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Operation and Production Management
Operation and Production Management
If we want high quality the required will be as the following: (type, quantity, cost, timing, quality.)
Supply chain: A sequence of activities and organizations involved in producing and delivering a good or
service.
Supply chains are both external and internal to the organization. The external parts of a supply chain
provide raw materials, parts, equipment, supplies, and/or other inputs to the organization, and they deliver
outputs that are goods to the organization’s customers.
The internal parts of a supply chain are part of the operations function itself, supplying operations with
parts and materials, performing work on products, and/or performing services.
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Or, Whatever:
Product or services it produced.
Operation management affects national’s ability to compete internationally.
*** The evolution
1) The manufacturing function.
2) The production function that have tangible output.
Manufacturing organization + extractive + trading….
3) The operation function Manufacturing
organization + extractive + trading
Service organization
Value-added: The difference between the cost of inputs and the value or price of outputs.
Manufacturing and service are often different in terms of what is done but quite similar in terms of how
it is done.
It also called 80/20 rule; that’s mean 80% of problems are caused by 20% from population.
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Ethical issue.
Financial statements.
Worker safety.
Product safety.
Quality.
The environment.
The community.
Hiring and firing workers.
Closing facilities.
Workers’ rights.
Demand forecast.
Aggregate planning.
Sequencing.
Scheduling.
Inventory management.
Quality control.
Project management.
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Lean production use minimum Volume high high
amount of resources and has the Flexibility high high
both advantage of craft and Variety large large
mass production. Cost low low
Work team: the work which done by people who works in team.
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Chapter 2: “Competitiveness, Strategy, and Productivity”
Quantity and time strategies quality based on strategies focus on maintaining or improving
productivity and its a measure of effective use of resources, usually expressed as the ratio of output
to input productivity ratio are used For planning workforce requirements scheduling equipment
financial analysis
b. A machine produced 70 pieces in two hours. However, two pieces were unusable.
SOLUTION:
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EXAMPLE 3: Determine the multifactor productivity for the combined input of labor and machine time
using the following data:
SOLUTION:
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Chapter 4: “product &service design”
Reliability
It is the ability of the product, part or system to be performing its intended function under a
prescribed set of conditions.
It is a probability that the product or system will:
Function when activated
Function for a given length of time.
Failure: is a situation in which a product, part or system does not perform as intended.
Cases of failure:
the smoke (heat) alarm
Case of partial performance
Case of working where it should not
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General rule: As the number of parts or components increase, the reliability decrease.
So this mean that the more complicated the product or system, the lower its reliability will be.
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Chapter 5: “Strategic Capacity Planning for Products and Services”
Capacity: is the upper limited ceiling on the load that an operating unit can handle.
The operating unit may be a plant, department, and machine.
The goal of capacity planning is to achieve a match between the
long-term supply capabilities of an organization and the
predicted level of long-term demand.
Capacity also includes:
Equipment.
Space.
Employee skills.
The basic questions in capacity handling are:
What kind of capacity is needed?
How much is needed?
When is it needed?
Importance of Capacity Decisions
Impacts ability to meet future demands.
Affects operating costs.
Major determinant of initial costs.
Involves long-term commitment.
Affects competitiveness.
Affects ease of management.
Globalization adds complexity.
Impacts long range planning.
Functional definitions of capacity:
Capacity Maximum output rate or service capacity an operation,
process, or facility is designed under idle conditions.
Effective capacity personal time, maintenance, and scrap Design
capacity minus allowances such as planned stops such as periodic
maintenance lunch breaks, problems in scheduling.
Actual output cannot exceed effective capacity outputs. Rate of
output actually achieved materials; defective includes absenteeism
breakdowns, shortage of materials, defective outputs.
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Examples of seasonal demand patterns
Seasonal: clothing, vacations, sports, education.
Monthly: bank transactions, social security checks.
Weekly: restaurants, supermarkets, traffic, hotel.
Daily: telephone calls, power usage, traffic, restaurants.
V.C=Q*v
T.R=R*Q
P=T.R-T.C =(R*Q)-(F.C+V.C)
P= Q(R-v)-FC
Q= (P+F.C)/(R-v)
QBEF=F.C/(R-v)
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Chapter 6: “process selection & facility layout”
Process Selection deciding on the way Production of goods or services will be organized.
Standardized systems:
Customized systems:
Each job is different, multi-purpose machines, high skilled workers, and lower
volume of Production, higher cost / unit.
Volume Few units Small quantity Moderate quantity large quantity Very large quantity
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1) Continues processing:
Producing very large volume of only highly Standardized product with
non- discrete (uncountable) units. (Sugar, flour, chemicals, petroleum,
steel).
2) Repetitive (mass/ assembly) Production:
They are semi continuous operations.
It involves one or a few similar items with large volumes using automate
specialized machine.
The output fairly standard involving very little processing variety: (cars,
TV’s, computers …)
3) Batch Processing
Producing batching with moderate volumes of similar items.
It uses the same processing requirements & equipment, arraying one or
more of the ingredients from one batch to the next.
4) Job shop
Producing lot production of small volume with specifications, according
to customer’s needs.
Lt’s responsible for specific operations not specific products.
It handles greater variety of job requirement.
5) Project
Complex jobs consisting of complication & unique, non-routine (non-
repetitive) activities, with a limited time farm.
Producing one unique per unit.
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Chapter 8: “Location Planning and Analysis"
Marketing strategy
Cost of doing business
Depletion of resources
2) Location of markets
Distribution costs Because of:
Perish ability of finished products: bakeries, flower- shops. Fresh seafood
Heavy weight or large volume For good producers: heavy products sand)
For services a close customer contact, tailor shops, home repair services
Governmental services post offices, police Competitive strategy for profit-oriented firms
For non-profit organization based on the needs of the users
For service banks, doctors, lawyers, retail sales fast food restaurant, supermarkets. Since
their products are often similar, they rely on convenience to attract customers.
3) Labor factor
o Costs
o Availability (skills, attitudes, volume)
o Productivity and unions
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Community consideration
• Quality of life Services: schools, housing, transportation, health care, environment, shopping,
police, fire department
• Attitudes impact on community...... noise, traffic, pollution, airports, and highways
• Taxes state & local, direct & indirect
• Environmental regulations state & local
• Developer support
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