21
Management Programme ASSIGNMENT FIRST SEMESTER 2013 MS - 53: Production/Operations Management School of Management Studies INDIRA GANDHI NATIONAL OPEN UNIVERSITY MAIDAN GARHI, NEW DELHI – 110 068 MS-53

IGNOU MBA MS-53 Solved Assignment 2013

Embed Size (px)

Citation preview

Page 1: IGNOU MBA MS-53 Solved Assignment 2013

Management Programme

ASSIGNMENT

FIRST SEMESTER

2013

MS - 53: Production/Operations Management

School of Management Studies

INDIRA GANDHI NATIONAL OPEN UNIVERSITY

MAIDAN GARHI, NEW DELHI – 110 068

MS-53

Page 2: IGNOU MBA MS-53 Solved Assignment 2013

ASSIGNMENT

Course Code : MS - 53

Course Title : Production/Operations Management

Assignment Code : MS-53/TMA/SEM - I /2013

Coverage : All Blocks

Note : Attempt all the questions and submit this assignment on or before 30th April,

2013 to the coordinator of your study center.

1) Explain the common principles on quality amongst the theory of Deming, Juran,

Crosby and Baldridge criteria.

2) Explain the importance of forecasting in Production Management. Briefly discuss

the various methods of forecasting.

3) Compare the manual and quantitative models for process Layout design. What are

the advantages of each kind of model?

4) Define Aggregate Planning. Explain its managerial importance. How it is

different than scheduling?

5) Outline the purpose of MRP and explain how an MRP System can achieve these

purposes.

6) Write short notes on:

a) Group Technology and Cellular Manufacturing

b) Just-in-Time manufacturing system

c) Role of computers in Production/Operations Management.

Page 3: IGNOU MBA MS-53 Solved Assignment 2013

Q1.Explain the common principles on quality amongst the theory of Deming, Juran,

Crosby and Baldridge criteria.

Ans:

Deming addressed the entire process and focused primarily the assertion that poor quality is not the fault of the worker, but is the fault of the system. Deming also strongly opposed the creation of quality inspection departments.

Juran's work focuses on the idea that organizational quality problems are largely the result of insufficient and ineffective planning for quality. In addition, Juran fleshed out many of the implementation issues involved with quality through his trilogy.

Crosby made two key points in his arguments about the responsibility of the quality department, and not the individual worker. Crosby has enjoyed the most commercial success of the three. First, he argued that quality, as a managed process, could be a source of profit for an organization. Second, Crosby adopted a "zero defects" approach to quality management, and emphasized the behavioral and motivational aspects of quality improvement rather than statistical approaches.

Similarities: All three men were very passionate about the role of quality in business organizations, and felt that quality is a process that must be deliberately managed. In addition, all three of them saw quality as the focal point for organizational performance and effectiveness.

Differences: Deming and Juran were more statistically oriented in their approach than Crosby. The individuals emphasized different aspects of quality management in their approaches. Crosby's zero defects approach probably goes further than would be advocated by Deming or Juran. Crosby was also more prolific than Deming and Juran in terms of the production of quality related materials (e.g., videos, workbooks, lecture series, etc.).

Q2)Explain the importance of forecasting in Production Management. Briefly

discuss the various methods of forecasting.

Ans: Importance of forecast lies in its ability to help the managers /planners to help them

take better actions regarding future and also to help to help them in discharging their

functions more effectively. How does it help?

A manager invariably continues to discharge his functions-forecast or no forecast.

When a forecast is available:

1) The manager is comparatively better informed so as to set up his objectives

more clearly.

2) His thinking, and generation and choice of alternatives becomes more focused.

Page 4: IGNOU MBA MS-53 Solved Assignment 2013

3) Because sufficient time is available, it is possible to organise and implement his

actions in a more effective way.

The importance is directly proportional to:

[Results of an action based on forecast] -[Results of an action for the same situation

without any forecast].

If the difference in positive and large then the importance is more, otherwise it is not

important.

Importance of forecast and of ability of used statistical forecasting techniques to

generate reliable/accurate forecasts, are directly related. If in general forecasts are not

accurate i.e. quantum of forecast error is more; then difference of results of actions as

discussed above may not be relevant. Because both become unreliable.

Forecast Error can be explained as:

Forecast Error = [value forecast value actually happenning]

The more sophisticated models of forecast often provide forecast with smaller error

but cost of development of the model, forecasting and maintaining tends to be high.

There has to be a tradeoff between choice of model and the cost The following figure

clearly explains this trade off:

Page 5: IGNOU MBA MS-53 Solved Assignment 2013

Methods of Forecasting

Three of the most important qualitative methods of forecasting are: i) Judgemental

forecasting ii) The Dephi technique iii) Cross impact analysis. These methods are

useful where historical data are not available or are not reliable predicting the future,

Qualitative methods are used .primarily for long and medium range forecasting

involving process design, facilities planning. Delphi Technique is gradually

becoming an important tool in the hands of planners. Delphi and its variants can help

collecting opinions of a large group of experts in the ill-structured area of forecasting,

objective setting and long range planning. Cross impact analysis presents a matrix for

analyzing the strength and direction of the impact of different events. An impact can

be enhancing type of inhibiting type.

JUDGEMENTAL FORECASTING

Judgemental (subjective) methods are those in which the process used to analyze the

data has not been well specified. They may use objective data or subjective impressions

as inputs, they maybe supported by form-al analysis, but the critical aspect of these

methods is that the inputs are translated into forecasts in the human mind.

Various methods of judgemental forecasting are listed below:

1) Personal Interviews

2) Telephone Interviews

3) Traditional Meetings

4) Structured Meetings

5) Role Playing

6) Mail Questionnaire

7) Delphi

8) Cross- Impact Theory

9) System Dynamics

Various types of errors are associated with judgemental forecasting. But the most

serious ones are

1) Bias, and

2) Anchoring

Bias is caused by preconceived notion about the world. Bias is also caused by the

Page 6: IGNOU MBA MS-53 Solved Assignment 2013

judgements of a person who stands to lose/gain from the forecast. Although bias can

be caused by the researcher and from the situation, the most serious form of bias is

caused by the judge. Judges often mention what they hope should happen rather then

what they think should happen. Optimism is one form of bias often associated with

judgemental forecasting.

Anchoring is the tendency to start with an answer while making a forecast. A

conservative judge uses the pastas an anchor for marking a forecast.

THE DELPHI TECHNIQUE

Opinion-Capture Techniques:

Collecting the opinion of experts to analyze the genesis and odor lads of a problems

and to come up with recommendation for As solution has been a very desirable task

among planners and Administrators, and particularly so among the technology

forecasters. One can distinguish four categories of opinion-capture techniques that

are generally employed for the purpose of forecasting:

• genius. (single individual) forecasting

• survey (polling) forecasting

• panel (face-to-face interaction) forecasting,

• Delphi (survey with feedback without face to face interaction) forecasting

The Forecasting Delphi

The original and the most common use of Delphi is to forecast a future event.

Organization have used the technique to forecast the future demand for their products

and to foresee advent of future technology.

The Decision-Analysis Delphi

Another application of Delphi process has been made to the process of decision

making. Turoff (1970), while developing this application, calls it the "Policy Delphi".

He has pointed out that Delphi in such uses is not a decision-making tool, but rather a

decision-analysis tool.

In this type of Delphi exercise, the planning horizon is held constant, and the

participant evaluates various objectives or alternatives according to their importance,

desirability, feasibility, ease of implementation, or probability of occurrence. The

Page 7: IGNOU MBA MS-53 Solved Assignment 2013

rounds are fairly similar to the forecasting Delphi.

FORECASTING BASED ON CROSS,IMPACT ANALYSIS

The basis of cross-impact theory is a cross-impact matrix. The matrix has all the

possible future events in its rows as well as in its columns. The columns the affecting

events, and the rows show the affected events. Each cell represents the strength and

direction of the impact of the column event on the row event. Since no event can be

enhancing type or inhibiting type. An enhancing impact increases the probability of

occurrence of the impact event due to the occurrence of the impacting event. An

inhibiting impact reduced this probability. Of course, this probability may remain

unaffected as in the case of the diagonal elements of the matrix.

Q.3 Compare the manual and quantitative models for process Layout design. What

are the advantages of each kind of model?

Ans:P RO C E S S L AYO U T(Manual & Quatitative)

The most common approach to developing a process layout is to arrange

departments consisting of like processes in a way that optimizes their relative placement.

For example, the departments in a low-volume toy factory might consist of the shipping

and receiving department, the plastic molding and stamping department, the metal form-

ing department, the sewing department, and the painting department. Parts for the

toys are fabricated in these departments and then sent to assembly departments where

they are put together. In many installations, optimal placement often means placing

departments with large amounts of inter department traffic adjacent to one another.

Suppose that we want to arrange the eight departments of a toy factory to mini-

mize the interdepartmental material handling cost. Initially, let us make the simplifying

assumption that all departments have the same amount of space (say, 40 feet

by 40 feet) and that the building is 80 feet wide and 160 feet long (and thus com-

patible with the department dimensions).

The first things we would want to know are the nature of the flow between departments

and how the material is transported.If the company has another factory that makes similar

products, information about flow patterns might be abstracted from the records. On the

other hand, if this is a new product line, such information would have to come from

Page 8: IGNOU MBA MS-53 Solved Assignment 2013

routing sheets or from estimates by knowledgeable personnel such as process or

industrial engineers. Of course, these data, regardless of their source, will have to be

modified to reflect the nature of future orders over the projected life of the proposed

layout.

Let us assume that this information is available. We find that all material is trans-

ported in a standard-size crate by forklift truck, one crate to a truck (which constitutes

one “load”). Now suppose that transportation costs are $1 to move a load between

adjacent departments and $1 extra for each department in between.The expected loads

between departments for the first year of operation are tabulated in Exhibit TN5.1;

available plant space is depicted in Exhibit TN5.2. Note that in our example, diagonal

moves are permitted so that departments 2 and 3, and 3 and 6, are considered adjacent.

Given this information, our first step is to illustrate the interdepartmental flow by a

model, such as Exhibit TN5.3. This provides the basic layout pattern, which we will try

to improve.

The second step is to determine the cost of this layout by multiplying the material han-

dling cost by the number of loads moved between each pair of departments. Exhibit

TN5.4 presents this information, which is derived as follows: The annual material

handling cost between Departments 1 and 2 is $175 ($1 X 175 moves), $60 between

Departments 1and 5 ($2 X 30 moves), $60 between Departments 1 and 7 ($3 X 20

moves), $240 between diagonal Departments 2 and 7 ($3 X 80), and so forth. (The

“distances” are taken from Exhibit TN5.2 or TN5.3, not Exhibit TN5.4.)

Page 9: IGNOU MBA MS-53 Solved Assignment 2013

The third step is a search for departmental changes that will reduce costs. On the basis

of the graph and the cost matrix, it seems desirable to place Departments 1 and 6

closer together to reduce their high move-distance costs. However, this requires

shifting several other departments, thereby affecting their move-distance costs

and the total cost of the second solution. Exhibit TN5.5 shows the revised layout

resulting from relocating Department 6 and an adjacent department. (Department 4 is

arbitrarily selected for this purpose.) The revised cost matrix for the exchange, showing

the cost changes, is given in Exhibit TN5.6. Note the total cost is $262 greater than in

the initial solution. Clearly,doubling the distance between Departments 6 and 7

accounted for the major part of the cost increase. This points out the fact that, even in a

small problem, it is rarely easy to decide the correct “obvious move” on the basis of

casual inspection.

Thus far, we have shown only one exchange among a large number of potential ex-

changes; in fact, for an eight-department problem, there are 8! (or 40,320) possible

arrangements. Therefore, the procedure we have employed would have only a

remote possibility of achieving an optimal combination in a reasonable number of

tries. Nor does our problem stop here.

Suppose that we do arrive at a good solution solely on the basis of material handling

cost, such as that shown in Exhibit TN5.7 (whose total cost is $3,550). We would note,

first of all, that our shipping and receiving department is near the center of the

factory—an arrangement that probably would not be acceptable. The sewing department

Page 10: IGNOU MBA MS-53 Solved Assignment 2013

is next to the painting department, introducing the hazard that lint, thread, and cloth

particles might drift onto painted items. Further, small toy assembly and large toy

assembly are located at opposite ends of the plant, which would increase travel time for

assemblers (who very likely would be needed in both departments at various times of the

day) and for supervisors (who might otherwise supervise both departments

simultaneously). Often factors other than material handling cost need to be considered

in finalizing a layout.

Page 11: IGNOU MBA MS-53 Solved Assignment 2013

CO M P U T E R I Z E D L A Y O U T T E C H N I Q U E S —C R A F T

A number of computerized layout programs have been developed since the 1970s to help de-

vise good process layouts. Of these, the most widely applied is the Computerized Relative

Allocation of Facilities Technique (CRAFT).

The CRAFT method follows the same basic idea that we developed in the layout of the

toy factory, but with some significant operational differences. Like the toy factory exam-

ple, it requires a load matrix and a distance matrix as initial inputs, but in addition, it re-

quires a cost per unit distance traveled, say, $.10 per foot moved. (Remember, we made the

simplifying assumption that cost doubled when material had to jump one department,

tripled when it had to jump two departments, and so forth.) With these inputs and an initial

layout in the program, CRAFT then tries to improve the relative placement of the depart-

ments as measured by total material handling cost for the layout. (Material handling cost

between departments = (Number of loads X Rectilinear distance between department

centroids X Cost per unit distance.) It makes improvements by exchanging pairs of

departments iteratively until no further cost reductions are possible. That is, the program

calculates the effect on total cost of exchanging departments; if this yields a reduction,

the exchange is made, which constitutes an iteration. As we saw in the manual method, the

departments are part of a material flow network, so even a simple pairwise exchange

generally will affect flow patterns among many other departments.

S Y S T E M A T I C L A Y O U T P L A N N I N G

In certain types of layout problems, numerical flow of items between departments either is

impractical to obtain or does not reveal the qualitative factors that may be crucial to the

placement decision. In these situations, the venerable technique known as systematic

layout planning (SLP) can be used.It involves developing a relationship chart showing

the degree of importance of having each department located adjacent to every other depart-

ment. From this chart, an activity relationship diagram, similar to the flow graph used for

illustrating material handling between departments, is developed. The activity relationship

diagram is then adjusted by trial and error until a satisfactory adjacency pattern is obtained.

This pattern, in turn, is modified department by department to meet building space limita-

tions.

Page 12: IGNOU MBA MS-53 Solved Assignment 2013

Q4 Define Aggregate Planning. Explain its managerial importance. How it is

different than scheduling?

Ans: If the demand for a company products was absolutely stable, there would be no

need for aggregate planning. The company can develop a production process and a

workforce level that would produce exactly the amount demanded every month in a

repeating cycle, while maintaining practically no inventory.

the aggregate plan is based on satisfying expected intermediate term demands, it is

necessary that accurate forecasts of these demands be made. Due importance must be

given to seasonal factor while arriving at forecasts. In addition, intermediate range

wage rates, material prices and holding costs also affect optimal plans. All these

parameters must be properly considered.

Aggregate Planning is necessary in Production and Operations Management (POM)

because it provides for,

Fully loaded facilities and minimizes overloading and underloading, thus reducing

costs.

Adequate production capacity to meet expected aggregate demand.

Getting the most output for the amount of resources available, which is important in

times of scarce production resources.

Aggregate planning is the key to managing change in POM because the changing

patterns of customer demand and the plans for providing production resources that

adapt to those changes are fundamental to aggregate planning.

Managerial Importance:

In this let us concentrate on the managerial inputs, objectives, alternatives and

strategies associated with aggregate plans.

Managerial Inputs

Figure 11.2 shows the type of information that managers from various functional areas

supply to aggregate plans. One way of ensuring the necessary cross-functional

coordination and supply of information is to create a committee of functional -area

representatives, chaired by a general manager, the committee has the overall

responsibility to make sure that company policies are followed, conflicts are resolved

amanda final plan is approved.

Page 13: IGNOU MBA MS-53 Solved Assignment 2013

Typical Objectives

The many functional areas in an organisation that give input to the aggregate plan

typically have conflicting objectives for the use of the organisation'

s resources. Six objectives usually are considered during development of a production or

a staffing plan:

1)Minimize costs maximize profits. If customer demand isn't affected by the plan

minimizing costs will also maximize profits.

2)Maximize customer service. Improving delivery time and on-time delivery may

require additional work-force, machine capacity, or inventory resources.

3)Minimize inventory investment. Inventory accumulations are expensive because

the money could be used more productive investments.

4)Minimize changes in production rates. Frequently changes in production rates can

cause difficulties in coordination line rebalancing.

5)Minimize changes in work-force levels. Fluctuating work-force levels may cause

lower productivity because new employees typically need time to become fully

productive.

6)Maximize utilisation of plant and equipment. Firm with a product focus require

uniformly high utilisation of plant and equipment.

Balancing these various objectives to arrive at an acceptable aggregate plan involves

consideration of various alternatives the two basic types of alternatives are action s that

Page 14: IGNOU MBA MS-53 Solved Assignment 2013

adjust demand pattern, whereas reactive alternatives are actions that respond to given

demand patterns.

Reactive Alternatives

Reactive alternatives are actions that can be taken to cope with demand requirements.

Typically, an operations manager controls reactive alternatives that is the operations

manager accepts forecaster demand as a given and modifies work-force levels

overtime, vacation schedules, inventory levels, subcontracting and planned backlogs

to meet that demand.

Work force Adjustment. Management can adjust work-force levels by hiring or

laying off employees. The use of this alternative can be attractive if the work force is

largely unskilled or semiskilled and the labour pool is large. However, for a particular

company, the size of the qualified labour pool may limit the number of new employees

that can be hire at any one time also new employees must be trained and the capacity of

the training facilities themselves might limit the number of new hires at any one time.

Overtime and undertime an alternative to work -force adjustment is the use of

overtime and undertime. Overtime can be used to satisfy output requirements that

cannot be completed on regular time. However, overtime is expensive. Moreover, in

many cases, workers do not want to work a lot of overtime for extended period of time,

and excessive overtime may result in declining quality and productivity. Undertime is

used when labour capacity exceeds demand requirements, workers are kept on the

payroll rather than being laid off.

Vocations Schedules: A firm can shut down during an annual full in sales, leaving a

skeleton crew to cover operations and perform maintenance, employees might be

required to take all or pan of their allowed vacation time during this period. The

companies sometimes use of this alternative during the holiday period, not only to do

maintenance work or install equipment, but also to decease inventory.

Anticipation Inventory: A plant facing seasonal demand can stock anticipation

inventory during light 6unand periods and use it during heavy demand periods

although this approach stabilizes output rates and work-force levels, it can be costly

because the value of the product is greatest in its finished state, stocking components

and sub assemblies that can be assembled quickly when customer orders come in

Page 15: IGNOU MBA MS-53 Solved Assignment 2013

might be preferable to stocking finished goods.

Service providers generally cannot use anticipation inventory because services cannot

be stocked, in some instances however, services can performed prior to actual need.

Subcontractors: Subcontractors can be used to overcome short-term capacity

shortages, such as during peaks of the season or business cycle. Subcontractors can

supply services, components and subassemblies, or even assemble an entire

product. If the subcontractor can supply components or subassemblies of equal or

better quality less expensively than the company can produce them itself, these

arrangements may become permanent, the major automakers.

Backlogs, Backorders and Stockouts: Another way in which firms with a process

focus often cope with a high demand forecast is to plan for order backlogs. A backlog

is an accumulation of customer orders that have been promised of delivery at some

future date. Firms with a process focus often use this method. The customer places an

order for a customized product or service, and the firm promises it for later delivery, job

shops, TV repair shops, and automobile repair shops work to varying degrees to backlogs

Backorders and stockouts are used by firms with a product focus. A back order is a

customer order that is not ready for the customer when promised or demanded, thereby

delaying demand requirements to later periods. A stockout is an inability to satisfy the

demand for a stock item when it occurs. In this case, the customer may go to a

competitor, resulting in a lost scale. Generally, backorders and stockouts are to be

avoided. Planned stockouts may be used, but only when the expected loss in sales and

customer goodwill is less than the cost of using other reactive alternatives or

aggressive alternatives, or adding the capacity needed to satisfy demand.

Difference Between Aggregate Planning & scheduling

Aggregate plans act as interface between strategic decision, which fix the

operating environment, and short term scheduling and control decisions, which guide

the company's day-to-day operations.

Aggregate planning typically focuses on manufacturing several aspects of

operations-aggregate production, inventory, and personnel levels-to minimize costs

over some planning horizon while satisfying demand and policy requirements.

Intermediate term planning is normally performed in terms of aggregate production

Page 16: IGNOU MBA MS-53 Solved Assignment 2013

units and resources (hence the term aggregate planning) rather than for individual

products. Although in the intermediate term major facility and process changes usually

be expanded by using overtime - work, subcontracting production, hiring addition

workers, or even adding entire work shifts. This approach takes the demand pattern as

forecasted and focuses on minimizing the costs.

Q5)Outline the purpose of MRP and explain how an MRP System can achieve these

purposes.

Ans:

Material Requirement Planning (MRP) is a system of planning and scheduling the

time-phased materials requirement for production operations. If the delivery schedule

for the end products is known, then Me sue and timing of the requirements of the

various lower-level work-in-process items and raw-materials can he planned exactly

by simple arithmetical calculation. Such planning is known as Material Requirement

Planning (MRP).

Although MRP is easy to understand, it can he used in two different ways: MRP-I

and MRP-II.

MRP-I: It is an inventory control system, which releases manufacturing and

purchase orders at the right time to support the maser schedule. This system launches

orders to control work-in-process and raw materials inventories through proper

timing of order placement. MRP-I doesn't include capacity planning. Henceforth the

terminology MRP-I and MRP will be used interchangeably.

MRP-II: It is an information system used to plan and control inventories and

capacities in manufacturing companies. The MRP-fl system coordinates sales,

purchasing, manufacturing, finance, and engineering by adopting a focal production

plan and by using one unified data tame to plan and update the activities in all the

systems. The subsequent sections shall cover MRP followed by MRP-II.

How an MRP System can achieve these purposes?

MRP is a calculation of the requirements of the dependent demand items, i.e.

items whose demand in dependent upon the demand for their respective higher level

Page 17: IGNOU MBA MS-53 Solved Assignment 2013

items. The end products in a company would be the independent demand items if the

demand for these is not easily computable based on the demand for other items some

where else.

The MRP system generates planned order releases. Each order is associated with a

set up cost i.e. cost of placing and receiving an order. This raises the question of how

much to order. One must consider the tradeoff of ordering costs and holding costs.

Various lot-sizing policies are possible. Lot-for-lot ordering is one important lot

sizing policy. Lot-for-lot is a lot sizing policy in which order quantity equals net

requirements for the period. The definition will be more cleared through examples

discussed subsequently. The main advantage of an MRP system is that it avoids

unnecessary stocks of items and produces/procures them only when required and in

the quantities required. Classical inventory systems use `averaging' techniques suffer

from a predictable drawback: in some periods there is more of the stock when less is

needed and in others there is less when more is needed. This type of averaging

technique is of an unrealistic approach. For most dependent demand items their

demand is `bunched' or lumpy'. MRP treats the discrete distribution as discrete and

not continuous. In the classical production-inventory systems, averaging is a part of

the system. In such cases the economies in materials are sought through Economic

Order Quantities (EOQ) or Optimal Period of Review which try to balance the order

cost with carrying costs for the materials. MRP obviates this need and treats the

problem of costs due to the materials directly, by producing/procuring the materials

in the quantity and the time these are required.

The timing of the order quantities are not `averaged' and made uniform. The material

is .ordered in the lot sizes, but only at the -time they are required for production.

There is no extrinsic trigger for placing an order quantity or a review period.

Computing the MRP for releasing a production/procurement order, involves

following steps.

To determine the time the higher level item are required and in what quantity?

To determine the time when and in what quantity the next lower level item is

required? This gives the gross requirement of the material.

To obtain the real or net requirement, the `on hand' and `schedule to receive'

Page 18: IGNOU MBA MS-53 Solved Assignment 2013

quantities of the item are deducted from the gross requirement. If there is

sufficient quantity on hand then there is no need to order for a further quantity.

The MRP so calculated are checked for viability vis-à-vis the production

capacity. If there is mismatch then the master schedule is modified and the

MRP is calculated again.

Q6 a)Group Technology and Cellular Manufacturing

Ans: GROUP TECHNOLOGY (GT)

It means grouping parts of a similar characteristic into families. Grouping is done

either based on similarities in design (i.e., the geometry of the parts), or based on

similarities in manufacturing (i.e., the type of processing requirements). For

computer-compatibility and ease of classification, various coding schemes are used.

Coding schemes facilitate retrieval of parts for either design or manufacturing

purposes. Thus, GT can be used either for retrieving existing designs for developing

new parts or for retrieving existing process plans for generating new ones by editing.

GT can be also used in forming manufacturing cells of machine groups that are

closely associated with each family of parts.

Cellular Manufacturing

Cellular manufacturing is Grouping of machines into cells that function like a

product layout island within a larger job shop or process layout.

Q6 b)Just-in-Time manufacturing system

Ans:

JIT also known as zero inventories and stockless production is a philosophy of

manufacturing, which focuses on the reduction of waste and delays at each stage of

the manufacturing process starting with purchase and ending with after-sales-service.

The major focus of a JIT system is waste elimination.

Page 19: IGNOU MBA MS-53 Solved Assignment 2013

Waste is anything other than that which adds value to the product. Every moment

from order entry to delivery is meant to add value to the product. Non-value adding

moments are reduced to a minimum. Thus, waste is also defined as anything other

than the minimum amount of equipment, materials, parts, space, and time, which are

absolutely essential to add value to the product. There are several types of wastes.

Toyota motor company of Japan has identified seven wastes after years of continuous

improvement activities (see figure 18.12). These are : waste from overproduction,

waste of waiting time, waste of transportation, processing waste, waste of motion,

inventory waste, and waste from product defects. As high-lighted in Figure 18.12.

Japanese manufacturing systems focus on producing what the customer desires

without any delays or defects, and without wasting any resources (i.e., labor,

material, or equipment). They employ methods through which employees are bound

to develop.

An ideal JIT system aims to achieve zero defects (i.e., high quality

products), zero inventory, zero lead time (implying rapid response),

Page 20: IGNOU MBA MS-53 Solved Assignment 2013

and a theoretical lot size of one. This is an unattainable ideal, which

leads to continuous cycle of never ending improvements. The basic

elements of a JIT system are:

• Pull production system

• Kanban production control

• Flexible resources

• Cellular layouts

• Small lot production

• Quick setups

• Uniform plant loading

• Preventive maintenance

• Employee involvement

• Reduction in number of suppliers

• Smaller shipment quantities

• Reliable transportation system

• Quality at source

Q6)c)Role of computers in Production/Operations Management.

Ans: The role of computers have gone much beyond debates, discussions and doubts.

Computers and its latest avataar, Information Technology, has already arrived and

should encompass the overlapping technologies of computing, micro-electronics,

robots and telecommunications capabilities.

Operations management has been undergoing a metamorphic change in its

philosophy, content and approach ever since Michael A. Porter, the Guru of strategy,

has propounded the Value Chain Analysis (VCA), which is a whole new way of

looking at a company's functions and structures. Porter has visualised a firms

structure as below :

Page 21: IGNOU MBA MS-53 Solved Assignment 2013

An organization's functions can be grouped as below:

a) Primary Activities

1)Inbound logistics

2)Operations

3)Outbound logistics

4)Marketing and sales

5)Service

b) Support Activities

i) Purchasing and Outsourcing

ii) Human Resource Management

Technology (or knowledge base)

Infrastructure comprising of finance, planning, quality etc.

Subsequently Porter and many other researchers have argued that it is not only

important to develop competence in these individual functions, but also build strong

links among them so that they function in tandem to one another and harmonize their

activities to deliver higher real and perceived value(s) to the customer. It is almost

impossible to visualize strengthening links among individuals, functions and

companies without learning to use computers imaginatively and integral with

telecommunication, micro-electronic and information technology capabilities.

Best Wishes

Maanas([email protected])