Operations Management 712116822

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Unit 1: Material Management

Q1. Discuss various areas of material management?

Q2. What are various objectives of material management?

Q3. What is the concept of integrated material management?

Q4. Integrated material management serves many aims discuss.

Q5. Integrated material management is very advantageous to an organization. Explain.

Q6. Differentiate between conventional and modern approaches of organization structureof material management.

Q7. What are various problems in material management?

Q8. Discuss very problems related to procurement of materials.

Q9. What are the various activities included in material management?

Q10. Discuss various costs involved in management of materials.

Q11. How departmental relationships affect materials management?

Q12. How integrated material management is different from material management?


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Unit 2: Material Handling

Q1. Is material planning a part of production planning?

Q2. Why material planning is needed?

Q3. Discuss various factors that affects material planning.

Q4. Discuss various techniques of material planning.

Q5. What is a material budget?

Q6. Which factors govern the drawing up of material budget?

Q7. How materials are classified?

Q8. How important is the material identification?

Q9. Why codification is necessary?

Q10. Discuss merits and demerits of material codification.

Q11. Discuss various codification systems with examples.

Q12. Discuss various standards.

Q13. What are the aims of standardization?

Q14. What factors must be taken into account while deciding upon a proper storeslayout?

Q15. Write material handling equipment used in :a) Chemical plantb) Steel plantc) Oil exploration unitd) Cement plant

e) Milk dairy

Q16. What are planning principles of material handling?

Q17. What are operating principles of material handling?

Q18. What are costing principles of material handling?

Q19. On what basis material handling equipment are classified?


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Q20. Discuss various principles of material handling?

Q21. Differentiate in ABC and VAD classification of materials.


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Unit 3: Inventory Management

Q1. How will you control the inventories of a manufacturing organization? Discuss the

various inventory costs.

Q2. Explain the following terms:a) carrying costb) shortage cost

Q3. Write short note on following:a) necessity for inventory controlb) function performed by inventoryc) inventory cost and their components

Q4. Most of the businessman view inventory as a necessary evil. Do you agree with this?Explain.

Q5. A certain item cost Rs,235 per ton. The monthly requirement is 5 tons and each timethe stock is replenished, there is a set up cost of Rs.1000. the cost of carrying of inventoryhas been estimated at 10% of value of the stock per year. What is the optimal orderquantity?

Q6. The XYZ manufacturing company has determined, from an analysis of its accountingand production data for part no. 625, that its cost to purchase is Rs.36 per order and Rs. 2per part. Its inventory carrying charges are 18% of the average inventory. The demand for

this part is 10000 units per annum. Finda) EOQb) What is the optimal no. of days supply per optimum order?

Q7. consider the inventory system with the following data in usual notations: R=1000unit/year, I=.30, P= Re.50 per unit, C3 = Rs.10, L= 2 year and C1=IP, determine

a) optimal order quantityb) reorder pointc) minimum average cost

Q8. A motor co. purchases 9000 motor spare parts for its annual requirement, ordering

one month usage at a time. Each spare parts cost Rs. 20. the ordering cost per order isrs.15 and carrying charges are 15% of average inventory per year.You have been asked to suggest more economical purchasing policy for the company.What advice would you offer and how much would it save the company per year.

Q9. A company uses 1200 unit per month of an electronic component each costing Rs. 2.Placing each order cost Rs.50 and the carrying cost is 6% per year of average inventory.

a) EOQb) If the company gets 5% discount on single order should it accept the discount

offer?


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c) Find the discount percentage which matches EOQ ordering for a single order.

Q10. In a warehouse the independent demand for a commonly used bolt is 500 unit per

month. The ordering cost is Rs. 30 per order placed. The carrying cost is 25% per yearand each bolt cost 50 paise.

i) Calculate the lot size for this product. State assumptions made in usingformula

ii) How often is this product to be purchased?iii) If ordering cost is reduced to Rs.5 per order, how will it change lot size and

frequency of purchasing?

Q11. A company works 50 weeks in a year. For a certain part included in the assembly ofseveral parts there is an annual demand of 10000 units. This part may be available foreither an outside supplier or a subsidiary company. The following data relating to the

parts are given:

From outside supplier (Rs) From subsidiary company(Rs)

Purchase price per unit 12 13

Cost of placing an order 10 10

Cost of receiving an order 20 15

Storage and all carryingcost, including capital costper unit per year

2 2

i) What purchase quantity from which source would you recommend?ii) What would be the minimum total cost?

Q12a. What are the different costs associated with inventory control system? How arethey obtained? Give both the analytical and graphical method of determining EOQ.b. for one of the bought item, the following are the relevant data?Ordering cost = Rs.500, holding cost = 40%Cost per item =Rs.100, annual demand =1000The purchase manager placed 5 order of equal quantity in one year in order to avail thediscount of 5% on cost of the item. Work out the gains or loss to the organization due tohis ordering policy for this item.

Q13. The inventory company after an analysis of its accounting and production recordshas determine that it uses Rs. 36000 per year of a component part purchased at rs.18 perpart. The purchase cost is Rs.40 per order. And its annual inventory carrying charges are50/3% of the average inventory.

a) Determine the most EOQ to order at one timeb) Determine the most EOQ of time to order per yearc) Determine the average days supply for ordering the most EOQd) Determine the optimum amount of Rs.Worth of unit per order.


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Q14. A contractor has to supply 10000 bearing per day to an automobile manufacturer.He finds that when he starts a production run, he can produce 25000 bearing per day. Thecost of holding a bearing in stock for one year is 2 paise and the set up cost of a

production run is Rs.18. what is the optimum lot size and how frequently shouldproduction run be made?

Q15. A product is produced 50 items per day. The demand occurs at the rate of 30itemsper day. Given the set up cost per order = Rs. 100 and holding cost per unit time =Re.0.05, find the economic lot size and the associated total cost per cycle assuming thatno shortage is allowed.

Q16. A company manufactures refrigeration units in batches. The estimated demand is10000 units/year. It cost Rs.100 to set up the manufacturing process and the carrying costis Re. 0.50 per unit per year. Once the production process has been set up, 80 units can be

manufactured daily. The demand during the production day has been 60 units per day.How many units should the company produce in each batch? How long will theproduction cycle last?

Q17. the manager of the company manufacturing car parts has entered into a contract ofsupplying 1000 nos. per day of a particular part to a car manufacturer. He finds that hisplant has a capacity of producing 2000 nos. per day of part. The cost of the part is Rs.50,cost of holding stock is 12% per annum and setup cost per production run is Rs.100. whatshould be the run size for each production run and total optimum cost/month. Howfrequently should production runs be made? Shortage is not permissible.

Q18. A contractor undertakes to supply diesel engines to a truck manufacturer @ 25/day.He finds that cost of holding a completed engine in stock is Rs.16 per month, and there isa clause in the contract penalizing him Rs.10 per engine per day late for missing theschedule delivery date. Production of engines is in batches, and each time a new batch isstarted there are setup cost of Rs.10000. how frequently should batches be started, andwhat should be the initial inventory level at the time batch is completed?

Q19. Describe decision rules for a purchase inventory model with three price breaks.

Q20. A manufacturer of engines is required to purchase 2400 casting per year. Thisrequirement is assumed to be fixed and known. The manufacturer is given a lower price

for quantity purchased within certain ranges. The problem is to determine the optimalpurchase quantity.The following data are given:Time period T = 12 monthsTotal demand R= 2400 units.I =2%Set up cost per procurement, C3 = Rs.350K11 = Rs.10 0q500K12 = Rs. 9.25 q500


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Q21. the demand for a product is 2400 units over 360 days. The storage cost is 0.06% ofunit cost of the product and ordering cost is Rs. 35000. find the optimal order quantity ifthe price breaks are as follows:

Quantity range purchasing cost(Rs)0q1000 10001000q4000 9254000q 850

Q22. A manufacturers requirement for an item is 2000 per unit per year. Ordering costare Rs.100 per order and inventory cost are 16% per year per unit of average inventory.calculate the EOQ. If the price quoted is Rs.10 each for quantity below 1000 units.Rs.9.50 for quantities between 1000 and below 2000 and Rs.9.30 for lot of 2000 or more,compute total ordering cost when ordering in lot of (i) 500 (ii) 1000 (iii) 2000 units

Q23. Assume that the following quantity discount schedule for a particular bearing isavailable to a retail store:

Order size (units) Discount

0-49 0%

50-99 5%

100-199 10%

200 and above 12%

The cost of single bearing with no discount is Rs. 30. the annual demand is 250 units.Ordering cost is Rs. 20 per order and annual inventory carrying cost is Rs. 4 per unit.Determibe the optimal order quantity and associated minimal total cost of inventory andpurchasing cost. If shortage are not allowed.

Q24. A hardware store procures and sells hardware items. Following information isavailable:

Expected annual sales 8000 units

Ordering cost Rs. 180 per orderHolding cost 10% of the average inventory value

The items can be purchased according to the following schedule:

Lot size Unit price (rs)

1-999 22.00

1000-1499 20.00

1500-1999 19.00

2000 or above 18.50

Determine the best order size.


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Q25. A company is requiring 1000 units of raw material per month. The ordering cost isRs. 15 per order. The carrying cost in addition to Rs. 2 per unit is estimated to be 15% ofaverage inventory per unit per year. The purchase price of raw material is Rs.100 per

unit. Find the economic lot size and the total cost. The company gets concession of 5%on purchase price if it orders 2000 units or more but less than 5000 units. Orders of 5000units or above get 2% commission in addition to 5%. Which of three ways of order thecompany should adopt?


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Unit-4: Understanding Operations

Q1. What do you understand by term operation management?

Q2. What are the major operations management issues that manufacturing organizationsface in the country?

Q3. How do you define a service system? Give some examples to support your definition.

Q4. How important is it to apply formal management principles to service operations?

Q5. There is nothing like a service system or a manufacturing system, in reality there is a

continuum between these two extremes. Comment on this statement.

Q6. Services are very different from manufacturing. Therefore it is not appropriate to usethe same sets of principles for managing the operations in manufacturing and serviceorganizations. Comment on this statement.

Q7. What is the role of the operations in an organization? What are the other functions inan organization? Are these functions are independent of one another? Give someexamples to support your argument

Q8. Distinguish between the following:a)

service and product attributes

b) manufacturing and service organizationc) design and operational control functions in operationd) long term and short term function in operation

Q9. What are the various functions of operations and how are they linked to other parts ofthe organization?

Q10. How will economic liberalization measures influence operations managementpractice?

Q11. manufacturing usually takes place in factories. Does the term operations mgmt alsoapply to non manufacturing activities? If so why?


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Unit-5: Designing Operations

Q1. What are key determinants of process characteristics in operations? Give specificexamples to show how they influence process characteristics?

Q2. Is there any relationship between volume, variety and flow with respected to processdesign?

Q3. How is the continuous flow system different from the intermittent flow system?What are the key implications for operations managers?

Q4. Give three examples for each of following and identify two important issues ofinterest to an operation manager:

a) mass production systemb) continuous flow systemc) flow shopd) intermittent flow systeme) job shopf) process industryg) batch production system

Q5. As an operation manager, which area would you focus on if you were to manage ajumbled flow process?

Q6. What are the key aspects of service process design? How is it different frommanufacturing process design?

Q7. Is it important to have a good product development process? What do firm gain fromthis?

Q8. Briefly sketch the product development process?.

Q9. Why is a product development process analogously linked to a funnel with stagesand gates?

Q10. What do you mean by quality function deployment? Of what use is it to the productdevelopment process?

Q11. What is the relevance of mass customization principles to the product developmentprocess? What are the alternatives available to a firm to enable itself for masscustomization?

Q12. How important is location decision in operation management? What are theconsequences of a bad location decision?


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Q13. Will the choice of the factor for selecting an appropriate location vary with thegeographical spread of potential candidates for location? Why?

Q14. Identify three important factors that a location planner may consider with respect toeach of the following:

a) a super specialty intensive care unitb) a thermal power plant operating with coal as its fuelc) a state of the art design centre for automatic manufacturingd) a multi cuisine restaurante) an agro based handicraft manufacturing unit

Q15. What are the pros and cons of using the location factor analysis method for locationplanning? Do you have any recommendation on how to use this method for location

planning?

Q16. A manager intending to use the location planning model for analysis is not clear asto which of two models-centre of gravity method and load distance method should beused for his analysis. Prepare a one page note that will help him identify an apporiatemodel for his consideration.

Q17. A firm is considering three alternative locations. Each of these location providessome advantages and some limitations. Therefore it is necessary that some method ofassessing the attractiveness of each site be arrived at. Based on the survey of its topmgmt, the company has identified seven factors that will determine the appropriateness

of site for setting up the new factory. These factors and scores out of 100 for each ofthem are tabulated below:

SI. no. Factors for consideration Score (out of 100)1 Nearness to port 80

2 Existence for supplierinfrastructure

70

3 Availability of skilledworker

90

4 Govt. policies and localtaxes

50

5 Projected cost of operations 60

6 Quality of roadinfrastructure

70

7 Availability of educationalinfrastructure

40

The company collected some data pertaining to each site that it is considering and basedon some criteria was able to arrive at how each site rates against a score of 100 against


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each factor. In some cases actual data was estimated on the basis of some projections.The table below has details pertaining to these:

SI. no. Factors forconsideration

Site 1 Site 2 Site3 Basis

1 Nearness to port 70 kms 130 kms 95 kms Actualdata

2 Existence forsupplierinfrastructure

60 80 85 Score outof 100

3 Availability ofskilled worker


4 Govt. policies andlocal taxes


5 Projected cost ofoperations

Rs.200 LacsRs.180

LacsRs.170

Actualdata

6 Quality of roadinfrastructure


7 Availability ofeducationalinfrastructure


Identify the most appropriate site for locating the new factory on the basis of the aboveinformation.

Q18. A chain of stores trading in host of retail goods for urban customers is planning toset up operations in one of the metro cities in the country. The exact location for the newoutlet is to be decided. In order to do that the company conducted a market survey andfound five pockets of consumption in metro. The distance coordinates of these fivepockets from a reference point in grid map pertaining to the city are as follows:

Zone 1 (15,22), zone 2 (10,40), zone 3 (35,15), zone 4 (50,5), zone 5 (40,35). Theannual demand for goods (in tones) in five zones is 200,130, 80,170,120 respectively.

a) What is the centre for gravity for setting up the operation in the city?b) If the cost of transporting the goods is Rs.300 per tonne, what is the cost

implication of locating the stores in centre of gravity?

Q19. The chain stores officials found that locating the operations in centre of gravitypoint, as obtained in above problem, cost them a lot. The operational cost of renting andmaintaining the site will be Rs.25 lacs per annum. In view of this they are nowconsidering other options. They have identified three other candidate locations whosecost of operation will be less than the centre of gravity location by 10%,25% and 18%respectively. The location coordinators for these three are (20,40) (40,25) (35,45)


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respectively. What should the chain store do in this case? Does it make sense to set upoperation in any of these to set up operation in any of these three alternative locations?

Q20. How does the choice of the layout affect the operational performance of anorganization?

Q21. What is the relationship between the volume, variety and flow characteristics of anoperating firm and its layout?

Q22. What are the different types of layout? How should an organization decide onwhich layout to choose?

Q23. Is group technology layout any different from product layout? Give reasons for youranswers.

Q24. Identify an appropriate layout for each of following situation. Justify your choice.

A) a manufacturer of garment for Van HeusenB) a multi cuisine restaurant in posh residential area in MumbaiC) the overhaul of helicopterD) an eye hospital

Q25. Suppose you are given three alternative designs for layout of a shop floor inmanufacturing organization, how will you decide which of these three is mostappropriate?

Q26. What do you understand from the phrase cellular manufacturing system?

Q27. Is layout design for service organization any different from that of a manufacturingorganization? Explain in detail.

Q28. in what ways can location decision have an impact on the production system?

Q29. in case you want to locate a modern sized hospital cum research and diagnosticcentre, what factor would you consider relevant in taking a location decision?

Q30. Location A would result in annual fixed cost of rs. 300000, variable cost of rs68/unit. Annual fixed costs at location B are Rs.800000, variable cost are Rs.32/unit andrevenue are Rs.68/unit. Sales volume is estimated to be 25000 units/year. Which locationis most attractive?

Q31. Potential locations in Ahemdabad, Baroda and Chennai have the cost structureshown in table below for a product expected to sell for Rs.130.

a) find the most economical locations for an expected volume of 6000 units per year.b) What is the expected profit if the site selected in (a) used?c) For what output range is each location best?


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Potential location Fixed cost per year Variable cost per unit

Ahmedabad 150000 75

Baroda 200000 50

Chennai 400000 25

Q32. A firm is considering four alternative locations for a new plant. It has attempted tostudy all cost at the various locations and finds that production cost of the following itemvary from one location to another. The firm will finance the new plant from bondsbearing 10% interest.

A B C D

Labour/ unit .75 1.10 .80 .90

Plantconstructioncost(million Rs)

4.60 3.90 4.00 4.80

Material andequipment (perunit)

.43 .60 .40 .55

Electricity (peryear)

30000 26000 30000 28000

Water (peryear)

7000 6000 7000 7000

Transportation

(per unit)

0.02 .10 .10 0.05

Taxes (peryear)

33000 28000 63000 35000

This cost includes a projected depreciation expenses, but no interest cost.Determine the most suitable location for output volumes in the range of 50000 to 130000units per year.

Q33. A sight is sought for a temporary plant to supply cement to 4 existing sites F1, F2,F3, F4. the location of the existing sites and the loads to be delivered to each are givenbelow:

Coordinatelocations(X i,Yi)

Existing facility F1 Annual loads Libetween Fi and newplant

Cost C1 to more oneload one distanceunit

(X i,Yi)

F1 1505 Rs.1 (20,30)

F2, 1800 1 (10,40)

F3 900 1 (30,50)

F4 1000 1 (40,60)

Total 5205


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Find the best site of the plant and total cost.

Q34. There are five existing facilities which are to be served by a single new facility. The

details of existing facilities are shown in the following table.

Existingfacility (i)

1 2 3 4 5

Coordinates(ai, bi,)

5,10 20,5 15,20 30,25 25,5

No. of tripsof loads/year(wi)

100 300 200 300 100

Find the optimum location of the new facility based on gravity location concept. If thecost of transporting one load is Rs. 5 per unit distance, compute the total cost oftransportation.

Q35. Bigtown is trying to find the best location for a master solid waste disposal station.At present, four substations are located at the following coordinates (x,y) locations:station 1 (40,120), station 2 ( 65,40) , station 3 (110,90), station 4 (10,130). The no. ofloads hauled monthly to master station will be 300 from station 1 and 200 from station 2and 350 from station 3 and 400 from station 4. use simple median model to find the bestlocations.

Q36. Arvind paper products ltd has two plants located in Mumbai and Kolkata. Theseplants distribute paper stocks to four major markets viz. Indore, Ahemdabad, Baroda andPune. Data on production capacities and wage rate are given in table along with locationcoordinates.

Locations Location coordinates Capacity/usagerates in tonesp.m

X Y

Mumbai 58 96 400Plants Kolkata 80 70 300

Indore 30 120 200

Ahemdabad 90 110 100

Baroda 127 130 300

Markets

Pune 65 40 100

Company wishes to find some central location between the plants and customers to locatethe warehouse. Use centre of gravity method to decide.

Q37. srinath department stores has five location throughout the city. Its parentcorporation, consolidated retail, Inc.is investigating centralizing all distribution to these


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stores. Their plans call for a central distribution centre to accept all incomingmerchandise. Process the necessary paperwork, and ship the goods to the individualstores. Since the stores are of different sizes, the volume of merchandise differs. Srinath

owns its own fleet of trunk for distribution. On a grid superimposed over the city, the fivestore locations and their monthly volumes are :

Coordinates

Stores X Y Volume (1000 LBS)

1 4 1 30

2 3 18 40

3 9 9 70

4 10 22 30

5 17 8 20

Determine the approximate location for the distribution centre by finding the centre ofgravity.

Q38. A company is planning to set up a new plant. Following is a table showingalternatives locations and respective costs. (in Rs.)

Cost locations 1 2 3 4 5

Transport, Rs. Perunit of production

1.00 1.50 1.35 1.65 1.70

Power, Rs. Per

unit of production

1.25 .65 1.05 1.20 0.75

Investment inland *

50 lakh 35lakh 40 lakh 20 lakh 30 lakh

Buildingconstruction*

130lakh 110 lakh 120 lakh 70 lakh 100 lakh

Equipment(capitalcost) Rs. Per unitof productionvolume

2.50 2.80 2.00 3.00 4.50

Location taxes,etc. 20 lakh

10 lakh 8 lakh 12 lakh 9 lakh

Wages (average)Rs. Per unit ofproduction

0.90 1.40 1.40 0.90 0.80

* To be costed at 15% per annum.If the volume of production is 500000 units, what is the preferred location? If the volumeis expanded to 700000 units would decision change?If the locations are rated for some factors as given below, would earlier decision willchange? All factors are equally important.


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Locations Factorindustrialrelations

Poweravailability

Labour climate

1 Excellent Ok Good Ok

2 Good Good Ok Ok

3 Ok Excellent Good Excellent

4 Ok Ok Excellent Excellent5 Excellent Good Excellent Excellent

How were these factors quantified? Can Brown and Gibson method be used for thislocation decision? Explain.

Q38. An industrialist faced with the choice among three possible locations has developedthe subjective factors which are given below:

Factor Site 1 Site 2 Site 3

City proximity Good Ok Ok

Industry relations Ok Excellent Good

Environmentaladvantage

Good Excellent Ok

State govt. support Ok Good Excellent

Property comparisons:

Factor Relative weightageCity proximity 1/6

Industry relations 0/6

Environmental advantage 2/6

State govt. support 3/6

The different costs are given below (in lakh of Rs.)

Site 1 Site 2 Site 3

Transportation cost 165 346.5 231

Labour cost 354.5 288.4 255.5

Energy cost 231 182.5 197.1Material cost 495 629.6 766.5

The industrialist considers objective factors to be more important than the subjectivefactors and allocated a weightage of 70% to the objective factors. Use brown and Gibsonmethod and suggest suitable sites.

Q39. A factory manager considering an interchange of department 3 and 6 in presentlayout. The present layout and the interdepartmental material handling frequencies arefurnished in figure. All the departments are of same size and configuration.


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1 3 5

2 4 6

Present layoutWeekly frequency of interdepartmental material handling.

From \to 1 2 3 4 5 6

1 0 90 160 50 02 70 0 100 130

3 20 0 0

4 180 10

5 40

6

The per unit length interdepartmental cost of material handling are equal. What is theeffect of the interchange of the departments 3 and 6 in layout?

Q40. given the following nearness diagram expressing the proximity requirements,arrange the work centres into a suitable 23 grid.

B C D E F

A I U A E X

B U E E I

C X I ED O U

E U

F

Q41. find an improved layout for initial unit layout in fig. by using craft pairwiseexchange technique. The interdepartmental flows are also furnished alongwith theinterdepartmental cost matrix.

A B C

Cost matrix:

From\to A B CA 1 1

B 1 1

C 1 1


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Flow matrix:

From\to A B C

A 1 2

B 1 3

C 3 3

Distance matrix:

From\to A B C

A 1 2

B 1 1ss

C 2 1

Q42. the layout of department A,B,C and D is shown in fig. the load summary or flowmatrix is shown below:

A B C D

A 1 1 3

B 2 2 1

C 0 2 2

D 1 0 0

A B

C D

Use the craft pairwise exchange technique and get the final layout.


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Unit 6a: Capacity Planning

Q1. How do you define capacity in an operating system? Are input measures of capacitymore appropriate than output measures of capacity?

Q2. Identify an appropriate measure of capacity in each of the following:

A) a watch manufacturer such as titanB) the paint shop at maruti udyog ltdC) a healthcare hospital focused on cardiac diseasesD) Bangalore metropolitan transport corporationE) The gear shop at Bharath earthmovers KFG plant

Q3. What are alternative methods available for building up capacity in a system? Whichmethod is the most suited for implementation?

Q4. Is capacity management a short term or a long term issue? Explain with examples.

Q5. What are the implications of adding capacity in huge chunks at less frequentintervals?

Q6. Why is capacity planning important? Outline the steps involved in a capacityplanning exercise.

Q7. What do you mean by waste elimination? Does it have any relevance for capacitymanagement?

Q8. What are the alternative methods by which capacity could be augmented in anoperating system? Explain with some examples? Are capacity management issues in aservice system different from those in a manufacturing system?

Q9. The manager of an automobile garage in the heart of the city of Delhi has built agood reputation for himself and more customers throng his garage for getting their carserviced. The utilization of the facility is now about 88%. He has been getting more andmore request for automobiles servicing. What would you advice the manager. Prepare a

one page report for the manager.

Q10. A manufacture of table fan has a factory that works on a single shift basis. A shiftlasts eight hours. But 30 minutes will be lost in normal breakage and allowances to begiven to the workers. There are 300 hundred working days in a year. There is afabrication shop, an assembly shop and a painting shop in factory. Each unit requires twohour in fabrication shop and 45 minutes each in assembly and paint shops. The workersare at 80% proficiency. Currently the shop is manufacturing 20000 fans per annum.Using the above data compute the following:


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A) If there are 24 workers in fabrication shop and 12 each in other two shops, whatwill the utilization of the worker be at the current level of operation?

B) How many worker are required if the overall utilization of the factory is targetedat 90%?

C) What is the additional no. of workers are required in each of the shops if theannual production increases to 25000? (assume a targeted utilization of 80% in allthe shops)

11. An eye hospital conducting surgeries is now operating at a capacity of 20 surgeries aday. On an average each surgery takes 45 minutes of the surgeons time, one hour of thepre operative staff in hospital. A surgeon works for 4 hrs a day while the staff works for 8hrs a day. The hospital currently estimates the surgeon works at utilization of 94% andother staff at 85% utilization. The hospitals are planning to increase its capacity by 20%and it has all other infrastructure facilities to handle this proposed capacity expansion.

What it needs to plan for its human resource required. During this expansion it alsoproposes to bring down the utilization of surgeons to 85% and that of the other staff to75%. The excess capacity will be used for training and development activities. If the costof locating new staff, training and inducting them into the hospital is Rs.20000 per personand that of surgeon is Rs.80000. what will be the initial cost of expansion plan?


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Unit 6b: Resource Planning

Q12. What do you mean by dependent demand and independent demand? Is knowledgeof this useful to an organization? If so, in what way is this information useful?

Q13. What is meant by bill of material (BOM)? Why does organization need BOM?

Q14. Suppose that an organization prepared an MRP on the basis of incorrect data onlead time of the components. What will the impact of this be on the actual operations?

Q15. Identify the appropriate lot sizing rule for each of the components given below.Justify your choice of the rule.

a) steel plates for manufacture of automobile doorsb) eye surgeon time (in hour) in an eye hospitalsc) bed linen for a five star hoteld) packing carton for a manufacturere) sliced vegetables for use in 12 vegetarian dishes in a fast food jointf) aircraft engines for Hindustan aeronautics ltds advance light helicopter

Q16. Omega a manufacturer of office aids, produces a desktop calendar unit a simple

process and the following components. The desktop calendar unit is basically assembledusing a base plate, a sliding unit and a calendar assembly. the sliding unit is made up of aplastic tray and a set 30 cards to store telephone and address information. The sliding unitis fixed to the base plate using a pair of 3mm screw. The calendar assembly is made up oftwo U shaped hooks and a calendar (consisting of about 400 pages containing the dailycalendar details). The calendar assembly is fixed to the base plate by clamping the Ushaped hooks using a pair of 3mm screw each.Each base plate is made of plastic sheets and require 150 square inches of plastic sheets.Similarly the sliding unit is also made of the same plastic and requires 30 square inchesof plastic sheets. Each U shaped hooks is made from 7 inches of 4mm steel rod. Thecalendar is bought directly from supplier. Finally the product is packed in a specially

made carton box and sealed using 12 inches of tape. There are also four bar coded labelsto stuck to each carton box after it is sealed. This makes it to be a packaged calendarready for shipping.

a) develop a product structure for desk calendar unitb) using the above information prepare a BOM for desktop calendar unit

Q17. A gearbox manufacture has 20 gearbox in stock. Each gearbox has four gears.There are 200 gears already in stock. The gears are made from gear blank. The stock ofgear blanks in stores is 100. each gear blank requires 30 kg of alloy steel.the stores have


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7000kg of alloy steel. Compute the requirement of components for manufacturing 570gearboxes in the next month.

Q18. Consider the product structure given below pertaining to a product manufactured byoriental housing and seals. the number in paraentheses in the figure indicate the numberof unit of the item required to assemble one unit of its parent. Use the informationavailable in product structure to answer the question below:

A

C(4)C(2)E(2)

B(2) D(3)

a) how many units of C are required to manufacture one unit of product A? did youmake any assumption in computing this value?

b) How much inventory of each component is required for satisfying a demand of100 unit of final product if (i) there is no stock of finished good (ii) there is astock of 30 units of final product?

Q19. In the above question, if lead time for manufacturing/assembly of thecomponents is as follows:

Product A- 2 weekComponent B- 1 weekComponent C- 2 weekComponent D- 2 weekComponent E- 1 week

a) how early can oriental deliver an order of 100 units of product to the customer if(i) there is no stock of item B


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(ii) there is stock of 220 unit of B.

b) willl the result change if there is stock of product A?

Q20. Given below is partially completed MRP working for component X. using theinformation provided, complete the table.

0 1 2 3 4 5 6

Grossrequirement

200 150 100 200 120 200

On handinventory

300

Net

requirementPlannedreceipt

Plannedorderrelease

Component XBOM qty 1

Lot size 2 periodsLead time 1


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Q21. Consider component XX, for which the MRP exercise needs to be done. The relvantinformation pertaining to the component has been extracted from the company recordsand reproduced below. Currently no decision has been made about the lot size rule.Company estimates suggest that the cost of carrying inventory Rs. 10 per unit period andthe cost of scheduling an order is Rs.500 per order. The EOQ is 150 units.

0 1 2 3 4 5 6

Grossrequirement

200 350 400 200 450 200

On handinventory

600

Netrequirement

Plannedreceipt

Plannedorderrelease

Use this information to analyze following 5 lot size rule and suggest an appropriate lotsizing rule for the component.

a) lot for lotb) POQ periodsc) POQ based on the EOQd) FOQ=500e) FOQ=500

Q22. consider the following product structure of a manufacturing firm. The company isinterested in performing an MRP exercise for next eight weeks to cover the requirementindicated in the MPS. The MPS requirement for the next eight weeks is20,80,100,200,100,0,120 and 150.

Component XXBOM qty 1 Lot size ???

Lead time 1


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A

C(2)

F(2)E(2)

B(2) D(3)

F(2)E(2)

The relevant information on lead time, inventory status and lot sizing are available in thetable below. Develop the MRP schedule for the final product as well as for all thecomponents and answer the following question:

Item Lead time (weeks) z Inventory status Lot sizing rule

A 1 100 Lot for lotB 2 200 Lot for lot

C 1 400 2 period

D 2 1000 3 periodE 2 2000 2 period

F 2 1200 500

G 1 2000 1000

a) do we need a schedule order release for component B? if so, when and howmuch?

b) How long will the on hand inventory of item D satisfy the requirement?c) How many order need to be placed for component F?d) If the cost of scheduling an order is Rs.2000. what is the total cost of ordering for

the MRP plan?

Q23. given below is the product structure pertaining to a manufacturing firm. In additionto the final product A, component B is sold as a spare in the market. The MPS for productA and component B and other relevant information for the problem are given in tablebelow:


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A

D(4)

D(2)E(2)

B(2) C(3)

F(2)G(2)

Period 1 2 3 4 5 6

Product A 100 80 220 140 70 160

ComponentB

40 30 70 60 50

Item Lead time (weeks) Inventory status Lot sizing ruleA 2 200 Lot for lot

B 2 900 Lot for lot

C 1 750 Lot for lot

D 2 2500 2period

E 1 300 3period

F 2 1000 500

G 1 600 1000

Perform an MRP exercise to cover the requirement of MPS and answer the following:

a) What is the gross requirement for Component B during six periods?b) How many order do we have to place for component C and in what quantities?c) Suppose the lead time for component G is two weeks instead of one week, what

will its impact on planning process?d) Suppose the EOQ for component c is 320 units. What will the appropriate POQ

lot size rule be for component C?

Q23. discuss the various approaches to define capacity. How do they differ?


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Q24. what is capacity planning? How is capacity measured?

Q25. establishing the minimum capacity and managing with alternative sources like

overtime additional shift and subcontracting is always a low risk strategy. Comment.

Q26. what is learning curve? And how it can be used in POM?

Q27. explain various element required for success of a MRP system.

Q28. Outline the purpose of MRP and explain how an MRP system can achieve thosepurpose?

Q29. production of a certain type of television series programme follows an 80%learning curve and requires 100 hours to complete the first unit. Estimate the time

required for fourth unit of the series.

Q30. the operation manager of the business resort international is preparing a budgetfor the labour cost required to handle several major conventions of the same typeduring the coming year. She estimated that the first one will take 300 labour hours at$ 25 per hour. Assuming that work follows a 78% learning curve, what is the firmsestimated labour cost for the eight conventions?

Q31. reliance appliance co. has a new facility for producing home freezers. The firmhas gone through a preliminary manufacturing period and believes it is experiencingan 88% learning curve. The 200th unit has required 1.40 labour hours for an assembly

activity. Estimate comparable time for (a) 100th unit (b) the 500th unit and (c) 5000thunit.

Q32. A firm, does control panel wiring for solid fueled rocket engines. The firm iscurrently preparing delivery estimates for govt. contract for 80 panels. The first unit isexpected to take 200 worker-hour and the firm usually experiences an 84% learningcurvefor this type of work.

a) what average time per unit can be expected for the first three units?b) How many worker-hours should be scheduled for the 40th unit?

Q33. telecom produces a new telephone system with built in TV screens. Its learning rateis 80%.

a) how long does it take telecom to make the 11th system when the first one took 56hours?

b) How long will the first eleven systems take in total?c) As a new purchasing agent, you expect to buy unit 12 through 15 of the new

phone system. What would be your expected cost for the unit if telecom chargesRs. 30 for each labour hour?


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Q34. A manufacture has committed to supply 10 units of a particular product. The firstunit took 100 hours to produce. The manufacturer wants to know.

i) time to make the 10th unitii) time to make all the 10 unitsiii) total labour cost if the labour rate is Rs.10/hriv) profit earned if total material cost is Rs.4000 and total overhead is Rs.700. the

price per unit is Rs.1500.

use 80% learning curve to answer each of the questions.

Q35. survodaya industries uses MRP for its production material planning. The tablebelow provides the information about a particular component is somewhat uncertainand in order to take care of a sudden spurt in the demand a safety stock of 50 item isrecommended.

WeekOrderquantity=250Lead time =3 weeks

1 2 3 4 5 6 7 8 9

Grossrequirements

40 100 70 150 20 20 50 100 70

Scheduledreceipt

250

On hand atthe end ofthe period

150

Netrequirement

Plannedorder release

During which week should the receipt be planned? When should the order be placed?What is the expected on hand position at the end of week 9?

Q36. complete the material requirement plan for item X shown below. Note that thisitem has an independent demand that necessitates that a safety stock of 40 units ismaintained.


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WeekOrder qty=70Lead time= 4 weeks

1 2 3 4 5 6 7 8 9 10 11 12

Safetystock =40

Projectrequiremnt

20 20 25 20 20 25 20 20 30 25 25 25

Receipts 70On hand atend ofperiod

65

Plannedorderrelease

Q37. for the product structure tree shown, compute the net requirement of A,B,C,D,Eand F to produce 10 units of end item X. assume stock on hand as NIL.

X

A(1) B(2)

C(3)

C(1) D(4)

F(3)

E(2)

E(4)


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Q38. the product structure tree for end item A below. Lead times for items are oneweek for 0 level items; 1 week for I level items; 2 weeks for level II items. There willbe 50 units of B on hand and 200 units of C. lot for lot ordering is used.

draw partial assembly charts of items A, B and C. determine material requirement ofordered part C chat will be needed to complete 150 units of A, by start of week 5.

A

B(3)G(2)

C(2) D(1) H(4) I(3)


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Unit-7:operation scheduling and production activity control

Q1. what are the key elements of mass manufacture?

Q2. write note on problems and prospects of batch production.

Q3. what is the distinctive feature of the job production as compared to mass and batchproduction system?

Q4. the work elements, precedence-requirement and time requirement to assemble apicture frame are shown below:

Element Precedence Time(minutes)

A .35

C .35

B A,B .70

D .50

E .50

F C,D .20G E,F .20

H F,G .50

I D .10

a) construct a precedence diagram

b) set up an assembly line capable of producing 1600 frames per 40 hrs. weekc) calculate efficiency and balance delay of lined) calculate maximum no. of frames that can be assembled each weeke) rebalance the line for maximum production.

Q5. the work element ,precedence requirement and time requirement to assemble an itemas tabulated below:

Element Precedence Time(minutes)

A .30

C A .40

B .60D B 1.20

E C .20

F D 1.20

G E .10

H F,G .50

I H .30

MANAGEMENT HAS DESIGNED AN OUTPUT RATE OF 275 UNITS PER DAY.ASSUME 440 minutes are available per day.

i) construct a precedence diagram


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ii) set up an aseembly line for this output rate.iii) calculate efficiency and balance delay of lineiv) calculate maximum no. of frames that can be assembled each weekv) rebalance the line for maximum production.

Q6. the time required to process four jobs received in order(A,B,C,D) are shown intable below. Determine the processing sequence that would result from using thepriority rulesa) FCFSb) EDDc) SPTd) Critical ratioAlso findi) avg completion time

ii) avg job latenessiii) avg no. of jobs at WC for FCFS and CR priority decision rule.

Job Job time (days) Due date(days)

A 8 6

B 11 18

C 4 24

D 12 14

Q7. shown below are due dates and process time remaining for 5 jobs that were assigneda letter as arrived. Sequence of jobs by priority rules.

a) FCFSb) EDDc) LSd) SPTe) LPT.

Also compare the effectiveness of the FCFS ans SPT rules in terms ofI) avg completion timeII) avg job latenessIII) avg no. of jobs at WC

Job Due date(days) Process time(days)

A 8 7

B 3 4

C 7 5

D 9 2

E 6 6

Q8. today is day 22 on production control calendar and four jobs are on order as shown.Determine the critical ratio for each job, and assign priority ranks.


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Job Date due Work days remaining

A 28 8

B 26 2

C 24 2

D 30 12

Q9. consider the following scheduling problem.

Job 1 2 3 4 5

Processingtime (hrs)

15 4 5 14 8

Find the optimal sequence which minimize the mean flow time and also obtained theminimum mean flow time.

Q10. A small work shop undertaking repair of damaged cars has one denter and onepainter. Presently there are six cars needs repair. The following estimates in hours of timeneeded for denting and painting on cars are available:

Car 1 2 3 4 5 6

Dentingtime (hrs)

4 7 3 12 11 9

Paintingtime(hrs) 11 7 10 8 10 13

What is the sequence that completes all the jobs in minimum time? What is thecorresponding schedule of jobs.

Q11. consider the following two machines and six jobs flow shop scheduling problem.Using Johnsons algorithm obtain the optimal sequence which will minimize themakespan.

Job Machine no.

I 1 21 5 4

2 2 3

3 13 14

4 10 1

5 8 9

6 12 11

Q12. a job shop has eight shop orders that must be processed sequentially through threework centers. Each job must be finished in the same sequence in which it was started.


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Times (hours) required at various work centres are as shown in table. Use Johnsons ruleto develop the job sequence that will minimize the completion time over all shops orders.

Job no A B C D E F G H

WC#1time

4 8 5 9 3 4 9 6

WC#2time

6 4 7 1 4 2 5 2

WC#3time

8 7 9 7 9 8 9 7

Q13. Six jobs are to be processed on three machines. Each job requires three operationson each machine. Find the optimal sequence and the minimum time.

Operating time (hrs)

jobs MACHINE 1 MACHINE 2 MACHINE 3

J1 9 8 20

J2 10 5 10

J3 13 7 3

J4 8 8 9

J5 8 3 9

J6 12 4 12

Q14. ten students are required to enroll for an MBA programme following an interviewand registration process the time in minutes are given below:

Students Registration Interview

S1 7 4

S2 8 2

S3 10 6

S4 3 6

S5 7 5

S6 4 7

S7 5 2S8 8 6

S9 5 7

S10 6 6

Identify how many optimal sequences can be formed and also compute the totalcompletion and idle time. (draw Gantt chart for it.)


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Q15. A workshop has six machines A,B,C,D,E,F. two jobs have to be processed througheach of these machines. The time spent on each machine and technological sequence ifjob is given below:

Time (hr)

machines

JOBS

A B C D E F

J1 20 30 10 10 25 15

J2 10 15 30 10 20 15

Technological sequenceJ1= A-C-D-B-E-FJ2= A-C-B-D-F-EDetermine the minimum time required to process two jobs on the above six machinesassuming that both jobs cant be processed simultaneously on the same machine.

Q16. using graphical method determine the minimum time needed to process the two jobson six machines. The information about machine sequence and time required by each jobon each machine is given here:

Job 1

Machine sequence Time (hrs)A 4

B 5

C 1

D 3

E 6

F 5

Job 2

Machine sequence Time (hrs)

B 6

A 3

C 2F 4

D 3

E 5

Q17. ROBOTIC control corp. uses a robotic controlled flexible production system toassemble the robots it sells. Five robots are available and must complete the taskspecified in table:


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Task Time (sec) Preceding task

A 10 NONE

B 24 None

C 17 A

D 49 A

E 12 CF 14 C

G 27 B

H 9 E

I 20 F,G

J 23 D,H,I

K 36 IL 18 J,K

a) draw precedenc diagramb) what is the theoretical minimum cycle time if all five robots are fully

utilized in a five station assembly line.c) Group the task into the most efficient five stations assembly line.d) What is cycle time?e) What is balance efficiency?

Q18. shown below are the due dates and process time remaining for five jobs that wereassigned a letter as they arrived. Sequence the jobs by priority rules:

a) FCFS

b) EDDc) LSd) SPTe) LPT

Job Due date (days) Process time

A 8 7

B 3 4

C 7 5

D 9 2

E 6 6

Q19. the orders shown in table were received in job shop where scheduling is done bypriority decision rule:


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Shop calendar date

Job no. Received Due Production daysrequired

870 317 368 20

870 319 374 30

872 320 354 10

873 326 373 25

874 333 346 15

In what sequence would the jobs be ranked according to the following decisions rule:

a) earliest due date

b) shortest processing timec) least slackd) FCFS

Q20. Consider the following two machines and six jobs flow shop scheduling problem.Using Johnsons algorithm, obtain the optimal sequence which will minimize themakespan.

Job Machine no. (times in minutes)

I 1 2

1 5 4

2 2 33 13 144 10 1

5 8 9

6 12 11

Q21. vidyasagar book binding works has six binding jobs on hand today. Book bindingconsist of a two step procedure:

a) cuttingb) binding.

The time estimates for jobs are as follows:

Job Time estimates (cutting) Minutes binding

A 40 30

B 55 65

C 25 60

D 70 50

E 20 30

F 35 70


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Sequence them so as to complete all jobs in minimum time: compute this minimumtime.

Q22. consider four jobs. A,B,C,D which have to be processed on three machinesM1,M2,M3. the processing time for each job on each of three machines are given intable.

Jobs M1 M2 M3

A 12 6 10

B 6 4 8

C 7 5 6

D 8 3 7

Using Johnsons rule find the optimal sequence.


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Unit 8: Scheduling of operations

Q1. How is scheduling linked to other aspects of production planning? Explain with the

help of an example.

Q2. Classify the following as a job shop or as a flow shop for the purpose of scheduling.Also identify the relevant parameters of the system that have a bearing on the schedulingcomplexity.

F) Executive health check up in a hospitalG) Tirupati temple queue complex having multiple stagesH) Breakfast buffet system at taj hotelI) Final assembly shop of computer manufacturerJ) Computerized passenger reservation system of Indian railways

Q3. What is cycle time? What are practical implications of cycle time measure in massproduction scenarios?

Q4. An organization has a certain no. of workstations in its final assembly for a desiredproduction rate. If the desired production rate has gone up by 10%, how would yourespond to the new requirement? Will this change have an effect on cycle time?

Q5. Consider one machine six job scheduling problem. All the jobs are available forscheduling at the beginning of planning horizon itself. The processing times and duedates of the job are given below:

Job number

1 2 3 4 5 6

Processing times(minutes)

12 10 15 13 12 9

Due (minutesfrom start ofplanninghorizon)

25 45 55 30 90 70

a) Use LPT, SPT, FCFS, Random, EDD and arrive at a schedule.b) For each of the schedules given above, compute the following performance

measuresi) mean flow timeii) make spaniii) mean completion timeiv) mean latenessv) mean tardinessvi) no. of tardy jobs


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Q6. A service provider has two stages in service delivery. Initially, the customer arrive atstage 1, get the service and then reach stage 2, where the remaining part of the service iscompleted. All arriving customers wait a lounge and are called on some basis into the

system once a batch of eight accumulates. All of them go through these two stages,although the time they spend in these two stages may vary depending upon their specificrequirement. The time spent by a set of eight customers on these two stages are givenbelow:

Customer number

1 2 3 4 5 6 7 8

Stage1(minutes)

11 10 9 13 12 10 9 11

Stage2(minutes)

9 14 10 12 14 14 11 10

Arrivaltime(minutesfrom startof batch)

0 1 3 4 5 7 8 10

a) use Johnsons rule to schedule customers in the systemb) develop a Gantt chart for the schedulec) identify key performance measure for above situation and compute them for

solution obtained using Johnsons ruled) if you scheduled the customer using FCFS what is the impact on the performance

criteria?e) Evaluate and compare the performance of the random rule with the above two

rule.

Operations Management 712116822

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