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Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.

1 Jakarta Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta

What Does Production Mean Today?

Week 8 • The concept of production means services as well as
goods.
• The key difference between production and services
operations is the customer's involvement in the latter.
ng
Produci • Customers are involved in all kinds of production because

Services
electronic communications are key components in winning
d s a nd and keeping customers.
Goo

Jakarta, Novem
ber 2007

Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id

Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta

The Growth of Global Operations

Services… Goods… • Global competition has made production a faster-paced,
more complex activity.
• New technologies make machines that run cleaner, faster
• are performed • are made and safer and that operate on a global scale.
• are intangible • are tangible • With the Internet, producers of both services and goods
• are unstorable • are storable can integrate their production with those of far-off suppliers
• 29.7% of GDP (US) and customers.
• 50.3% of GDP (US)

Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id

Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta

What is Operations
(or Production) Management Resource Transformation Process

Systematic direction and control of the processes
that transform resources into finished products
that create value for and provide benefits
to customers

Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id

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Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta

Operations Processes

Services… Goods… • Operations process is a set of methods and technologies
used in the production of a good or a service

• are performed • are made – Goods classification is based on whether an operations
• are intangible • are tangible process combines resources or breaks them into
• are unstorable • are storable component parts
• 29.7% of GDP (US) – Services classification is based on the extent of customer
• 50.3% of GDP (US)
contact required

Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id

Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta

Goods-Manufacturing Processes :
Analytic vs. Synthetic Processes Service Processes: Extent of Customer Contact

• High-contact system is an operation in which the
• Analytic process breaks down resources into components customer is part of the system during service delivery
• Synthetic process combines raw materials to produce a
finished product

Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id

Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta

Differences between
Service and Manufacturing Operations

• Low-contact system is an operation in which the
customer need not be a part of the system to receive the
service
• Focus on Performance
• Focus on Process and Outcome
• Focus on Service Characteristics
– Intangibility
– Customization
– Unstorability
• Focus on the Customer-Service Link
– E-Commerce: The “Virtual Presence” of the Customer
• Focus on Service Quality Considerations

Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id

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Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta

Operations Planning Operations Planning and Control

• Managers from many departments contribute to decisions
about operations.
• The business plan and forecasts developed by top
managers guide operations planning.
– Forecast is a facet of a long-range
production plan that predicts
future demand

Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id

Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta

What is Capacity ? Capacity Planning

• Capacity Planning for Producing Goods
Amount of a product that a company can produce – Capacity planning for goods means ensuring that a
firm’s capacity slightly exceeds normal demand for its
under normal working conditions product.

• Capacity Planning for Producing Services
– In low-contact processes, maintaining inventory lets
managers set capacity at the level of average
demand.
– In high-contact processes, managers must plan
capacity to meet peak demand.

Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id

Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta

Location Planning Layout Planning for Producing Goods

• Location Planning for Producing Goods Layout must be planned for three types of space:
– Location decisions are influenced by proximity to raw
1. Productive facilities
materials and markets, availability of labor, energy
and transportation costs and other factors. 2. Nonproductive facilities
• Location Planning for Producing Services 3. Support facilities
– Low-contact services can be located near resource
supplies, labor or transportation outlets.
– High-contact services must locate near the
customers who participate in the system.

Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id

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Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta

Layout Planning for Producing Goods Layouts for Producing Goods

• Process layout groups equipment and people according to
function
• Cellular layout works well when a family of products
follows a fixed flow path
• Product layout is set up to make one type of product in a
fixed sequence and is arranged according to its
production requirements
– Assembly line is a product layout in which a product
moves step-by-step through a plant on conveyer
belts or other equipment until it is completed

Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id

Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta

Other Developments in Layout Flexibility Layout Planning for Producing Services

• U-shaped product line is a product layout in which • In a low-contact system, the facility should be arranged to
machines and workers are placed in a narrow U shape enhance the performing of the service.
rather than a straight line • In a high-contact system, the facility should be arranged
to meet customer needs.
• Flexible Manufacturing System (FMS) is a production
system in which a single factory uses automation to
produce a wide variety of products

Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id

Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta

Layout of a Typical Piccadilly Cafeteria What is Quality ?

The American Society for Quality defines quality
as the combination of “characteristics of a product
or service that bear on its ability to satisfy stated
or implied needs.”

Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id

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Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta

Methods Planning Service Flow Analysis

• Methods Improvement in Goods
– Process flowchart is a diagram included in a detailed
description of methods
• Methods Improvement in Services
– Service flow analysis shows the flow of processes
that make up a given service
– Designing to Control Employee Discretion in Services
– Design for Customer Contact in Services

Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id

Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta

Operations Scheduling Tools for Scheduling Service Operations

• Gantt chart diagrams steps to be performed and specifies
• Scheduling Goods Operations
the time required to complete each step
– Master production schedule
shows which products will be
produced, when production will
take place and what resources
will be used

• Scheduling Service Operations
– In low-contact services, work scheduling may be based
either on desired completion dates or on the time of order
arrivals.
– In high-contact services, the customer must be
accommodated as part of the system and its processes.

Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id

Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta

Tools for Scheduling Service Operations What is Operation Control ?

• PERT chart breaks down large projects into steps and
specifies the time required to perform each one
Process of monitoring production performance by
comparing results with plans

Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id

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Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta

What is Follow-Up ? Materials Management

• Materials management allows managers not only to
Production control activity for ensuring control but also to plan and organize materials flow
that production decisions are being implemented – Standardization is the use of standard and uniform
components in the production process

Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id

Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta

Major Areas in Material Management Purchasing Processes

1. Transportation includes the means of transporting
resources to the manufacturer and finished goods to • Holding costs are costs of keeping extra supplies or
buyers inventory on hand
2. Warehousing is the storage of both incoming materials for
• Opportunity costs are additional earnings that the
production and finished goods for distribution to
company must pass up because funds are tied up in
customers inventory
3. Inventory control includes the receiving, storing, handling
and counting of all raw materials, partly finished goods • Lead time is the gap between the customer’s order
and finished goods placement and the seller’s shipment
4. Purchasing is the acquisition of the raw materials and • Supplier selection is the process of deciding which
services that a firm needs to produce its products suppliers to buy from

Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id

Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta

Tools for Operations Process Control What is Quality Control

Management of the production process designed to
manufacture goods or supply services that meet specific
• Worker Training quality standards
• Lean Production Systems:
Just-in-Operations
– Just-in-Time (JIT) Production
• Material Requirements Planning
– Bill of Materials
– Manufacturing Resource Planning (MRP II)

Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id

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Universitas Multimedia Nusantara (UMN) Wisma BNI 46, 2nd Floor, Jl. Jend. Sudirman Kav.1 Jakarta

thank you

Exclusively prepared & presented by: Anna Riana Putriya, SE, MSi e-mail: anna@unimedia.ac.id

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