A process is something ongoing, like an assembly line in a factory, or a kitchen in a restaurant. There is always a bottleneck, which is the slowest point on the line. Stuff collects behind it. There is no getting around this, other than to identify your bottleneck and try to diminish its impact.
Capacity is the maximum stuff you can produce in a given time. If you need more stuff than that, you have a problem.
Operations Management is looking at the customer’s definition of quality and managing a process to meet that need in the most efficient way possible. 100% efficiency is not always desirable; sometimes downtime has a purpose in a process. It all depends on what quality means to you, and your customer.
If you have a flawed process for making something, then fixing the flaws costs you more than it would have cost you to have a flaw-free process in the first place. Quality, then, is free.
Sometimes.
There’s also a point of diminishing returns, which is why you don’t spend $500 fixing a TV when you can buy a new one for $250. And the very definition of quality–meeting the expectations of your customers–doesn’t require perfection. So there is a point when you stop spending money to fix things, and just live with the flaws.
To figure out where that point is, you need to understand your customers’ definition of quality, which, again, means knowing your customers. That’s “Gap Analysis:” looking at the places where there are gaps in the flow of information from your customers to you, and back again. Users have complaints that never get back to the designers. The designers don’t clearly communicate the design to the builders. Marketers don’t emphasize the most desirable features.
There are features, and then there are requirements. If you need seating for 8, then the nicest convertible in the world isn’t going to meet your requirements, no matter how big the engine or plush the leather. If you confuse needs with wants, you’ll wonder why nobody’s buying your product. All other things being equal, however, features are important. So don’t forget the cupholders.