Om introduction
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POST GRADUATE PROGRAMME IN POST GRADUATE PROGRAMME IN
MANAGEMENTMANAGEMENT
SESSION PLAN SESSION PLAN
FOR FOR
SL OP 502: OPERATIONS SL OP 502: OPERATIONS
MANAGEMENTMANAGEMENT
Course InstructorDr. N. Sambandam
OPERATIONS MANAGEMENTPROGRAMME SCHEDULE
Session No.Session No. TopicTopic
1 & 2 Introduction, Operations Strategy & Competitiveness
3 & 4 Process Analysis, Product Design and Manufacturing Process Selection & Design
5 & 6 Service Process Selection & Design and Facility Location
7 & 8 Facility Layout and Waiting Line Management
9 & 10 Strategic Capacity Management and Aggregate Sales and Operations Planning
11 & 12 Inventory Control & Mid Term Test
13 & 14 Materials Requirement Planning – MRP
15 & 16 Supply Chain Strategy
17 & 18 Total Quality Management
19 & 20 Just-In-Time and Lean Systems
21 & 22 Project Management
23 & 24 Case Discussions
25 & 26 Course Review with Problem Solving
27 & 28 Course Review with Problem Solving
REFERENCES1. Richard B. Chase, “Operations and Supply Management”, 12th Edition, Tata
McGraw Hill, 2010.
2. Krajewski, Lee J, et al. “Operations Management Strategy and Analysis”, 7th Edition
Pearson Education India.
3. Norman Gaither, “Production and Operations Management”, 8th Edition, The Dryden
Press, 1999.
4. Russell, R.S & Taylor III, B.W, “Production and Operations Management” 4th
Edition, Pearson Education, 2000.
EVALUATION SCHEME : Assignment (2 Nos.) : 20%
Mid Term Test : 15%
Attendance/Case Study Presentation : 15%
Semester Ending Exam : 50%
Business FunctionsBusiness Functions
FinanceFinance
OperationsOperations
MarketingMarketing
Organization Chart for Organization Chart for Commercial BankCommercial Bank
Commercial Bank
OperationsTeller SchedulingCheck ClearingCollectionTransaction processingFacilities design/layoutVault operationsMaintenanceSecurity
FinanceInvestmentsSecuritiesReal estate
Accounting
Auditing
MarketingLoans Commercial Industrial Financial Personal Mortgage
Trust department
Organization Chart for AirlineOrganization Chart for Airline
Airline
OperationsGround support equipt.MaintenanceGround operations Facility maintenance CateringFlight operations Crew scheduling Flying Communications DispatchingManagement science
Finance/AccountingAccounting A/C payable A/C receivable General ledgerFinance Cash control International Exchange
MarketingTraffic administration Reservation Schedules Tariffs (pricing)SalesAdvertising
Organization Chart for Organization Chart for ManufacturingManufacturing
Manufacturing
OperationsFacilities Construction; maintenanceProduction and Inventory control Scheduling; materials controlQuality assurance and controlSupply Chain ManagementManufacturing Tooling; fabrication; assemblyDesign Product development and design Detailed product specificationsIndustrial engineering Efficient use of machines, space, and personnelProcess analysis Development and installation of production tools and equipment
Finance/accountingDisbursements/credits A/C receivable A/C payable General ledgerFunds management Money market International exchangeCapital requirements Stock issue Bond issue and recall
MarketingSales promotionAdvertisingSalesMarket research
OPERATIONS MANAGEMENTOPERATIONS MANAGEMENT
DEFINITIONThe management of the Production function within any Organization, whether it produces GOODS or SERVICES.TYPES OF ORGANIZATION1.Manufacturing – The output is tangible product Example: Automobile Industry, Chemical Industry, Electrical Appliance Company, etc.2.Non Manufacturing – The output is intangible product. Example: Bank, Hospital, Restaurant, Parking lot, Barber Shop, etc.
FUNCTIONS OF MANUFACTURING FUNCTIONS OF MANUFACTURING
RAWRAW
MATERIALS MATERIALS
FACTORY OPERATIONS FACTORY OPERATIONS
1. PROCESSING1. PROCESSING
2. ASSEMBLY2. ASSEMBLY
3. MATERIAL HANDING3. MATERIAL HANDING
4. INSPECTION & TESTING4. INSPECTION & TESTING
FINISHEDFINISHED
PRODUCTSPRODUCTS
SHIPPINGSHIPPINGRECEIVING RECEIVING
5. CONTROL5. CONTROL
TYPES OF OPERATIONSTYPES OF OPERATIONS
1. PROJECT2. UNIT/BATCH3. MASS4. CONTINUOUS
Types of ProcessesTypes of Processes
Type of product
Unique
PROJECTPROJECT BATCHBATCH
Made-to- order
(customized)
Type of customer
One-at-a-time
Few individual
customers
MASSMASS
Made-to- stock
(standardized )
Mass
market
CONT.CONT.
Commodity
Mass
market
Product demand Infrequent Fluctuates Stable Very stable
Types of Processes (cont.)Types of Processes (cont.)
Demand volume
Very low
PROJECTPROJECT BATCHBATCH
Low to medium
No. of different products
Infinite variety
Many, varied
MASSMASS
High
Few
CONT.CONT.
Very high
Very few
Production system
Long-term project
Discrete, job shops
Repetitive, assembly
lines
Continuous, process
industries
Types of Processes (cont.)Types of Processes (cont.)
Equipment Varied
PROJECTPROJECT BATCHBATCH
General-purpose
Primary type of work
Specialized contracts
Fabrication
MASSMASS
Special-purpose
Assembly
CONT.CONT.
Highly automated
Mixing, treating, refining
Worker skills
Experts, crafts-
persons
Wide range of skills
Limited range of
skills
Equipment monitors
Types of Processes (cont.)Types of Processes (cont.)
Advantages Custom work, latest technology
PROJECTPROJECT BATCHBATCH
Flexibility, quality
Dis-advantages
Non-repetitive, small customer base, expensive
Costly, slow,
difficult to
manage
MASSMASS
Efficiency,
speed,
low cost
Capitalinvestment;
lack of responsivenes
s
CONTCONT..
Highly efficient,
large capacity,
ease of control
Difficult to change,
far-reaching errors,
limited variety
ExamplesConstruction, shipbuilding,
spacecraft
Machine shops,
print shops, bakeries, education
Automobiles,
televisions,
computers,
fast food
Paint, chemicals, foodstuffs
MANUFACTURINGMANUFACTURING NATURE OF PRODUCTS:
DISCRETE,BULKY,CONTINUES.
NATURE OF CUSTOMER:MTS,MTOATO & ETO
VOLUME OF PRODUCTION:UNITBATCHMASS
PHYSICAL FLOW OF MATERIAL:FIXED LAYOUTPRODUCT LAYOUTPROCESS LAYOUTGROUP LAYOUTMIXED LAYOUT
REPETITIVE :REFINERIES, CEMENT, SUGAR, INSURANCE, AUTO PARTS, ETC.
PROJECT: MARKETING RESEARCH, CONSTRUCTION
JOB M/C SHOP, RESTAURANTS, DELIVERY SERVICES, ETC.
HYBRID (job lot Prod.)FURNITURE, M/C TOOLSAPPLIANCES, ETC.
LIMITED – QUANTITY LARGE SCALE PRODUCTION.
DYNAMO, GENERATOR, BOAT, CRANE, ETC.
Customer order decoupling pointCustomer order decoupling pointRaw Raw
Materials Materials Components Components SemiSemi
FinishedFinishedFinishedFinishedGoodsGoods
ENGENG PRODPROD PRODPROD PRODPROD
SUPPLIERSUPPLIER CLIENTCLIENT
Production Based on ForecastProduction Based on Forecast
Stock PointStock PointProduction Based on Production Based on
Customer OrderCustomer Order
Engineer -to-OrderEngineer -to-Order
Make-to-OrderMake-to-Order
AssembleAssemble-to-Order-to-Order
Make to StockMake to Stock
MANUFACTURING STRATEGY AND LEAD TIME MANUFACTURING STRATEGY AND LEAD TIME
Design Purchase Manufacture Assembly Ship
Delivery Lead Time
Inventory Manufacture Assembly Ship
Delivery LeadTime
Manufacture Inventory Assembly Ship
Delivery Lead Time
Manufacture Inventory Assembly Ship
Delivery Lead TimeDelivery Lead Time
Engineer Engineer
to orderto order
Make to Make to
orderorder
Assembly Assembly
to orderto order
Make to Make to
stockstock
Manufacturing SectorsManufacturing Sectors
Textile and Garments Skill Development
Leather and Leather Goods Ports & Shipping Industry
Auto Components Capital Goods Industry
Drugs & Pharmaceuticals Paper Industry
Food Processing Biotechnology
Telecom Equipment Cement
Gem and Jewellery Fertilizers
Handlooms and Handicrafts Minerals and Metals
Chemicals & Petrochemicals Steel
IT Hardware/Electronics
Service Sectors
Banks Hospital
Mutual Fund Financial Institutions (UTI, HDBC, etc.)
Railways
Insurance (LIC, Pearless, New India Insurance)
Shipping Corporation of India
Air Lines (Private & National) Road Transport (BEST, TCI, etc.)
Tourist Corporations (TCI, Thomas Cook, Govt.. Tourism etc.)
Municipal Corporations
Hotel & Restaurants Educational (Universities & Institutions)
Post & Telegraphs CPWD
Construction (Builders) Food & Fertilizers (Storing & Distribution)
ServicesServices ManufacturingManufacturing
Output IntangibleIntangible TangibleTangible
Output Inventoried NoNo YesYes
Customer Contact ExtensiveExtensive LittleLittle
Lead Time ShortShort LongLong
Intensity LaborLabor CapitalCapital
Quality Subjective Subjective ObjectiveObjective
Characteristics of Services and Manufactured Characteristics of Services and Manufactured ProductsProducts
Operations Operations
Managers Managers
DirectingDirecting
People People
ControlControl
oror
Follow up Follow up
MotivatingMotivating
PersonnelPersonnel
Planning Planning
Courses ofCourses of
Action Action
TrainingTraining
People People
OrganizingOrganizing
and and
CoordinatingCoordinating
Activities Activities
What Operations Managers DoWhat Operations Managers Do
③ DIRECTING PEOPLE SO THAT
THEY UNDERSTAND THEIR
ASSIGNMENTS AND PERFORM THE
PROPER ACTIVITIES
⑥ CONTROL OR FOLLOW-
UP TO SEE THAT THE
OBJECTIVES ARE BEING
MET AND TAKING
CORRECTIVE ACTION
IF THE PROGRESS IS
NOT SATISFACTORY
④④MOTIVATING PERSONNEL
SO THAT THEY WILL
PROVIDE THE NECESSARY
CONTRIBUTIONS TO THE
ORGANIZATION. .
② ORGANIZING RESOURCES
SUCH AS PEOPLE, EQUIPMENT
(LAYOUT), AND TIME (SCHEDULE)
AND COORDINATING ACTIVITIES
SO THAT TEAM WORK IS ACHIEVED. ① PLANNING OBJECTIVES
AND COURSES OF ACTION
WHEREBY THE OBJECTIVES
MAY BE ACHIEVED.
⑤ TRAINING PEOPLE SO THAT THE
NECESSARY SKILLS ARE
DEVELOPED TO ENSURE THE
SUCCESS AND CONTINUITY
OF THE ORGANIZATION
SKILLS OF OPERATIONS MANAGERS AT VARIOUS LEVELS OF A MANUFACTURING FIRM
CO
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SKILLS NEEDEDSKILLS NEEDED
Plant Plant ManagerManager
Production Production ManagerManager
Production Production SupervisorSupervisor
ManagementManagement LevelsLevels
Historical Events Historical Events in Operations in Operations ManagementManagement
Era Events/Concepts Dates Originator
Industrial
Revolution
Steam engine 1769 James Watt
Division of labor 1776 Adam Smith
Interchangeable parts 1790 Eli Whitney
Scientific Management
Principles of scientific
management1911 Frederick W. Taylor
Time and motion studies 1911Frank and Lillian Gilbreth
Activity scheduling chart 1912 Henry Gantt
Moving assembly line 1913 Henry Ford
Historical Events in Historical Events in Operations Management Operations Management (cont.)(cont.)
Era Events/Concepts Dates Originator
Human Relations
Hawthorne studies 1930 Elton Mayo
Motivation theories1940s Abraham Maslow1950s Frederick Herzberg1960s Douglas McGregor
Operations Research
Linear programming 1947 George DantzigDigital computer 1951 Remington RandSimulation, waiting
line theory, decision
theory, PERT/CPM
1950sOperations research groups
MRP, EDI, EFT, CIM1960s, 1970s
Joseph Orlicky, IBM
and others
Historical Events in Historical Events in Operations Management Operations Management (cont.)(cont.)
Era Events/Concepts Dates Originator
Quality
Revolution
JIT (just-in-time) 1970s Taiichi Ohno (Toyota)TQM (total quality
management)1980s
W. Edwards Deming,
Joseph JuranStrategy and
operations1980s
Wickham Skinner,
Robert HayesBusiness process reengineering
1990sMichael Hammer,
James Champy
Six Sigma 1990s GE, Motorola
Historical Events in Historical Events in Operations Management Operations Management (cont.)(cont.)Era Events/Concepts Dates Originator
Internet Revolution
Internet, WWW, ERP, supply chain management
1990s ARPANET, Tim
Berners-Lee SAP,
i2 Technologies,
ORACLEE-commerce 2000s Amazon, Yahoo,
eBay, Google, and others
Globalization WTO, European Union, and other trade agreements, global supply chains, outsourcing, BPO, Services Science
1990s
2000s
Numerous countries
and companies