Innovation and Operations

April 2010

Richard Noble

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Innovation and OperationsLearning Outcomes

Reminder- the activities of Operations Managers

input output

Transformedresources;MaterialsInformationCustomers

TransformingResources;Facilities Staff

design

Planning and control

improvement

Operationsstrategy

objectives

Relation to competition

Goods and Services

Operationsmanagement

Operationsstrategy

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A good design

• Meets customer requirements

» Dyson light weight

» On site service

• Is simple to make/produce-• -- Management Today

» Pulley blocks HMS Victory p116

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A trigger -Total Quality Management

1. Customer defines the quality2. Top management leadership3. Quality as a strategic issue4. All employees responsible for quality5. Continuous improvement6. Shared problem solving IBM7. Statistical quality control8. Training & education for all employees

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Quality improvement is the MOST powerful mechanism to change anything 5

TQM In Service situations

• Inputs similar to manufacturing

• Processes & outputs are different

• Services tend to be labour intensive

• Quality measurement is harder

• Timeliness is an important feature

» So why are have the differences even discussed » See the3M case study page 452?

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Lllustration 1. Fire Service

Hampshire Fire and Rescue ServiceI

Innovation in the Fire Service.

Innovation is the successful exploitation of new ideas. 

These ideas improve the way we do things and the things we make: the things that allow a business to remain competitive. 

Some ideas are small and iterative; others can create an entire paradigm shift. 

Evidence shows that businesses that have the awareness to continually create, evaluate and successfully exploit their new ideas are more likely to survive and prosper in the competitive global economy

http://www.dti.gov.uk/innovation/innovation-dti/page11863.html

Making Hampshire Safer

Motivators for Innovation

• Communication

• Empowerment

• Feedback

• Recognition

• Sense of value

• Investors in People

Hampshire Fire and Rescue Service

Innovative Ideas

Hampshire Fire and Rescue Service

•Community Fire Wardens

•Environmental Audits

•Fire Setters Intervention

•Young Firefighters Association

•Local Fire Intervention Education

•Rapid Response Vehicles

•Partnership Working

Making Hampshire Safer

Without Innovation Which Generates Prevention Ideas.

We Will Always Have To Deal With This

Hampshire Fire and Rescue Service

Making Hampshire Safer

Illustration 2.

NHS- A Big business• 1.33 m direct employees

• 575 trusts/organisations

• 305 m primary care appointments

• 686 m prescriptions

• 17.8 m A&E attendances

• 13.4 m out-patient visits

• 5.4 m operations €90 + b

illion in

2009/10

Why innovate?

“This Government formally committed the NHS to becoming an innovative organisation when it published the NHS plan back in 2000.”Lord Warner, Parliamentary Under-Secretary of State in the Lords, April 2004

“He that will not apply new remedies must expect new evils, for time is the great innovator.”Francis Bacon

“As the NHS is a service, driven first and foremost by science and scientific advances, innovation should be a natural part of our business.”Rt Hon John Hutton MP, Minister of State (Health), June 2004

Innovation• Introducing into practice new ideas (or ideas

new to you) which lead to improvements in efficiency, effectiveness or better value for money

• Intellectual property (IP) includes services, systems devices, diagnostics, consumables and therapeutics

• Innovative staff let down by:

– Not capturing their ideas

– Wasting assets by not implementing them

– Resistance to innovative ideas for service development, drugs and products from other healthcare systems and healthcare industries in the UK and internationally

Research and development

• Funded by Department of Health’s R&D directorate

• Examples– Serious Hazards of Transfusion

(SHOT)• Barcode reading device

– South West Hub• Blood transfusion wastage cut, saving

£20m per year

People

• IiP

• Improving Working Lives (IWL) – work/life balance

• Child-friendly policies

• Agenda for Change (A4C)

• Knowledge and skills framework

– Competency based

– Appraisals and personal development

– Training

– Reward and recognition

General• NHS Direct

– Telephone– Online

• Walk-in centres and treatment centres– Run by commercial companies on behalf of

NHS

Illustration 3University-What form can Innovation take?

• Product-Research Academic papers

Books

• New courses or servicesMSc Health and Well being

• Process– New ways of delivering courses

• eLearning, Work-Based learning, Problem-Based learning

• Position • Positioning University in different markets

• Internal Structure of University

Process - DCQE

– “The central aim of DCQE is to enhance the quality of the student learning experience and promote student success. Its mission is to play a central role in advising, guiding, supporting and developing staff and students through the dissemination, promotion and embedding of good practice in academic departments”

– T&L Conferences

– Workshops & seminars

Supply Chain Management

The Operation

THE SUPPLY CHAIN

Information on price, products, location, delivery etc

BPR on whole sectors -Ebay 19

Ohno’s seven Wastes of-

• overproduction -making too much too early or just in case-

• waiting -time not being used effectively• transporting (e.g. double handling)

• inappropriate processing e.g. ‘ using a hammer to crack a nut’

• unnecessary inventory( excessive safety stock)• unnecessary motions(relates to the ergonomics of the workplace-

bending, reaching, more than two turns to loosen a nut)

• defects (quality failure- scrap, rework , complaints )

• NEW WASTES- waste of untapped human potential, waste of inappropriate systems, wasted energy, pollution waste.

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Agile supply chains• Agility- ‘ adaptable, flexible responsive business capable of rapid adaptation

in response to unexpected and unpredicted changes and events market opportunities and customer requirements. Time compression is key to agility in SC

• Drivers to agility/lean- as before plus emphasis on mass customisation (big differences in taste even in small area like W. Europe), rapid rates of technological innovation

• Lean has been viewed as an enabler to agility

• Advantages: inventory held at generic level- fewer stock keeping variants/ less inventory in total. See DELL illustration page 130

• ‘Leagile’

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Innovation as an Operations Process itself

• See slide 3

TheInnovation Process

(efficiency)

Inputs

Time,People,ITIdeas

OutputsNew Products and Services.

PatentsJournal articlesBooksRepaired car

(effectiveness)

Indeed -Paul Trotts whole book?

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A Design SpectrumProduct- process- service -SCM –organisation- controls- business sector

The story today-

If you INNOVATE you will be successful

To manage all this is very difficult23

References

• Chapter 4 of Paul Trotts book. Dell p130, 3M p452, Pulley blocks HMS Victory p115

• Slack et al (2007) chapter 15• Sunday Times- Appointment section March 14 2010

• Management Today April 2008 ( Keeping things simple &

managing complexity)

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