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Changing Challenges for the Operations/Engineering ManagersGeneral discussion
Week 1
Engineering Management 2
Dr. Farhad AnvariRoom A181 (Hamilton Campus)
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Changing Challenges
TraditionalApproach
Reasons forChange
CurrentChallenge
Ethics andregulationsnot at theforefront
Public concern overpollution, corruption,child labor, etc.
High ethical andsocialresponsibility;increased legaland professionalstandards
Local ornationalfocus
ro!th of reliable, lo!cost co""unicationand transportation
lobal focus,internationalcollaboration
Lengthyproductdevelop"ent
#horter life cycles;gro!th of globalco""unication; CA$,%nternet
Rapid productdevelop"ent;designcollaboration
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Changing Challenges
TraditionalApproach
Reasons forChange
CurrentChallenge
E"phasis onspeciali&ed,often "anualtas's
Recognition of thee"ployee(s totalcontribution; 'no!ledgesociety
E"po!erede"ployees;enriched )obs
*%n+houseproduction;lo!+bidpurchasing
Rapid technologicalchange; increasingco"petitive forces
#upply+chainpartnering; )ointventures, alliances
Large lot
production
#horter product life
cycles; increasing needto reduce inventory
-ust+%n+Ti"e
perfor"ance;lean; continuousi"prove"ent, #i#ig"a
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Changing Challenges for theEngineering/Operations Management
• Glo al fo!"s• #"st$in$time
• %"ppl&$!hainpartnering• 'apid prod"!t
development(allian!es
• Mass!"stomi)ation
• Empo*eredemplo&ees(teams
To/ro"• Local or national focus• 0atch ship"ents
• Lo! bid purchasing
• Lengthy productdevelop"ent
• #tandard products
• -ob speciali&ation
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+e& ,oints for Dis!"ssion
• C R !ssues• uppl" Chain• #"pes of $usiness%Consumer Relationships
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Corporate so!ial responsi ilit&-C%' and %"staina ilit&
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%"staina le development
CSR is closely linked with the principles of“sustainable development”
ustaina&le development is developmentthat meets the needs of the present withoutcompromisin' the a&ilit" of future'enerations to meet their own needs.[Brundtland report (WC !" #$%&'
Readhttp www.defra.'ov.uk sustaina&le 'overnment
http://www.defra.gov.uk/sustainable/government/http://www.defra.gov.uk/sustainable/government/http://www.defra.gov.uk/sustainable/government/http://www.defra.gov.uk/sustainable/government/
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Dimensions of %"staina le Development
ocial e*uit"
+conomicprosperit"
+nvironmental *ualit"
%"staina ledevelopment
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Corporate %o!ial 'esponsi ilit&-C%'
Generally, CSR is understood to be the way firmsintegrate social , environ"ental and econo"icconcerns into their values, culture, decision making,strategy and operations in a transparent andaccountable manner, and thereby establish betterpractices within the firm, create wealth and improvesociety.
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• Conserving Natural Resources and the nvironment• !or future generations, reduce resource
consumption, stop pollution and conserve natural
habitats
Environ"ent
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Life Cycle Analysis
#ransportRetail
,se
-ispose
Grave
Cradle
+ tract
/rocess
Rec"cleReincarnate
0anufacture
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#ocial $evelop"ent
• "he relationship between business andsociety in general
• "hroughout the world, people need #obs,food, education, energy, health care, waterand sanitation. $eople also need respect forcultural and social diversity and the rights ofworkers. %ll members of society need a rolein determining their futures.
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Econo"ic ro!th
• Socio&economic or financial aspects,including describing CSR in terms of itsimpact on the business operations.
• !oster responsible long&term growth whileensuring that no nation or community is leftbehind.
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%"ppl& Chain Challenges
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A s"ppl& !hain for read
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%"ppl& Chain Cereal man"fa!t"ringE0ample
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%"ppl& Chain De nition
• uppl" chain is a network of interconnectedor'ani ations or or'ani ational entities developedwith the 'oal of 'ettin' the right prod"!t tothe right pla!e at the right time .
(Chopra" )**+'
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#upply Chain 1anage"ent2 $efinition
Supply chain management is a set of approachesutili'ed to efficiently integrate suppliers, manufacturers,warehouses, and stores, so that merchandise isproduced and distributed at the right (uantities, to the
right locations, and at the right time, in order to minimi'esystem wide costs while satisfying service levelre(uirements.
(Simchi-Levi)
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ntegration• !nte'ration is the central theme in C0 2 Ma3or
!hallenge 4444• $uildin' s"ner'" &" inte'ratin' &usiness functions3
departments and companies
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nternal 5al"e Chain 6o!al Fo!"s
R ) *
+perations
ecutive-anagement
ogistics
-arketing
/umanResource
-anagement %ccounting
!inance
Supply-anagement
0nformation"echnology
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R ) *
+perations
ecutive-anagement
ogistics
-arketing
/umanResource
-anagement %ccounting
!inance
Supply-anagement
0nformation"echnology
,pstreamuppliers
-ownstreamCustomers
nternal 5al"e Chain Compan&Fo!"s
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R ) *
+perations
ecutive-anagement
ogistics
-arketing
/umanResource
-anagement %ccounting
!inance
Supply-anagement
0nformation"echnology
R ) *
+perations
ecutive-anagement
ogistics
-arketing
/umanResource
-anagement %ccounting
!inance
Supply-anagement
0nformation"echnology
R ) *
+perations
ecutive-anagement
ogistics
-arketing
/umanResource
-anagement %ccounting
!inance
Supply-anagement
0nformation"echnology
R ) *
+perations
ecutive-anagement
ogistics
-arketing
/umanResource
-anagement %ccounting
!inance
Supply-anagement
0nformation"echnology
R ) *
+perations
ecutive-anagement
ogistics
-arketing
/umanResource
-anagement %ccounting
!inance
Supply-anagement
0nformation"echnology
Fo!alFirm
%"pplier%"pplier7s%"pplier
C"stomer C"stomer7sC"stomer
%CM 6inked 5al"e Chains
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%"ppl& Chain ntegration
• nternal ,ro!ess ntegration increase colla&orationamon' the compan"4s functional 'roups.
• 8a!k*ard ,ro!ess ntegration colla&oration with 1st%tier and 5nd%tier (leadin' companies) suppliers.
• For*ard ,ro!ess ntegration colla&oration with 1st%tier customers.
• Complete ntegration colla&oration from the6suppliers4 supplier to the customers4 customer.7
C h a l l e n g e
9 9 9
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5911 /earson +ducation3 !nc. pu&lishin' as/rentice Hall
ome $oein' uppliers (:8:)/ir" Country Co"ponentLatecoere /rance Passenger doorsLabinel /rance 3iring$assault /rance $esign and
PL1 soft!are1essier+0ugatti /rance Electric bra'esThales /rance Electrical po!er
conversion syste"and integratedstandby flight display
1essier+$o!ty /rance Landing gear structure$iehl er"any %nterior lighting
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5911 /earson +ducation3 !nc. pu&lishin' as/rentice Hall
ome $oein' uppliers (:8:)/ir" Country Co"ponentCobha" 45 /uel pu"ps and valvesRolls+Royce 45 Engines#"iths Aerospace 45 Central co"puter
syste"0AE #6#TE1# 45 ElectronicsAlenia Aeronautics %taly 4pper center
fuselage 7hori&ontal stabili&er
Toray %ndustries -apan Carbon fiber for!ing and tail units
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5911 /earson +ducation3 !nc. pu&lishin' as/rentice Hall
ome $oein' uppliers (:8:)/ir" Country Co"ponent/u)i Heavy -apan Center !ing bo %ndustries5a!asa'i Heavy -apan /or!ard fuselage,
%ndustries fi ed section of !ing, landing gear !ell
Tei)in #ei'i -apan Hydraulic actuators1itsubishi Heavy -apan 3ing bo
%ndustriesChengdu Aircraft China Rudder roupHafei Aviation China Parts
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5911 /earson +ducation3 !nc. pu&lishin' as/rentice Hall
ome $oein' uppliers (:8:)/ir" Country Co"ponent5orean Aviation #outh 3ingtips
5orea#aab #!eden Cargo access doors
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8"siness to "siness -828
0ost common3 all &ut thelast link in the suppl" chain
,amples-0anufacturer and
;holesaler;holesaler and Retailer
8"siness to !ons"mer
-82CRetail operationsCatalo'ue operations3
etc.
,amples-!nternet retailersAma on.com3 etc.
Cons"mer to 8"siness-C28
Consumer
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'olls 'o&!e
• RR 'roup is a glo al "siness withcustomers in 1? countries
• Address four 'lo&al market (civil3 defenceaerospace3 marine and ener'")
• /roduction facilities in 1 countries.• +mplo"s around 93999• #urnover B11 &illion (5911)•
!t has 3999 aero en'ines in service with?99 airlines
( ource www.rolls%ro"ce.com)
' ll ' &! $ % !h ll i
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'olls 'o&!e$ %ome !hallenges inOM/EM.
•/h"sical lo'isticsComple uppl" Chain
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• Customers demand for hi'her levels of *ualit"and service for less mone" due to their owncompetitive environments
• Rolls%Ro"ce4s customers look for a much morecomplete service ( total !"stomer !are $ Crelationships)
#ervices$ 'esponsi le for the maintenan!e( repair and overha"l
of !"stomer e;"ipment. O*ns overha"l < ases= either*holl& or in partnership *ith Airlines
$ Man"fa!t"re original e;"ipment and s"ppl& spareparts to e0isting !"stomers and overha"l ases
$ n$>ight engine monitoring -2?/@
'olls 'o&!e$ %ome !hallenges in OM/EM..
$usiness pressure- Cost3 deliver"3 lead%time3 *ualit"3
De i&ilit"3 sustaina&ilit" etc
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o"r :ask9
• !dentif" or'anisation ("ou have worked inor currentl" workin' in)
• #"pe of $usiness ($5$ or $5C EE3 0+- or
lar'eEE)• #urnoverE• Current challen'es issues in
Fps0't +n'0'tE
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%mall B Medi"m %i)e Enterprises -%MEs
Categor& ead!o"nt-Emplo&ees
:"rnover
0edium 5 9 B 1 0illion
mall 9 B 8.5 0illion
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