Production and Operations Management

Introduction Introduction

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Operations as a Transformation Process

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INPUT •Material•Machines•Labor•Management•Capital

TRANSFORMATIONPROCESS

OUTPUT •Goods•Services

Feedback & Requirements

Production management is concerned with the manufacturing of goods:

Examples of goods:carsbookschairscomputershousesetc.

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Examples of services:retailing/foodbankingeducationhealth careutilitiesinsurancegovernment agenciesetc.

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OPERATIONS MANAGEMENT QUESTIONS

1. . How many items will be demanded next month?

2. How many items should be produced next month?

3. How many workers are needed to satisfy the proposed production level?

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OPERATIONS MANAGEMENT QUESTIONS4. If a plant is built, how should the activities be

scheduled so that the project is completed on time, within budget, and with acceptable quality?

5. How is the quality of our output measured and how is it improved?

6. If sodas are needed, how many should be ordered?

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Introduction

• Production means application of processes (technology) to the raw material to add the use and economic values to arrive at the desired product by the best method without sacrificing the desired quality.

• Production is of 3 major ways

• Production by Disintegration -separating the contents, the desired products are produced. For example …………..

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• Production by Integration- in this type of production various components of the product are assembled together to form the desired product. Eg……….

• Production by Service- here the chemical and mechanical properties are improved without any physical change. Eg……… heat treatment of metals

• Generally speaking, production is the use of any process or procedure designed to transform a set of input elements, which have use value and economic value.

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Management

• Do it yourself;

• Ask your neighbor …………..

• What is management?

• What are the activities involved in management?

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Operations- An overview

• Operations management is the conversion of inputs into outputs, using physical resources so as to provide the desired utility to the customer while meeting the other organizational objectives of effectiveness, efficiency and adaptability.

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A product

• Many of us know of a product from the consumers orientation. It is better for us to deal with different angles, because it will be helpful for us to understand the subject of production and operations manegement.

• To a consumer; the product is a combination of or optimal mix of utilities. This is because every consumer expects some use or uses from the product. For example soap can be identified by cleanliness of body, freshness, fragrance or health etc

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• To a production manager; a product is the combination of various surfaces and processes (operations). This is because the production manager is solely responsible for producing the product. He has to think of the various surfaces by which the product is made of so that he can plan for processes by which a particular surface can be made.

• To a financial manager; a product is a mix of various cost elements as he is responsible for the profitability of the product.

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• To a personnel/Human resource manager; a product is a mix of various skills as he is the person who selects and trains the personnel to meet the demand of the skill to produce the product.

• In general a product is a bundle of tangible and intangible attributes which along with the service is meant to satisfy the customer wants.

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Importance of operations management

• Efficient production management will give benefits to the various sections of society. That is the stakeholders

Consumer benefits from increased productivity, increased use value in the product. Products are available to him/her at a right place, at right price, at right time, in desired quantity and of desired quality.

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Importance of operations mgt con….Investors; they get increased security for their

investments, adequate market returns and creditability and good image in the society.

Employee gets adequate wages, job security, improved working conditions and increased personal and job satisfaction.

Suppliers will get confidence in management and their bills can be realized without any delay.

Community enjoys benefits from economic 15

and social stability.The nation will achieve prospects and security

because of increased productivity and healthy industrial atmosphere.

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Functions of production mgt department• The functions of the production department

depend on the size of the firm. As such there may be no guidelines to specify the function of production dept but the following are some of the functions which are looked after by the production department

Materials: the selection of materials for the product, production manager must have sound knowledge of materials and their properties so that he can select appropriate materials for his product.

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Functions of production mgt cont…Methods: Finding the best method for the

process, to search for the methods that suit the available resources, identifying the sequence of processes for manufacture of the product.

Machines and equipment: selection of suitable machinery for the process desired, designing the maintenance policy and design of lay out of machines are taken care of by the production department.

Estimating: To fix the production targets and delivery dates and to keep the production costs a

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at minimum, production department does a thorough of production times and costs.

Loading and scheduling; the production management department has to draw a time table for various activities specifying when to start and when to finish the process required.

Routing, this is concerned with fixing the flow lines for various raw materials, components etc from stores to the packing of finished products so that all the concerned know what exactly is happening on the shop floor.

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Despatching; the activities of the shop floor follow given instructions which are given by the production department.

Expediting or follow up; it is the responsibility of the production department to know whether activities are being carried out as per plans or not. Expediting helps to evaluate the plans

Inspection; this is generally done during production, but a separate quality control department does quality inspection which is not normally under prodn department.

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Evaluation; the production department must evaluate itself and its contribution in fulfilling the corporate objectives and departmental objectives. This is necessary for setting future standards.

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