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X. Try to express your opinion why this man is worth speaking about.

XI. Put the sentences in the appropriate order to make a conversation between an examiner and a student and act it out.

-Have you heard something about new technologies?

-Very good. Let’s speak about technology. Have you read a lot about it?

-Then, tell me, please, who deals with technological choices?

-Of course. But do managers have to know about technology?

-It goes without saying if they want their business to be successful.

-What does the technological choice of an organization depend on?

-I think I have.

-It depends on many things such as output quantity, production costs…

-Computer-integrated manufacturing, computer-aided design and manufacturing are widely used by organizations.

-Technologists, if I’m not mistaken.

-Can you give examples of computer-integrated manufacturing?

XII. You are a manager at the local factory producing Christmas-tree decorations. Write a recommendation if it is possible to change the operations technology and if it is worth changing.

Text 19

I. Listen to a native speaker and try to memorize the pronunciation of the words. Try to imitate the pronunciation.

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II. Read and translate the text.

IMPROVINGPRODUCTIVITY

As the clock struck noon in Appleton, Wisconsin, the entire 500-member insurance staff of the Aid Association for Lutherans (AAL), a fraternal society that operates as a large insurance business, piled their personal belongings on chairs and rolled the chairs to other parts of headquarters. Corridors were jammed as “organized chaos” brought a reorganization of insurance operations into reality. Within 2 hours, the move transformed the functionally organized bureaucracy into self-managing teams that would eventually operate without several layers of supervisors. Under the new arrangement, all the policies related to a particular customer would be handled by a single team, rather than being routed to separate departments. Within a year of the move, productivity rose 20 percent – a significant amount, particularly for a service organization.

The results at AAL constitute only one example of what can be accomplished when productivity improvements in operations are given high priority. Within organizations, attempts to improve productivity – that is, to generate more outputs from the same or fewer inputs – depend on the fivestep process described below.

The first step in improving productivity is for managers to establish a base point against which to assess future improvements. Examples of measures that could be used to establish a base point include the number of claims processed daily, dollar income per square foot of selling space, amount produced per day, percentage of output passing inspection, percentage of repaired items that had to be returned for further repairs, or customers served per hour. The important thing is to choose measures that focus on important aspects of productivity for the particular organization or work unit.

The second step involves setting goals in order to establish the desired productivity level. A number of studies in a wide variety of jobs and industries support the usefulness of goal setting as a means of raising productivity levels.

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The third step is to review methods for increasing productivity. Extensive reviews of productivity studies indicate that useful methods for increasing productivity include improving employee selection techniques, placing people in jobs that are well matched to their qualifications, training workers in job-related skills, redesigning jobs to give workers more control over their own productivity, providing financial incentives that are carefully tied to productivity issues, and using feedback and performance appraisals to let workers know how they are doing.

Still other approaches aimed at improving productivity include many of the operations management techniques such as aggregate planning, master production scheduling, Material Resource Planning (MRP) and related systems, well-thought-out purchasing programs, appropriate facilities and layouts, and new process technologies.

Productivity expert Wickham Skinner argues that managers sometimes overemphasize cost cutting as the principal means of increasing productivity and fail to adopt major new process technologies that would make significant breakthroughs in productivity and competitiveness. Often, rethinking the work process itself also leads to breakthroughs. The new Sleep Inn hotel chain introduced by Manor Care has been developed with labor productivity in mind. For example, the hotels have a sophisticated washer and dryer installed behind the desk so that the night-shift desk operator can also do the laundry by pushing a few buttons. Concrete and shrubs eliminate grass cutting. Shower stalls are round so that they are easier to keep clean. These and other labor-saving changes will allow a typical 100-bed Sleep Inn to employ only 12 full-time employees, 13 percent fewer than the average for a no-frills hotel. The fourth step is to select a method and implement. This step involves choosing a method that appears to have the best chance of success in the particular situation. Implementation is likely to involve some considerations about the best wayto bring about change.

Finally, the last step in improving productivity is to measure results and modify as necessary. Further modifications are necessary only if productivity is not improving as planned. Met goals, of course, lead to new goals, since increasing productivity is a continual challenge for successful organizations.

III. Compose several sentences or small situations concerning company productivity with the expressions. Mind the articles and prepositions.

Within a year of; per day; as a means of; in a wide variety of; for example.

 Workbook Ex. 43on page 118 – 119.

IV. While listening to the lecture on economics your friend has made some notes but put no full stops. So, he understands nothing. Can you help him? Translate the extract to confirm your decision.

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Productivity is clearly one of the most important challenges facing today’s managers Cardinal Industries Inc., based in Columbus, Ohio, is the world’s largest builder of modular housing the company owes much of its success to productivity for example, it can build, deliver, and install a single-family home for half the cost per square foot of a site-built house by building the houses in a factory, multiple jobs can be done at the same time and automation can also be used more extensively than would be possible at an individual building site Cardinal’s size also allows it to negotiate lower prices from suppliers and invest in research development as a way of finding other ways to lower costs and raise quality.

V. Match the numbers to the letters. Use the given words (1 – 5) in the sentences of your own and let your partner specify what you mean using the definitions (a – e).

1 Productivity

2 Improve

3 Increase

4 Technique

5 Breakthrough

VI. Work in pairs. Make up a small dialogue on the following situation. Use the information in brackets for help.

1.Firms can improve their productivity by spending more on research and development. (R&D spending helps identify new uses for existing products, and new methods for making products; and each of these contributes to productivity. For example, Bausch & Lomb almost missed the boat on extended-wear contact lenses because the company had neglected R&D. Recognizing its mistake management made R&D a top-priority item. As a result the company made several scientific breakthroughs, shortening the time needed to introduce new products, and greatly enhanced both total sales and profits – and all with a smaller work force than the company used to employ.)

2.Firms can improve operations to boost productivity by reassessing and revamping their transformation facilities. (Building a new factory is no guarantee of success, but IBM, Ford, Caterpillar, and many other American businesses have achieved dramatic productivity gains by revamping their production facilities. Facilities refinements are not limited to manufacturers. In recent years, many McDonald’s restaurants have added drive-through windows,

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and many are moving soft-drink dispensers out to the restaurant floor so that customers can get their own drinks. Each of these moves is an attempt to increase the speed with which customers can be served – and to thus increase productivity.)

3.Increasing the flexibility of an organization’s work force by training employees to perform a number of different jobs contributes to productivity. (The Lechmere department store in Sarasota, Florida, encourages workers to learn numerous jobs within the store. One person in the store can operate a forklift in the stockroom, serve as a cashier, or provide customer service on the sales floor. At a Motorola plant, 397 out of 400 employees have learned at least two skills under similar program.)

4.Firms have to reward people for learning new skills and using them proficiently. (At Motorola workers who master a new skill are assigned for a five-day period to a job requiring them to use that skill. If they perform with no defects, they are moved to a higher pay grade, and then they move back and forth between jobs as they are needed. If there is a performance problem, they receive more training and practice.)

Text 20

I. Listen to a native speaker and try to memorize the pronunciation of the words. Try to imitate the pronunciation.

II. What is Siemens famous for? Do you or your friends have its products? Are they of high quality? Read the text and write out the key phrases.

SIEMENS STRESSES PRODUCTIVITY AND QUALITY

Siemens, founded in 1847, is Europe’s largest electrical products company and is succeeding through the use of modern operations management technology. Siemens’s home office is now in Munich. Siemens built an electric

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railway in 1879, an X-ray tube in 1896, and the first telex in 1933. It has long been known for developing technologically advanced products in the electric and electronic industries. Indeed, it spends about 12 percent of its sales on research and development, a figure noticeably higher than that of many other firms.

Late in 1988, Siemens made two moves to develop its presence in the telecommunications field. It combined in a 50-50 joint venture with Britain’s General Electric Company to take over Plessey Company. If that acquisition actually takes place, Siemens will become the second-largest European supplier of central telephone exchanges and equipment. While the takeover was being resisted by Plessey, Siemens entered into a joint venture with IBM to purchase much of IBM’s Rolm telecommunications unit and to cooperate with IBM on marketing the rest of Rolm’s business. When the IBM agreement is completed, Siemens will be the world’s largest supplier of PBX’s and it will have all of Rolm’s sales outlets in the United States. That will add greatly to Siemens’s presence in the United States, which is already substantial since it acquired some American firms.

Siemens’s electronic product lines emphasize factory and office automation, computerized medical equipment, telecommunications gear, and research in computer memory chips. To hedge against exchange-rate fluctuations, Siemens must keep costs down and productivity up. To accomplish both simultaneously takes a top-notch operations management system. Siemens seems to be developing one.

In the manufacture of semiconductors, Siemens has been moving to try to catch up with the Japanese, who are currently the world leaders. Siemens’s effort, dubbed the Mega Project, will cost around $1 billion but will be well worthwhile if Siemens can eventually match the Japanese. The Mega Project involves completely changing Siemens’s semiconductor plant located in Regensburg, West Germany.

That plant produces 1-megabit dynamic random access memory (DRAM) chips. Each DRAM chip can store a million bits of information. Siemens bought technology from Japan’s Toshiba Corporation to get this project started and began a joint venture with N. V. Philips, the Dutch electronics firm, on the next generation of chips, which will be capable of storing four megabits of information.

The Regensburg plant was constructed specifically for this product. Circuit lines on DRAMs are 1 micron wide (a micron is about 1 percent of the width of a human hair). The smaller the circuit line, the more information can be placed on the chip. The microscopic etching necessary to put those lines on the silicon wafers requires the very strictest of production standards. The plant thus rests on a special foundation designed to minimize vibration that could cause problems in the fabrication rooms. Workers wear white suits with hoods to keep

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contamination low. In special “clean rooms,” the air is filtered and recirculated so that dust and other particles are eliminated and the air is about 1,000 times cleaner than the air in a typical hospital operating room.

Production rates at the Regensburg plant are about twice those of most Japanese chip manufacturers although about the same as those of Toshiba (from whom Siemens obtained the technology). However, the experience of building and operating this plant will eventually enable Siemens to produce the new tourmegabit chips faster than anyone else in the world.

Siemens is moving to market DRAMs just as carefully and aggressively as it produces them. Departments were organized to direct the marketing effort in numerous specific areas such as automotive applications, data processing, entertainment and games, industrial controls, and telecommunications. In the United States alone, Siemens has seventy sales representatives and has increased its presence with dealers and distributors. There is no shortage of demand at present, but the computer and electronics fields have a tendency to go flat periodically. The question for Siemens is whether it will be able to cope with a downturn. If management prepares for that eventuality as well as they prepared for their efforts in DRAMs, Siemens is likely to be one of the four or five international companies dominating the market by the year 2000.

 Workbook Ex. 44, 45on page 119.

III. In what paragraph of the text is it said:

-о том, что компания «Сименз» хотела догнать Японию в производстве полупроводников?

-о том, что только в США у «Сименз» 70 торговых представителей?

IV. Read the text again and divide it into five paragraphs. Give titles choosing from the list below:

 Historic development

 A company which is worth speaking about  Useful experience

 One of the successful companies in the world  Desire to be the first

V. Can you answer the questions?

1.What is the role of operations management in Siemens’s strategy? How closely are operations and strategy related? Why?

2.How are operations systems at Siemens related to other aspects of the organization?

3.What is the relation of productivity and quality in a highly technologically based field like semiconductors? Why?

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4. Is Siemens likely to be able to catch up with the Japanese in the semiconductor field? Why or why not?

VI. Give a report on “Improving Productivity” using the key phrases you have written.

Text 21

I. Listen to a native speaker and try to memorize the pronunciation of the words. Try to imitate the pronunciation.

II. Read the text and give another title.

FANUC COMPANY

If you had an opportunity to visit some of the most highly automated factories in the world, chances that you would quickly run into the name “Fanuc”. Japanese-based Fanuc (pronounced fa-NUKE) is the world’s top supplier of devices that control the machines in automated factories. The company is also the foremost producer of industrial robots. The name “Fanuc” is an acronym for Fuji Automatic Numerical Control.

Fanuc’s products are usually easy to recognize because they typically are painted bright yellow – or at least have bright-yellow nameplates. In fact, yellow is obstructively evident at Fanuc headquarters. The company helicopter, the buildings, the jackets or smocks that employees wear – just about everything

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connected with Fanuc – all are bright yellow. The color yellow was chosen by Fanuc’s chief executive Dr. Seiuemon Inaba because he perceives it to be an “emperor’s color”, befitting a premier company.

Fanuc constantly beats the competition by being the lowest-cost producer of high-quality automation components. In fact, the components are considered to be the highest quality available anywhere in the world. Fanuc’s efforts to drive down costs are relentless, and Fanuc plants are among the most automated to be found anywhere. The 400 robots at the Mount Fuji complex slightly outnumber the production workers. The other 1700 workers are research engineers, administrators, and salespersons. In one plant, which cost about one-tenth of a conventional facility, 70 workers and 130 robots turn out 18,000 electric motors per month. To make a factory of this type possible, Fanuc had to redesign the motors, greatly reducing the number of parts needed for each motor.

Such efforts have helped Fanuc counteract the effects of the recently rising yen on the prices that Fanuc would otherwise have needed to charge its international customers. For example, in one instance, engineers drastically reduced the number of parts in a motor controller, a device that regulates the speed of a motor. The controller now has 573 parts compared with an earlier 1070; in addition, all cables and metal-stamping processes have been eliminated.

A large part of Fanuc’s success can be attributed to Dr. Inaba, a directive leader, who is uncompromising in his emphasis on product quality and reliability. Subordinates generally do not speak in meetings unless he addresses them. Yet Inaba has been able to provide a vision for the company that has inspired employees to put forth their best efforts.

An additional factor is that Inaba rewards employees exceptionally well. The earnings of managers at Fanuc are generally about 50 percent more than the usual salaries at other Japanese companies, and engineers earn about 30 percent more than their counterparts in other organizations. The company also takes care of employees in other significant ways. For example, within the factory grounds there is family housing, as well as yellow dorms for single men, single women, and married people living away from their families. Workers may stay in these living facilities even past retirement – until death if they wish. Employees and their families can pursue leisure interests by studying such subjects as flower arranging or the tea ceremony in the Fanuc cultural center. They can exercise in the Fanuc gym or vacation in Fanuc-owned lodges in Japan, Spain, and the United States (Wisconsin). One outcome is that the workers are extremely loyal and hardworking, even by Japanese standards. For example, employees frequently sleep in beds provided on the premises so that they can work longer hours than they would otherwise to help the company maintain its preeminent position. Inaba located the company’s headquarters at the base of Mount Fuji because he feels that people work best when there is a chill in the air.

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Another reason is that foreign dignitaries can have their picture taken with one of Japan’s most famous landmarks as a background.

In urging his workers toward success, Inaba once told his engineers, “No matter how excellent a product may be produced, we will not be able to win a war if we should fail to market it at the proper time.” Accordingly, he gave the product development lab a legendary wall clock that turns at 10 times the normal speed. “That saved me making a speech,” he says. Inaba also expects at least $400,000 in sales per employee and an operating income that is 35 percent of sales.

General Motors formed a joint venture with Fanuc in 1982, after the automaker was unable to expand its own robot production enough to meet its own demand and also sell to others. Since then, the joint enterprise, called the GMFanuc Robotics Corporation, has become the world’s largest supplier of robots.

More recently, another giant, General Electric, gave up its attempts to become the number-one company in factory automation after losing at least $200 million. Instead, GE formed a joint venture with Fanuc, its most formidable competitor. The new venture, the GE Fanuc Automation Corporation, specializes in devices that control automated machines, particularly computerized numerical controls. The controls are the electronic boxes that form the brains and nervous systems of automated versions of such tools as lathes and milling machines. When GE’s plant in Charlottesville, Virginia, began making Fanuc models in 1988, the Fanuc versions incorporated refinements that one GE executive termed “awesome.”

Few leaders are as directive as Dr. Inaba is. Yet, within the broad parameters and major directions that he outlines, workers have considerable latitude in pursuing the innovations that have made Fanuc a world-class supplier of factory automation devices. Although the company has been at the forefront in supplying others with automation devices, much of its success can be attributed to the internal emphasis on innovation within its own factory operations. The company’s tireless efforts have made Fanuc the lowest-cost producer of automation equipment, yet its quality is unsurpassed. Thus Fanuc has been able to achieve high-quality outputs, yet, compared with the competition, it uses relatively fewer inputs. How has Fanuc been able to achieve such enviable productivity? A major part of the company’s success can be attributed to its excellence in operations management, the functional area responsible for producing the goods and services that Fanuc has to offer.

 Workbook Ex. 46, 47on page 119 – 120.

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