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Topic-9

Topic-9. Information systems in POM. Information systems and data processing in operations planning and scheduling. Operations in information age: * high information requirement for better decisions * information explosion * information technology development

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Topic-9

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  1. Topic-9 Information systems in POM

  2. Information systems and data processing in operations planning and scheduling • Operations in information age: * high information requirement for better decisions * information explosion * information technology development • POM information system: Integrating all data processing tasks in operations into a computer system to assist production decisions

  3. Planning and Control Systems Diagram

  4. POM Data Base – Product Information • Item definition 1. Item number 2. Item description 3. Unit of measurement 4. Item type • Bills of materials 1. Structured BOM 2. Indented BOM 3. “Where used” BOM

  5. POM Data Base – Process Information • Work center data: 1.Description of equipment 2.Capacity (per planning period) • Routines: 1.Sequence of operations 2.Processing time for each operation 3.Setup time for each operation

  6. Item Definition • An item is any raw material, part, subassembly or end product that must be uniformly identified for planning, scheduling and controlling purpose. • An item is usually identified by: 1. item number A. Digit/character position of the number ENG4C-3.5 B. Digit number only: 003,0110

  7. Item Definition (II) 2.Item description: ENGINE/4-CYLINDER/3.5HP 3.Unit of measure: that tells how the unit is counted. Square Feet / Gallon / Ton 4. Item type that tell what kind of item it is (E)—End product (A)—Assembly (SA)—subassembly (P)--Part (RM)—raw material

  8. Types of Items • End Item: A parent, but not a component typically a final product • Intermediate Item: An item with at least one parent and at least one component • Subassembly: Special case of intermediate item: it is assembled from more than one component. • Purchased Item: An item with no components, coming from a supplier.

  9. Bills of Materials (BOM) • A BOM is a way to identifying 1. the components and 2. The quantity of each component that required for an end product • BOM can code in several formats: 1. Structured BOM 2. Indented BOM 3. “Where used” BOM

  10. Back slats Seat cushion Leg supports Seat-frame boards Back legs Front legs A Ladder-back chair Bill of Materials Figure 16.3

  11. A Ladder-back chair B (1) Ladder-back subassembly C (1) Seat subassembly D (2) Front legs E (4) Leg supports F (2) Back legs G (4) Back slats H (1) Seat frame I (1) Seat cushion J (4) Seat-frame boards Bill of Materials Figure 16.3

  12. Product A Level 0 Level 1 Level 2 Level 3 Level 4 Assembly A Part G Assembly C (2) (10) (1) Part E Subassembly D Part G Subassembly D (8) (2) (6) (1) Part E Part F Part E Part F (1) (4) (1) (4) Material H Material H (6 inches) (6 inches) A structured Bill of Material Total Number of Part E Required for One Unit of Product A: Total Quantity of Material H (inches) Required for One Unit of End Product A: = 1*8*2 + 1*2*2 + 1*1*1 = 16 + 4 + 1 = 21 = 6*4*2*2 + 6*4*1*1 = 96 + 24 = 120

  13. An Indented Bill of Material

  14. Directly Showing the “Parenthood” Relationship. This is a Down-Up Approach, Useful When There is a Particular Problem (e.g., Low Inventory Level/ Bad Parts). Three Forms of BOM– Provide Exactly Same Information, Used in Different Conditions. Where Used Information

  15. Work Center Data • A work center is a set of one or more machines/works that designed to perform certain processing works. • Examples: print center; inspection station; tool booth;…… • An essential element of information about a work center is : How much capacity available for each planning period.

  16. A particular work center contains six machines. The work center normally operates two 8-hour shifts per day, five days per week. The maximum allowable overtime is two hours per shift. Thus: Work Center Example

  17. Routines • A routine for an item: is used to identify the sequence of operations required to produce the item. For each operation, routings provide the following information: • Work center where each operation is performed • Machine/tooling requirement • Operation time and • Alternative routings if available

  18. Routings Example • The following is the routing to print 10 reams (500 sheet/ream) of letterhead stationary with one ink color:

  19. Total POM Leadtime • Total POM Leadtime: the time period between the time an order is accepted and the time the items are ready for delivery. • Total leadtime consist of : 1. Order preparing time: from order received to order released 2. Shop flow time from order released to shop to order completed and ready to leave the shop 3. Packing and per-delivery time:

  20. Operations Leadtime • Operations Leadtime consist of 4 components: 1. Processing time 2. Setup time 3. Moving time 4. Queuing time

  21. Supply Chain Management & E-Business

  22. Customer Customer Customer Customer Distribution center Distribution center Manufacturer Tier 1 Tier 2 Tier 3 Legend Supplier of services Supplier of materials Supply Chain Figure 9.5

  23. Supply chain management and e-business • Materials: any commodities used directly or indirectly in producing a product or service. Raw materials, component parts, assemblies, finished product and supplies. • Supply chain: the way materials flow through different organization from the raw material supplier to the finished goods consumer.

  24. Supply chain management and e-business (II) • SCM: refers to all the management functions related to the flow of materials from the company’s direct suppliers to its direct customers. ---Include: purchasing traffic production control inventory control warehousing and shipping. ----Two alternative names: materials management; logistics management

  25. Purchasing • Factors increasing the importance of purchasing today: --tremendous impact of material cost on profit (60-70% of sales) --popularity of just in time manufacturing --increasing global competition • Mission of purchasing: develop purchasing plans for each major product or service that are consistent with operations strategies: --low production costs --fast and on-time deliveries --high quality products and services --flexibility

  26. Purchasing (II) • Purchasing management: --Maintain data base available, qualified suppliers --Select suppliers to supply each material --Negotiate contracts --Act as interface between company and suppliers --Provide training to suppliers on latest technologies • Advantages of centralized purchasing: --buying in large quantities—better price --more clout with suppliers—great supply continuity --larger purchasing department—buyer specialization --combining small orders—less order cost duplication --combining shipments—lower transportation costs --better overall control

  27. Purchasing (III) • Buyers’ duties: • Know the market for their commodities • Understand the laws • Process purchase requisitions and quotation requests • Make supplier selections • Negotiate prices and conditions of sale • Place and follow-up on purchase orders • Maintain ethical behavior • Make or buy analysis: • Lower cost • Better quality • More reliable deliveries • What degree of vertical integration is desirable • should distinctive competencies be outsourced?

  28. Logistics • Logistics usually to management of : --the movement of materials within the factory --the shipment of incoming materials from suppliers --the shipment of outgoing products to customers Shipments to and from factories • Traffic departments routinely examine shipping schedules/select: --shipping methods --time tables --ways of expediting deliveries

  29. Logistics (II) • Traffic management is a specialized field requiring technical training • Distribution is shipment of finished goods through the distribution system to customers Distribution system is the network of shipping and receiving points starting with the factory and ending with customers

  30. Distribution Requirements Planning(DRP) • DRP is the planning for the replenishment of regional warehouse inventories • DRP uses MRP-type logic • Distribution requirements planning: * Scheduled receipts * Planned receipt of shipments * Projected ending inventory= +scheduled receipts + planned receipt of shipments - forecasted Distribution resource planning extends DRP

  31. Analyzing Shipping Decisions • Transportation problem involves shipping a product from several sources with limited supply to several destinations with demand to be satisfied • Innovations in logistics:

  32. Warehousing • Warehousing is management of materials while they are in storage • Inventory accounting: 1.In past inventory accounting was based on: * periodic inventory accounting systems * physical inventory counts 2.Today • Perpetual inventory accounting systems • Cycle counting

  33. Measuring the Performance Materials Managers • Level and value of in-house inventories • Percentage of orders delivered on time • Number of stockouts • Annual cost of materials • Annual cost of transportation • Annual cost of warehouse • Number of customer complaints • Other factors

  34. Supply-Chain Software • Supply-Chain Software: • Provides the capacity to share information with suppliers and customers and make decisions affecting internal and external supply chains • Often part of enterprise resource planning (ERP) systems • Supply-Chain Management Across the Organization • Firms must be committed to reengineering information flows for optimal supply chain management • Processes most affected are order placement, order fulfillment, and purchasing, processes that intersect all of the traditional functional areas of the firm • Supply-chain management is essential for both manufacturing and service firms

  35. E-Commerce • The Internet: • Word wide web: • How the internet works • Global impact of the internet • How e-commerce affects processes

  36. Types of E-Business • Business-to-consumer (C2C) commerce • Business-to-business (B2B) commerce • Consumer-to-consumer (C2C) commerce • Government-to-business (G2B) • Government-to-government (G2G) • Government-to-citizen (G2C)

  37. Types of E-Business (II) • E-commerce and small business -- 40%of US small business have their own website -- purchasing of goods and services is the typical e-commerce activity of small business

  38. Major Development Stages of Websites and E-Business Evolution and revolution in Web site development: • Stage 1: Growth through Experimentation • Stage 2: Growth through Value Creation • Stage 3: Growth through Focus and Uniqueness • Stage 4: Growth through Differentiation • Stage 5: Growth through Long-Term relationship

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