1INTRODUCTION TO PRODUCTION AND OPERATION MANAGEMENT CHAPTER OUTLINE 1.1 Introduction 1.2 Historical Evolution of Production and Operations Management 1.7 Operations Management 1.8 Managing Global Operations 1.9 Scope of Production and Operations Management • Exercises • Skill Development 1.3 Concept of Production 1.4 Production System 1.5 Production Management 1.6 Operating System 1.1 • Caselet INTRODUCTION Production/operations management is the process, which combines and transforms various resources used in the production/operations subsystem of the organization into value added product/services in a controlled manner as per the policies of the organization. Therefore, it is that part of an organization, which is concerned with the transformation of a range of inputs into the required (products/services) having the requisite quality level. The set of interrelated management activities, which are involved in manufacturing certain products, is called as production management. If the same concept is extended to services management, then the corresponding set of management activities is called as operations management. 1.2 HISTORICAL EVOLUTION OF PRODUCTION AND OPERATIONS MANAGEMENT For over two centuries operations and production management has been recognised as an important factor in a country’s economic growth. 1 The traditional view of manufacturing management began in eighteenth century when Adam Smith recognised the economic benefits of specialisation of labour. He recommended breaking of jobs down into subtasks and recognises workers to specialised tasks in which they would become highly skilled and efficient. In the early twentieth century, F.W. Taylor implemented Smith’s theories and developed scientific management. From then till 1930, many techniques were developed prevailing the traditional view. Brief information about the contributions to manufacturing management is shown in the Table 1.1. TABLE 1.1 Historical summary of operations management Date 1776 1799 1832 Contribution 1940 1946 Specialization of labour in manufacturing Interchangeable parts, cost accounting Division of labour by skill; assignment of jobs by skill; basics of time study Scientific management time study and work study developed; dividing planning and doing of work Motion of study of jobs Scheduling techniques for employees, machines jobs in manufacturing Economic lot sizes for inventory control Human relations; the Hawthorne studies Statistical inference applied to product quality: quality control charts Statistical sampling applied to quality control: inspection sampling plans Operations research applications in World War II Digital computer 1947 Linear programming 1950 Mathematical programming, on-linear and stochastic processes Commercial digital computer: large-scale computations available. Organizational behaviour: continued study of people at work Integrating operations into overall strategy and policy, Computer applications to manufacturing, Scheduling and control, Material requirement planning (MRP) Quality and productivity applications from Japan: robotics, CAD-CAM 1900 1900 1901 1915 1927 1931 1935 1951 1960 1970 1980 Contributor Adam Smith Eli Whitney and others Charles Babbage Frederick W. Taylor Frank B. Gilbreth Henry L. Gantt F.W. Harris Elton Mayo W.A. Shewart H.F. Dodge & H.G. Roming P.M. Blacker and others. John Mauchlly and J.P. Eckert G.B. Dantzig, Williams & others A. Charnes, W.W. Cooper & others Sperry Univac L. Cummings, L. Porter W. Skinner J. Orlicky and G. Wright W.E. Deming and J. Juran. Production management becomes the acceptable term from 1930s to 1950s. As F.W. Taylor’s works become more widely known, managers developed techniques that focussed on economic efficiency in manufacturing. Workers were studied in great detail to eliminate wasteful efforts and achieve greater efficiency. At the same time, psychologists, socialists and 3 CONCEPT OF PRODUCTION Production function is that part of an organization. boilers with a specific capacity. Production is defined as “the step-by-step conversion of one form of material into another form through chemical or mechanical process to create or enhance the utility of the product to the user. With the 1970s emerges two distinct changes in our views. Some examples of production are: manufacturing custom-made products like. which is concerned with the transformation of a range of inputs into the required outputs (products) having the requisite quality level. Edwood Buffa defines production as ‘a process by which goods and services are created’. television. Fig.” Thus production is a value addition process.1 Schematic production system 1. It is that activity whereby resources. some structural fabrication works for selected customers. At each stage of processing. there will be value addition. reflected in the new name operations management was a shift in the service and manufacturing sectors of the economy. etc.other social scientists began to study people and human behaviour in the working environment. rather than just analysis. and computer socialists contributed newer. bus. The most obvious of these. more sophisticated analytical approaches. A simplified production system is shown above. 1. flowing within a defined system. The second. economists. 1. which produces products of an organization. radio. motor cycle. constructing flats. etc.4 PRODUCTION SYSTEM The production system of an organization is that part. . are combined and in a controlled manner to add value in accordance with the policies communicated by management. mathematicians. and manufacturing standardized products like. In addition. the change from ‘production’ to ‘operations’ emphasized the broadening of our field to service organizations.. As service sector became more prominent. car. in management practices. more suitable change was the beginning of an emphasis on synthesis. .transformed in a controlled manner to add value in accordance with the policies communicated by management. A simplified production system is shown above. The production system has the following characteristics: 1. Batch. Highly skilled operators who can take up each job as a challenge because of uniqueness. 4. Production is an organized activity. 3. 2. . 1. demands processing on machines in a certain sequence. Use of general purpose machines and facilities. High variety of products and low volume. tools. so every production system has an objective. It does not operate in isolation from the other organization system. Mass and Continuous Production systems. 2.2 Classification of production systems JOB SHOP PRODUCTION Job shop production are characterised by manufacturing of one or few quantity of products designed and produced as per the specification of customers within prefixed time and cost. 4.4. Fig. Large inventory of materials. Each job demands unique technological requirements. 3. Detailed planning is essential for sequencing the requirements of each product.1 Classification of Production System Production systems can be classified as Job Shop. There exists a feedback about the activities. Characteristics The Job-shop production system is followed when there is: 1. capacities for each work centre and order priorities. 1. The distinguishing feature of this is low volume and high variety of products. 5. A job shop comprises of general purpose machines arranged into different departments. which is essential to control and improve system performance. The system transforms the various inputs to useful outputs. parts. 2. Production planning is complicated. Because of general purpose machines and facilities variety of products can be produced. Higher cost due to frequent set up changes. as each job gives them learning opportunities.” It is characterised by the manufacture of limited number of products produced at regular intervals and stocked awaiting sales. Advantages Following are the advantages of batch production: 1. Full potential of operators can be utilised. 2. 4. When there is shorter production runs. Limitations Following are the limitations of job shop production: 1.Advantages Following are the advantages of job shop production: 1. 3. 4. When plant and machinery set up is used for the production of item in a batch and change of set up is required for processing the next batch. 2. 2. BATCH PRODUCTION Batch production is defined by American Production and Inventory Control Society (APICS) “as a form of manufacturing in which the job passes through the functional departments in lots or batches and each lot may have a different routing. Lower investment in plant and machinery. Operators will become more skilled and competent. Characteristics Batch production system is used under the following circumstances: 1. Production planning and control is complex. Better utilisation of plant and machinery. Higher level of inventory at all levels and hence higher inventory cost. When manufacturing lead time and cost are lower as compared to job order production. 3. 4. Cost per unit is lower as compared to job order production. Flexibility to accommodate and process number of products. Limitations Following are the limitations of batch production: 1. 3. 5. . Material handling is complex because of irregular and longer flows. Opportunity exists for creative methods and innovative ideas. When plant and machinery are flexible. 4. 2. Job satisfaction exists for operators. 6. Larger space requirements. Promotes functional specialisation. 3. 8. 7. Low process inventory. Material handling can be completely automatic. 3. 4. 3. etc. The items are made to flow through the sequence of operations through material handling devices such as conveyors. Higher capacity utilisation due to line balancing. . 4. Shorter cycle time of production. 3. Characteristics Continuous production is used under the following circumstances: 1. Less skilled operators are required. Higher rate of production with reduced cycle time. Lower in process inventory. 6. 2. 2. Dedicated plant and equipment with zero flexibility. 2. High investment in production facilities. 5. Product and process standardisation exists and all outputs follow the same path. components and parts is continuous and without any back tracking. Standardisation of product and process sequence. Limitations Following are the limitations of mass production: 1. transfer devices. The machines are arranged in a line or product layout. The cycle time is determined by the slowest operation. Large volume of products. This production system is justified by very large volume of production. Flow of materials. MASS PRODUCTION Manufacture of discrete parts or assemblies using a continuous process are called mass production. Production planning and control is easy. Perfectly balanced production lines.3. Breakdown of one machine will stop an entire production line. Dedicated special purpose machines having higher production capacities and output rates. Characteristics Mass production is used under the following circumstances: 1. 4. 5. Line layout needs major change with the changes in the product design. CONTINUOUS PRODUCTION Production facilities are arranged as per the sequence of production operations from the first operations to the finished product. Higher set up costs due to frequent changes in set up. Work in process inventory is higher compared to continuous production. 4. Advantages Following are the advantages of mass production: 1. 9. Manufacturing cost per unit is low. Planning and scheduling is a routine action. Limitations Following are the limitations of continuous production: 1. Higher capacity utilisation due to line balancing. Person with limited skills can be used on the production line. Advantages Following are the advantages of continuous production: 1. Very high investment for setting flow lines.2. leads to shortage of products. 3. QUANTITY RIGHT The manufacturing organization should produce the products in right number. RIGHT QUALITY The quality of product is established based upon the customers needs. Material handling is fully automated. Manpower is not required for material handling as it is completely automatic. organizing.5 PRODUCTION MANAGEMENT Production management is a process of planning. If they are produced in excess of demand the capital will block up in the form of inventory and if the quantity is produced in short of demand. 4. 5.1Objectives of Production Management The objective of the production management is ‘to produce goods services of right quality and quantity at the right time and right manufacturing cost’. 6. It is determined by the cost of the product and the technical characteristics as suited to the specific requirements. 3. It combines and transforms various resources used in the production subsystem of the organization into value added product in a controlled manner as per the policies of the organization. . Unit cost is lower due to high volume of production. Standardisation of product and process sequence.5. Component materials cannot be readily identified with final product. Buffa defines production management as. directing and controlling the activities of the production function. 1. 2. Higher rate of production with reduced cycle time. 5. “Production management deals with decision making related to production processes so that the resulting goods or services are produced according to specifications. Product differentiation is limited. 2. The right quality is not necessarily best quality. 2.” 1. E. Flexibility to accommodate and process number of products does not exist. Process follows a predetermined sequence of operations. in the amount and by the schedule demanded and out of minimum cost. 3. 4. 1.S. little customer contact. Adam & Ronald J. and sophisticated methods for measuring production activities and resource consumption as product are made. Bus and taxi services. whereas. an effort.2Distinction between Manufacturing Operations and Service Operations Following characteristics can be considered for distinguishing manufacturing operations with service operations: 1. Degree of customer contact 5. the production department has to make the optimal utilization of input resources to achieve its objective.” 1. Tangible/Intangible nature of output 2. 1. no customer participation in the conversion process (in production). a conversion process that includes service yields an intangible output: a deed. all attempts should be made to produce the products at pre-established cost. RIGHT MANUFACTURING COST Manufacturing costs are established before the product is actually manufactured. Nature of work (job) 4. 1. outputs that customers consume overtime. It converts physical resources into outputs. “An operating system is a configuration of resources combined for the provision of goods or services. Hence.1 Concept of Operations An operation is defined in terms of the mission it serves for the organization.6 OPERATING SYSTEM Operating system converts inputs in order to provide outputs which are required by a customer. tailors.e. So. a performance. Everett E. Manufacturing operations is a conversion process that includes manufacturing yields a tangible output: a product. Customer participation in conversion 6. hospital and builders are the examples of an operating system. the function of which is to satisfy customer wants i.6. technology it employs and the human and managerial processes it involves. RIGHT TIME Timeliness of delivery is one of the important parameter to judge the effectiveness of production department. jobs that use less labour and more equipment. Ebert define operating system as. Measurement of performance. “An operating system ( function) of an organization is the part of an organization that produces the organization’s physical goods and services.3. so as to reduce the variation between actual and the standard (pre-established) cost. . 4. Operations in an organization can be categorised into manufacturing operations and service operations.” Ray Wild defines operating system as.. Consumption of output 3. In some of the organization the product is a physical good (hotels) while in others it is a service (hospitals). to provide some utility for the customer. Manufacturing is characterised by tangible outputs (products).6. 1. BEHAVIOUR Operation managers are concerned with how their efforts to plan.1 A Framework for Managing Operations Managing operations can be enclosed in a frame of general management function as shown in Fig. They determine the activities required to achieve the goals and assign authority and responsibility for carrying them out. and the policies. organizing. hair styling. The operations manager defines the objectives for the operations subsystem of the organization. Operation managers are concerned with planning. and schedules are the important functions here. It also involves product planning. PLANNING Activities that establishes a course of action and guide future decision-making is planning. linear programming and computer simulation for capacity utilisation. outputs that customers consumes immediately. organise. telephone services and some are people based namely tax consultant services. and control the conversion process. frequent customer participation in the conversion process. and control affect human behaviour. Operation managers establish a structure of roles and the flow of information within the operations subsystem. Controlling costs. CONTROLLING Activities that assure the actual performance in accordance with planned performance. quality. and procedures for achieving the objectives. This stage includes clarifying the role and focus of operations in the organization’s overall strategy. they encounter many problems and must make many decisions. organizing. . 1. and controlling the activities which affect human behaviour through models. facility designing and using the conversion process. decision tree analysis for long-term capacity problem of facility expansion. Some services are equipment based namely rail-road services. organize.Service is characterised by intangible outputs. ORGANIZING Activities that establishes a structure of tasks and authority. To ensure that the plans for the operations subsystems are accomplished. and elementary methods for measuring conversion activities and resource consumption. Their interest lies in decision-making behaviour. the operations manager must exercise control by measuring actual outputs and comparing them to planned operations management. simple median model for determining best locations of facilities etc. MODELS As operation managers plan. jobs that use more labour and less equipment. direct consumer contact.7 OPERATIONS MANAGEMENT 1.7. They can simplify their difficulties using models like aggregate planning models for examining how best to use existing capacity in short-term. and controlling actions. break even analysis to identify break even volumes.3. They also want to know how the behaviour of subordinates can affect management’s planning. 1.Fig.3 General model for managing operations . primary objective can be satisfied by providing the ‘right thing at a right price at the right time’.e.2 Objectives of Operations Management Objectives of operations management can be categorised into customer service and resource utilisation. i.... 2.e. requested or acceptable specification Cost. i..2. purchase price or cost of obtaining goods. They are the principal sources of customer satisfaction and must. Goods of a given.e. cost of movements. requested or Transport acceptable specification Supply Management of a given. delivery delay from order or request to receipt of goods. 1. requested or acceptable specification Cost. These aspects of customer service—specification. i. i. TABLE 1. The operating system must provide something to a specification which can satisfy the customer in terms of cost and timing. i. i. Timing. delivery delay from order or request to receipt of goods. purchase price or cost of obtaining goods. Therefore.. Timing. CUSTOMER SERVICE The first objective of operating systems is the customer serivce to the satisfaction of customer wants. Service Cost. Timing. Duration or time to move. Wait or delay from requesting treatment to its commencement. this objective will influence the operations manager’s decisions to achieve the required customer service.. Generally an organization will aim reliably and consistently to achieve certain standards and operations manager will be influential in attempting to achieve these standards. Treatment of a given.e.e. be the principal dimension of the customer service objective for operations managers.. i.1.7. Thus. Timing. Duration or time required for treatment. Wait or delay from requesting to its commencement.. cost of movements. cost and timing—are described for four functions in Table 1. customer service must be provided with the achievement of . 1. i.e. i.e.e.e. Hence. 2.2 Aspects of customer service Principal function Principal customer wants Primary considerations Other considerations Manufacture Goods of a given. requested or acceptable specification Cost. therefore.. RESOURCE UTILISATION Another major objective of operating systems is to utilise resources for the satisfaction of customer wants effectively. customer service is a key objective of operations management. competitions. political and socio-cultural relations.3 The twin objectives of operations management The customer service objective. MANAGING GLOBAL OPERATIONS The term ‘globalization’ describes businesses’ deployment of facilities and operations around the world. to achieve agreed levels of utilisation of materials. and hence a satisfactory performance must be achieved on both objectives. Each measure indicates the extent to which the potential or capacity of such resources is utilised. the strengths and weaknesses of the organization. rather it could be think globally and act . under utilisation or waste. An improvement in one will often give rise to deterioration in the other. 1. Hence. Globalization can be defined as a process in which geographic distance becomes a factor of diminishing importance in the establishment and maintenance of cross border economic.. Improved transportation and communication technologies. Opened financial systems. To provide agreed/adequate levels of customer service (and hence customer satisfaction) by providing goods or services with the right specification. Reduced import quotas and other trade barriers. This is referred as the objective of resource utilisation.g. Operations management is concerned essentially with the utilisation of resources.. and many of the problems will be faced by operations managers because of this conflict. space utilisation. machines and labour. Global markets impose new standards on quality and time. 2. Inefficient use of resources or inadequate customer service leads to commercial failure of an operating system. 3. at the right cost and at the right time. There are four developments.8 The resource utilisation objective. Table 1. operations managers must attempt to balance these basic objectives. The extent of the utilisation of the resources’ potential might be expressed in terms of the proportion of available time used or occupied. TABLE 1. It can also be defined as worldwide drive toward a globalized economic system dominated by supranational corporate trade and banking institutions that are not accountable to democratic processes or national governments. Increased demand for imports. Operations management is also concerned with the achievement of both satisfactory customer service and resource utilisation. To achieve adequate levels of resource utilisation (or productivity) e.effective operations through efficient use of resources. i. Managers should not think about domestic markets first and then global markets later. and 4. which have spurred the trend toward globalization. All the activities of operations management must be tackled with these two objectives in mind. levels of activity. Often both cannot be maximised. The type of balance established both between and within these basic objectives will be influenced by market considerations. etc.e. When a firm sets up facilities abroad it involve some added complexities in its operation. These are: 1.3 summarises the twin objectives of operations management. obtaining maximum effect from resources or minimising their loss. etc. Hence. the operations managers should make a contribution when these objectives are set. marketing. logistics. economical and technological environments. religion. Location of facilities 2. residence or studies in a respectful way of perspectives of people from different races.. Quality control 7. and different costs. To envision trends in global operations. To associate success and failure cases of global operations to political. different management style. location of plant should be based on the company’s expansion . To develop an understanding of the world vision regardless of their country of origin. It is an important strategic level decision-making for an organization. by its primary concern for ‘conversion by using physical resources. supply chain. etc. LOCATION OF FACILITIES Location of facilities for operations is a long-term capacity decision which involves a long term commitment about the geographically static factors that affect a business organization. Hence. preferences. they must have a good understanding of their competitors. Production and planning control 6.’ Following are the activities which are listed under production and operations management functions: 1. It deals with the questions such as ‘where our main operations should be based?’ The selection of location is a key-decision as large investment is made in building plant and machinery. It distinguishes itself from other functions such as personnel. Managing global operations would focus on the following key issues: To acquire and properly utilize the following concepts and those related to global operations. Materials management 8. To develop criteria for conceptualization and evaluation of different global operations. Plant layouts and material handling 3.locally.9 SCOPE OF PRODUCTION AND OPERATIONS MANAGEMENT Production and operations management concern with the conversion of inputs into outputs. Also. politic affiliation. unfamiliar laws and regulations. Some other important challenges of managing multinational operations include other languages and customs. etc. etc. finance. social. place of origin. studies. Maintenance management. 1. To associate global historical events to key drivers in global operations from different perspectives. so as to provide the desired utilities to the customer while meeting the other organizational objectives of effectiveness. efficiency and adoptability. An improper location of plant may lead to waste of all the investments made in plant and machinery equipments. Process design 5. using physical resources. Product design 4. choice of technology. work centres and equipment in the conversion process. the important decisions in process design are to analyse the workflow for converting raw material into finished product and to select the workstation for each included in the workflow. Hence. product development. This cost can be reduced by proper section. material handling equipments and all other supporting services along with the design of best structure to contain all these facilities”. Product development translates the needs of customers given by marketing into technical specifications and designing the various features into the product to these specifications. Material handling devices increases the output. The entire process of need identification to physical manufactures of product involves three functions: marketing. The purpose of the location study is to find the optimal location that will results in the greatest advantage to the organization. The overall objective of the plant layout is to design a physical arrangement that meets the required output quality and quantity most economically. to give production orders to shops and to follow up the progress of products according to orders. improves quality. Hence. It is also defined as the ‘art and science of moving. with 50 to 75% of the cost of production. operating equipment. PRODUCT DESIGN Product design deals with conversion of ideas into reality. develop and introduce new products as a survival and growth strategy. changing sources of raw materials and many other factors. . manufacturing. speeds up the deliveries and decreases the cost of production. Developing the new products and launching them in the market is the biggest challenge faced by the organizations. According to James Moore. “Plant layout is a plan of an optimum arrangement of facilities including personnel. material handling is a prime consideration in the designing new plant and several existing plants. Manufacturing has the responsibility of selecting the processes by which the product can be manufactured. PROCESS DESIGN Process design is a macroscopic decision-making of an overall process route for converting the raw material into finished goods. ‘Material Handling’ refers to the ‘moving of materials from the store room to the machine and from one machine to the next during the process of manufacture’. PRODUCTION PLANNING AND CONTROL Production planning and control can be defined as the process of planning the production in advance. Product design and development provides link between marketing. fixing the starting and finishing dates for each item. These decisions encompass the selection of a process. diversification plan for the products. Every business organization have to design. It is the configuration of departments. storage space. setting the exact route of each item. operation and maintenance of material handling devices. packing and storing of products in any form’. It is a specialised activity for a modern manufacturing concern. process flow analysis and layout of the facilities.plan and policy. PLANT LAYOUT AND MATERIAL HANDLING Plant layout refers to the physical arrangement of facilities. customer needs and expectations and the activities required to manufacture the product. to where we want to go. when to do it and who is to do it. Planning is deciding in advance what to do. Therefore.The principle of production planning and control lies in the statement ‘First Plan Your Work and then Work on Your Plan’. It gives necessary authority so as to start a particular work.4 Scope of production and operations management Dispatching is concerned with the starting the processes. Scheduling determines the programme for the operations. how to do it. dispatching and follow-up. It makes it possible for things to occur which would not otherwise happen. Fig. Main functions of production planning and control includes planning. 1. Routing determines the most advantageous path to be followed from department to department and machine to machine till raw material gets its final shape. dispatching is ‘release of orders and instruction for the starting of production for any item in acceptance with the route sheet and schedule charts’. Planning bridges the gap from where we are. which has already been planned under ‘Routing’ and ‘Scheduling’. The function of follow-up is to report daily the progress of work in each shop in a prescribed proforma and to investigate the causes of deviations from the planned performance. scheduling. Routing may be defined as the selection of path which each part of the product will follow. . Scheduling may be defined as ‘the fixation of time and date for each operation’ as well as it determines the sequence of operations to be followed. routing. which being transformed from raw material to finished products. greater usefulness. 3. It is a systematic control of various factors that affect the quality of the product.. their idleness or downtime becomes are very expensive. To ensure the availability of the machines. Quality control can also be defined as ‘that industrial management technique by means of which product of uniform acceptable quality is manufactured’. maintainability. control and use of materials needed and flow of goods and services connected with the production process having some predetermined objectives in view. To cut down costs through simplification. To purchase. The main objectives of quality control are: To improve the companies income by making the production more acceptable to the customers i.e. To achieve minimum breakdown and to keep the plant in good working condition at the lowest possible cost. To reduce companies cost through reduction of losses due to defects. To produce optimal quality at reduced price. MATERIALS MANAGEMENT Materials management is that aspect of management function which is primarily concerned with the acquisition. To make inspection prompt to ensure quality control. receive. To trace new sources of supply and to develop cordial relations with them in order to ensure continuous supply at reasonable rates. It is the entire collection of activities which ensures that the operation will produce the optimum quality products at minimum cost. Therefore. it is very important that the plant machinery should be properly maintained. to build customer goodwill. The main objectives of materials management are: To minimise material cost. . standardisation. To check the variation during manufacturing. To reduce investment tied in the inventories for use in other productive purposes and to develop high inventory turnover ratios. etc.QUALITY CONTROL Quality Control (QC) may be defined as ‘a system that is used to maintain a desired level of quality in a product or service’. value analysis. by providing long life. etc. import substitution. buildings and services required by other sections of the factory for the performance of their functions at optimal return on investment. To ensure satisfaction of customers with productions or services or high quality level. 2. relies on effective feed back system and corrective action procedure. Quality control aims at prevention of defects at the source. MAINTENANCE MANAGEMENT In modern industry. transport and store materials efficiently and to reduce the related cost. To keep the machines and other facilities in such a condition that permits them to be used at their optimal capacity without interruption. confidence and reputation of manufacturer. The main objectives of maintenance management are: 1. To achieve interchangeability of manufacture in large scale production. Hence. equipment and machinery are a very important part of the total productive effort. Explain in brief the objectives of operations management. 7.EXERCISES Section A 1. 9. Mention any four advantages of batch production. 3. 2. advantages and limitations? Explain in brief the objectives of production management. 15. What do you mean by ‘Production’? What do you mean by production system? Mention the different types of production systems. 3. 6. advantages and limitations? What is batch production? What are its characteristics. Mention any four objectives of production management. 2. advantages and limitations? What is mass production? What are its characteristics. Mention any four limitations of job shop production. How do you manage operations? What do you mean by operations? What do you mean by manufacturing operations? What do you mean by service operations? What do you mean by ‘globalization’? Section B 1. 18. What is job shop production? What are its characteristics. Mention any four limitations of batch production. 23. 5. 2. advantages and limitations? What is batch production? What are its characteristics. 16. 13. 5. 6. 10. 4. 8. 17. Define operating system. What is job shop production? What is batch production? What is mass production? What is continuous production? Mention any four advantages of job shop production. Briefly explain the production system and its characteristics. Mention any four limitations of mass production. 20. 9. . 11. 22. 10. Explain the framework of managing operations. Mention any four advantages of mass production. Mention any four advantages of continuous production. Mention any four limitations of continuous production. 8. 7. Define production management. Distinguish between manufacturing operations and service operations. 12. Section C 1. 19. 3. 21. Explain the different types of production systems. Explain the key issues to be considered for managing global operations. 4. 14. advantages and limitations? What is continuous production? What are its characteristics. Explain the scope of production and operations management. She was relieved to give up the stress of job hunting. Identify the type of production system followed. On a rainy Tuesday morning. as the rejection letters began to pile up. quality assurance. others switched from professional lawn care services. 1. though: She was able to bring in a little money by mowing lawns for her neighbors. Sheena knew she could earn a living this way. inventory management. By the end of her first year in business. How the customer services is rendered [feedback system exist or not] CASELET SHEENA Sheena had worked for the same Fortune 500 Company for most 15 years. things were starting to turn around.Skill Development Visit a fast food restaurant like Pizza hut. 4. and maintenance. She also performed other services such as fertilizing lawns. Check how production system is managed. even then. Her funds were being depleted and she was getting more discouraged. after eight months of searching she was no closer to finding a job than the day she started. Questions 1. There was one bright spot. scheduling. and trimming shrubbery. At first. Sheena is the operations manager of her business.the work over to her. After recovering from the initial shock. she believed she could expand further if she wanted to. Among her responsibilities are forecasting. Sheena asked him how much he’d be willing to pay. Sheena knew she had to make an important decision in her life. Other neighbors wanted her to work on their lawns. it comes as a real shock to Sheena and about 400 of her co-workers when they were suddenly terminated following the new CEO’s decision to downsize the company. but once people realized Sheena was available. Some people were simply glad to turn . nobody was around to cut the grass. Pizza corner to understand the concept of this chapter by getting the information for the following questions. Sheena was determined to make a go of it. 2. Business became so good that Sheena hired two part-time workers to assist her and. Despite her efforts. So. But she was also fearful of being completely on her own. Find out utilisation of the resources namely manpower. Customer orders were up. and she was excited about the prospects of being her own boss. . In what ways are Sheena’s customers most likely to judge the quality of her lawn care services? 2. Soon Sheena was mowing the lawns of five neighbors. Nevertheless. but she didn’t feel that she could spare any more time from her job search. However. business was a little slow. 3. Although the company had gone through some tough times. Almost jokingly. many asked her to take care of their lawns. and quality and productivity had improved dramatically from what they had been only a few years earlier due company wide quality improvement program. Sheena tried to find employment elsewhere. capacity and material. she decided to go into business for herself taking care of neighborhood lawns. She got involved quite by chance when she heard one neighbor remark that now that his children were on their own. weeding gardens. (c) What scheduling must she do? What things might occur to disrupt schedules and cause Sheena to reschedule? (d) How important is quality assurance to Sheena’s business? Explain. and a salad bar. SUPERSTORES Many of the company’s stores are giant 100. Each store is a little different. and offer a wide variety of fresh-cut flowers. flower arrangements. Some feature a Market Cafe that has different food stations. Aside from the features normally found in supermarkets. 2. Among the special features in some stores are a dry cleaning department. rolls. Irwin/McGraw-Hill] WEGMANS FOOD MARKETS Wegmans Food Markets. and another oriental food. The town is considering an ordinance that would prohibit putting grass clippings at the curb for pickup because local landfills cannot handle the volume. double or triple the size of average supermarkets. each devoted to preparing and serving a certain type of food. and pastries). and listening to its customers. one station has pizza and other Italian specialties. Wegmans is so good at what it does that grocery chains all over the country send representatives to Wegmans for a firsthand look at operations. a wokery. Inc.000 square foot superstores. cakes. Headquartered in Rochester. In fact. [Source: Production/Operations Management by William J. What are some of the trade-offs that Sheena probably considered relative to: (a) Working for a company instead of for herself? (b) Expanding the business? 4. (e) What kinds of maintenance must be performed? 3. Through a combination of market research.Stevenson. varies and plants. Customers often wander among stations as they decide .. Wegmans has a strong reputation for offering its customers high product quality and excellent service. pies. The company employs over 23. In-store card shops covers over 1000 square feet of floor of floor space. They also offer film processing a complete pharmacy.(a) What kinds of things would likely require forecasts? (b) What inventory items does Sheena probably have? Name one inventory decision she has to make periodically. The bulk foods department provides customers with the opportunity to select what quantities they desire from a vast array of foodstuffs and some nonfood items. Wegmans operates over 70 stores. Wegmans has evolved into a very successful organization. In-store floral shops range in size up to 800 square feet of space.000 people. NY.0 billion. and extra large produce sections. A superstore typically employs from 500 to 600 people. Individual stores differ somewhat in terms of actual size and some special features. For example. What options might Sheena consider if the ordinance is passed? Name two advantages and two drawbacks of each option. and has annual sales of over Rs. a card shop and video rentals. a salad bar and a dessert station. is one of the premier grocery chains in the United States. they generally have a large bakery Section (each store bakes its own bread. There are also being a sandwich bar. trial and error. along with the potential new products. However. unless the main warehouse is also out of stock. for seasonal periods. Growers may use specially designed containers that go right onto the store floor instead of large bins. and benefits. customers can stop in on their way home from work and choose from a selection of freshly prepared dinner entrees.what to order. special promotions. MEAT DEPARTMENT In addition to large display cases of both fresh and frozen meat products. profit sharing. such as holidays. a store may receive two truckloads from the main warehouse. Private label food items as well as name brands are regularly evaluated in test kitchens. During peak periods. It typically invests an average of Rs. In addition to learning about stores operations. The superstores typically receive one truckload of goods per day from the main warehouse. The larger stores have produce sections that are four to five times the size of a produce section of an average supermarket. In several affluent locations. they are not used directly for replenishing stock. Although sales records are available from records of items scanned at the checkouts.7000 to train each new employee. The company exercises strict control over suppliers. This avoids the bruising that often occurs when fruits and vegetables are transferred from bins to display shelves and the need to devote labor to transfer the produce to shelves. new employees learn the importance of good customer service and how to provide it. PRODUCE DEPARTMENT The company prides itself on fresh produce. managers often check scanner records to learn what past demand was during a comparable period. bypassing the main warehouse. Employees are motivated through a combination of compensation. The employees are helpful. Some stores have a coffee shop section with tables and chairs where shoppers can enjoy regular or specialty coffees and variety of tempting pastries. local circumstances must all be taken into account. QUALITY Quality and Customer satisfaction are utmost in the minds of Wegmans management and its employees. insisting on product quality and on-time deliveries. EMPLOYEES The company recognises the value of good employees. ORDERING Each department handles its own ordering. such as pricing. cheerfully answering customer questions or handling complaints. many stores have a full-service butcher shop that offers a variety of fresh meat products and where butchers are available to provide customized cuts of meat for customers. Wegmans offers locally grown produce a season. Managers are responsible for checking and . The short lead-time greatly reduce the length of the time an item might be out of stock. That reduces the company’s inventory holding costs and gets the produce into the stores as quickly as possible. Wegmans uses a ’farm to market’ system whereby some local growers deliver their produce directly to individual stores. Other factors. Produce is replenished as often as 12 times a day. Moreover. Indicate how and why each of these factors is important to the successful operation of a supermarket: (a) (b) (c) (d) (e) (f) Customer satisfaction. it is then sent to the test kitchen to determine the cause of the problem. Capacity planning. Layout of the store. employees are encouraged to report problems to their managers.Stevenson. If the item is a Wegmans brand food item. Location Inventory management. Irwin/McGraw-Hill] . How do customers judge the quality of a supermarket? 2. the customer is offered a choice of a replacement or a refund. corrective action is taken. If the cause can be determined.maintaining products and service quality in their departments. [Source: Production/Operations Management by William J. (g) Scheduling. Forecasting. If a customer is dissatisfied with an item and returns it. or even a portion of the item. Questions 1.