Master of Business Administration- MBA Semester 2



ROLL NO. : 511116481 LC. CODE : 0965 SUBJECT : MB0044 – Production and Operations Management

CIM is most useful where a high level of ICT is used in the company or facility. the availability of process planning and its data. Some factors involved when considering a CIM implementation are the production volume. analysis. Through the integration of computers. marketing. cost accounting. Mechanisms for sensing state and modifying processes. CIM implies that there are at least two computers exchanging information. although the main advantage is the ability to create automated manufacturing processes. inventory control. Ans: Computer-integrated manufacturing (CIM) is the manufacturing approach of using computers to control the entire production process. e. production. providing direct control and monitoring of all the operations. based on real-time input from sensors. Explain briefly the Computer Integrated Manufacturing. Algorithms for uniting the data processing component with the sensor/modification component. Key challenges There are three major challenges to development of a smoothly operating computer-integrated manufacturing system: . three components distinguish CIM from other manufacturing methodologies:    Means for data storage. CIM is an example of the implementation of information and communication technologies (ICTs) in manufacturing. It is also known as flexible design and manufacturing. manufacturing can be faster and less error-prone. such as CAD/CAM systems. the experience of the company or personnel to make the integration. As a method of manufacturing. retrieval. and support functions of a manufacturing enterprise are organized. and distribution are linked through the computer with factory floor functions such as materials handling and management. manipulation and presentation.g.Assignment Set . planning. Typically CIM relies on closed-loop control processes. Q1. In a CIM system functional areas such as design. The term "computer-integrated manufacturing" is both a method of manufacturing and the name of a computer-automated system in which individual engineering.1 (60 Marks) Note: Each question carries 10 Marks. purchasing. the controller of an arm robot and a micro-controller of a CNC machine.[1][2] This integration allows individual processes to exchange information with each other and initiate actions. the level of the integration into the product itself and the integration of the production processes. Answer all the questions.

electric power. procurement. In the case of AGVs. a process. and telecommunications Defense Facility operations . pulp and paper Transportation . and the automation professional is ―any individual involved in the creation and application of technology to monitor and control the production and delivery of products and services. including automotive. energy management. or a system operate automatically. the more critical is the integrity of the data used to control the machines. conveyors and robots. aerospace. and management.‖ Automation encompasses many vital elements. . Data integrity: The higher the degree of automation. such as CNC. the automation profession includes ―everyone involved in the creation and application of technology to monitor and control the production and delivery of products and services‖. While the CIM system saves on labor of operating the machines. are using different communications protocols. even differing lengths of time for charging the batteries may cause problems. integration. environmental control.‖ Using our definition. and job functions. but there must always be a competent engineer on hand to handle circumstances which could not be foreseen by the designers of the control software. safety.‖ We define automation as “ the creation and application of technology to monitor and control the production and delivery of products and services. Here are some examples:       Manufacturing . oil and gas. it requires extra human labor in ensuring that there are proper safeguards for the data signals that are used to control the machines. What is automation? What are the kinds of automation? Ans: The dictionary defines automation as ―the technique of making an apparatus. Process control: Computers may be used to assist the human operators of the manufacturing facility. including water and wastewater. Automation provides benefits to virtually all of industry. including food and pharmaceutical. Integration of components from different suppliers: When different machines. computer    Q2. including security. and rail Utilities . systems. and maintenance to design. and other building automation And many others Automation crosses all functions within industry from installation. Automation even reaches into the marketing and sales functions of these industries. chemical and petroleum.

By bringing in the term Policy the rules management get’s a more of the ―enterprise-style‖. Support Automation Support Automation refers to software packages are focused on supporting the routine work of help desk personnel. and many.Automation involves a very broad range of technologies including robotics and expert systems. Examples for this category are products like CA SupportBridge or mValent Integrity. where batch processing or job Scheduling were a big improvement. many more. as companies have started to deploy myriad of servers into an extremely fast growing number of data centers all over the world. Run-Book-Automation Products belonging to this category are very popular nowadays. Policy-Based Automation Certain Automation solutions such as Enigmatec are elevating the importance of rules to an higher level. electro-optics. These products are gaining ground in modern service oriented environments and are represented through products from big vendors like CA/Cybermation and IBM Tivoli or smaller competitors like ASG and UC4 Data Center Automation This is the hottest topic today. policy-based execution and configured to smart coloured visual GUIs. Think of it as a kind of script integration in existing Service desk. bringing high demand for automated tools to provision. sensors. IBM Tivoli Provisioning Manager and to bring in some cloudy haze modern and . Examples for this kind of products are Opalis Integration Server. Cybersecurity. which is focused on Change Management Automation. eventtriggering. IT-Workload Automation These concepts stem from early (mainframe) days of computing. wireless applications. BMC Realops or HP/Opsware/IConclude Opsforce. change and manage vast numbers of components. telemetry and communications. They allow to define a set of ITSM-Workflows through a Graphical user interface. systems integration. Though modern products are highly evolutionized through offering multi platform compatibility. Some solutions in the IT Process Automation area are providing a rich set of features for designing and managing policies. test measurement. BMC BladeLogic. HP know that story. Products in this category are former Opsware Server Automation System. Good products offer a multitude of connectors and interfaces to existing ITSM suites like OpenView. CRM application or even in Knowledge Base Applications for Automated Self Service. process measurement and control. Tivoli or Unicenter. allowing operator to ―automate‖ recurring tasks. where the bucks go. Any of the large vendor offers such a tool or suite and – you guessed it – here is place.

The Need for location decisions These decisions are needed when a new plant is to be set up or when the operations involved in the company at the present location need to be expanded but expansion becomes difficult because of the poor selection of the site for such operations. They also include infrastructural facilities. and availability of skilled workers. as it would largely affect the cycle of production. The way the works of a company have to be performed. the taxation and also the work attitude of the workers. customer satisfaction are some of the other factors which are greatly influenced by the plant location decisions – hence these decisions require in-depth analysis. Plant location decisions need detailed analysis because: 1. Factors governing plant location: 1. Location of the plant itself becomes a very important factor concerning service facilities. transportation. What are the factors that influence the plant location? Ans: Units concerning both manufacturing as well as the assembling of the products are on a very large scale affected by the decisions involving the location of the plant. . Q3. Once a plant is set up at a location which is not much suitable. poor location can act as a continuous stimulus of higher cost. it is a very disturbing as well as very expensive process to shift works of a company to some other place. According to Robinson. These decisions are sometimes taken because of the social or the political conditions engulfing the working of a company. The investments involved in the in setting up of the plant premises . legislation. largely depends upon the industrial policies issued by the government. 3. 2. Marketing.buying of the land etc are very large and especially in the case of big multinational companies. quality. transportation products/players like Elastra or 3Tera/Applogic which allow to mix data center and cloud offerings. as the plant location decisions are strategic and long-term in nature.e. Regional factors: These factors include proximity of the plant to the market and also to the sources of the raw materials. the investments can go into millions of rupees. so economic factors of the location should be very minutely and carefully checked and discussed in order to achieve good returns on the money which has been invested. Any change that creeps in the industrial policy of the government which favors decentralization and hence does not permit any change or any expansion of the existing plant – requires strictly evaluated location decisions. Wrong plant location generally affects cost parameters i. Robinson was the one who has very clearly and efficiently justified industrial location concerns using pure materials nearer to the markets or the consumption centers.

first emphasized by Kaoru Ishikawa. it's temporary. more fragile or more perishable than is raw materials. As one expert notes. Q5. Community factors: These involve accommodation.the place of production is likely to be at the place of consumption where the final product is more expensive to carry because it is more bulky. A project isn't something that's part of normal business operations. a marketing campaign. prepared form for collecting and analyzing data. and you'll have a name for them too: "indispensable.‖ ―The Basic Seven. "It has a beginning . Ans: ―The Old Seven. Stratification: A technique that separates data gathered from a variety of sources so that patterns can be seen (some lists replace ―stratification‖ with ―flowchart‖ or ―run chart‖).‖ Start your quality journey by mastering these tools. a generic tool that can be adapted for a wide variety of purposes.‖ ―The First Seven. and it's specific. or a wedding. Describe the five dimensions of project management. the launch of a new service. supporting industries and services. Check sheet: A structured. Q4. 2. Pareto chart: Shows on a bar graph which factors are more significant. to look for a relationship. suitability of the land etc. Define project management. one variable on each axis."        Cause-and-effect diagram (also called Ishikawa or fishbone chart): Identifies many possible causes for an effect or problem and sorts ideas into useful categories. Scatter diagram: Graphs pairs of numerical data. education. It also includes attitude of the community. Histogram: The most commonly used graph for showing frequency distributions. whether the project is development of a new product. Describe the seven basic quality control tools. or how often each different value in a set of data occurs. entertainment and transport facilities. It's typically created once. Ans: roject management is the science (and art) of organizing the components of a project. Control charts: Graphs used to study how a process changes over time.‖ Quality pros have many names for these seven basic tools of quality. a professor of engineering at Tokyo University and the father of ―quality circles.

the project manager can set milestones. how the tasks are related. budget. that could affect scheduling. the project manager lists all activities or tasks. 3. A change in one constraint will typically affect the other constraints. cash. project management typically follows the same pattern: 1. resources. for example. dates by which important aspects of the project need to be met. 2. materials.and an end. The project manager works with the business sponsor or manager who wants to have the project implemented and other stakeholders -. the project manager knows how many resources and how much budget he or she has to work with for the project. and scope. Definition Planning Execution Control Closure Defining the Project In this stage the project manager defines what the project is and what the users hope to achieve by undertaking the project. the project manager identifies how many people (often referred to as "resources") and how much expense ("cost") is involved in the project. The project manager will also want to identify project constraints." A project consumes resources (whether people. The project manager then assigns those resources and allocates budget to various tasks in the project. In this stage. or time). and budget. This phase also includes a list of project deliverables. For example. and it has funding limits. Likewise. and how each tasks is tied to a specific deadline. In this phase. Executing the Project Build the project team. . resources. if additional features are added as part of project scope. the project tasks related to it will also reflect a comparable delay. In this stage. a budget constraint may affect the number of people who can work on the project. 4. thereby imposing a resource constraint. so that. 5. the outcome of a specific set of activities.those who have a vested interest in the outcome of the project. if one task is x number of days late. as well as any other requirements that are necessary for completing the project. This phase also allows the project manager to define relationships between tasks. Likewise. Project Management Basics No matter what the type of project. The project manager will also need to manage assumptions and risks related to the project. how long each task will take. Planning the Project Define all project activities. Define requirements for completing the project. Constraints typically relate to schedule. Now the work of the project begins.

Supply chain management involves coordinating and integrating these flows both within and among companies. Scope Frequently. If a company reduces the amount of time it can spend on a project. money. By keeping up with the details of progress. What is meant by Supply Chain Management (SCM)? What are the objectives of SCM? Ans: Supply chain management (SCM) is the oversight of materials. the project manager and business owner pull together the project team and those who have an interest in the outcome of the project (stakeholders) to analyze the final outcome of the project. Time. PPM is a move by organizations to get control over numerous projects by evaluating how well each project aligns with strategic goals and quantifying its value. It is said that the ultimate goal of any effective supply chain management system is to reduce inventory (with the assumption that products are available when needed). Supply chain management flows can be divided into three main flows: . Reducing or increasing any one of the three will probably have an impact on the other two. that will affect the scope (what can be included in the project) as well as the cost (since additional people or resources may be required to meet the abbreviated schedule). each resulting in potentially differing amounts of return or value. sophisticated software systems with Web interfaces are competing with Web-based application service providers (ASP) who promise to provide part or all of the SCM service for companies who rent their service. information. An organization will typically be working on multiple projects. and finances as they move in a process from supplier to manufacturer to wholesaler to retailer to consumer.Controlling the Project The project manager is in charge of updating the project plans to reflect actual time elapsed for each task. The company or agency may decide to eliminate those projects with a lower return in order to dedicate greater resources to the remaining projects or in order to preserve the projects with the highest return or value Q6. the project manager is able to understand how well the project is progressing overall. A product such as Microsoft Project facilitates the administrative aspects of project management. Closure of the Project In this stage. Project Portfolio Management Recent trends in project management include project portfolio management (PPM). Money. people refer to project management as having three components: time. and scope. As a solution for successful supply chain management.

   The product flow The information flow The finances flow The product flow includes the movement of goods from a supplier to a customer. 2. Achieving maximum efficiency in using labour. capital & plant through the company. Product Quantity control. Flexible planning and control procedures. This shared data may reside in diverse database systems. Planning applications use advanced algorithms to determine the best way to fill an order. at several different sites and companies. . manufacturers. variety reduction. 6. or data warehouses. 5. Minimizing variance by means of activities like standardization. Minimum total cost of operation & procurement. 4. and includes key suppliers. Reduction of pre & post production inventory. Solving supplier’s problems and beyond his level. and consignment and title ownership arrangements. There are two main types of SCM software: planning applications and execution applications. the management of materials. Execution applications track the physical status of goods. The information flow involves transmitting orders and updating the status of delivery. 7. payment schedules. 8. 3. and end customers of a specific company). The financial flow consists of credit terms. as well as any customer returns or service needs. Objectives of SCM A well designed SC is expected to support the strategic objectives of:1. Customer service performance improvement. and financial information involving all parties Some SCM applications are based on open data models that support the sharing of data both inside and outside the enterprise (this is called the extended enterprise. etc.

The measure can be compared to the results of competitors to see if the company is using its working capital in the most effective manner. because it has too much invested in accounts receivable and/or inventory to produce a given level of sales. and capital).Assignment Set . . Ans: The amount of output per unit of input (labor. equipment. objectives. The main processes of a company are as follows: Description: The working capital productivity measure is similar to the sales to current assets ratio.2 (60 Marks) Note: Each question carries 10 Marks. theory and key figures of its own. in that both are used to see if there are sufficient assets available to support a given level of sales activity. in order to be able to measure and understand them. yet. while in the service sector productivity might be measured based on the revenue generated by an employee divided by his/her salary. A producing company can be divided into sub-processes in different ways. There are many different ways of measuring productivity. Answer all the questions. For example. What is productivity? Write a brief note on capital productivity. Q1. Alternatively. The working capital productivity measure tends to be somewhat more accurate. since it subtracts current liabilities from current assets to arrive at a net current asset figure that may be considerably less than the total current assets figure used in the other measurement. in a factory productivity might be measured based on the number of hours it takes to produce a good. each with a logic. the following five are identified as main processes. yet. an excessively low working capital productivity measurement reveals that a company is quite inefficient at producing sales. as a part of the whole. It is important to examine each of them individually.

After completing an operation on a machine. a few of the operations can be done on a single machine with a number of attachments. When these can be achieved with the help of automation and the processes are conducted with self regulation.Formula: To calculate working capital productivity. The formula is as: Annual Sales Working Capital Q2. we have an automated flow line. positioned etc. Bottlenecks cannot be permitted. Sometimes. Flow lines compel engineers to put in place equipments that balance their production rates. It is necessary to design the machines in such a way that the operation times are the same throughout the sequence in the flow of the martial. The logic to be followed is to find out whether the reduction in cost per piece justifies the costs of designing. diivide annual sales by total working capital. many companies have found that well designed flow lines suit their purpose well. rotated. we will have automated flow lines established. The costs involved in changing the set up of automated flow lines are high. It is not possible to think of inventories (Work In Process) in a flow line. Cellular Manufacturing along with conventional Product and Process Layouts are still resorted to as they allow flexibility for the production system. the semi finished parts are moved to the next machine in the sequence determined by the process requirements a flow line is established. every bottleneck gets . automated flow lines are considered only when the product is required to be made in high volumes over a relatively long period. for completing different operations. Designers now incorporate flexibility in the machines which will take care of small changes in dimensions by making adjustments or minor changes in the existing machine or layout. Ans: Automated flow lines : When several automated machines are linked by a transfer system which moves the parts by using handling machines which are also automated. By necessity. It may be useful to also calculate average working capital. With methodologies of JIT and Lean Manufacturing finding importance and relevance in the competitive field of manufacturing. We assume that product life cycles are sufficiently stable to invest heavily on the automated flow lines to achieve reduced cost per unit. where one component is manufactured using several operations and machines it is possible to achieve this condition – or very nearly. The parts at various stages from raw material to ready for fitment or assembly are processed continuously to attain the required shapes or acquire special properties to enable them to perform desired functions. in case the ending working capital for the reporting period is unusually high or low. lifted. Group Technology. manufacturing and setting up automated flow lines. So. The materials need to be moved. Provision for extra pallets or tool holders or conveyors are made in the original design to accommodate anticipated changes. In fixed automation or hard automation. held. The global trends are favouring flexibility in the manufacturing systems. Describe briefly the automated flow lines. One important consideration is to balance times that different machines take to complete the operations assigned to them. The change in movements needed can be achieved by programming the machines. They are moved further to other machines for performing further operations. Human intervention may be needed to verify that the operations are taking place according to standards.

Point 5: Find the problems. Instead. mistake. Ans: otal quality management or TQM is an integrative philosophy of management for continuously improving the quality of products and processes. McKone. suppliers. cross-functional training. it is important to note that setting up automated flow lines will not be suitable for many industries Q3. A modern method of on-the-job training use control charts to determine whether a worker has been properly trained and is able to perform the job correctly. Production managers see every bottleneck as an opportunity to hasten the flow and reduce inventories. process management. lack of maintenance of machines. Fear can often be found at all levels in an organization: fear of change. However.focused upon and solutions found to ease them. require. committed leadership. Management must prepare to take immediate action on response from supervisors concerning problems such as inherited defects. Point 3: Cease dependence on mass inspection. Point 1: Create constancy of purpose toward improvement of the product and service so as to become competitive. instead. Statistical methods must be used to discover when training is complete. Point 4: Improve the quality of incoming materials. statistical evidence that quality is built in. customer involvement. Point 7 : Institute modern methods of supervision. along with price. poor tools or fuzzy operational definitions. stay in business and provide jobs. information and feedback. TQM capitalizes on the involvement of management. In other words. Considering the practices of TQM as discussed in six empirical studies. We are in a new economic age. Cua. and Schroeder (2001) identified the nine common TQM practices as cross-functional product design. What is meant by Total Quality Management? Mention the 14 points of Deming’s approach to management. and employee involvement. workforce. Point 8: Fear is a barrier to improvement so drive out fear by encouraging effective two-way communication and other mechanisms that will enable everybody to be part of change. We no longer need live with commonly accepted levels of delay. in order to meet or exceed customer expectations. Point 6: Institute modern methods of training and education for all. constantly improve the system of production and service. strategic planning. and even customers. [1] TQM functions on the premise that the quality of products and processes is the responsibility of everyone who is involved with the creation or consumption of the products or services offered by an organization. and to belong to it. depend on meaningful measures of quality. Point 2: Adopt the new philosophy. The emphasis of production supervisors must be to help people to do a better job. supplier quality management. End the practice of awarding business on the basis of a price alone. Improvement of quality will automatically improve productivity. defective material and defective workmanship. There should be continual reduction of waste and continual improvement of quality in every activity so as to yield a continual rise in productivity and a decrease in costs. fear of the fact that it may be necessary to learn a better way of working and fear that their positions might be usurped frequently .

or semi-permanent functional activities to produce products or services. Typical constraints are scope. undertaken to meet unique goals and objectives. Point 10: Eliminate the use of slogans. A project is a temporary endeavor with a defined beginning and end (usually time-constrained. workers can also fear the effects of change on their jobs. the management of these two systems is often quite different. posters and exhortations for the workforce. whilst on the shop-floor. and people in management. Point 12: Remove the barriers that rob hourly workers. Substitute aids and helpful leadership. and as such requires the development of distinct technical skills and management strategies. The primary challenge of project management is to achieve all of the project goals[4] and objectives while honoring the preconceived constraints. administration and production must work in teams to tackle problems that may be encountered with products or service. Ans: Project management is the discipline of planning. design. and budget. Describe briefly the Project Monitoring and control. The temporary nature of projects stands in contrast with business as usual (or operations). securing. Point 13: Institute a vigorous program of education. What an organization needs is not just good people. abolition of the annual merit rating (appraisal of performance) and of management by objectives. These meetings . Point 9: Break down barriers between departments and staff areas. demanding zero defects and new levels of productivity without providing methods. and managing resources to achieve specific goals. In practice. Point 11: Eliminate work standards that prescribe numerical quotas for the workforce and numerical goals for people in management. organizing. Q4.affect middle and higher management. it needs people that are improving with education. Such exhortations only create adversarial relationships. People in different areas such as research. The secondary—and more ambitious—challenge is to optimize the allocation and integrate the inputs necessary to meet pre-defined objectives. and encourage self-improvement for everyone. which are repetitive. time. sales. and often constrained by funding or deliverables). typically to bring about beneficial change or added value. This implies. of their right to pride of workmanship. permanent. Project Communication Tools and Techniques Pulse Meetings Pulse meetings are short team status meetings where the project management team is able to gather project performance information about the activities that are underway. Point 14: Top management's permanent commitment to ever-improving quality and productivity must be clearly defined and a management structure created that will continuously take action to follow the preceding 13 points.

Ans: Just in Time (JIT) is a management philosophy aimed at eliminating waste and continuously improving quality. . These are most often used on Full-scale and Complex projects. Credit for developing JIT as a management strategy goes to Toyota. Program Reviews Program Reviews are meetings with the project team members and sub-project leaders that review the current status of the program as compared to the original program plan. The reviewers should perform an in-depth analysis of the project deliverables and activities to determine whether the project work has been accomplished completely and correctly. the beginning and completion of project activities is reported Variance Reports Variance reports are formal reports generated by the PMIS. or Production Readiness Reviews. the Program Reviews focus on the big picture and emphasize the integration between activities and between sub-projects encompassed within the program. or by a project supplier. Security Reviews. one of the other business management systems . by the Earned Value Management System. Variance reports compare what has actually happened on a project against what was expected to have happened on the project. Q5. Write a brief note on Just-In-Time (JIT). Examples would be Desgin Reviews. Although the history of JIT traces back to Henry Ford who applied Just in Time principles to manage inventory in the Ford Automobile Company during the early part of the 20th Century. He developed Just in Time strategy as a means of competitive advantage during the post World War II period in Japan. Code Reviews. the origins of the JIT as a management strategy traces to Taiichi Onho of the Toyota Manufacturing Company. Unlike the Pulse Meetings which focus on day-to-day activities. Toyota JIT manufacturing started in the aftermath of World War II. The question being asked is whether the program activities and the sub-projects are likely to interfere with each other Technical Reviews Technical Reviews are formal meetings conducted with subject matter experts who are not members of the proejct team.such as the quality control system. Normally they are only a few minutes in duration.should occur frequently and can either be face-to-face or virtual. These are in-depth reviews focused upon a technical aspect of the project. During the meeting. These reviews will normally generate a list of actions that must be completed.

projects. It is particularly suited to physical and mechanical problems. American car manufacturers made ―lots‖ or a ―batch‖ of a model or a component before switching over to a new model or component. The need of the hour was thus to reduce manufacturing costs to increase profits. is a systematic and functionbased approach to improving the value of products. The low demand in Japan led to price resistance. What is value engineering? Explain its significance. also known as Value Analysis.The post-World War II Japanese automobile industry faced a crisis of existence. understand different perspectives. Q6. This system was not suited to the Japanese conditions where a small market required manufacturing in small quantities. where items moved through the production system only as and when needed. but can also be used in other areas. innovate. 2. Taiichi Onho identified waste as the primary evil. To overcome these two challenges. The productivity of an American car worker was nine times that of a Japanese car worker at that time. and Taiichi Onho sought ways to reach such levels. Ans: Value Engineering (VE). The process helps team members communicate across boundaries. Two pressing challenges however prevented Toyota from adopting the American way: 1. Use it to find a focus on key areas for innovation. The categories of waste identified included       overproduction inventory or waste associated with keeping dead stock time spent by workers waiting for materials to appear in the assembly line time spend on transportation or movement workers spending more time than necessary processing an item waste associated with defective items Taiichi Onho then sought to eliminate waste through the just-in-time philosophy. Use it in reverse (called Value Engineering) to identify specific solutions to detail problems. The car pricing policy of US manufacturers was to charge a mark-up on the cost price.When to use itUse Value Analysis to analyze and understand the detail of specific situations. or processes.VE involves a team of people following a structured process. and companies such as Toyota looked to benchmark their thriving American counterparts. and analyze. Quick Logical X X Long Psychological .

. Value Engineering) is used to increase the value of products or services to all concerned by considering the function of individual items and the benefit of this function and balancing this against the costs incurred in delivering it.Individual How it works X Group Value Analysis (and its design partner. The task then becomes to increase the value or decrease the cost.

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