Preface |
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xiii | |
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1 Introduction to Business Process Design |
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1 | (26) |
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1.1 What Is a Business Process? |
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1 | (9) |
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1.1.1 Process Types and Hierarchies |
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3 | (1) |
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1.1.2 Determinants of the Process Architecture |
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4 | (1) |
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1.1.2.1 Inputs and Outputs |
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5 | (1) |
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5 | (1) |
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1.1.2.3 Network of Activities and Buffers |
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6 | (2) |
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8 | (1) |
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1.1.2.5 Information Structure |
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9 | (1) |
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1.1.3 Workflow Management Systems |
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9 | (1) |
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1.2 The Essence of Business Process Design |
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10 | (6) |
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1.2.1 Incremental Process Improvement and Process Design |
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12 | (1) |
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1.2.2 An Illustrative Example |
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13 | (3) |
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1.3 Business Process Design, Overall Business Performance, and Strategy |
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16 | (2) |
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1.3.1 Business Process Design and Overall Business Performance |
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16 | (1) |
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1.3.2 Business Process Design and Strategy |
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17 | (1) |
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1.4 Why Do Inefficient and Ineffective Business Processes Exist? |
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18 | (2) |
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20 | (1) |
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Discussion Questions and Exercises |
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21 | (5) |
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26 | (1) |
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2 Process Management and Process-Oriented Improvement Programs |
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27 | (50) |
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2.1 Process Management and the Power of Adopting a Process View |
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27 | (15) |
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2.1.1 Phase I: Initialization |
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29 | (1) |
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2.1.1.1 Process Ownership |
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30 | (1) |
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2.1.1.2 Analyzing Process Boundaries and Interfaces |
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31 | (2) |
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2.1.2 Phase II: Definition |
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33 | (1) |
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34 | (1) |
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2.1.3.1 Establishing Control Points |
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34 | (1) |
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2.1.3.2 Developing and Implementing Measurements |
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35 | (1) |
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2.1.3.3 Feedback and Control |
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36 | (1) |
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2.1.4 An Illustrative Example: Managing a Document Distribution Process |
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36 | (1) |
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2.1.4.1 Assign Process Ownership |
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37 | (1) |
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2.1.4.2 Analyze Boundaries and Interfaces |
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37 | (2) |
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2.1.4.3 Define the Process |
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39 | (1) |
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2.1.4.4 Establish Control Points |
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40 | (1) |
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2.1.4.5 Develop and Implement Measures |
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40 | (1) |
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2.1.4.6 Perform Feedback and Control |
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41 | (1) |
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2.1.4.7 Summary and Final Remarks |
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41 | (1) |
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2.2 Six Sigma Quality Programs |
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42 | (10) |
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2.2.1 Six Sigma Definitions |
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42 | (2) |
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2.2.2 The Six Sigma Cost and Revenue Rationale |
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44 | (1) |
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2.2.2.1 The Cost or Efficiency Rationale |
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44 | (2) |
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2.2.2.2 The Revenue or Effectiveness Rationale |
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46 | (1) |
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2.2.3 Six Sigma in Product and Process Design |
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47 | (1) |
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2.2.4 The Six Sigma Framework |
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48 | (1) |
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2.2.4.1 Top Management Commitment |
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48 | (1) |
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2.2.4.2 Stakeholder Involvement |
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49 | (1) |
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49 | (1) |
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2.2.4.4 Measurement System |
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50 | (1) |
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2.2.4.5 The Improvement Methodology |
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50 | (2) |
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2.2.5 Concluding Remarks: Key Reasons for the Success of Six Sigma |
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52 | (1) |
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2.3 Business Process Reengineering |
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52 | (14) |
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2.3.1 Reengineering and Its Relationship with other Earlier Programs |
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54 | (3) |
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2.3.2 A Brief History of Reengineering |
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57 | (1) |
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2.3.3 When Should a Process Be Reengineered? |
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58 | (2) |
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2.3.4 What Should Be Reengineered? |
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60 | (1) |
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61 | (1) |
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62 | (1) |
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62 | (1) |
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2.3.5 Suggested Reengineering Frameworks |
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63 | (3) |
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2.4 Revolutionary versus Evolutionary Change |
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66 | (3) |
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69 | (2) |
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Discussion Questions and Exercises |
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71 | (3) |
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74 | (3) |
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3 A Framework for Business Process Design Projects |
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77 | (34) |
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3.1 Step 1: Case for Action and Vision Statements |
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79 | (2) |
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3.2 Step 2: Process Identification and Selection |
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81 | (2) |
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3.3 Step 3: Obtaining Management Commitment |
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83 | (1) |
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3.4 Step 4: Evaluation of Design Enablers |
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83 | (5) |
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3.4.1 Example: The Internet-Enabling Change at Chase Manhattan Bank |
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85 | (1) |
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3.4.2 Example: New Technology as a Change Enabler in the Grocery Industry |
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86 | (2) |
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3.5 Step 5: Acquiring Process Understanding |
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88 | (3) |
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3.5.1 Understanding the Existing Process |
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88 | (2) |
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3.5.2 Understanding the Customer |
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90 | (1) |
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3.6 Step 6: Creative Process Design |
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91 | (11) |
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93 | (2) |
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95 | (7) |
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3.6.3 The Devil's Quadrangle |
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102 | (1) |
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3.7 Step 7: Process Modeling and Simulation |
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102 | (3) |
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3.8 Step 8: Implementation of the New Process Design |
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105 | (1) |
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106 | (1) |
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Discussion Questions and Exercises |
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107 | (2) |
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109 | (2) |
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4 Basic Tools for Process Design |
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111 | (40) |
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4.1 Process Flow Analysis |
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113 | (12) |
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4.1.1 General Process Charts |
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114 | (1) |
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4.1.2 Process Flow Diagrams |
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115 | (2) |
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4.1.3 Process Activity Charts |
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117 | (1) |
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118 | (3) |
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4.1.5 Service System Maps |
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121 | (4) |
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4.2 Workflow Design Principles and Tools |
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125 | (15) |
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4.2.1 Establish a Product Orientation in the Process |
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125 | (2) |
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127 | (1) |
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4.2.3 Establish One-at-a-Time Processing |
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128 | (2) |
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4.2.4 Balance the Flow to the Bottleneck |
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130 | (4) |
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4.2.5 Minimize Sequential Processing and Handoffs |
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134 | (1) |
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4.2.6 Establish an Efficient System for Processing of Work |
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135 | (5) |
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4.2.7 Minimize Multiple Paths through Operations |
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140 | (1) |
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4.3 Additional Diagramming Tools |
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140 | (2) |
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4.4 From Theory to Practice: Designing an Order-Picking Process |
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142 | (1) |
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143 | (1) |
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Discussion Questions and Exercises |
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143 | (6) |
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149 | (2) |
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151 | (36) |
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5.1 Business Processes and Flows |
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151 | (7) |
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153 | (1) |
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154 | (2) |
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156 | (1) |
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157 | (1) |
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5.2 Cycle Time and Capacity Analysis |
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158 | (10) |
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5.2.1 Cycle Time Analysis |
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158 | (1) |
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159 | (1) |
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160 | (1) |
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5.2.1.3 Parallel Activities |
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160 | (4) |
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164 | (1) |
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164 | (1) |
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165 | (1) |
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5.2.2.3 Parallel Activities |
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165 | (3) |
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5.3 Managing Cycle Time and Capacity |
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168 | (4) |
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5.3.1 Cycle Time Reduction |
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168 | (2) |
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5.3.2 Increasing Process Capacity |
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170 | (2) |
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5.4 Theory of Constraints |
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172 | (6) |
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5.4.1 Drum-Buffer-Rope Systems |
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177 | (1) |
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178 | (1) |
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Discussion Questions and Exercises |
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178 | (7) |
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185 | (2) |
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6 Introduction to Queuing Modeling |
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187 | (54) |
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6.1 Queuing Systems, the Basic Queuing Process, and Queuing Strategies |
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189 | (7) |
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6.1.1 The Basic Queuing Process |
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190 | (1) |
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6.1.1.1 The Calling Population |
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191 | (1) |
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6.1.1.2 The Arrival Process |
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192 | (1) |
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6.1.1.3 The Queue Configuration |
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192 | (2) |
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6.1.1.4 The Queue Discipline |
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194 | (1) |
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6.1.1.5 The Service Mechanism |
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194 | (1) |
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6.1.2 Strategies for Mitigating the Effects of Long Queues |
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195 | (1) |
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6.2 Analytical Queuing Models |
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196 | (44) |
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6.2.1 The Exponential Distribution and its Role in Queuing Theory |
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197 | (4) |
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6.2.1.1 The Exponential Distribution, the Poisson Distribution, and the Poisson Process |
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201 | (1) |
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6.2.2 Terminology, Notation, and Little's Law Revisited |
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202 | (4) |
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6.2.3 Birth-and-Death Processes |
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206 | (10) |
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216 | (4) |
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220 | (3) |
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223 | (4) |
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6.2.7 The M/M/c/∞/N Model |
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227 | (4) |
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6.2.8 Queuing Theory and Process Design |
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231 | (2) |
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233 | (1) |
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234 | (1) |
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6.2.8.3 A Decision Model for Designing Queuing Systems |
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234 | (6) |
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240 | (1) |
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Appendix 6A Mathematical Derivations and Models with Generally Distributed Service Times |
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241 | (274) |
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6A.1 Mathematical Derivations of Key Results |
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241 | (2) |
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6A.1.1 The Exponential Distribution (Section 6.2.1) |
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241 | (1) |
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6A.1.2 Birth-and-death processes (6.2.3) |
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241 | (1) |
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6A.1.3 The M/M/1 Model (6.2.4) |
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242 | (1) |
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6A.2 Queuing Models with Generally Distributed Service Times |
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243 | (2) |
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6A.2.1 The M/G/1 Queuing Model |
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243 | (1) |
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6A.2.2 The M/G/∞ queuing model |
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244 | (1) |
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Discussion Questions and Exercises |
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245 | (11) |
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256 | (1) |
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7 Introduction to Simulation |
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257 | (36) |
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259 | (2) |
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7.2 Monte Carlo Simulation |
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261 | (4) |
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7.3 Discrete-Event Simulation |
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265 | (2) |
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7.4 Getting Started in Simulation Modeling |
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267 | (5) |
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7.4.1 Step 1: Defining the Problem |
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267 | (1) |
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7.4.2 Step 2: Understanding the Process |
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268 | (1) |
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7.4.3 Step 3: Determining Goals and Objective |
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269 | (1) |
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7.4.4 Step 4: Obtaining Support from Management |
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269 | (1) |
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7.4.5 Step 5: Choosing Simulation Software |
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270 | (1) |
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7.4.6 Step 6: Determining Data Requirements and Availability |
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270 | (1) |
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7.4.7 Step 7: Developing Assumptions about the Problem |
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271 | (1) |
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7.4.8 Step 8: Determining Desired Outputs |
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271 | (1) |
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7.4.9 Step 9: Building the Simulation Model |
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271 | (1) |
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7.4.10 Step 10: Project Kickoff |
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272 | (1) |
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7.5 An Illustrative Example |
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272 | (7) |
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7.6 Spreadsheet Simulation of a Process |
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279 | (2) |
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7.7 Successful Simulation in Practice |
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281 | (3) |
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284 | (3) |
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287 | (1) |
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Discussion Questions and Exercises |
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287 | (5) |
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292 | (1) |
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8 Modeling and Simulating Business Processes with ExtendSim |
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293 | (64) |
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8.1 Developing a Simulation Model---Principles and Concepts |
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294 | (2) |
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296 | (1) |
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296 | (1) |
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296 | (4) |
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8.3 ExtendSim Tutorial: A Basic Queuing Model |
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300 | (4) |
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8.4 Basic Data Collection and Statistical Analysis |
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304 | (5) |
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8.5 Adding Randomness to Processing Times and the Use of Attributes |
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309 | (5) |
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8.6 Adding a Second Underwriting Team |
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314 | (3) |
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8.7 Modeling Resources and Resource Pools |
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317 | (4) |
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8.8 Customizing the Animation |
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321 | (1) |
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8.9 Calculating Activity-Based Costs |
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322 | (4) |
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326 | (2) |
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8.11 Modeling Advanced Queuing Features |
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328 | (7) |
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330 | (1) |
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330 | (2) |
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332 | (1) |
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8.11.4 Priorities and Priority Queues |
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333 | (2) |
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8.12 Modeling Routing in Multiple Paths and Parallel Paths |
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335 | (7) |
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336 | (4) |
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340 | (2) |
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8.13 Model Documentation and Enhancements |
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342 | (2) |
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344 | (1) |
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Discussion Questions and Exercises |
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344 | (11) |
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355 | (2) |
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9 Input and Output Data Analysis |
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357 | (80) |
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9.1 Dealing with Randomness |
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358 | (2) |
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9.2 Characterizing Probability Distributions of Field Data |
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360 | (10) |
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9.2.1 Goodness-of-Fit Tests |
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363 | (1) |
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9.2.2 Using Stat::Fit for Distribution Fitting |
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364 | (3) |
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9.2.3 Choosing a Distribution in the Absence of Sample Data |
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367 | (3) |
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9.3 Random Number Generators |
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370 | (4) |
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373 | (1) |
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9.4 Generation of Random Variates |
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374 | (3) |
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9.5 Analysis of Simulation Output Data |
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377 | (15) |
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9.5.1 Nonterminating Processes |
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379 | (2) |
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9.5.2 Terminating Processes |
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381 | (2) |
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9.5.3 Confidence Intervals |
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383 | (1) |
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9.5.3.1 Confidence Interval for a Population Mean |
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384 | (2) |
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9.5.4 Sample Size Calculation |
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386 | (3) |
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9.5.5 Comparing Output Variables for Different Process Designs |
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389 | (3) |
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9.6 Modeling and Analysis of Process Design Cases |
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392 | (15) |
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9.6.1 Process Design of a Call Center for Software Support |
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393 | (1) |
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9.6.1.1 Modeling, Analysis, and Recommendations |
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394 | (3) |
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9.6.2 Design of a Hospital Admissions Process |
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397 | (10) |
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407 | (1) |
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407 | (12) |
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9.8.1 Case 1: Improving the X-Ray Process at County Hospital |
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407 | (1) |
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9.8.1.1 Part I: Analyzing the Current Process Design |
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408 | (2) |
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9.8.1.2 Part II: Suggest and Evaluate a New Process Design |
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410 | (1) |
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9.8.2 Case 2: Process Modeling and Analysis in an Assembly Factory |
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410 | (4) |
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9.8.3 Case 3: Redesign of a Credit Applications Process |
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414 | (1) |
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9.8.4 Case 4: Redesigning the Adoption Process in a Humane Society |
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414 | (2) |
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416 | (1) |
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416 | (1) |
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9.8.5 Case 5: Performance Analysis and Improvement of an Internet Ordering Process |
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417 | (2) |
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Appendix 9A Hypothesis Testing, Confidence Intervals, and Statistical Tables |
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419 | (7) |
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9A.1 Goodness-of-Fit Tests (Section 9.2.1) |
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419 | (1) |
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9A1.1 The Chi-Square Test |
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419 | (3) |
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9A.1.2 The Kolmogorov-Smirnov Test |
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422 | (3) |
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9A.2 Confidence Interval for a Population Proportion (Section 9.5.3) |
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425 | (1) |
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9A.3 Hypothesis Testing (Section 9.5.5) |
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426 | (6) |
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429 | (3) |
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432 | (4) |
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436 | (1) |
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10 Optimizing Business Process Performance |
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437 | (36) |
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10.1 Business Process Optimization |
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437 | (2) |
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10.2 The Role of Simulation Optimization in Business Process Management |
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439 | (5) |
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10.3 Simulation Optimization with ExtendSim |
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444 | (13) |
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10.3.1 Tutorial: Process Optimization with ExtendSim |
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447 | (7) |
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10.3.2 Alternative Optimization Models |
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454 | (3) |
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10.4 Optimization of Process Simulation Models |
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457 | (4) |
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10.4.1 Configuring a Hospital Emergency Room Process |
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457 | (2) |
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10.4.2 Staffing Levels for a Personal Insurance Claims Process |
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459 | (2) |
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461 | (1) |
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Appendix 10A Evolutionary Computation |
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462 | (1) |
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463 | (8) |
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10A.1 Simulation Optimization Projects |
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464 | (1) |
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10A.2 Emergency Room Staffing |
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464 | (2) |
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10A.3 Call Center Configuration |
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466 | (2) |
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10A.4 Loan Application Process |
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468 | (2) |
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10A.5 Process with Multiple Job Types and Deadlines |
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470 | (1) |
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471 | (2) |
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11 Business Process Analytics |
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473 | (42) |
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11.1 Competing on Analytics |
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475 | (4) |
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11.2 Business Process Management Systems |
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479 | (13) |
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481 | (1) |
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482 | (6) |
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11.2.3 Monitor and Control |
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488 | (1) |
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489 | (3) |
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11.3 Process Benchmarking |
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492 | (9) |
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11.3.1 Graphical Analysis of the Ratio Model |
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495 | (1) |
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11.3.1.1 Efficiency Calculation |
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496 | (2) |
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11.3.2 Linear Programming Formulation of the Ratio Model |
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498 | (3) |
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11.3.3 Learning from Best-Practice Organizations |
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501 | (1) |
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Appendix 11A Excel Add-In for Data Envelopment Analysis |
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501 | (6) |
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Discussion Questions and Exercises |
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507 | (5) |
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512 | (3) |
Epilogue |
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515 | (2) |
Index |
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517 | |