1. Innovation and operations management
Chapter 4
Innovation and operations management

2. Learning objectives
At the end of this session you should be able to understand:
innovation in the context of operations
the difference between ‘product’ and ‘process’ innovation and design.

3. The functional links
Operations
Marketing
Research and development

4. Ideas generation Marketing Concept generation Internal sources
External sources
Marketing
Customer needs
analysis
Surveys
Research departments
Customer suggestions
Suggestions from staff
Competitors
Concept generation

5. A good innovative design
Meets customer requirements
Is simple to make
Can be rapidly developed into production
Few modifications are required during the development phase

6. Design for manufacturing
If a product is easy to make, it will be economical to produce
It is important to consider the manufacturability early in the design phase
Integrate product design with process planning and design

7. Design simplification
PRODUCTS
DESIGN
Assembly using common fasteners
One-piece base and elimination of fasteners
Push and snap in assembly

8. Product process types High Variety Low Low Volume High
PROCESSES
High
Project
Jobbing
Batch
Variety
Mass
Continuous
Low
Low
Volume
High
THE MOST APPROPRIATE METHOD (PARTICULARLY IN COST TERMS) CHANGES WITH TIME

9. Awards
Malcolm Baldridge
Demming
ISO 9000
EFQM

10. Excellence model Leadership Society Results Partnerships & Resources
Processes
Key
Performance
INNOVATION AND LEARNING
ENABLERS
RESULTS
People
Policy & Strategy
Customer Results
EFQM, The Model is a registered trademark of the EFQM

11. What is self assessment?
Self-assessment is a comprehensive, systematic and regular review of an organisation’s activities and results against a ‘continuous improvement model’. Source: EFQM (2003) EFQM Excellence Model
The process allows the organisation to discern clearly its strengths and areas for improvement and culminates in planned improvement action plans which are then monitored for progress.

12. NHS1 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 health care systems and health care industries in the UK and internationally

13. NHS2 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
“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

14. NHS3 General NHS Direct Care in the community NHS Plus Patient choice
Telephone
Online
Sky TV
Care in the community
NHS Plus
Workplace health care (self-funding)
Patient choice
Choose and book
Walk-in centres and treatment centres
Run by commercial companies on behalf of NHS

15. LA1 Making improvements
Customer feedback
New ideas and innovation
Staff feedback
KEY PRINCIPLES:
Motivation of staff is key in looking for innovation.
Cultural change has taken place across the council. Especially with e-government.
Consider things such as:
Look at processes that do not add value to the Council and try to re-engineer process.
Currently process mapping every service area to see what improvements can be made.
Customers now expect more than ever. They expect us to answer requests:
Quicker, better and more efficiently. They also want to get our services 24hrs a day.
Actually targeting unhappy customers in order turn around their view of the council. Actually checking those who complain and ask them to come to consultation on the future long term vision of the council!
Full senior management support

16. LA2 Actions already undertaken
Innovation outputs : (Resulting from staff suggestions)
Installed timers on the water coolers, vending machines to reduce energy use out of working hours
Fitted new Building management system that allows for automatic switching on and off, dependant upon weather and time of day.
Now replacing all new plant with versions that can be operated with our new building management system.
New lighting using triphosphorus. These last longer and use less electricity.
Newsletters with helpful hints.

17. Illustration DELL Mass customisation
SCM good links with flexible vendors
Background in telemarketing
Customer knowledge leading to ‘premier pages’ that have saved Ford $2m
High reliability: Dell has received awards for performance
Delivery support 24/7
Adaptive business strategy by moving up the value chain
Concentrating on what customers wanted

18. Conclusions
Whilst you might not be directly involved in R&D you will be involved in innovation.