Qu.

1 Differentiate between operations and production

Management ?
Ans.:- Differentiate between operations and production Management

Production Management Operation Management

Definition

Production management is Operation management is about the management of

about managing activities overall business operations which includes production
related to production only and post-production stages

Area of Decision making

Related to aspects of Related to the regular business activities in an

production only organization

Found In

It is found in enterprises It is found in places like Banks, Hospital,Companies et

where production is which are providing service
undertaken

Capital Requirement

More capital requirement Fewer capital requirements

initially

This article discusses a valuable topic for Commerce students which

involves highlighting the differences between Project Management and
Operation Management. Stay tuned to BYJU’S for more such exciting
articles.

Top Differences in Commerce:

•Cost Accounting vs Financial Accounting
•What are Assets and Liabilities
•What is Trial Balance and Balance Sheet
•Fixed Assets and Current Assets
•What is Fixed Cost and Variable Cost
•Balance Sheet and Financial Statement

Q.2 Write short note on Facility Layount.?

Ans.:- Facilities Layout
There are three types of workflow layouts that managers can choose
from and how office and factory facilities are approached differently.
What are the criteria of creating an effective and efficient workflow and
building a high standard of production?

Facility layout decisions are based on criteria aimed at creating an

effective and efficient workflow and high standard production.

LEARNING OBJECTIVES
Outline the key considerations in facility design
KEY TAKEAWAYS
Key Points
 There are three types of workflow layouts that managers can
choose from.
 Office and factory facilities are approached differently.
 A facility manager’s industry can also influence the facilities layout
design.

Key Terms
 facilities layout: Facility layout is simply the way a facility is
arranged in order to maximize processes that are not only
efficient but effective towards the overall organizational goal.

Introduction
Facilities is defined as the workspace and equipment needed to carry
out the operations of the organization. This includes offices, factories,
computers, and trucks.

The location, design, and layout of an organizations’ facilities are

central to maximising the efficiency of the overall operations system.

In this unit, we’re going to focus on facility design and layout.

Facilities Design and Layout

After choosing the facility’s location, the next stage in operations
planning is to design the best physical layout for the facility. The
avaliable space needs to be assessed with workstations, equipment,
storage, and other amenities need to be arranged. The aim is to allow
for the most efficient workflow without disruption. A workplace that
has carefully arranged its layout will allow for a more effictive and
efficient workflow and produce its good or services to a high standard.

There are three types of workflow layouts that managers can choose
from:

 Process layout: arranged in departments (e.g., hospitals).

 Product layout: production line (e.g., a car assembly plant).
 Fixed-position layout: building a large item (e.g., jumbo jet).

Facility Layout Considerations

Facility managers should consider several factors when designing the

layout of a facility to achieve maximum effectiveness.

 Does the design and layout allow for growth or change? Is there a
chance that your company will experience significant growth?
Could some other change come about that could influence the
layout of your facility? In business, anything is possible. Make sure
that same is true of your facilities layout. While making changes is
a costly and undertaking them shouldn’t be taken lightly, your
layout should be flexible enough to allow a redesign if the
situation calls for it.
 Is the process flow smooth? If you are running a factory, for
example, the flow should be such that the raw materials enter at
one end and the finished product exits at the other. The flow
doesn’t have to form a straight line, but there should be no
backtracking. Backtracking creates confusion. Employees get
confused (“Has that been done yet? “), parts get lost, and
coordination is very difficult. You need to have a smooth process
to be efficient.
 Are materials being handled efficiently? Here simplicity is best.
  Does the facility layout aid the business in meeting its production
needs? Is there enough space and is it used efficiently? Have you
allowed enough space for shipping and receiving? Can different
areas of the business communicate effectively? Does the layout
lend itself to promotional activities? (e.g., showing the facilites to
potential customers)
 Does the layout contribute to employee satisfaction and moral?
Numerous studies have linked employee moral to productivity. So
managers should take this point into consideration when
designing the layout of their facilities. How can this be done?
Paint the walls light colors, allow for windows and space, include a
cafeteria and a gym. Some of the options may cost lots of money,
but if it increases productivity in the long run, it is probably worth
making the investment.

Facility layout is an arrangement of different aspects of manufacturing

in an appropriate manner as to achieve desired production results.
Facility layout considers available space, final product, safety of users
and facility and convenience of operations.

An effective facility layout ensures that there is a smooth and steady

flow of production material, equipment and manpower at minimum
cost.

Facility layout looks at physical allocation of space for economic activity

in the plant. Therefore, main objective of the facility layout planning is
to design effective workflow as to make equipment and workers more
productive.

Facility Layout Objective

A model facility layout should be able to provide an ideal relationship
between raw material, equipment, manpower and final product at
minimal cost under safe and comfortable environment. An efficient and
effective facility layout can cover following objectives:

To provide optimum space to organize equipment and facilitate

movement of goods and to create safe and comfortable work
environment.

To promote order in production towards a single objective

To reduce movement of workers, raw material and equipment

To promote safety of plant as well as its workers

To facilitate extension or change in the layout to accommodate new

product line or technology upgradation

To increase production capacity of the organization

An organization can achieve the above-mentioned objective by

ensuring the following:

Better training of the workers and supervisors. Creating awareness

about of health hazard and safety standards Optimum utilization of
workforce and equipment Encouraging empowerment and reducing
administrative and other indirect work

Q.3 Explain in detail Material Management ?

Ans.:- Material Management is a system that effectively controls and

manages materials and supplies used in an organization. The goal of
material management is to ensure that the right materials are available at
the right time and in the right quantities, to support the production process
and meet customer demand.
Here are some key points to consider when exploring material
management:

 Material management plays a crucial role in the success of an

organization by ensuring that materials are available when needed
and in the right quantities.
 It helps to minimize waste and reduce costs by ensuring no over-
stocking or under-stocking of materials.
 It helps to improve customer satisfaction by ensuring that orders are
delivered on time and with the correct items.
 The critical components of material management include material
planning, procurement, inventory control, and distribution.
 Material planning involves forecasting demand, determining the
materials needed, and developing a plan to acquire those materials.
 Procurement involves sourcing and purchasing materials from
suppliers.
 Inventory control involves managing the flow of materials into and
out of the organization and monitoring inventory levels to ensure
they remain within acceptable limits.
 Distribution involves the physical movement of materials from the
organization to the customer.

Types of Material Management

The following are the different types of material management:

 Inventory Management
Inventory management involves the maintenance of a company's stock
of raw materials, semi-finished goods, and finished products. It includes
identifying the optimal inventory level to be maintained, determining
the reorder points, and ensuring that the inventory is stored correctly.
Inventory management aims to strike a balance between the costs of
holding too much inventory and the costs of running out of stock.

 Purchasing Management
Purchasing management involves procuring raw materials, supplies, and
services required for production. It consists of the selection of suppliers,
negotiation of prices, preparation of purchase orders, and management of
supplier relationships.

The objective of purchasing management is to buy the required materials

at the best possible price and quality while ensuring timely delivery.

 Warehouse Management
Warehouse management involves the storage and handling of materials, as
well as the management of the physical movement of goods within a
warehouse. It includes receiving, storing, and shipping materials, as well as
managing inventory levels and the location of materials within the
warehouse.

The goal of warehouse management is to optimize the use of space and

minimize the cost of storing and handling materials.

 Material Requirements Planning (MRP)

Material Requirements Planning (MRP) is a computer-based inventory
management system used to plan production schedules and manage the
procurement of materials.

MRP considers the lead time for ordering materials, the time required for
production, and the inventory levels of materials. MRP aims to ensure that
suitable materials are available at the right time and in the correct quantity
to meet production needs.
  Transportation Management
Transportation management involves the physical movement of materials
from one location to another. It includes the selection of carriers,
negotiation of freight rates, preparation of shipping documents, and
management of delivery schedules. Transportation management aims to
ensure that the materials are delivered on time and at the lowest possible
cost.

Objectives Of Material Management

The following are the five primary objectives of material management:

 Right Material
The first objective of material management is to ensure that suitable
materials are available for production. It involves identifying the materials
required for production and ensuring that they are of the correct quality,
specification, and quantity.

By ensuring that the right materials are available, companies can minimize
the risk of production delays and ensure customer satisfaction.

 Right Time
The second objective of material management is to ensure that the right
materials are available at the right time. It involves managing the
movement of materials within the warehouse, reducing lead times, and
improving the efficiency of delivery processes.

 Right Amount
The third objective of material management is to ensure that the right
amount of materials are available for production. It involves determining
the optimal inventory level to maintain and implementing processes to
manage the movement of materials within the warehouse.

By ensuring that the right amount of materials are available, companies can
minimize the risk of stock shortages, reduce the cost of storage and
handling, and increase efficiency.

 Right Price
The fourth objective of material management is to ensure that materials
are purchased at the right price. It involves negotiating with suppliers to
obtain the best possible prices and implementing cost-saving measures,
such as reducing waste, reducing lead times, and improving the efficiency
of delivery processes.

 Right Sources
The fifth objective of material management is to ensure that materials are
sourced from the right sources. It involves identifying reliable
suppliers, developing partnerships with suppliers, and ensuring that
materials are purchased from approved suppliers only.

By sourcing materials from the right sources, companies can reduce the risk
of defective materials, minimize the risk of production delays, and ensure
customer satisfaction.