Production and Operations Management Essay Sample

Production and Operations Management Pages
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Q1) Explain the basic competitive priorities considered while formulating operations strategy by a firm?

Ans: Operations strategy is the collective concrete actions chosen, mandated, or stimulated by corporate strategy. It is, of course, implemented within the operations function. The operations strategy specifies how the firm will employ its operations capabilities to support the business strategy. Operation advantages depend on its processes and competitive priorities considered while establishing the capabilities. The basic competitive priorities are: * Cost

* Quality
* Time
* Flexibility
Cost: Cost is a primary consideration while marketing a product or service. A firm competing on a price/cost basis is able to provide consumers with an in-demand product at a price that is competitively lower than that offered by firms producing the same or similar good/service. Lower Price and better quality of a product will ensure and higher profitability. To estimate the actual cost of production, the operations manager must address labour, materials, scrap generations, overhead and other initial cost of design and development. QUALITY is defined by the customer.

The Operations Manger mainly looks into two aspects namely highly performance design and Consistent quality. High Performance design includes superior features, great durability, and convenience to services where as consistent design measures the frequency with which the product meets its design specifications and performs best. TIME: Faster delivery time, on – time delivery, and speedy development cycle are the time factors that operations strategy looks into. Faster delivery time is the time lapsed between the customer order and the delivery. On time delivery is the frequency with which the product is delivered on time. The development speed is the elapsed time from the idea generation up to the final design and production of products. FLEXIBILITY: Firms may compete on their ability to provide either flexibility of the product or volume. Firms that can easily accept engineering changes  their customers. The two types of Flexibilities are: * Customization

* Volume Flexibility
While Customization is the ability of the firm to satisfy the specific needs of each of their customers, the volume flexibility is the ability to accelerate or decelerate the rate of production to handle the fluctuations in demand.

Q2: a -List the benefits of forecasting?
Ans: There are three Categories of Benefits of Forecasting
Direct Cost Savings: savings in expenditure other than labour, print, travel costs, telephone etc. that can directly be attributed to the introduction of the Intranet. These can be further calculated in the three steps: a) Number of incidences of expenditure in the time period, b) The Cost of each incidence,

c) The proportion of these that can be eliminated using the intranet Labour Savings: savings in the amount of time required to carry out tasks as a result of introducing the intranet. These can be expressed in minutes per person per day. To calculate the savings, divide the number of minutes saved by the number of minutes in the day and multiply the size of the population and average salary. Productivity Increase: increases in output per person attributable to the introduction of intranet, expressed as a percentage. Because Personal productivity has such a wide range of implications from organization to organization, hence it is probably easier to convert these to simple labour savings. b- Explain the significance of plant location decision?

Ans: A plant location can be changed frequently since a large capital needs to be invested to build the plant and machinery in the selected area. Therefore, before selecting a plant location, a long range of forecasting is to be made to foresee the future needs of the company. Location Decisions are made on basis of parameters which make it suitable for various considerations of suppliers and markets. While locating a plant , the following long range of forecasting are to be considered: * The Company’s expansion Plan and policy

* Diversification plan for the products
* Changing market Conditions
* Changing sources of raw materials
* Many other factors that influence the choice of the location decisions. The main Concern of the operations manager will be the extent of flexibility he/she has. This can be determined by the following questions: * What is the volume of production of different products

* What operations have to be outsourced
* What will be the growth potential in that place

Location Planning Process:

Planning is the most important function of management, especially, when we have to deal with lands, buildings, and machineries.

Planning the location of the plant:: Factors influencing plant location can be broadly divided into two types namely: general factors and special factors:

The general factors that influence the plant location are listed as follows:
* Availability of land:
* Availability of inputs:
* Closeness to market places:
* Communication facilities:
* Infrastructure:
* Power
* Water:
* Transport
* Government support:
* Housing and recreation:

The special factors that influence the plant location are:
* Economic stability
* outside investments
* Cultural factors
* Wages
* Joint ventures : support of big time players

Q 3) What do you understand by “line balancing”? What happens if balance doesn’t exist? Ans: Assembly line refers to a special arrangement of facilities typically along a straight line or au-shaped line, exclusively to produce assemblies or finished products. The assembly starts in the form of a skeleton at one end and passes through several “work stations” where; different operations are performed and components are added, and the final assembly is obtained after passing through successive stages. The line is arranged so as to produce a specified number of products over a certain time period.

To facilitate easy mounting of components and fast operations, the assembly moves at certain speed and rolls over at the end of the line. A simple line (typically set up for the purpose of assembly) consists of a series of work stations, and the total work content of the product, which is expressed in terms of the total time is divided among these workstations equally. As the items move along the line, the work is progressed intermittently and leaves the line as a finished product. Typically the objective is, to divide the work content equally among the workstations so that the workstations are loaded as evenly as possible. This is known as balancing.

Firstly, if such a balance is not achieved, a certain amount of inefficiency will arise because some stations will have more work to perform than others, and all the stations are expected to process same number of items per period of time. Secondly, unequal work content at different work stations leads to unequal work distribution and also formation of queue of items. Hence, to ensure a smooth flow, all the workstations are given the same time to process the items. The entire line typically, on a manual or power-driven conveyor moves from workstation to workstation at a constant rate. The time required to complete the work allotted to each station is known as the “service time” and the time available at each station is known as the “cycle time”, normally longer than the service time.

The cycle time includes both the productive as well as the non-productive time along with idle time if any. Non productive time includes time for movement, handling and inspection time. The allocation of work elements to a work station may also be influenced by “zoning” constraints which occurs in two ways: positive zoning constraint demands that certain operations have to be clubbed together because of certain sharing of resources, and negative zoning which insists that certain operations should be clubbed together because of interference or conflict.

All these constraints make it very difficult or impossible to achieve perfect line balance and hence, a certain amount of balancing delay or balancing loss is inevitable. Balance delay is defined as the total time available to complete the given job and the total time required. The objective of line balancing is that, given a desired cycle time, the attempt is to assign work elements to workstations to:

Minimise idle time or balancing delay
Minimise the number of work stations
Distribute balancing delay evenly between stations
Avoid violating any constraints

Q4) What do you understand by “line balancing”? What happens if balance doesn’t exist? Ans : Total quality management (TQM) has different approaches towards its achievement. The basic thrust of each of these is realizing excellence. All the approaches have a lot in common; however, the emphasis shifts from one to other. Some use an ‘integrated approach’.

Following are some of the approaches to TQM:

Deming Wheel: Edward Deming is regarded as the American who taught the Japanese about quality improvement. Deming’s philosophy helps organizations to improve the quality of the products and services they offer.

Deming’s approach is summarized in 14 points: 1. Constancy of purpose for continuous improvement, 2. Adopt the total quality management philosophy for economic purposes, 3. Do not depend on inspection to deliver quality, 4. Do not award any business based on price alone, 5. Improve the system of production and service constantly, 6. Conduct meaningful training on the job , 7. Adopt modern methods of supervision and leadership, 8. Remove fear from the minds of everyone connected with the organization, 9. Remove barriers between departments and people, 10. Do not exhort, repeat slogans, and put up posters, 11. Do not set-up numerical quotas and work standards, 12. Give pride of workmanship to the workmen, 13.Education and training to be given vigorously, 14. State and exhibit top management’s commitment for quality and productivity.

Juran’s quality trilogy:
Joseph Juran like Edward Deming is considered as a legendary quality guru and is also regarded as a proponent in spreading total quality management culture. According to Juran, the definition of quality is “Fitness for use” and is considered as most adequate. Juran uses his famous universal breakthrough sequence to implement quality programmes. The universal breakthrough sequences are: * Proof of need

* Project identification
* Top management commitment.
* Diagnostic journey
* Remedial action:

Crosby’s absolutes of quality:
Philip Crosby is internationally known for the “Zero Defects” concept of quality. Like Deming, Crosby also lays emphasis on top management commitment and responsibility for designing the system, so that defects are not inevitable. He urged that there be no restriction on spending for achieving quality. In the long run, maintaining quality is more economical than compromising on its achievement. His absolutes can be listed as follows:

* Quality is conformance to requirements, not ‘goodness’
* Prevention, not appraisal, is the path to quality
* Quality is measured as the price paid for non-conformance and as indices
* Quality originates in all factions.

Taguchi’s quality loss function:

Genichi Taguchi is a Japanese quality guru and unlike other experts sees quality from a perspective of loss. He is not in favour of just meeting the specifications, but contends that the quality characteristics should always be close to the nominal or target value. Taguchi’s contention is that quality comes from design. He believed that, designers should make robust designs so that, product can withstand the variability which tends to be persistent and give quality for longer periods. His objective in giving the loss function is to make manufacturers realise that it is the target value of the specification that should be sought to be achieved and not the permissible deviations.

Q5 ) a. What is meant by productivity? Explain.

Ans: Productivity is generally expressed as the ratio of outputs to inputs. Productivity = Input

While the above ratio may imply efficiency, productivity is the value added for every unit of investment. Thus, it is value added upon cost. Enhancement of productivity is achieved by either reducing the inputs for the same output or increasing the output by using the same input. Productivity can be calculated for: * A single operation

* A functional unit
* A department or division

A plant Productivity is a measure of the efficiency of the system and looks at the economies achieved during the processes. Every process will have a number of contributors which help in achieving the maximum productivity. The processes are people, machines, facilitating goods, ancillary equipments, and technology. Each of these elements attempts to enhance the contribution of other elements. Opportunities exist at all stages of the workflow in the entire system to introduce measures for increasing the productivity. Quite often, productivity may suffer because of several problems associated with different elements of production. In such cases, quality circles are very efficient in executing low cost projects by using non-intrusive methods of improving productivity and quality throughout the organisation.

5 b) What do you mean by operations strategy? Explain in brief

Ans: Operations strategy is defined as the set of decisions that are warranted in the operational processes in order to support the competitive strategies of the business. The objectives stated above will give the firm a competitive advanatage in the products or services that are served to the customers. Operations strategy is a long-range business plan for the company’s products and will provide a road map for the operational functions to be pursued. Therefore, the strategic decisions include the capacity to be built into the production system, the type of processes and manufacturing technology to be adopted, the nature of products to be produced, and the type of material flow and other logistics required to achieve the level of performance. Planning of operations strategy is very essential as it will enable the organisation to respond to market needs in an effective manner. It also gives the opportunity to align the resources and manufacturing activities to produce and deliver the products and become successful in the market.

Q 6 ) What is logical process modelling? What is physical modelling?

Ans: Logical process modelling:
Logical process modelling is the representation of putting together all the activities of business process in detail and making a representation of them. The initial data collected has to be arranged in a logical manner so that, links are made between nodes for making the workflow smooth. The steps to be followed to make the work smoother are given as follows: 1. Capture relevant data in detail to be acted upon, 2. Establish controls and limit access to the data during process execution, 3. Determine which task in the process is to be done and also the subsequent tasks in that process, 4. Make sure that all relevant data is available for all the tasks, 5. Make the relevant and appropriate data available for that task, 6. Establish a mechanism to indicate acceptance of the results after every task or process. This is to have an assurance that flow is going ahead with accomplishments in the desired path.

Logical process model consists of only the business activities and shows the connectivity among them. The process model is a representation of the business activities and is different from the technology dependent ones. Thus, we have a model that is singularly structured only for business activities. Computer programmes are also present in the total system. This allows the business oriented executives to be in control of the inputs, processes and outputs. The logical process model improves control on the access to data. It also identifies, who is in possession of data at different nodes in the dataflow network that has been structured. A few of the logical modeling formats are as follows:

Process descriptions with task sequences and data addresses
Flow charts with various activities and relationships
Flow diagrams
Function hierarchies

Physical process modelling
Physical process modelling is concerned with the actual design of database meeting the requirements of the business. Physical modelling deals with the conversion of the logical model into a relational model. Objects get defined at the schema level. The objects here are tables created on the basis of entities and attributes. A database is defined for the business. All the information is put together to make the database software specific. This means that the objects during physical modelling vary on the database software being used.

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