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Operations Management

Lesson 2 Facility Management. Operations Management. What you will learn in this unit: Facilities Management Location Decisions Layout Decisions Logistic Decisions Labour Decisions Technology Choice and Selection. Facilities Management.

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Operations Management

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  1. Lesson 2 Facility Management Operations Management

  2. What you will learn in this unit: • Facilities Management • Location Decisions • Layout Decisions • Logistic Decisions • Labour Decisions • Technology Choice and Selection

  3. Facilities Management Facilities management is the process of managing and improving capital investment of the organisation, these involves where to locate the operations, what are the layout to use, what logistic means that best for operations optimisation, who to engage to deliver the goods/services and what technologies to be utilised.

  4. Location Decision Location is the geographical positioning of an operation relative to the input resources, other operations or customers with which it interacts (Slack, 2001). Importance of location • It have significant impact on cost • Impact on speed of service • Attracting labour • Availability of raw materials

  5. The location of operations Supply-side Demand-side Operation factors factors Labour costs Labour skills Land costs Suitability of site Energy costs Image Transportation costs Convenience for customers Community factors

  6. Site Selection Factors • Historical – corporate towns • Inherent Local Conditions • Climate • Culture • Ethics • Language

  7. Site Selection Factors • Staffing • Labour Costs • Social Laws • Labour Competency • Productivity • Trade Unions • Education Level • Technological Sophistication • Labour Mix

  8. Site Selection Factors • Infrastructure • Family Services • Communications • Environmental Regulations • Legal Framework • Transportation • Rental costs • Living Costs • Country Stability

  9. Site Selection Factors • Construction • Land Cost • Construction Labour • Land Preparation • Expansion Possibilities • Zoning Regulations • Environmental Regulations • Materials Availability

  10. Site Selection Factors • Cash Flow Considerations • Exchange Rates • Repatriation of Funds • Taxes • Financial Aid

  11. Site Selection Factors • Proximity of Resources • Raw Materials • Process & Utility Water • Power Supply • Suppliers & Subcontractors • Convenience for Customers

  12. Layout – deciding where to put all the facilities, machines, equipment & staff in an operation (Slack, 2001) Layout Decision

  13. Why is layout design important? • Require substantial investments of resources • Involve long term commitments – not easily changed • Impact on the cost & efficiency of short term operations

  14. The facilities layout decision procedure Project process Decision 1 Volume and Jobbing process variety Batch process Process type Mass process Continuous process Decision 2 Strategic performance Fixed position layout Basic layout type objectives Process layout Cell layout Product layout Decision 3 Detailed design The physical position of all of layout transforming resources Flow of transformed resources

  15. Basic layout types Manufacturing B asic layout Service process types types process types Fixed Project processes Project processes Professional position layout services Jobbing processes Process layout Service shops Batch pro cesses Cell layout Mass services Mass processes Product layout Continuous processes Volume Variety

  16. Fixed Position Layout • Transformed resources remain stationary • Transforming resources move as necessary • Effectiveness is governed by:- • Scheduling of transforming resources • Reliability of transforming resources • Eg’s – shipbuilding, construction projects, some surgery, restaurant

  17. Process Layout • Similar processes (or with similar needs) are located together • Utilisation of transforming resources is improved • Transformed resources move through the operation according to their needs • Different products  different needs different routes • May be very complex • Eg’s – supermarkets, some machine manufacture

  18. Cell Layout • Machines or services grouped into cells • Cells determined by the process requirements of the family of product/services they transform • Could be considered mini product layouts • Can simplify a functional/process layout • Flexible • Duplicates some resources

  19. Product Layout • Locates the transforming resources entirely for the convenience of the transformed resources • Transformed resources follow a specified route • Flow is clear, predictable, easy to control • Eg’s – car assembly, paper manufacture, self-service cafe

  20. V olume-variety characteristics Low VOLUME High Low Fixed position layout Process layout VARIETY Cell layout Product layout Low

  21. What makes a good layout • Safety • Length of flow • Clarity of flow • Staff comfort • Management coordination • Accessibility • Space utilisation • Long term flexibility

  22. Logistic Decisions Logistic decision takes into consideration the flow of goods, information and financial resources therefore firms would have identify the necessary resources to support their operation.

  23. Public Logistics • Internal or Channel (Outbound) Logistics • Information Logistics • Supplier Logistics

  24. Labour Decisions • Labour decisions that focus on the human resources that help to ensure the operation process are optimise.

  25. Jobanalysis The process of determining the requirements of the job

  26. Job Analysis • The process of developing a detailed description of the tasks and responsibilities involved in a job, • determining the relationship of a given job to other jobs, and • ascertaining the knowledge, skill and abilities necessary for an employee to perform the job successfully.

  27. Tangible outcomes of job analysis Job description: A written description of a job, the types of duties performed and the conditions under which these duties are performed Person specification: Details the qualifications, experience and personal qualities required of suitable job-holders Job design: Concerns the satisfaction of the job holder’s needs

  28. Human engineering • Aims to identify and respond to worker needs in the performance of their jobs • Adapts work environment and equipment to the person • Can improve efficiency and create a more harmonious work environment

  29. Job design strategies • Job enlargement • Job rotation • Job enrichment • Self-managing work teams • Adjustments in work schedules

  30. Technology Decision • IT Technology • Manufacturing technology • Technology patents and processes • R&D technology • Material technology

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