-WHAT-IS-POM

7/30/2019 -WHAT-IS-POM

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Production Systems

AndOperations Management

Anubha Walia


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1. MANAGING OPERATIONS

Nature and scope of production/operation management

Relationship with other functional areas

Standardisation and simplification

Reliability and redundancy

Value engineering Ergonomic considerations

Product (and service) design for differentiation

2. PROCESS DESIGNING

Types of production systems and layouts

Capacity requirements planning

Facilities, location and influencing factors; evaluation of alternatives JIT, FMS, and Group Technology

3. PRODUCTIVITY AND WORK STUDY

Method study: Basic procedure, charts, diagram

Work measurement & Time study

Work sampling, learning curve, production standards

Aggregate production planning; heuristic methods 4. PROCESS CONTROL

Inventory management: Basic concepts; selective inventory control models; orderingsystems; material requirement planning; operations scheduling: Meaning; dynamicand static scheduling; design rules

Quality control; variables and attributes

Process control and acceptance sampling Maintenance: Facilities; total productive maintenance


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Production

Inputs (6Ms-Man, Machine, Method, Material,

Money, Management)

Process- Conversion

Output-Good / Services

Production is heart of OrgFin, Mktg, HR

Material Mgmt dependant


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(Input Conversion / Transformation Output)

Input Transforming

Resources

Facilities

Staff

Output

Good orServices

Volume

VarietyVariation

Visibility

Input

Transformed

Resources

Material

Information

Customer

The Transformation

Process

Physical PropertiesInformational Properties

Possession

LocationStorage/Accommodation

Physiological State

Psychological State

Environment :- *Customer * Competitors *Suppliers*Government regulations * Technology * Economy

Monitoring & Control


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Production Management Function

Planning- Course of Action. Pdt planning,

facility planning, Designing

Organizing- Est structure of tasks andassigning authority.

Controllingensure actual performance is in

accordance with planned performance. Weprepare standard


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Introduction

Operations management is the management of

an organizations productive resources or its

production system. A production system takes inputs and converts

them into outputs.

The conversion process is the predominantactivity of a production system.

The primary concern of an operations manager

is the activities of the conversion process.


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Organizational Model

Marketing

MISEngineering

HRM

QA

Accounting

Sales

Finance

OM


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Some inter-functional relationships between the

operations function and other core and

support functions

Engineering/technicalfunction

Accounting

and financefunction

Humanresourcesfunction

Informationtechnology(IT) function

Marketingfunction

Product/servicedevelopment

function

Financial analysisfor performanceand decisions

Provisionof relevantdata

Analysis of newtechnology options Understanding of

process technologyneeds

Understanding of thecapabilities and

constraints of theoperations process

New product andservice ideas

Understanding of thecapabilities and

constraints of theoperations process

Marketrequirements

Provision of systems fordesign, planning and

control, and improvement

Understanding

of infrastucturaland systemneeds

Recruitmentdevelopmentand training

Understanding of humanresource needs

Operationsfunction


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Objective of PM

Optimal use of resources

Max use of Manpower and resource

Quality of good at minimal cost

Contributing towards all round productivity

through Decision Making & QT


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Scope of POM

A) GENERAL PHASE

1Operations Management

(Input Conversion / Transformation Output)

2Strategic Role ( Strategy and performance

objectives)


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Scope of POM Cont

B) DESIGN PHASE

3 Design of Products and Services

4 Design of Operations Networka) Capacity Decision

b) Layout Decision

c) Location Decision

5 Process Technology

6 Job Design & Work Organization


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Scope of POM Cont

C) PLANNING & CONTROL

7 Capacity Planning and Control

8 Inventory Planning and Control

9 Supply Chain Planning and Control

10 MRP ( Material Requirement Planning )

11 Quality Planning and Control

12 Project Planning and Control

13 JIT ( Just In Time) Planning and Control


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Scope of POM Cont

D) IMPROVEMENT

14 Failure Prevention & Recovery

15 TQM ( Total Quality Management)


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Scope of POM Cont

E) OPERATION CHALLENGES

a) Globalization and Environmental Protection

b) Social Responsibility

c) Technology Awareness

d) Knowledge Management

e) Industrial Safety and Security


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Why Should you study POM

A business education is incomplete without anunderstanding of modern approaches to managingoperations.

Operations management provides a systematicway of looking at organizational processes.

Operations management presents interesting

career opportunities. The concepts and tools of OM are widely used in

managing other functions of a business.


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They are alloperat ions

Retail

operation

Back office

operation in

a bank

Take-out /

restaurant

operation

Kitchen unit

manufacturing

operation


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POM

Plan, design and operate production system / subsystems

that create and deliver the firms primary products and

services and to achieve organizational goals

Note that:

Operations management deals with process

Management in a broad, systems sense

Subsystems are operations too Multiple goals: efficiency, productivity, cost minimization


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Managers Need Knowledge Of

Production processes

Operations management processes

Decision making tools


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Operations Management As a

Function Skill Areas Quantitative

methods

Organizational

behavior

General

management

Information systems

Economics International

business

Business ethics

and lawFigure 1.3


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Japanese Production System

Quality comes first

Continuous improvement of products &

processes

Eliminate all forms of waste

7 waste


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Operations Management Today

Service economy

Environmental awareness


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Operations Management Uses

apply quality tools to tax work

project management used on merger

inventory theory for personal purchases

job design improves home chores

flexible spending accounts analyzed as

inventory models


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POM Models

Verbal Models- Express in words therelationship among variablea motorist asks

you to give directions for the nearest fast foodstation.

SchematicPictorial relationshipmap

IconicPhysical replica of process egarchmodel of new building

Mathematicalfunctional relationship amongvariables


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Productivity & Wastivity

Effectiveness of PM is measured by efficiency

through which the i/p are converted into o/p

Productivityoutput / inputStandard / Actual

Wastivity

1/Productivity

Amt of waste generated in the system. If we couldmeasure waste, then it becomes a tool for

measuring the efficiency of the i/p call wastivity


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Example of waste

Idling of resourcesmaterial waiting in the

form of inventory in store, job order waiting to

be processed Production of Defective good and services


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Productivity problem In a manf unit the standard time allowed for the

production of a unit is 5 hrs. If in a particular month126 units are produced by employing 4 persons andthe allowable delays are found to be 44 man hours,find the productivity and wastivity

Earned Standard Hrs630 hrs

Std time5hrs, prod126 unit = 5x126=630hrs

Available Man hr = 756 hrs

Manpower emp4 person, Monthly working hr4x25x8=800 hrs

Allowed delayActual Man hr 800-44 = 756

ProductivityESH/AWH = 630/756x100=83.3%

Wastivity100-83.316.6%


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ERGONOMICS British termsystematic study of how people

physically interact with the working environment, aswell as their equipment, facilities, and pdt.

Alternative name is human factor, becoz people differ

in size, age, there are significant design question thatmust be decided

Eg- AT&T Henry Dreyfuss designers created one ofthe first single unit mouth and ear telephone that was

used by both adult and kids Ergonomics starts with physical efficiency, issue of

safety and comfort


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2 topic

Types of production systems and layouts

Capacity requirements planning

Facilities, location and influencing factors;evaluation of alternatives

JIT, FMS, and Group Technology


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Plant Layout & Location

FactoryPlace in which the factors of

productionland, labour, capital and

enterprises are brought together for creation ofgood and service. The term plant layout is used

with factory layout


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Optimal Criteria for Selecting Plant location

Criteria is to achieve max ROI return on investmentover long run ROI depends on Profit Margin and Investment Turnover

ROI (Average) = IT x PM

IT =~ long run investment PM= ~ long run profit margin

IT = SR / TA SR = Sales Revenue TATotal Assests PM = P / SR P = ~long run profit SRSales Rev

ROI = (SR / TA) x (P / SR) = P / TA

P = SRTC were TC is Total Cost

SR depends upon the market and not location hence ROI isdirectly proportional to TC/TA

THUS, to MAX ROR, the location must be chosen so as to minimise the TA(land, building, equipment, material, cash) and TC (cost of material, transpcost, labour cost, conversion cost)


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Types of Production System (PS)

2 types = Continuous and Intermittent PS CPSContinuous physical flow of material.

Standard pdts are manuf which are large in dd.

Standardized I/p and sequence of operations,

machine tools and equipment are used. Less

supervision, Possibility of Rigid Quality

Control

CPS are of two types- Mass production and

Process production


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Mass and Process

MassOne type of product or max 2 or 3 type

of pdt are manf in large quantities and muchemphasis is not given to consumer order.

ProcessThis system is used for manf those

items whose demand is continuous or high.Here single Raw material can be transformed

into different kinds of pdt a different stage of

the production. (oil refinery to kerosene,gasoline


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Intermittent PS

Good are manf specifically to fulfill order by

customers rather than producing against stock.Eg switch gear

Two typesJob and Batch production

Jobproduction of a single complete unit byone operator or a group operators eg bridge

constructionwhole project considered as one

operation. Require skilled labour BatchItems are processed in lots. Printing

press


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Plant capacity

Capacity may be defined as the max or limitingcapability of a production unit to produce ina

specified period.

This is expressed in terms of o/p per unit oftime.

Measure of capacitydifferent org used

different measure of capacity. Steel plant-tons,beercans produced, auto plantauto parts


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Capacity Planning

Designed capacityi.e maximum capacity thata producing unit can produce under idealcondition.

Whenever the existing dd changes or addition

of new product has been made, then re-assessment of capacity at various stage ofproduction, depending upon the process details(i.e identifying ways of meeting desiredcapacity throughbetter utilization, higherefficiency, overtime, adding machinery orshifts


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LAYOUT TYPES LINE LAYOUT all equipment reqd for one part or

pdt are grouped together in one department insequence of the operation performedhigher rate of

o/p as no interruption, high division of work, less

inspection, lower material handling cost, better

machine utilizationS, U, L shape

Process / FUNCTIONAL LAYOUT The product is

fabricated by moving it from one dept to another dept

acc to sequence of operation to be performed ( highdegree of pdt can be manf, flexibility to change, mach

breakdown do


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FMS- Flexible Manf System

The age of mass prod is gone and era of

flexible prod is being started as competitive

world is there pdt introduced, phase out results

to lower order quantities. Rapid intro of new pdt

Quick modification in pdt

Consistently Q Control

Ability to produce variety of pdt Increase productivity

Saves labour cost

Shorter preparation time for new pdt.

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