Alaska Airlines (Module B): Good scheduling of crews and planes means optimization–the perfect fit for our coverage of LP. This video can also be shown with Ch. 15, Short Term Scheduling.
We think your students will appreciate the smooth integration of these great topics into your lectures. All videos are provided free to adopters and are also embedded in MyOMLab. The see a copy of the new edition, just click on the Order Desk Copy button on the top of the blog.
To celebrate the arrival of British Airways’ first 787-9 Dreamliner, it has released a time lapse video showing the aircraft being built at the Boeing factory in Everett, Washington.The behind the scenes footage shows the massive production that is involved in constructing the Dreamliner with parts flown in from all over the world on 747 Dreamlifter cargo planes.
The four-minute video goes inside the plane showing bathrooms being installed as well as galleys, overhead cabin bins and panels being fitted onto the aircraft.The video makes a nice fit to the Global Company Profile on Boeing that opens Chapter 2, Operations Strategy in a Global Environment. We think your students will enjoy it and that it can lead to interesting classroom discussions about global sourcing, assembly lines, project management, and quality.
The wings of the planes are lifted into place as are the engines and finally it is finished with a spray paint of the British Airways logo. British Airways has started flying the new stretched model (20 feet longer than the original 787) to Delhi. Routes to Abu Dhabi, Muscat, Kuala Lumpur and Austin will follow. The Boeing 787-9 Dreamliner seats around 250 passengers, has a flight range of 8,200 nautical miles, and uses 20% less fuel than the 747s.
Starting about 20 years ago, with our 6th edition, Jay and I began developing a series of company video and cases. They have ranged from manufacturers of potato chips, boats, and ambulances, to service firms like a hospital, an NBA team, Red Lobster, and Hard Rock. The videos are brief (5 – 12 minutes) and tie directly to the content of a specific text chapter. There may be as many as seven videos on one company (such as Arnold Palmer Hospital or Hard Rock Café) and students seem to like following one or two organizations throughout the text/semester. We are very pleased, that over the years, our 35 videos have won many awards, including 2 Silver Addy’s for the best short video, selected from 10,000’s of entries each year. We are even up for an Emmy award for one of our Orlando Magic videos!
I have always started the first week of the semester with one or both of the following: Hard Rock Café: OM in Services (8 minutes) and Frito-Lay: OM in Manufacturing (7 minutes). The first shows how a service firm that is known throughout the world approaches some of the 10 OM decisions around which we structure the text. This firm is especially interesting because it is a lot more than a restaurant. We show that Hard Rock makes almost the same revenue from its small retail shops as it does from the food side of the house.
The second video provides a perfect contrast to Hard Rock and makes for a great class discussion on how manufacturers
differ from service firms. Frito-Lay is also a product everyone knows. But this company does not let outsiders in to tour, and has proprietary processes that even we were not allowed to film. This video reviews how Frito-Lay deals with all 10 of the decisions that OM managers have to make.
I hope our video series helps get your Fall, 2015 semester off to a successful start. And there is more to come, as we introduce five new videos featuring OM at Alaska Airlines in January, 2016!
Jay and I have followed the Boeing 787 project closely for the past decade. The Global Company Profile that opens Chapter 2 details the plane’s design, supply chain, technology, and construction. The 787 has become one of Boeing’s most popular models due to its lightweight carbon composite airframe and the resulting lower fuel burn. Boeing continues to lose money on each Dreamliner it builds, but expects to reach the break-even point on the 787 program this year. The program’s deferred production cost, an accounting measure of how efficient an assembly program becomes over time, rose to $25.2 billion last year, topping the $25 billion cap Boeing had forecast for the 787.
Of course, the 787′s assembly costs will continue to drop over time as workers improve the efficiencies of the line and the rate at which they can build new planes. We discuss this issue on page 768, in Module E, noting the far-reaching consequences of learning curves. Boeing has a backlog of about 850 Dreamliner orders, on sales of 1,072 planes. It builds 10 each month at two plants and plans to boost output gradually to a dozen per month in 2016 and to 14 by 2020.
Your students will enjoy this 3-minute video showing the assembly line in Charleston S.C. The amazing thing about the building is there are no uprights supporting the roof. Six planes in various stages of completion are under the one roof. When completed, the plane is towed to the paint shop. Boeing has a runway that connects with the Charleston airport, and from here that the planes are delivered to customers.
You might show this video with Chapter 2, OM in a Global Environment (Boeing is one of the U.S.’s largest exporters), Chapter 9, Layout, or Module E.
“The MSC Oscar, launched earlier this month, has the greatest capacity of any container ship on the planet,” writes Vox (Jan.22, 2015). It can carry over 19,200 20-foot shipping containers. That’s enough space for 117 million pairs of sneakers or 39,000 cars or 900 million cans of dog food. And it’s just the latest stage in the explosive growth of container ships since they debuted in the 1950s.But it probably won’t hold the title for long: For the last several years, the record has been broken every year. To understand how container ships got so huge, you have to go back 60 years, when overseas shipping was so cumbersome and expensive that many companies simply choose not to try. This short (2.5 min.) video explains the origins of the container ship and how they drastically changed the world.
Until 1956, most international cargo was manually packed in the holds of shipping boats by dock workers, and manually unloaded when it reached port. That year, a North Carolina trucking company owner had the idea to use cranes to directly load truck trailers onto the ship and debuted the Ideal X — the very first container ship, a converted tanker that could carry 58 containers. In 1957, he launched the much-larger Gateway City, which could hold 226 containers, stacked in racks. Other companies copied his methods, and shipping containers now come in standardized sizes (they are now 8 feet wide, 20 or 40 feet long). By the end of the 1970s, the majority of consumer goods coming to the US were being shipped by container.
It’s hard to overstate how much all of this has changed the world economy. Before the container ship, transoceanic shipping was so expensive that it didn’t make sense to send most goods around the world. Now, it’s cheap — which, combined with-free trade policies, means that vendors in wealthy countries can efficiently take advantage of cheap labor abroad. For the American consumer, it means that the vast majority of goods — shoes, clothes, flat-screen TVs, basketballs, even toothbrushes — come from abroad, via container.
Classroom discussion questions:
1. How have these cargo ships changed global economies?
2. What are the complications from the growing sizes of the ships?
Frank and Lillian Gilbreth, the pioneers of time and motion studies, would smile with approval as they watch this 2-minute video comparing F1 racing pit stops in 1950 and today. If you follow F1 racing, it comes as no surprise that pit stops have been reduced to an amazing 2 seconds!
The role of the pit has changed dramatically over the years, writes OR/MS Today (Oct., 2014). For much of racing history, cars would only stop in the event of problems. Scheduled tire changes or fuel stops were not part of the equation. But in 1982, an analytically-minded UK race team focused on 2 important facts. First, softer tires stuck to the track better than harder ones, though they wore out more quickly. Second, less gas in the tank translated into a lighter, faster car. Calculations showed that time spent changing tires and refueling was more than offset by performance on the track.
The idea quickly caught on, making pit stops–and their efficient execution–an integral part of racing. But in 2010, when F1 racing instituted a no refueling policy (out of safety concerns), the stage was set for lightening-fast tire changes. Achieving a 2-second tire change required optimizing the entire process. Analysts looked at everything from the design of wheels nuts (1 per wheel on F1 cars), to special self-positioning pneumatic guns that remove and tighten each nut. They then turned their attention to the pit crews. Teams of 3 work on each wheel, one to remove the old tire, one to position the new one, and one to operate the gun. Their moves are choreographed down to the position of their hands and feet from start to finish. With 2 jack operators and other workers, as many as 20 people crowd around a car during a pit stop–for 2 seconds of work.
What a great example of methods analysis (see Figures 10.5- 10.7) for Chapter 10.
Classroom discussion questions:
1. Try to create an activity chart for the pit stop from the video, using Figure 10.6 and Solved Problem 10.1 as models.
2. How does this differ from the NASCAR pit stop described in the Global Company Profile that opens Chapter 10 on pages 396-7?
Breakfast in your home is a global affair. While your eggs may be from a nearby farm, your cooking pan could be from Germany, the refrigerator, toaster, and table from China, the fruit salad from 4-5 different countries, your newspaper from Indonesian wood pulp, and the coffee from Ethiopia. Regardless of national origin, pretty much all of it came from outside your town, by means ranging from 1,200-foot-long container vessel to railroad to truck. And that’s just breakfast. For all of our activities, the average American requires the movement of 57 tons of cargo per year!
“Ninety percent of the world’s freight goes by sea, and the vessels that transport it are the largest vehicles on Earth,” writes The Atlantic-CityLab (Oct.2, 2014). The more containers that can fit on a ship (measured in 20-foot equivalent units, or TEUs), the cheaper it is to move them. Today, the Triple E class container ships built for Maersk Line are the world’s largest ships. The Triple E class can hold 18,000 TEUs, enough to transport 111 million pairs of sneakers, or enough to shoe over 1/3 of the U.S. in a single trip. The Triple E is 1,300 feet long (which is the height of the Empire State building), 194 feet wide, and 240 feet high. This 6 minute video provides a perfect interface when you discuss logistics in Chapter 11.
As ships bring bigger swells of goods and ask for quicker turnaround times, the ports are focusing on how to get those goods off the ship and on the roads or rails faster. So while ships are maximizing economies, ports are focusing on efficiency. At this point, rail proves to be the most efficient mode of land transport. In 2013, railroads moved a ton of freight an average of 473 miles on a single gallon of diesel fuel. Rail is widely considered to be 3-4 times more fuel efficient than trucks, and especially vital for moving bulk cargo—2/3 of U.S. coal shipments move by rail, for example.
At Japanese manufacturer Roland DG, assembling thousands of parts into wide-format printers is as easy as coloring by numbers, writes The Wall Street Journal (June 2, 2014). That’s because Roland DG makes everything from billboard printers to machines that shape dental crowns using an advanced production system known as “D-shop.” Under this method, workers in single-person stalls assemble products from start to finish, guided by a 3-D graphic and using parts delivered automatically from a rotating rack. Every worker is capable of assembling any variation of the company’s 50 or so products.
In 1998, Roland became one of the first companies in Japan to abandon the assembly line in favor of one-person work stalls modeled after Japanese noodle stands. With orders coming in smaller and smaller lots, Roland decided it needed a manufacturing system in which a single worker could build any one of its diverse products. On a recent day, one employee was assembling from scratch an industrial printer that ultimately would be more than twice her size and weigh almost 900 pounds, while another was assembling a dental-crown milling machine.
A computer monitor displays step-by-step instructions along with 3-D drawings: “Turn Screw A in these eight locations” or “Secure Part B using Bracket C.” At the same time, the rotating parts rack turns to show which of the dozens of parts to use. Meanwhile, a digital screwdriver keeps track of how many times screws are turned and how tightly. Until the correct screws are turned the correct number of times, the instructions on the computer screen don’t advance to the next step. The system is so simple, say managers, that nearly anyone can assemble products anywhere. The computer even gives workers a pat on the back at the end of the day, with the message, “You must be tired, and we thank you.”
You and your students will enjoy the 2 minute video embedded in the WSJ article.
Classroom discussion questions:
1. Why did Roland develop the D-shop?
2. What are the advantages and disadvantages of this approach over the traditional assembly line?
When you are teaching Supplement 5, Sustainability in the Supply Chain, you may want to show our latest video on sustainability at the Orlando Magic’s Amway Center. This arena became the 1st gold-certified LEED basketball facility in the U.S.
Now The Wall Street Journal (May 19, 2014) reports that NFL teams are starting to see “green” as well. The San Francisco 49er’s new $1.2 billion stadium will be the first in the league to feature a “living roof,” a canopy of green and flowering plants nestled across the top of an 8-story tower of luxury suites; this will reduce the building’s energy use and offer other environmental benefits by providing natural insulation. NFL clubs are also developing green programs to reduce energy emissions. They are using solar panels, wind turbines, electric charging stations and other low-carbon alternatives. The NFL is part of a general effort among U.S. sports leagues to embrace cleaner energy, led by a group launched in 2011 calling itself the Green Sports Alliance.
Alliance officials say sports teams that go green help boost public awareness of environmental goals while also benefiting their operations by lowering their energy costs. The $1.2 billion Atlanta Falcons Stadium, set to open in 2017, will include a rainwater-collection system to use for irrigation and cooling. The Philadelphia Eagles’ Lincoln Financial Field has installed features including energy-saving timers and sensors for lighting and cooling equipment. These and other energy-saving features have cut the team’s power consumption by half. The Houston Texans have created an interactive media guide, saving 2.6 million pages used in printing; the Redskins have installed solar panels at FedEx Field; the Rams have printed game tickets on recycled paper; the Vikings have put in reduced-flow plumbing at the players’ clubhouse and training areas; and the 49er’s stadium is net energy neutral, which means it is expected to generate all the energy it needs for the team’s 10 home games.
“The exponential growth in the power of silicon chips, digital sensors and high-bandwidth communications improves robots just as it improves all sorts of other products,” writes The Economist’s special report (March 29-April 4, 2014). Three other factors are also at play.
One is that robotics R&D is getting easier. New shared standards make good ideas easily portable from one robot platform to another. A robot like Rethink Robotics’s Baxter, with two arms and easy, intuitive programming interface, would have been barely conceivable 10 years ago. Now you can buy one for $25,000. A second factor is investment. (The biggest robot news of 2013 was that Google bought eight promising robot startups.) The third factor is imagination. In the past few years, clever companies have seen ways to make robots work as grips on film sets and panel installers at solar-power plants. Aerial robots—drones– let farmers tend their crops in new ways, give viewers and broadcasters new perspectives on events, monitor traffic and fires, look for infrastructure in need of repair, and more.
While society may benefit greatly, robots’ growing competence may make some human labor redundant. Aetheon’s Tugs, for instance, which take hospital carts where they are needed, are ready to take over much of the work that porters do today. Kiva’s warehouse robots make it possible for Amazon to send out more parcels with fewer workers. Click here to watch a great 3 minute video on Amazon’s robots. Driverless cars could displace millions of people employed behind the wheel today.
The advent of robots that are cheap and safe enough to be used outside big factories is one reason for a resurgence of interest in robotics over the past few years. Foxconn, a Taiwanese company that manufactures and assembles electronics, is aiming to robotize much of its operation with hundreds of thousands of its own relatively cheap Foxbots. Car companies use the lion’s share of industrial robots; they account for over 50% of robot installations in the U.S.
Classroom discussion questions:
1. Why are robots proliferating?
2. Why did Amazon buy Kiva Systems?
Elon Musk recently made the cover of Fortune (Dec.9, 2013) as its 2013 Business Person of the Year for his famous creation of both Tesla and Space X. The article recalls that just a few years back, the best most people could say about electric cars was that they would be great for sustainability, but for the foreseeable future they’d be horribly limited by range and wouldn’t be very appealing to drive. Battery technology was simply too expensive and too heavy for it to be otherwise. The key breakthrough was to switch to lithium-ion battery technology, an expensive technology used not in cars, but in computers and phones. Musk believed that if you could combine large enough numbers of lithium-ion cells into a single battery, you could provide not only adequate range for a car but also power capable of turning the humble electric car into an object of desire.
Musk wasn’t the first person to have that insight. His genius was to take that core idea to its logical conclusion and integrate it into a broader picture of how a series of such cars could be manufactured and marketed for ever-shrinking costs, in a sequence that would eventually bring Tesla to the mass market. A full seven years ago, he posted an article titled “The Secret Tesla Motors Master Plan,” which outlined the basics: three generations of cars, first the super high-end sports car, then a sporty 4-door family car, then a mass market car. And underpinning it all, the conviction that the cars wouldn’t just work, but be lusted after.
He had no certainty that the company would succeed. But he was convinced that (a) the laws of physics meant that electric power could deliver a profoundly better automobile, (b) there was a path to possible success via three generations of cars, and (c) the goal was essential if humanity was to have a shot at a sustainable-energy future. This 5 minute video of the Tesla S production is one your students will enjoy as it shows the power of robotics in manufacturing.
“On its home territory, Amazon.com is routinely hailed as a jobs machine,” writes The New York Times (Dec.2, 2013). Thanks to its warehouse building spree, it is hiring tens of thousands of workers, plus many more for the holidays. President Obama has called Amazon “a great example of what’s possible… the kind of approach that we need from America’s businesses.”
The recession might have cut deeper in Europe, making the question of new jobs even more crucial, but the attitude there is much cooler toward Amazon and its high-tech ways. In Germany, there is continuing labor strife. France is erecting barriers against the company’s aggressive discounting. And in Britain, the warehouses have been compared, in a story in The Financial Times, with a “slave camp.”
That shocking charge resurfaced in the latest investigation when a BBC reporter, Adam Littler, briefly went to work undercover at Amazon’s Wales warehouse. His report, broadcast last week on the show “Panorama,” (click here for the 1/2 hour video) showed him hustling to keep up with the demands of his hand-held scanner, which gave him only a few moments to find each product. In his 10-hour night shift, Littler said: “I managed to walk or hobble nearly 11 miles. We are machines, we are robots, we plug our scanner in, we’re holding it, but we might as well be plugging it into ourselves.”
Michael Marmot, a labor expert identified by the BBC as “one of Britain’s leading experts on stress at work,” told the TV show that with “the characteristics of this type of job, the evidence shows increased risk of mental illness and physical illness.” Amazon’s own expert disagrees, of course, and we have to question the shock value displayed in the video. The real question for your students is how are labor standards set–and whether they are fair to both the company and employees. For another view altogether of Amazon’s sophisticated warehouses in the US, watch this 3 minute video.
Classroom discussion questions:
1. How can labor standards for this job be set (see Chapter 10)?
2. What are the ergonomic issues addressed in the video?