Production And Operation Management

What Is Production Management?Production Management involves understanding of the characteristics of various types of production systems, identification of the dynamics of the different phases of the management process, realizing the potential of different analytical tools, learning the nuances of the implementation of these tools, visualizing the impact of various uncertain situations and developing the ability to react under various scenarios to achieve consistently excellent business results. These organizations achieved superior quality, higher productivity, perfect delivery performance, overall customer satisfaction and enterprise excellence all with lower cost.

Integrated Production ManagementIndian industries spends billions of dollars on warehousing, inventory control, physical distribution, production management etc.In 1980s, problems like:Labor shortage, increased global competition, shortage & rising cost of energy, need for increased productivity, increased cost of carrying inventories, increased attention to quality & reindustrialization influences the need for improved management.

Integrated Production Management ContinueAccording to the need of improved management of materials in the factory & warehouse, production management is included in Material Management.MATERIAL MANAGEMENT: it is procuring, storing, handling, controlling, packaging, inspecting & transporting materials as well as providing customer service.In general: it can be defined as providing safely the right amount of the right material at the right place, at the right time, and at the right cost without damage.

Today PRODUCTION MANAGEMENT is much more than simply handling material. It involves:Handling materialStoring materialControlling materialTraditionally Production Management has been manifested with references to manufacturing as value adding & Production Management as cost adding.In 1980s, Productivity, Quality and Inventories represent three major targets of opportunity.

Design of Production Management SystemIt includes layout design & structural design in facilities design.Facilities Design is related to Product design, Process design & Schedule design.Product designers specify what the end product is to be in terms of dimensions material composition, packaging.Process planner determines how the product will be produced.Schedule designer (production planner) specifies the production quantities & schedules the production equipment.

Integrated Production SystemToday we have factories with segregated technology. We need technologically integrated factories. It will become a reality in individual companies only if strategic manufacturing plans are developed & such plans include material handling strategies.Attempts by industries to implement automation in manufacturing have tended to create islands of automation, rather than automated systems.Robots, flexible manufacturing systems, numerically controlled machine centres etc.are good examples.

INVENTORIESInventory is a list for goods and materials, or those goods and materials themselves, held available in stock by a business. Inventory are held in order to manage and hide from the customer the fact that manufacture/supply delay is longer than delivery delay, and also to ease the effect of imperfections in the manufacturing process that lower production efficiencies if production capacity stands idle for lack of materials.

The attention being paid to inventory management by Toyota Production System (Japan).Just-in-Time:- it refers to production of the necessary materials being performed JIT. Each process must accurately produce the required amount of product within a carefully controlled period of time.Autonomation:- More than one defects control. It is realized by quality control of the products & the autonomous defects control established through quality circles.Kanban:- It is the information system supporting JIT. The type & quantity of material required are entered on a material requisition form called a kanban.

Andon:- It is an electric board that is visible to every plant employee. It is used by employees to signal the need for assistance & prevent a stoppage of the assembly line.Yo-I-Don:- it means ready, set, go. It provides one method of smoothing the flow in a process.

According to MONDEN-in its simplest terms, the Toyota production system might be interpreted as a special case of material requirements planning.

Material ControlIt is required to reduce in-process inventories.Material control includes not only traditional inventory control, but also the location of material in in-process storage, and its orientation.Previously noted, in batch manufacturing 95% of the manufacturing cycle spends as in-process inventory.Proper planning of the storage & control is the key to an effective manufacturing system.

Apple and Strahan note, parts that comprise these inventories are typically stored in a manner that makes poor use of building space, provides limited accessibility to individual part numbers, and represents a low level of location control.Factors governing in-process storage by Apple & Strahan :Inventory size and allocationUnit load designInventory locationControl of status, location, and quantityStorage mode.

System ProductivityProductivity is not always enough, with rapid technological advancement & futuristic manufacturing equipment & processes, networked systems tend to become more & more complex. And this has necessitated organizations to revisit their systems & procedures as to how effective & efficient they prove to be.

Certain Key Aspects of System ProductivityAnalytical Supply Chain Management SolutionsScientific ABC analysisDynamic control of InventoryDynamic scheduling-fulfillment-based planning through ERPBroad based Outsourcing

CAPITAL PRODUCTIVITYCapital:- It refers to financial wealth, especially that used to start or maintain a business, sometimes referred to as Cash flow. Capital deployed in plant, machinery, buildings, distribution system etc.& it need to be productive.Reasons for low productivity:Demand fluctuationsUncertainties of production owing to breakdownsInventories

Various Methods Of Capital Productivity:

OutsourcingMethods of ImprovementBalancing of workstationsRationalization of packaging methodsQuality circles

LABOR PRODUCTIVITYProductivity: proper utilization of available resources to achieve the best results with minimum cost. Labor productivity: It is defined by the OECD to be "the ratio of a volume measure of output to a volume measure of input.Output per worker corresponds to the "average product of labor" and can be contrasted with the marginal product of labor, which refers to the increase in output that results from a corresponding (marginal) increase in labor input.

LABOR PRODUCTIVITY continue.Frederick W. Taylor in his "Task Study" said, "Human work Can be made infinitely more productive not by 'working harder' but by "working smarter'. How to increase labor productivity:-Balancing operations in assembly lineReallocation of workersSetting up productivity norms and evaluation of Production Operations

TRAININGThe term training refers to the acquisition of knowledge, skills, and competencies as a result of the teaching of vocational or practical skills and knowledge that relate to specific useful competencies. The dictionary meaning of Training is practical education in any profession or art.

TRAININGIn practical terms, Training would mean imparting competencies to do a particular act in a particular manner.

A life office would like to impart training to its prospective clients and the existing clients in certain processes that would ensure smooth relationship between the clients and the life office.

TRAINING continue..

So, we can say that Training will:-Improve Productivity Reduce Cost Make Production Competitive

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PRODUCTION AND OPERTAION MANAGEMNTUNIT-2ADVANCED METHODOLOGIES OF PRODUCTION

Advanced methodologies of productionProduction Systems contain the machinery, which are used to transform materials to the desired shapes, having the requisite properties induced into them for obtaining specific performance parameters.Production process includes obtaining raw materials, store them & move them from one stage of operation to the next, sometimes outside the plants. Tracking them throughout the process is a stupendous task.

Optimization at every stage is necessary to derive competitive advantage.To optimize, Advanced methodologies in aspect s like material handling, scheduling, Just In Time, Lean Manufacturing, packaging, logistics get the support of data base management systems, online transmission & processing of information that initiate & follow activities.

CAD-computer aided designCAD is the software aids in creating or modifying an existing design. Images of different components can be seen as assembled ,section-view etc. with great accuracies.With it we can send drawings via internet or intranet to concerned person.Corrections & incorporations can be made very quickly.

CAD-computer aided designWith it, the efficiency of designers increases by nearly 5 times. The software can generate the volume, weights of components as also other engineering parameters like centre of gravity, deflections under estimated loads & various other design parameters on complicated forms.This aids in reducing the time required to make a design or modify a product & thus concept market period gets drastically cut.

CIM, computer Integrated ManufacturingIntegration occurs when a broad range of manufacturing & supporting activities are linked.Activities include engineering design, production planning, shop control, order processing, material control, distribution etc.Information flow across all functions takes place with the help of computers.

CIM, computer Integrated ManufacturingCIM helps in avoiding accumulation of materials resulting in better throughput & better utilization of space. Identifying shortages, ensuring faster deliveries becomes easy with CIM.Transmission, processing, distribution & feedback happen with CIM resulting rapid production & reduced indirect costs.

Split- Case Order Fulfillment Methods & MechanizationSplit-case order: Fulfillment of orders which need different merchandise in different quantities requires that cases will have to be split, and pieces picked, repacked in cartons & ship to the customer.Mechanization: it helps in improving identification, pick-up & repacking the materials in addition to relieving monotony of the workers.

ORDER PICKING METHODSItems should be picked & packed in a logical manner & assigned to personnel as per customer requirements, so that their productivity is maximized.Accuracy of fulfillment of order is ensured by 2 basic factors:Order Extent- It is defined as the number of order to be picked simultaneously by a picker in an assignment.Discrete order: Single order is selected at a time.Batch order: the merchandise requirements of many orders are put together & selected for pick up in the geographical area which is covered in a single pass.

ORDER PICKING METHODSCoverage extent: the physical area to be traversed by the picker in selecting merchandise for an assignment within the picking zone. The zones are identified within the picking area.Tour picking: the entire picking area is considered for picking merchandise.SORTING- It is done for the purpose of easing the operation of matching orders, merchandise & the customers for whom they are done. Sort immediate or by merging a number of order & batches are made to consolidate the priorities for execution. This method is called Merge & Sort.

ROUTING: when orders are routed among the zones where picks are required, we call them Routing the picks. When orders are routed from zone to zone, in a particular order, whether any picks are there or not, we call them Chaining.When multiple zones are covered simultaneously in different zones we call them parallel routing.

ORDER PACKING METHODSWhen split-case is executed it becomes necessary that the merchandise is repacked for shipment to meet the requirements of the customers.In first method, they are picked & packed. This method is used where customer use the merchandize directly.

CLASSIFICATION SCHEMESD iscrete Order Picking or B atch Order PickingZ one picking or T our pickingBS Batch order picking-sort immediateBMBatch order picking- sort immediateZRZone picking with routingZCZone picking with chainingZPZone picking in parallel.For example: BSDZCA- batch order picking, sort immediate discrete order picking, zone picking with chaining and Assemble.

CHOICE OF OPTIMAL FULFILLMENT STRATEGIESGeneral order characteristics:Number of line-itemsQuality of pieces per line- itemGeneral order categories:Wholesale distributionRetail distributionDirect marketingConsumer DistributionThe performance measures to be satisfied by the choice of strategy are to minimize the costs involved & maximize desirable characteristics.

Communication of Picking DirectivesFor efficient process of order picking by personnel, we need accurate, timely & sufficient information.Various Techniques:-1. Reports- Customers order either in the printed format generated by the customer or converted to one by the marketing deptt., pick lists, packing slips, stock location reports, delivery notes.Labels: These labels are bar coded for item sorting & order verification.Radio frequency Terminals: coding & bar coding for identifying orders for routing & sorting.

Communication of Picking Directives2. Display Light- These computer activated lights are used to direct order selectors to items & locations to pick order or batch requirements. They call for the attention of the personnel & alert them.

Order Picking & Packing EconomicsThe main cost factors can be divided into two categories: Capital Costs & Operating Costs.Capital costs- it includes facilities, material handling systems, weighing systems, supporting & facilities goods which are used over a long time.Operating Costs- include labor, consumable supplies, insurance, utilities, taxes etc.Incidental costs- those associated with damages, resolution of errors, return handling, inventory shrinkage etc.

Space & Storage Equipment CostsSplit case picking & packing functions & the space required for them can be broadly categorized as-On line storageReplenishment aislesPicking aislesPacking work spaceMaterial handling space

Storage Density Vs. VelocityStorage Density refers to quantity of material or number of items that can be stored in a unit of volume, say 10 cubic meter.Velocity refers to the speed with which materials are moved to the next point in the supply chain.The major costs that are necessary to be incurred for an on-line storage system are space & equipment costs.

Capital Costs for on-line storageMechanization CostsPicking and Packing costsOrder assembly and packing system costs.

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PRODUCTION AND OPERATION MANAGEMENTUNIT-3OPERATIONS MANAGEMENT

OPERATIONS MANAGEMENT

Operations management is an area of business that is concerned with the production of goods and services, and involves the responsibility of ensuring that business operations are efficient and effective. It is the management of resources, the distribution of goods and services to customers, and the analysis of queue systems.APICS The Association for Operations Management also defines operations management as "the field of study that focuses on the effectively planning, scheduling, use, and control of a manufacturing or service organization through the study of concepts from design engineering, industrial engineering, management information systems, quality management, production management, inventory management, accounting, and other functions as they affect the organization"

Management activities encompasses in Operation Management

People- direct or indirect workforce;Parts- the components, sub-assemblies or even products.Processes- methodologies, technology, tooling, fixtures for establishing, maintaining & improving productivity;Planning & control- information management system which initiates, directs, monitors & collects feedback to enable efficient use of resources.

SCOPE OF OPERATIONSOperations research plays an increasingly important role in both the public and private sectors.Operations research addresses a wide variety of issues in transportation, inventory planning, production planning, crew planning, communication network design and operation, computer operations, financial assets and risk management, revenue management, market clearing and many other topics that aim to improve business productivity.

OPERATION STRATEGYOPERATIONS: It is one of the major functions of any business organization Marketing discovers the destination for the product or service that is produced.The operations functions should be guided by strategies which are consistent with the organization strategy. COMPETETIVENESS is at the core of all strategies.Different functional areas with their own capabilities & constraints have to be integrated for the overall corporate strategies.Operation Strategy is formulated to leverage the advantages, absorb the consequences of the variable nature of various functions & provide a dependable implementation programme.

Formulation of StrategyFormulation of Strategy depends on the assessments of strengths, understanding of the weaknesses, the nature of external environment & the resilience of the internal environment. The policies derived from the operations strategy should be amenable to go along with other functions.ORGANIZATION STRATEGY should be such that the strategies of different functions are designed to lend support to one another.

OPERATIONS STRATEGY takes under its umbrella the following:

QualityTimeFlexibility

STRATEGIC MANAGEMENT PROCESSThe organizational processes depend upon the:Structure of the organizationThe hierarchical levelsDecision arrival mechanismCommunication systemsAuthorization processesImplementation proceduresFeedback & monitoring devicesTo formulate and implement strategies.

Purpose of StrategiesTo leverage the companys advantagesTo prepare for the eventualities of uncertain external happeningsTo maximize the chances of success in the endeavorsTo ensure effective & efficient processTo avoid lossThe actual activities which result in outcomes are called Operations.

The Operations Strategy would consider the following:Additional machinery or sub-contractingMethods to improve productivityRevamping assembly lines Measures to improve motivationPromoting existing employees or hire new onesIdentifying & developing new suppliersLook for opportunities to reduce costs

STRATEGIC DECISION MAKINGDecision making is the crucial management function. Decisions commit the organization & its members to perform activities which have financial repercussions & affect the functioning of others who are connected with those.

Factors which form the basis of decision making:Environmental ScanningCore Competencies

Environmental Scanning- Becoming aware about the threats & opportunities and their impact on the firm by a process of analysis.Core competencies- The unique strengths on the basis of which the entrepreneur started the organization.Some additional strengths & competencies have been acquired to augment the existing business built.The developments and improvements both in knowledge and skills make the core strengths better.

CORE PROCESSESCore processes of an organization are determined by the core competencies.Four main core processes are:Customer relationshipNew product/ service developmentSupplier relationshipOrder fulfillment

DIFFERENTIATION STRATEGIESDifferentiation is a process by which a company distinguishes itself from its competitors and their offerings.The difference should be perceived by the customers as- important, distinctive, superior & affordable. Nonetheless, they have to make the companys offerings I.e. products & services profitable.

Tools for implementation of OperationsSet of specialized techniques are known as tools which can be standardized for ease of implementation and control.IMPLEMENTATION OF OPERATIONS: Implementation is the process of executing the planned operations.Estimating, routing, loading are the planning processes and dispatching and progressing are processes which are conducted while the manufacturing is going on.We call the former PLANNING and the latter CONTROLING function. Put together they are considered IMPLEMENTATION.

Tools for implementation of OperationsTools for implementation: GANTT charts are used to record progress comparing the actual against the planned activities and keep track of the flow of the material.Line Balancing & Line of Balance are two more tools to ensure that machining centers are loaded uniformly.Simulation Models are used to predict utilization of Machines and Production levels.Microsoft Operations Manager 2005 is a useful tool in this regard.

INDUSTRY BEST PRACTICESEach industry would have developed over years or decades. Materials would have changed, processes would have changed. All products & services are meant to serve needs of the customers, are undergo continuous changes both in shapes & features.Industry best practices open up the field for benchmarking by companies which need to improve their performance.

Pragmatic Bench MarkingIt is a method of measuring a companys processes, methods, procedures and in a way all functions in great detail. Benchmarking is used to understand how these got into the system and what circumstances brought them about.The metrics that could be used are- number of pieces per hour, cost per unit, number of breakdowns per week, customer alienation per week, return on investment, number of returns from customers in a month and inventory turnover.

Types Of BenchmarkingProcess benchmarking- Business ProcessFinancial benchmarkingPerformance benchmarkingProduct benchmarkingStrategic benchmarkingFunctional benchmarking

Benchmarking OperationPlanningAnalysisIntegrationActionIt is necessary to set achievable targets keeping in view the availability of resources, technology and spread awareness about the importance of what is attempted & how success improves the image of the company.

The BCG Growth-Share Matrix is a portfolio planning model developed by Bruce Henderson of the Boston Consulting Group in the early 1970's. It is based on the observation that a company's business units can be classified into four categories based on combinations of market growth and market share relative to the largest competitor, hence the name "growth-share". Market growth serves as a proxy for industry attractiveness, and relative market share serves as a proxy for competitive advantage. The growth-share matrix thus maps the business unit positions within these two important determinants of profitability.

This framework assumes that an increase in relative market share will result in an increase in the generation of cash. The four categories are:Dogs - Dogs have low market share and a low growth rate and thus neither generate nor consume a large amount of cash. However, dogs are cash traps because of the money tied up in a business that has little potential. Such businesses are candidates for divestiture.

Question marks - Question marks are growing rapidly and thus consume large amounts of cash, but because they have low market shares they do not generate much cash. The result is a large net cash consumption. A question mark (also known as a "problem child") has the potential to gain market share and become a star, and eventually a cash cow when the market growth slows. If the question mark does not succeed in becoming the market leader, then after perhaps years of cash consumption it will degenerate into a dog when the market growth declines. Question marks must be analyzed carefully in order to determine whether they are worth the investment required to grow market share.

Stars - Stars generate large amounts of cash because of their strong relative market share, but also consume large amounts of cash because of their high growth rate; therefore the cash in each direction approximately nets out. If a star can maintain its large market share, it will become a cash cow when the market growth rate declines. The portfolio of a diversified company always should have stars that will become the next cash cows and ensure future cash generation.

Cash cows - As leaders in a mature market, cash cows exhibit a return on assets that is greater than the market growth rate, and thus generate more cash than they consume. Such business units should be "milked", extracting the profits and investing as little cash as possible. Cash cows provide the cash required to turn question marks into market leaders, to cover the administrative costs of the company, to fund research and development, to service the corporate debt, and to pay dividends to shareholders. Because the cash cow generates a relatively stable cash flow, its value can be determined with reasonable accuracy by calculating the present value of its cash stream using a discounted cash flow analysis.

Under the growth-share matrix model, as an industry matures and its growth rate declines, a business unit will become either a cash cow or a dog, determined solely by whether it had become the market leader during the period of high growth. THANKS.

PRODUCTION AND OPERATION MANAGEMENTUNIT-4PRODUCTION TECHNIQUES

INTRODUCTIONA technique is a procedure used to accomplish a specific activity or task:Technology, the study of or a collection of techniques Skill, the ability to perform a task Scientific technique, any systematic method to obtain information of a scientific nature

Production TechniquesProduction Techniques encompass the work systems, their design and the processes of planning & production control techniques.Deploying existing resources, reinforcing them with new equipments, identifying new vendors, updating their technology, resolving quality problems, identifying bottlenecks in the flow of materials and information.SUITABILITY of various techniques & their combinations has to be viewed with flexibility for increasing or decreasing capacity to meet the market compulsion.

Production TechniquesReducing inventory has become very important. Assurance of quality has become fundamental for an organizations existence because processes involved are automated & the flow cannot be interrupted.From concept to product, the periods are shrinking.Computerization and Information Technology are facilitating the various processes to make them accurate, timely & savings in cost.

Automated Production SystemsAll operation systems are based on the following criteria:Output of the product- whether they are goods or servicesSpecification of the product- standards or customizedThe flow pattern- whether it is job shop or batch production, assembly or continuous.

Evolution of the Production SystemThe goods required by society were produced in small quantities by craftsmen who would know the needs of the community and produced them by their own hands with simple tools. He would be responsible for the design, procurement of the required materials and the processes, he considered fit. Repeated performance would improve their skills. But as demand increases, more people get involved in the process, apprentices would join these craftsmen & additional suppliers. They uses sources like horses, oxen, wind & water mills for power.

Division of labor became necessary to achieve efficiencies & the jobs that became specialized.Invention of petrol & diesel led to mass production. Frederick Taylor introduces the science of management. Observation, documentation, analysis became the backbone of achieving efficiencies.Special purpose machines, numerically controlled machines and robots maximize the production.ASRS-automated storage & retrieval systems and AGVS- automated guided vehicle systems and many more automated systems cost huge sums but beneficial for long term benefits.

Automated Flow LinesWhen several automated machines are linked by a transfer system which moves the parts by using handling machines which are also automated.After completing an operation on a machine, the semi-finish parts are moved to the next machine in the sequence determined by the process requirements and the flow line is established. Human Intervention may be needed to verify that the operations are taking place according to standards.Automated flow lines are beneficial to balance times that different machines take to complete the operations assigned to them.

Automated Flow LinesThe global trends are favoring flexibility in the manufacturing systems. As the cost involved in changing the set up of automated flow lines are high, the Automated Flow Lines are considered only when the product is required to be made in high volumes over a relatively long period.

Automated Assembly LinesAn assembly line is a manufacturing process in which parts (usually interchangeable parts) are added to a product in a sequential manner using optimally planned logistics to create a finished product much faster than with handcrafting-type methods. Mass production via assembly lines is widely considered to be the catalyst which initiated the modern consumer culture by making possible low unit costs for manufactured goods.

Automated Assembly LinesAssembly line uses proven and developed automation solutions to allow the customer to carry out assembly operations and the required production test parameters. Assembly line automation is a specialist area that combines many elements of automation and engineering.

Flexible Manufacturing SystemsA flexible manufacturing system (FMS) is a manufacturing system in which there is some amount of flexibility that allows the system to react in the case of changes, whether predicted or unpredicted. This flexibility is generally considered to fall into two categories, which both contain numerous subcategories.The first category, machine flexibility, covers the system's ability to be changed to produce new product types, and ability to change the order of operations executed on a part. The second category is called routing flexibility, which consists of the ability to use multiple machines to perform the same operation on a part, as well as the system's ability to absorb large-scale changes, such as in volume, capacity, or capability.

The main advantages of an FMS is its high flexibility in managing manufacturing resources like time and effort in order to manufacture a new product. The best application of an FMS is found in the production of small sets of products like those from a mass production.An Industrial Flexible Manufacturing System (FMS) consists of robots, Computer-controlled Machines, Numerical controlled machines (CNC), instrumentation devices, computers, sensors, and other stand alone systems such as inspection machines. The use of robots in the production segment of manufacturing industries promises a variety of benefits ranging from high utilization to high volume of productivity.

The production of each part or work-piece will require a different combination of manufacturing nodes. The movement of parts from one node to another is done through the material handling system. At the end of part processing, the finished parts will be routed to an automatic inspection node, and subsequently unloaded from the Flexible Manufacturing System.AdvantagesProductivity increment due to automation Preparation time for new products is shorter due to flexibility Saved labor cost, due to automation Improved production quality, due to automation However, it is not always necessary that on increasing flexibility productivity also in

Global Trends in Rapid PrototypingA prototype is an original type, form, or instance of something serving as a typical example, basis, or standard for other things of the same category.Prototyping is a process by which a new product is developed in small numbers so as to determine the suitability of the materials, study the various methods of manufacture, type of machinery required & to develop techniques to overcome problems that may be encountered when full scale manufacture is undertaken.It helps in confirming the design and any shortcomings can be rectified at low cost.

Building Manufacturing FlexibilityFlexibility has three dimensions in the manufacturing field:VarietyVolumeTimeManufacturing flexibility has become the cornerstone of operations strategy in the 2000s.The ability to improve/maintain market share becauseCustomer orders can be delivered soon after receipt of the orderProduction can quickly be shifted from product to productProduction capacity can be increased rapidlyNew products can be developed and introduced into production quickly and inexpensively

PRODUCTION AND OPERATION MANAGEMENTUNIT-5FACILITY MANAGEMENT

FACILITY MANAGEMENTIn business, facility management (or facilities management) is the management of building, estates which encompasses both building fabric and services. The services are sometimes considered to be divided into "hard services" and "soft services. Hard services includes such things as ensuring that a building's air conditioning is operating efficiently, reliably, safely and legally. Soft services includes such things as ensuring that the building is cleaned properly and regularly or monitoring the performance of contractors (e.g. builders, electricians).

FACILITY MANAGEMENTThe term "facility management" is similar to "property management" but often applied only to larger and/or commercial properties where the management and operation is more complex.

FACILITY PLANNING PROCESSIt is the most important function of management. We will consider them in two parts:Facility locationFacility lay-outFACILITY LOCATION- Facility location, also known as location analysis, is a branch of operations research concerning itself with mathematical modeling and solution of problems concerning the placement of facilities in order to minimize transportation costs, avoid placing hazardous materials near housing, outperform competitors' facilities, etc.

FACILITY LOCATIONFactors influencing plant location are:General Factors-Availability of landAvailability of inputsCloseness to market placesCommunication facilitiesInfrastructure- power, waterTransportGovernment support- subsidies etc.Housing & recreation- educational facilities

Special Factors-Economic stability- outside investmentsCultural factorsWagesJoint ventures- support of big time playersMethods for Plant Location:-Rating Plan MethodFactor Rating MethodPoint Rating MethodBreak-Even AnalysisCentre of Gravity MethodRefer book for details.

FACILITY LAYOUTLayout means the positioning of various equipments, machineries, department facilities etc to maximize productivity and valuable space utilization. It has to be considered with a view to accommodate additional machines.Different types of layouts are in vogue depending upon the product, process and the type of production.Always consider the Manufacturing systems while planning for Layout. It has to be considered with a view to accommodate additional machines.FACILITY LAYOUT IS OF TWO TYPES:Machine layoutProduct layout

MACHINERY LAYOUTThe processes involved in getting things done have to be detailed out in terms of materials required, the sequence of the various activities of the process & their movements from one location to another.In it the essence of planning is the determination of activities that need to be performed at a future date to meet demands that have been forecast based on market surveys.Another main consideration is the material handling that is required for the raw materials, goods in process and the finished goods.

PRODUCT LAYOUTThese are also called production lines or assembly lines. They are designed and laid out in such a way that only a few products are capable of being manufactured or assembled.Materials flow through the various facilities. These use special machines to perform specific operations to produce only one product at one time. So, companies set different set of machines for different operations.The operation times, the sequence of movements, routing procedures are highly standardized to meet production requirements which are synchronized with many such products to complete finished goods to meet demands.The skill required of the workers is low, supervision is minimal. Training needs are small. The MAIN concern is to keep a check on the processes so that QUALITY is assured.

OPTIMIZATION OF RESOURCE UTILIZATIONResources can broadly classified under three categories:First category- land, machinery, equipments, tools, raw materials, inventory, power etc.Second category- Processes, technology, techniques etc.Third category: People both inside & outside the organization, employees, suppliers, customers, members of the society.All the resources have inherent potential of enabling the realization of the goals f the organization. It is the responsibility of the management to identify the strengths that all these factors have and utilize them for achieving productivity.

Resources will have constraints in terms of their availability- quantities and timeliness.Reasons why companies still build up inventories :Customer Service- created inventory helps speed up delivery, thus meeting the need of the customer. An old customer tends to stay with you if you are able to give immediate delivery or he may be tempted to try a new supplier.Ordering Cost- frequent reordering increases the cost of procurement. Higher quantities may bring in entitlement of discounts. Further price increases will not affect us.In the shop floor longer runs lead to higher productivity & minimize the set up costs.Labor & equipment utilization will be high as quantities produced per set up is high.Reduced transportation costs- both inbound & outbound.

WORK CENTRE LOCATIONSA work centre is a production facility comprising of one or more machines and one or more workmen considered as a single unit for purposes of estimation of capacity. This unit may have a single operation or a number of them conducted on the input items.In many organizations, they are even considered as cost centers. Each work centre receives information along with material that enter it. The material also leaves the work center with information.Activities conducted on the basis of information that flows with material. Some centers have to close as a matter of necessity, some need not be & some need to be as far away as possible. THANKS..

PRODUCTION & OPERATION MANAGEMENTUNIT-6TOTAL QUALITY MANAGEMENT

INTRODUCTIONWhat is quality?Dictionary has many definitions: Essential characteristic, Superior, etc.Some definitions that have gained wide acceptance in various organizations: Quality is customer satisfaction, Quality is Fitness for Use.

The American National Standards Institute (ANSI) and the American Society for Quality (ASQ) define quality as:The totality of features and characteristics of a product or service that bears on its ability to satisfy given needs.

WHY QUALITY?Reasons for quality becoming a cardinal priority for most organizations:Competition Todays market demand high quality products at low cost. Having `high quality reputation is not enough! Internal cost of maintaining the reputation should be less.Changing customer The new customer is not only commanding priority based on volume but is more demanding about the quality system.Changing product mix The shift from low volume, high price to high volume, low price have resulted in a need to reduce the internal cost of poor quality.

WHY QUALITY?Product complexity As systems have become more complex, the reliability requirements for suppliers of components have become more stringent.Higher levels of customer satisfaction Higher customers expectations are getting spawned by increasing competition.

Relatively simpler approaches to quality viz. product inspection for quality control and incorporation of internal cost of poor quality into the selling price, might not work for todays complex market environment.

Quality perspectivesEveryone defines Quality based on their own perspective of it. Typical responses about the definition of quality would include:PerfectionConsistencyEliminating wasteSpeed of deliveryCompliance with policies and proceduresDoing it right the first timeDelighting or pleasing customersTotal customer satisfaction and service

Determinants of QualityQuality of design: design means specifications of materials, finishes, characteristics & other features incorporated in products. So, design as per specifications or parameters.Conformance to design: degree to which manufactures product meets the parameters.Utilization conditions: It refers to the necessity of the customer being informed so that the purpose for which the product was made is realized.After sales service: to make sure that product is functioning as per expectations.

System View of QualitySystem consists of a number of elements which have specific functions of their own, but give support and receive support from one another to deliver outputs as though they come from a single unit.Design ensures that information flow, feedback & monitoring take place to make the system efficient.Quality Control is exercised by mainly two methods:First, by designing the equipments, processes, manufacturing methods, technologies to ensure that quality parameters are obtained without fail. Robustness is built into all aspects so that in the inputs or extreme working conditions dont affect the quality characteristics.

Second, All processes have equipments, tools, methodologies, movements, facilitating goods & people who have their behaviors exhibited depending on their knowledge, skills & abilities.To anticipate & plan for their proper designed performance within the permissible deviations so as not to affect quality is the mechanism for assuring quality. This is quality control system.

Q.C.TECHNIQUESTechniques are specific activities & procedures adopted using data for determining a particular aspect of quality for arriving at decisions which are conclusive. Each technique is developed & checked by Senior consultant or personnel.Quality at the source: This concept of quality makes the production worker responsible for inspection of his own work & take corrective action. Since, inspection is done immediately after a job s done, the cause of the error with clarity & aids in faster rectification.

QC TOOLS7 basic tools for achieving quality:Flow chartCheck sheetHistogramPareto analysisScatter diagramControl chartCause & Effect diagram

ACCEPTANCE SAMPLINGStatistical procedure used in quality control. Acceptance sampling involves testing a batch of data to determine if the proportion of units having a particular attribute exceeds a given percentage. The sampling plan involves three determinations: (1) batch size; (2) sample size; and (3) maximum number of defects that can be uncovered before rejection of the entire batch. This technique permits acceptance or rejection of a batch of merchandise or documents under precisely specified circumstances.

ACCEPTANCE SAMPLINGAcceptance sampling is an important field of statistical quality control that was popularized by Dodge and Romig and originally applied by the U.S. military to the testing of bullets during World War II. If every bullet was tested in advance, no bullets would be left to ship. If, on the other hand, none were tested, malfunctions might occur in the field of battle, with potentially disastrous results.

ACCEPTANCE SAMPLINGDefinition of Lot Acceptance Sampling Dodge reasoned that a sample should be picked at random from the lot, and on the basis of information that was yielded by the sample, a decision should be made regarding the disposition of the lot. In general, the decision is either to accept or reject the lot. This process is called Lot Acceptance Sampling or just Acceptance Sampling The main purpose of acceptance sampling is to decide whether or not the lot is likely to be acceptable, not to estimate the quality of the lot.

PRODUCTION & OPERATION MANAGEMENT UNIT-7BUSINESS PROCESS MODELING

Business Process ModelingBusiness Process: It refers to the techniques and activities used as a part of business process management discipline.Business Process Modeling(BPM): It is an activity performed by business analysts within a company. Analysts use BPM tools to model both the current state of an enterprise and the intended futures state. To move from the current state to the future state may or may not require IT developments, although that is common.

Business Process ModelingBPM: It refers to a set of activities which organizations can perform to either optimize their business processes or adapt them to new organizational needs. It is synonymously used to refer to the software tools themselves.Business System: A combination of people and automated applications organized to meet a particular set of business objectives.

Business ProcessBusiness process is a total response that a business undertakes utilizing resources & delivering outputs that create value for the customer. The Business Process:Has a goalUses specific inputsDelivers specific outputs,Collects resources,Performs a number of activities in some order;Creates value for the customer.

Logical Process ModelingIt is the representation of putting together all the activities of business process in detail & making a representation of them. The initial data collected need to be arranged in a logical manner so that links are made between nodes for making the workflow smooth. The steps are:Capturing relevant data in detail to be acted upon,Establishing controls and limiting access to the data during process execution,Determining as which task in the process to be done & subsequent tasks in that process,Making sure that all relevant data are available for all the tasks that need to be in the order determined,Making available the relevant & appropriate data for that task,Establishing a mechanism to indicate acceptance of the results after every task or process to have the assurance that flow is going ahead with accomplishments in the desired path.

The Logical Process Model improves control on the access to data & identifies who is in possession of data at different nodes in the dataflow network that has been structured. Few of the logical modeling formats are given below:Process description- with task sequences & data addresses.Flow charts- with various activities & relationshipsFlow diagramsFunction hierarchiesFunction dependency diagrams

Data Driven Approach to Process Definition This approach is most commonly used in relational & object-oriented analysis efforts, analyzes the life cycle of each major data entity type.This approach defines a process for each phase or change the data undergoes, the method by which the data is created, the reasons for the change & the event that causes the data to achieve its terminal state.This method assures that all data actions are accounted for & that there are meaningful association between the data and its processes.

Process definition also helps you know when a process should be broken into smaller, sequential processes. If the definition of a process is ambiguous or lengthy, it is usually a candidate for decomposing into sequential processes. All the functions are decomposed to processes, and all processes are ultimately decomposed into sequential processes.

Construct the Process Model DiagramThe business analyst can now use process modeling software to construct diagrams to represent graphically the business process under consideration.In drawing the diagrams, consider including the following items:The starting point of the process; it is possible that we have multiple beginnings & different activities starting simultaneously and running parallel.The task that are done during process execution and their sequence and dependencies.Nodes in the path which show the activities that should be completed before starting further activities.

Decision points- take decision between choosing the path or whether the process should continue or not.The points at which the process path divides creating two or more paths for activities combine & lead to another activity.The end of the process. We may have one or more.The model is built upon data that get input at various stages of the process, data that get accumulated at nodes for further distribution & identifying activities that go along the path.All through the diagrams we ensure that all data are made available and verify whether desired results are being derived.Logical Process Modeling will of great assistance to system architects & developers to produce efficient & scalable applications.

Logical vs. Physical Database ModelingAfter all business requirements have been gathered for a proposed database, they must be modeled. Models are created to visually represent the proposed database so that business requirements can easily be associated. Server model diagrams represent a detailed picture of the database as being transformed from the business model into a relational database with tables, columns & constraints.Basically, data modeling serves as a link between business needs and system requirements.Two types of data modeling are :Logical ModelingPhysical modeling

Logical ModelingLogical modeling deals with gathering business requirements & converting those requirements into a model. The logical model revolves around the needs of the business, not the database, although the needs of the business are used to establish the needs of the database. Logical modeling involves gathering information about business processes, business entities (categories of data) & organizational units.Logical Modeling should accurately render a visual representation of the activities and data relevant to a particular business.The outcomes are- Entity Relationship diagram & Business process diagrams.

Physical ModelingPhysical modeling involves the actual design of a database according to the requirements that were established during logical modeling. Physical modeling deals with the conversion of the logical, or business model, into a relational database model. When physical modeling occurs, objects are being defined at the schema level. A schema is a group of related objects in a database. A database design effort is normally associated with one schema. The objects here are tables created on the basis of entities & attributes.The outcomes are server model diagrams showing tables & relationships with a database.

Business AnalystHis main responsibility is to collect in detail business problems, the requirements of the business people. He has to liaise between them to break down data, see through the logical steps that need to be taken and fill the gaps to enable the experts in technology to provide solutions. His knowledge, skills & functions are:Lead the team members to a consensus,Identify or gather the requirements of the business process that are critical, he needs to question concern people, verify the statements that are made, locate any gaps & arrange in the logical process for creating uninterrupted dataflow.

Identify the core requirements,Question business area experts & seek relevant information,Make sure that the requirements can be subjected to tests & the results are verifiable; analysts most important skill will be in his capacity to separate the grain from the chaff to know which are critical, vital & important bits of information from a huge mass of data he is confronted with.

Workflow Vs BPM

BPM is loosely coupled, not fixed like workflow. BPM is all about managing exceptions, about keeping them within your controlled business environment.Comparing BPM and Workflow management is like comparing a car and a train: a train(workflow) will get you from A to B, but you dont have many options on routing, on timing, and no exceptions are allowed. The route is planned in meticulous detail. It is capable of carrying large volumes of passengers.In a car(BPM), the passenger has autonomy and a direct interaction with the environment. The flexibility to get from A to B is also very much higher & can be changed at any time, depending on the circumstances.

PRODUCTION AND OPERATION MANAGEMENTUNIT-8 PROJECT MANAGEMENT- PLANNING PROCESS

PROJECT MANAGEMENTProject Management is the discipline of planning, organizing, and managing resources to bring about the successful completion of specific project goals and objectives. A project is a finite endeavor (having specific start and completion dates) undertaken to create a unique product or service which brings about beneficial change or added value. This finite characteristic of projects stands in sharp contrast to processes, or operations, which are permanent or semi-permanent functional work to repetitively produce the same product or service. In practice, the management of these two systems is often found to be quite different, and as such requires the development of distinct technical skills and the adoption of separate management philosophy, which is the subject of this article.

PMBOK (Project Management -- Body of Knowledge as defined by the Project Management Institute PMI):"Project management is the application of knowledge, skills, tools and techniques to project activities to meet project requirements." DIN 69901 (Deutsches Institut fr Normung - German Organization for Standardization): "Project management is the complete set of tasks, techniques, tools applied during project execution"

Understanding Project ManagementThe primary challenge of project management is to achieve all of the project goals and objectives while adhering to classic project constraintsusually scope, time and budget. The secondaryand more ambitiouschallenge is to optimize the allocation and integration of inputs necessary to meet pre-defined objectives. A project is a carefully defined set of activities that use resources (money, people, materials, energy, space, provisions, communication, motivation, etc.) to achieve the project goals and objectives.

Definitions related to Project ManagementPROJECT- A project is a finite endeavor (having specific start and completion dates) undertaken to create a unique product or service which brings about beneficial change or added value. This finite characteristic of projects stands in sharp contrast to processes, or operations, which are permanent or semi-permanent functional work to repetitively produce the same product or service. In practice, the management of these two systems is often found to be quite different, and as such requires the development of distinct technical skills and the adoption of separate management philosophy .

Definitions related to Project ManagementMANAGEMENT- Management in business and human organization activity is simply the act of getting people together to accomplish desired goals. Management comprises planning, organizing, resourcing, leading or directing, and controlling an organization (a group of one or more people or entities) or effort for the purpose of accomplishing a goal.

PROJECT CYCLE- A project cycle basically consists of the various activities of operations, resources and the limitations imposed on them.

Definitions related to Project ManagementPROCESS- A process is thus a specific ordering of work activities across time and space, with a beginning and an end, and clearly defined inputs and outputs: a structure for action. ... Taking a process approach implies adopting the customers point of view. Processes are the structure by which an organization does what is necessary to produce value for its customers. RESOURCE- It refers to manpower, machinery, money and materials required in the project.SCOPE- It refers to the various parameters that affect the project in its planning, formulation & executions.PROJECT COST- It is budgeted expenditure of the project.

NEED FOR PROJECT MANAGEMENTA project require huge investments which should not go waste A loss in any project would have direct or indirect impact on the society Prevent failures in projects Scope of the project activity may undergo a change Technology used may change during the course of project execution Consequences of negativity in project related problems could be very serious Changes in economic conditions may affect a project .

PROJECT MANAGEMENT PRINCIPLES Project management can be considered to have five dimensions Features Quality Cost Schedules Staff

Project Management Knowledge AreaProject ManagementProject Time ManagementProject HumanManagementExecutingProcessesProject Scope ManagementProject QualityManagementProject riskmanagementProject Communication ManagementProject CostManagementProject IntegrationManagement

PROJECT MANAGERA project manager is a professional in the field of project management. They have the responsibility of the planning, execution, and closing of any project.A project manager is the person accountable for accomplishing the stated project objectives. The successful project manager focuses on this as his/her main concern and attempts to reduce risk significantly, often by adhering to a policy of open communication, ensuring that project participants can voice their opinions and concerns.

RESPONSIBILITIES OF PROJECT MANAGERBudgeting and cost control Scheduling tasksAllocating resources Tracking project expenditures Ensuring technical quality Manage relations with the customer and company

PROJECT FAILURESProject being initiated at random at all levels.Project objective not in line with business objectiveProject management not observedProject manager with no prior experience in the related projectNon-dedicated teamLack of complete support from clientsNo prioritization of project activity from an organizational positionOne or more of the stages in the project mishandledLess qualified/ non-dedicated manpowerAbsence of smooth flow of communication b/w the involved parties

ESSENTIALS OF PROJECT MANAGEMENT PHILOSOPHYPROJECT EVALUATION & SELECTION CRITERIAFollowing criterions has to be considered:Relevance: is the project relevant to the defined scope in terms of the deliverable product & service.State-of-the-art technical: Check if the state-of-the-art methodologies are adequately describedRelevance to marketCreativePotential Project management & work plan Effort justification: Are the efforts in line with the work and the objectives to be achieved?

How does Project Management add value ?Projects may be completed with one or more of the following: Stretched deadline Over stresses team Wasted resources Unmet customer functional requirements Overshot budget A good project management methodology provides a framework for the processes

Steps of Good Project ManagementDefine the project Reduce it to a set of manageable resources Obtain appropriate and necessary resourcesBuild a team to perform the project work Plan the work and allocate the resources to the tasks Monitor and control the work Report progress to senior management and/or the project sponsor Close down the project when completed Review it to ensure that the lessons are learnt and widely understood

Project Management Players Individuals and organizations That are actively involved in the project Whose interests may be affected (positively or negatively) by the outcome (success or failure) of the project Exert influence over the project and its results Players are also called stakeholders of the projectProject manager: the individual responsibilities for managing the project Customer: the individual or organization who will use the products the end result of the project Performing organization: the enterprise whose employees are most directly involved in doing the work of the project Sponsor: the individual or group within or external to the performing organization that funds the project

Project Planning Project planning is part of project management, which relates to the use of schedules such as Gantt charts to plan and subsequently report progress within the project environment. Initially, the project scope is defined and the appropriate methods for completing the project are determined. The main objectives of scoping boundaries are:Define the project boundariesExplicitly stating the objectives that the project will cover Implicitly providing direction to the project and enabling assessment of the final products quality .

Outline of the project PlanContext for the ProjectPurpose and Objectives of the Project Tasks, Milestones, and Deliverables Uncertainties, Risks and Opportunities, and Planned Responses Critical Success Factors Use GANTT Chart of tasks to monitor and control the project deliverables

Tasks involved in ScopingEstablish project objectives which could be identified from clients through workshops & interviews.Establish scope of investigation in order to determine the dimension that apply to the project & identify the constraints.Identify initial requirement and validate them against the project objectives.Identify the criteria for assessing the success of both the final project product & the process used to create it.Identify outline solution to illustrate the feasibility of achieving the defined business requirements for the project.Identify Training requirement to determine the probable client training & technical writing.Review project scope.

PLANNING TOOLSProject Organization and Structure Project Management Team Key Stakeholders Identify management level personnel who are official to the success Document the responsibilities of stakeholders Stage Teams Identify appropriate personnel required for the stage, define the team structure and appoint team leadersBusiness Key resources Determine training requirement Assess the capabilities and skills of all those identified as part of the project organization.

PROJECT PROCESSESProject process is classified into two main categories: Project management process Project management process is defined by the organization. It describes and organize the work of the project. Product oriented process Product oriented process is defined by the life cycle. It specifies and creates products and related works.

PROCESS GROUPSINITIATINGPROCESSESCONTROLLINGPROCESSESCLOSING PROCESSESEXECUTINGPROCESSESPLANNING PROCESSES

Connection between Process Groups in a phase It consists of the following Initiating processes: recognition to start and establishing commitment. Planning processes: devising and maintaining a workable scheme to accomplish the business need Executing processes: coordinating people to carry out the plan. Controlling processes: monitoring and measuring progress and taking remedial actionClosing processes: Formalizing acceptance and bringing project to an orderly end.

Process Interactions The individual processes are linked and outputsInputs: it refers to the client documents converted to action plans to be acted upon.Tools and techniques: It refers to the mechanisms applied on to the inputs to the inputs to create desired outputsOutputs: It refers to the documents that are results of the processProcess Interactions Initiating Processes: Every process is initiated by management group decision which results in the next phase of the project.

Planning Processes Planning has the major importance Plans are nothing planning is everything Planning processes are highly interdependentIf the cost is unacceptable, scope and time may need to be redefined Executing Processes Interactions depend on the of the work They are dynamic & dependent on Team innovations

Controlling Processes Measuring project performance [time, cost, quality]Identifying variances from the plan Updating project plans Taking corrective action Closing Processes Review of the projectFindings Analysis of the project performance with respect to various processes

Customization Large projects may need details A detailed project management plan might be necessary to indicate every detail in the initial stages. Smaller projects may need relatively less details A detailed plan may not be required in the initial stages. Process details might change for other reasons Resources identification might be required for scope definition.

PROJECT INITIATIONDECISIONS ON THE ABOVECOMMISSIONING, FINE TUNING & FINALMODIFICATIONS TO THE DELIVERABLESFINAL DOCUMENTATION, SUBMISSION TO GOVT.& OTHER AGENCIESDESIGN OF PROJECT & TENDERPREPARATIONSISSUING WORK ORDERSASSESSMENT OF TENDERSCOMMENCEMENT OF WORKINFRASTRUCTURE, HUMAN RESOURCE MANAGEM,ENT IN PROJECTEXECUTION OF PROJECT AS PER PLANDelivery of the Project- Product or ServiceLEGAL APPROVALS FOR PROJECT

PRODUCTION AND OPERATIONS MANAGEMENT

UNIT-9PROJECT IMPLEMENTATION, CONTROL AND CLOSURE

INTRODUCTION A production process may be considered very important in todays growing industries. The project managers have to keep in mind the various problems that may be encountered during the executing the project. Also the manager must understand the change processes in a project to bring about any changes, it has to be through a proper process plan of change. The important aspect of any such process introduction or any change is to execute it correctly and then review the process post execution and finally documenting.

PROJECT MANAGEMENT LIFE CYCLE Analysis and Evaluation Phase This is the initial phase of any project. In this phase information is collected from the customer pertaining to the project and the requirements are analyzed. The entire project has to be planned and it should be done in a strategic manner. The project manager conducts the analysis of the problem and submits a detailed report to the top management. The report consist of project justification, details on what the problem is, methods of solving the problem, list of the objectives to be achieved, project budget and the success rate of completing the project. The report must also contain information on the project feasibility, and the risks involved in the project.

The important tasks of this phases are as follows - Specification requirements Analysis (SRA): It has to be conducted to determine the essential requirements of a project in order to achieve the target. Feasibility study: To analyze whether the project is technically, economically and practically feasible to be undertaken. Trade-off analysis: To understand and examine the various alternatives which could be considered Estimation: To estimate the project cost, effort required for the project and functionally of various processes in the project System design: Choose a general design that can fulfill the requirements.Project evaluation: Evaluate the project in terms of expected profit, cost and risks involved

MARKETING PHASEA PROJECT PROPOSAL IS PREPARED BY A GROUP OF PEOPLE INCLUDING THE PROJECT MANAGER. THIS PROPOSAL HAS TO CONTAIN THE STRATEGIES ADOPTED TO MARKET THE PRODUCT TO THE CUSTOMERS.

PROJECT MONITORING AND CONTROLAny project aimed at delivering a product or a service has to go through phases in a planned manner in order to meet the requirements. It is possible to work according to the project plan only by careful monitoring of the project progress. The methodology of PERT (Programme Evaluation Review Technique) and CPM (Critical Path Method) may be used to analyze the project. In the PERT method one can find out the variance and use the variance to analyze the various probabilistic estimates pertaining to the project. Using the CPM one can estimate the start time and the finish time for every event of the project in its WBS (Work Breakdown Structure).

STEPS OF MONITORING AND CONTROLLING A PROJECT

Preliminary WorkProject Progress Stage Control Resources Quality ControlProgress Control Approvals

Refer Book for details

CHANGING PROJECT MANAGEMENT PROCESSRequest for a change Identify need for a change based on which a formal request from either a member of the project learn or a client or a coordinator or Key stakeholder to make a change is to be made. Identify Alternative Solution Evaluate the change request and identify several alternative solutions. Assess the alternatives with respect to the functional scope, schedule, effort and cost. Decide on the Actions for the change Present the change request, alternatives solutions and recommendation to the project management team. The project management team is required to accept the recommendation, choose an alternative solution, or request further investigation. Implement Change Make appropriate schedule and other project plan adjustments to accommodate the change, communicate these to team members, monitor progress and execute quality control on the changes.

TOOLS FOR CHANGING A PROCESSChange Management System (CMS): It is a methodology which requires collection of all formal documented procedures, defining how project performance will be monitored and evaluated, how project plans could be updated, how various measures can be implemented to control the change process. Configuration Management (CM): Identify the configuration items and define the naming and numbering scheme, structure the changes, define a backup procedure, and follow the methods for tracking the status of configuration items. Identify and define the responsibility and authority of the CMS.

RISK MANAGEMENT

Risks are those events or conditions that may occur and whose occurrence has a harmful or negative impact on a project. Risk management aims to identify the risks and then take actions to minimize their effect on the project. Risk management entails additional cost. Hence risk management can be considered cost-effective only if the cost of risk management is considerably less than the cost incurred if the risk materializes.

FOUR IMPORTANT COMPONENTS IN RISK MANAGEMENT Risk Assessment- Identify the possible risks and assess the consequences by means of checklists of possible risks, surveys, meetings and brainstorming and reviews of plans, processes and products. The project manager can also use the process database to get information about risks and risk management on similar projects. Risk Control-Identify the actions needed to minimize the risk consequences. This is also known as risk mitigation. Develop a risk management plan. Focus on the highest prioritized risks. Prioritization requires analyzing the possible effects of the risk event in case it actually occurs. This approach requires a quantitative assessment of the risk probability and the risk consequences. For each risk determine the rate of its occurrence and indicate whether the risk is low, medium or of high category.

Risk Prioritizing -Rank the risk based on the probability and effects on the project; for example, a high probability, high impact item will have higher rank than a risk item a medium probability and high impact. In case of conflict use judgment. Risk Mitigation-Select the top few risk items for mitigation and tracking. Refer to a list of commonly used risk mitigation steps for various risks from the previous risk logs maintained by the project manager and select suitable risk mitigation step. The risk mitigation step must be properly executed by incorporating them into the project schedule.

PROJECT CLOSURECOMPLETION OF ALL ACTIVITIES AND BENEFITS It implies that on successful completion of a project, it has not drifted from its intended course and plans. Otherwise it would have resulted in a change and may also kick start another project affecting the main project. The project member are acknowledgement for the completion of the project, motivating them to take up more projects wherein the members would be able to confidently handle and take care of all the problems based upon their learning from earlier project.

POST IMPLEMENTATION REVIEW After every stage of a project is implemented, it may so happen that there could be a minor change or modification which has to be reviewed which has to be reviewed. A review may by in the following form:Final product review Outstanding project work review Project Review Process review

TOOLS THAT MAY BE CONSIDERED FOR POST IMPLEMENTATION REVIEW Final product evaluation: this may be done through regularly organized meetings and quality reviews. Outstanding project work evaluation: All outstanding works of a project can be reviewed to check its output quality, its performance compared to planned and evaluate the same. Project review questionnaire may become important if the review are to be structured and group discussion may be initiated depending upon the points to be discussed. Process evaluation: Evaluation of any process is one of the key issues of project.

FINAL PROJECT REPORTING AND DOCUMENTATION After completion of a project stage and the project as a whole, it is documented. Reports are prepared to indicate the details. The objectives of the stage and the project and the corresponding plans should be reviewed and items that are still open should then be closed or resolved. The outstanding items should be passed on to the person responsible for the subsequent work. It is necessary to document every stage of the project. Every review meeting by the project team and any other members of the project organization and follow ups have to be well documented. Also various metrics could have been used during the course of the project and necessary changes in the stages. Effects on the process and the corresponding metrics are evaluated and documented.

UNIT-10MODERN TRENDS IN PROJECT MANAGEMENT

INTRODUCTIONIn todays world, a manager is often faced with the challenges of newer competition arising out various business facets. His task is to understand the problem & quickly analyze it and solve it. For this the manager must know the recent trends in the Industry to apply them to his problem solving methodology. A problem may lead to another problem if not addressed properly & hence the entire focus should be understand and develop new solution techniques to tackle the problems.

PROJECT MANAGEMENT INFORMATION SYSTEM (PMIS)An information system dealing with project management tasks is known as PMIS. It mainly aimed at providing the management at different levels with information related to the system of the organization. It helps in decision-making in arriving at optimum allocation of resources.It also holds schedule, scope changes, risk assessment and actual results. A good PMIS is possible to be developed from the team members and not from the systems administrators of the company.

Aspects of PMISThe four major aspects of a PMIS are:Provide information to the major stakeholders is the right information at the right time.Assist the team members, stakeholders,managers with necessary information and summary of the information shared to the higher level managers.Assists the managers in doing what if analyzes about project staffing, proposed staffing changes and total allocation of resources.Help organizational learning by helping the members of the organization learn about Project management.

MODERN TRENDS IN PROJECT MANAGEMENT1. PERCEPTION: The perception of a manager in current trends in project management is to obtain result. A more result-cum-profit oriented corporate strategy lays greater emphasis on maximized efficiency of operations.Various tools used currently are:Continuous business process improvementForce field analysisInformation risk managementManagement assurance measureSEI-CMM & ISO certification (Software Engg.Instt.capability maturity model).Strategic Inflection point

2.PROJECT DEVELOPMENT PROCESS CYCLE: In order to improve project performance, the company must assure quality and quality control at every stage of the project throughout the project life cycle.Various Steps-Planning for reviewConducting the reviewTake actions on findingsDo continuous improvementCritical Success factorsResults and benefits of the Project Quality reviews

PROJECT MANAGER: He enable the necessary adjustments and taking the actions needed to achieve the project goals finishing the project on time, scope and budget.Project manager process helps in terms of discipline and control, for the customer because, in the way that process is anticipating potential problems to the customer and finally for the sponsor.

MACRO ISSUES1. Evolving Key Success Factors Upfront: In order to provide complete stability to fulfillment of goals, one needs to constantly evaluate from time to time, the consideration of what will constitute the success of completing a project and assessing its success before completion.The KSF should be evolved based on a basic consensus document (BCD) KSF will also provide an input to effective exit strategy (EES).Exit here does not mean exit from the project but from any of the drilled down elemental activities which may prove to be hurdles.

2. Empowerment Title (ET): ET reflects the relative importance of members of the organization at three levels-Team members empowered to work within limits of their respective allocated responsibilities, the major change from bureaucratic systems is an expectation from these members to innovate and contribute to time and cost.Group leaders are empowered additionally to act independently towards client expectation and are also vested with some limited financial powers.Managers are empowered further to act independently but to maintain a scientific balance among time, cost, expectation and perception apart from being a virtual advisor to the top management.

3. Partnering Decision Making(PDM):It is a substitute to monitoring and control. A senior with better decision making process will work can be done to manage the future better from past experience. The key here is the active participation of members in the decision making process. This step is most difficult since junior members have to respond and resist to being pushed through sheer innovation and performance.

4.Management By Exception (MBE)Practice whereby only the information that indicates a signicant deviations of actual results from the budgeted or planned results is brought to the managements notice. Its objective is to facilitate managements focus on really important tactical and strategic task. In MBE, the decision that cannot be made at one level of management is passed on to the next higher level.

5. Knowledge Factor(K): Knowledge is the most powerful mover of the wheels of progress. K factor is an index of the extent to which one can manage today with yesterdays knowledge content and also the extent to which todays knowledge will be used tomorrow. It is important for leaders to recognize the knowledge potential of the younger members.It is the task of every team members to maximize the K-factor in all directions.

Modern Mantra Of Project Management DMAISDefine:Benchmark, customer requirement, process flow map, quality function deployment, project management plan.Measure:Data collection, defect metrics, sampling.Analyze:Cause and effect, failure modes and effect analysis, decision and risk analysis, root cause analysis, reliability analysis.Improve:Design of experiments, modeling, robust design.Standardize: Control charts, time series, procedural adherence, performance management, preventive activities.

New Horizons in Project ManagementBelieving in discontinuityOwning the problems & sharing the solutionsBreaking the status quo mentalityStepping out of comfortable zoneHuman capital by passing financialTransform work culture from 5 to 7 dimensionReal number of encounters replacing number of years of experienceSeeking meaning out of changeDetachment from the fruits of results

UNIT-11SUPPLY CHAIN MANAGEMENT

INTRODUCTIONSupply chain management (SCM) is the management of a network of interconnected businesses involved in the ultimate provision of product and service packages required by end customers. Supply Chain Management spans all movement and storage of raw materials, work-in-process inventory, and finished goods from point-of-origin to point-of-consumption (supply chain).

Supply Chain ManagementSupply chain management is a cross-functional approach to manage the movement of raw materials into an organization, certain aspects of the internal processing of materials into finished goods, and then the movement of finished goods out of the organization toward the end-consumer. As organizations strive to focus on core competencies and becoming more flexible, they have reduced their ownership of raw materials sources and distribution channels. These functions are increasingly being outsourced to other entities that can perform the activities better or more cost effectively. The effect is to increase the number of organizations involved in satisfying customer demand, while reducing management control of daily logistics operations. Less control and more supply chain partners led to the creation of supply chain management concepts. The purpose of supply chain management is to improve trust and collaboration among supply chain partners, thus improving inventory visibility and improving inventory velocity.

SUPPLY CHAIN

Implementation Steps of SCMStudy the strengths & weaknesses within the enterprise as well as of External agencies involved.Understand the organization objectives.Study the existing systems & identify the gaps & propose solutions to plug the loopholes.Evolve consensus & test fire individual solutions.Integrate solutions which are adjudged successful into the mainstream.Study overall impact after all proposals in a section are implemented review consensus.Finalize SCM document, circulate & implement.

Domain ApplicationsSCM can be easily applied & integrated with-ERP systemsDesign systems like auto-CAD, Pro-ER & D systemsISO 9000 systemsAccounting & financial systemsCosting systemsManufacturing systems

SUPPLY CHAIN DECISIONSStrategicStrategic network optimization, including the number, location, and size of warehouses, distribution centers and facilities.Strategic partnership with suppliers, distributors, and customers, creating communication channels for critical information and operational improvements such as cross docking, direct shipping, and third-party logistics.Product design coordination, so that new and existing products can be optimally integrated into the supply chain, load managementInformation Technology infrastructure, to support supply chain operations.Where-to-make and what-to-make-or-buy decisionsAligning overall organizational strategy with supply strategy.

TacticalSourcing contracts and other purchasing decisions.Production decisions, including contracting, scheduling, and planning process definition.Inventory decisions, including quantity, location, and quality of inventory.Transportation strategy, including frequency, routes, and contracting.Benchmarking of all operations against competitors and implementation of best practices throughout the enterprise.Milestone paymentsFocus on customer demand.

OperationalDaily production and distribution planning, including all nodes in the supply chain.Production scheduling for each manufacturing facility in the supply chain (minute by minute).Demand planning and forecasting, coordinating the demand forecast of all customers and sharing the forecast with all suppliers.Sourcing planning, including current inventory and forecast demand, in collaboration with all suppliers.Inbound operations, including transportation from suppliers and receiving inventory.

Production operations, including the consumption of materials and flow of finished goods.Outbound operations, including all fulfillment activities and transportation to customers.Order promising, accounting for all constraints in the supply chain, including all suppliers, manufacturing facilities, distribution centers, and other customers...

Major Decision Areas in SCMLOCATION DECISION- The geographic placement of production facilities, stocking points, & sourcing points is the natural first step in creating a supply chain. Once the size, number & location of these are determined so are the possible paths by which the product flows through to the final customer.PRODUCTION DECISION- The strategic decisions included what products to produce & which plants to produce them in allocation of suppliers to plants to the customer markets. The operational decisions focus on detailed production scheduling.

3. INVENTORY DECISIONS- Inventories exist at every stage of the supply chain as either raw materials, semi-finished or finished goods. They can also be in process between locations. Their primary purpose is to buffer against uncertainties.4. TRANSPORTATION DECISIONS- The best choice of the mode is often found by trading-off the cost of using the particular mode of transport with the indirect cost of inventory associated with that mode. Since transportation is more than 30% of the logistics costs, operating efficiently makes good economic sense. Shipment sizes routing & scheduling of equipment are the key in effective management of the firms transport strategy.

5. SUPPLY CHAIN MODELING APPROACHES- Due to the enormity of data requirement, and the broad as scope of decisions, various models provide approximate solutions to the decisions they describe. To facilitate a concise review of the literature, and at the same time attempting to accommodate the polarity in modeling, we divide the modeling approaches into 3 areas: network design, rough cut methods & simulation methods.a) Network design method; This model cover the 4 major decision areas, provide normative models for the strategic decisions. It focus more on the design aspect of the supply chain, the establishment of the network and the associated flows on them.

b) Rough Cut Methods; It give guiding policies for the operational decisions. These models typically assume a single site and add supply chain characteristics to it, such as explicitly considering the sites relation to the others in the network.c) Simulation Based method- With this method a comprehensive supply chain model can be analyzed, considering both strategic & operational elements. However, one can only evaluate the effectiveness of a pre-specified policy rather than develop new ones.

THE 7 PRINCIPLE