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PRODUCTION AND OPERATION MANAGEMENT

PRODUCTION AND OPERATION MANAGEMENT. BB0021-BBA(IV) SIKKIM MANIPAL UNIVERSITY. UNIT-1 BASIC CONCEPTS.

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PRODUCTION AND OPERATION MANAGEMENT

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  1. PRODUCTION AND OPERATION MANAGEMENT BB0021-BBA(IV) SIKKIM MANIPAL UNIVERSITY

  2. UNIT-1 BASIC CONCEPTS PRODUCTION: Manufacturing is the use of machines, tools and labor to make things for use or sale. The term may refer to a range of human activity, from handicraft to high tech, but is most commonly applied to industrial production, in which raw materials are transformed into finished goods on a large scale. Such finished goods may be used for manufacturing other, more complex products, such as household appliances or automobiles, or sold to wholesalers, who in turn sell them to retailers, who then sell them to end users - the "consumers". Manufacturing takes place under all types of economic systems. | | <document classification>

  3. FACTORS OF PRODUCTION • Land and other natural resources. • Labor (human efforts). • Capital( factory, building, machinery, tools, raw materials). • Enterprise. | | <document classification>

  4. Boundaries of Production System • Policy Formulating System • Control systems • Intermediate organization systems • Manufacturing System | | <document classification>

  5. Types of Production • Job Production • Continuous Production • Batch Production | | <document classification>

  6. Production Management Production Management refers to the application of management principles to the function in a factory.The production management team (consisting of a production manager and any number of assistants) is responsible for realizing the visions of the producer and the director or choreographer within constraints of technical possibility. This involves coordinating the operations of various production sub-disciplines (scenic, wardrobe, lighting, sound, projection, automation, video, pyrotechnics, stage management, etc.) of the presentation. | | <document classification>

  7. Production Management • In addition to management and financial skills, a production manager must have detailed knowledge of all production disciplines including a thorough understanding of the interaction of these disciplines during the production process. This may involve dealing with matters ranging from the procurement of staff, materials and services, to freight, customs coordination, telecommunications, labor relations, logistics, information technology, government liaison, venue booking, scheduling, operations management and workplace safety. | | <document classification>

  8. Objectives of Production Management • Manufacturing cost • Product quality • Manufacturing schedule • Machinery and equipment • Materials • Manpower • Manufacturing Services | | <document classification>

  9. 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. | | <document classification>

  10. Operations Management 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" | | <document classification>

  11. UNIT-2 DESIGN AND PRODUCT Product design can be defined as the idea generation, concept development, testing and manufacturing or implementation of a physical object or service. Product Designers conceptualize and evaluate ideas, making them tangible through products in a more systematic approach. The role of a product designer encompasses many characteristics of the marketing manager, product manager, industrial designer and design engineer. | | <document classification>

  12. Braun’s Ten Industrial Principles • Usefulness • Quality • Ease of use • Simplicity • Clarity • Order • Naturalness • Aesthetics • Innovation • Truthfulness | | <document classification>

  13. Stages of Design Concept Generation Screening Preliminary Design Evaluation & Improvement Prototyping & final design The concept The Process The package | | <document classification>

  14. Concept Generation Ideas from customers Focus groups Listening to customers Ideas from competitor activity Ideas from staff Ideas from Research and development Reverse engineering From idea to concept Concept screening The marketing screen The Operations screen Finance screen Competitor Analysis Price-performance targeting Financial analysis Stages of Design | | <document classification>

  15. Requisites of Good Design • Customer Satisfaction • Earn Adequate Profit Factors affecting Product Design • Performance factors • Operating Conditions | | <document classification>

  16. UNIT-3 Product Life Cycle The product life cycle (PLC) describes the stages a new product idea goes through from beginning to end. The five major stages : • Product Development • Market Introduction • Market growth • Market Maturity • Sales Decline | | <document classification>

  17. Product Life Cycle Volume Growth Decline Product Development Introduction Maturity Units Sales Profits 0 Time | | <document classification>

  18. Stages of PLC • The different stages in a product life cycle are: • Market introduction stage • cost high • sales volume low • no/little competition - competitive manufacturers watch for acceptance/segment growth losses • demand has to be created • customers have to be prompted to try the product | | <document classification>

  19. Stages of PLC 2. Growth stage • costs reduced due to economies of scale and • sales volume increases significantly • profitability • public awareness • competition begins to increase with a few new players in establishing market • prices to maximize market share | | <document classification>

  20. Stages of PLC 3. Mature stage • Costs are very low as you are well established in market & no need for publicity. • sales volume peaks • increase in competitive offerings • prices tend to drop due to the proliferation of competing products • brand differentiation, feature diversification, as each player seeks to differentiate from competition with "how much product" is offered • Industrial profits go down | | <document classification>

  21. Stages of PLC 4. Saturation and decline stage • costs become counter-optimal • sales volume decline or stabilize • prices, profitability diminish • profit becomes more a challenge of production/distribution efficiency than increased sales | | <document classification>

  22. The product life cycle goes through many phases, involves many professional disciplines, and requires many skills, tools and processes. Product life cycle (PLC) has to do with the life of a product in the market with respect to business/commercial costs and sales measures. In the criticism of the product life cycle, Dhalla & Yuspeh state: ...clearly, the PLC is a dependent variable which is determined by market actions; it is not an independent variable to which companies should adapt their marketing programs. Marketing management itself can alter the shape and duration of a brand's life cycle. | | <document classification>

  23. UNIT-4 PRODUCT PLANNING & DEVELOPMENT Product:In general usage, product may refer to a single item or unit, a group of equivalent products, a grouping of goods or services, or an industrial classification for the goods or services. Classification of Products: • Consumer & Business Products • Convenience goods • Shopping goods • Specialty goods • Unsought goods • Classification of Business goods • Raw Materials • Installations • Accessory equipment etc. | | <document classification>

  24. Product Development The entire product development process is characterized by a number of factors which complicate its conduct. • Preliminary secreting of new product ideas. • The time substantial amounts of expenditures are authorized for research and development. • Authorization for prototype manufacture and market or use testing. • The decision regarding full scale manufacture and marketing. | | <document classification>

  25. Product Planning & Development System Phases involved are: • Generating new product ideas. • Preliminary appraisal of new product ideas & selection of projects. • Product and market research. • Process research • Prototype testing in production and marketing • Commercialization | | <document classification>

  26. Determinants of Product Mix • Technology • Competition • Operating Capacity • Market factors • Company attributes | | <document classification>

  27. Market factors Shifts in customer’s product mix Changes in availability of cost Changes in manufacturing processes Shifts in location of customers Changes in levels of business activity Government controls Company Attributes Marketing performance Production capabilities R&D strength Financial slack Interest and abilities of the executive group Determinants of Product Mix | | <document classification>

  28. UNIT-5 PLANT LOCATION Plant Location refers to the area where the plant will operate to produce goods or services. Site is an important activity which decides the fate of the business. A good location may, reduce the cost of production and distribution to a considerable extent. Locating a business involves a large, relatively permanent.If the site selection isn’t proper all the money spent on factory building, machinery and their installation will go in waste and the owner has to suffer a great loss. While selecting a site, it is necessary to consider technical, commercial and financial aspects. | | <document classification>

  29. The Problem of Location The problem of site selection of a factory can be solved in the following three stages: • Selection of the region • Selection of the locality • Selection of actual site | | <document classification>

  30. Steps in Plant Location • Selection of the region or general area • Selection of the particular community • Selection of the exact plant site | | <document classification>

  31. Factors Affecting Plant Location • Selection of Region • Availability of raw materials • Power and Fuel • Transport • Market • Meteorological conditions and topography | | <document classification>

  32. Labor Supplementary & complementary Industries Banking Local taxes Water Momentum of early start Personal factors Historical factors Political stability State assistance Selection of Community | | <document classification>

  33. Price of land Type of soil Waste disposal Expansion potential Commercial Services Availability of amenities Health of locality Statutory considerations Flood & drought experience Right & title of the land Good scenery Attitude of local people Technological know-how Religious & social institutions Selection of Plant Site | | <document classification>

  34. Recent trends in Plant Location • To locate plants away from cities • The development of Industrial estates • Competition among states to develop industries • Trend towards decentralization • Pollution control • Location of industries leading to balanced regional development • Growth of multinational firms, thereby transcending the geographical areas of the country | | <document classification>

  35. UNIT-6 PLANT LAYOUT • According to Mallick and Gaudreau- “A floor plant for determining and arranging the desired machinery and equipment of plant, in one best place, to permit the quickest flow of materials at the lowest cost and with the least amount of handling in processing the product from the receipt of raw materials to the shipment of finished products.” | | <document classification>

  36. Knowles and Thomson said that plant layout involves: Planning and arranging manufacturing machinery, equipment and services for the first time in completely new plants. The improvements in layouts already in use in order to introduce new methods and improvements in manufacturing procedures. | | <document classification>

  37. Essential features of Plant Layout • Departmentation of factory into a number of units to facilitate the smooth flow of production • Arrangement of plant and machinery in a systematic and orderly way to quicken the process of production • Placing the right equipments and tools in their appropriate places so that they will be readily available when required. • To arrange the material handling equipments and other auxiliary services required in the course of manufacturing. | | <document classification>

  38. Objectives of Plant Layout • To facilitate manufacturing process • To minimize material handling • To maintain high turnover of semi-finished goods • Effective utilization of space • To provide employees comfort and job satisfaction • To provide effective utilization of labor | | <document classification>

  39. Principles of Plant Layout • Principle of overall integration • Principle of minimum distance • Principle of flow • Principle of cubic space • Principle of satisfaction and safety • Principle of flexibility | | <document classification>

  40. Factory & Machine Layout • Factory layout is one of the components of plant layout, the other being machine layout. The layout of a factory means the position of the departments of shops in the factory, storage points in the working areas, including office and staff facilities relative to one another. • Machine layout is another name for plant layout(as discussed earlier). | | <document classification>

  41. Types of Plant Layout • Product Line Layout • Process or Functional layout • Combination of product and process layout; and • Fixed position layout | | <document classification>

  42. 1. Product or Line Layout • Straight-line type • U-shaped type • Circular type • Odd-angle type | | <document classification>

  43. Duplication of equipment Production control Adaptability in the case of breakdown of individual machines Material handling cost Production time involved Accumulation of work in process Floor area occupied Greater utilization of machines Flexibility Application Difference b/w Product layout & Process layout | | <document classification>

  44. Topics for Discussion • COMBINATION OF PRODUCT AND PROCESS LAYOUT • FIXED POSITION LAYOUT OR STATIC PRODUCT LAYOUT | | <document classification>

  45. TOOLS & TECHNIQUES FOR PLANT LAYOUT • TOOLS • Process charts and flow diagrams • Machine data cards • TECHNIQUES • Templates • Model of equipment • Layout of drawings • Plot plans | | <document classification>

  46. Collection of basic data Analysis & co-ordination of basic data Decide the type of machines required Decide material handling plan Sketch the plot for factory building Plan the general flow pattern Plan individual work station Calculate the storage space required Locate service departments Construct master plan Check the final layout Get official Approval Install the approved layout Layout Procedure | | <document classification>

  47. Revision of Layout- Re layout procedure Need for revising the original layout arises from the following: • Use of an unsuitable site for factory • Failure to make periodic work simplification surveys • Rapid expansion of the factory • Shifting the plant to other localities • Introduction of new product line Steps in the re-layout Procedure • To state the objectives to be accomplished and collect data. • Conduct work-simplification survey • Develop an improved layout | | <document classification>

  48. UNIT-7 MATERIAL HANDLING • Material Handling is the movement, storage, control and protection of materials, goods and products throughout the process of manufacturing, distribution, consumption and disposal. The focus is on the methods, mechanical equipment, systems and related controls used to achieve these functions. The material handling industry manufactures and distributes the equipment and services required to implement material handling systems. Material handling systems range from simple pallet rack and shelving projects, to complex conveyor belt and Automated Storage and Retrieval Systems (AS/RS). | | <document classification>

  49. FUNCTIONS OF MATERIAL HANDLING • To choose production machinery and assist in plant layout so as to eliminate as far as possible the need of material handling. • To choose most appropriate material handling equipment which is safe and can fulfill material handling requirements at the minimum possible overall cost. | | <document classification>

  50. Factors of selecting the Material Handling Equipment • Material to be moved • Plant buildings and layout • Type of production Machines • Type of material flow pattern • Type of Production • Cost of material handling equipment • Handling Cost • Life of the equipment • Amount of care & maintenance required for the material handling equipment. | | <document classification>

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