➢ Definition of Production and Operation Management

➢ Organizational Functions

➢ Why study OM

➢ Cases of production and operation management

➢ Nature and Scope of operation and management

➢ A brief history of operations management

➢ Types of Manufacturing systems

➢ Services

➢ Characteristics and classification of services

➢ Goods versus Services

➢ Measuring productivity

➢ Role of production manager

➢ Production is the creation of goods and services
➢ Operation Management is the set of activities that
create value in the form of goods and services
by transforming inputs in to outputs.
Organizing to produce goods and
services: Essential functions:
➢ Marketing-Generates demand

➢ Production/operations-Creates the
products
➢ Finance/accounting-Tracks how well the organization is
doing, pay bills,collect the money
➢ Human resources-Provides labour, wage and salary
administration and job evaluation
➢ OM is one of the four major functions of any
organization, we want to study how people organize
themselves for productive enterprise

➢ We want to know how goods and services are

produced

➢ We want to understand what operations managers

do

➢ OM is such a costly part of an organization

➢ Production and operation management is defined as the
design, operation, and improvement of transformation
process, which converts the various inputs into the
desired outputs of products and services.

➢ Definition : According to E.S.Buffa “Production

management deals with decision making related to
production process so that result the goods or services
are produced according to specifications in the amounts
and by the scheduled demanded and at minimum cost.’’
 Inputs Outputs

Labor
Products

Materials
Services

Capital
Information

Energy

Resources
Products/services
Organisation Input Resources Transformation Output

Auto mobile Steel sheets, Tools Fabrication and High quality

plant engine parts Workers Assembling auto mobile
Taxi services Customers Driver, taxi, Driving Destination
petrol

Hospital Pharmacy Doctors Health care Healthy

In patient Nurses individual
Out patient
➢ Production as a system: Convert a set off inputs into a set of
desired outputs.

➢ Production as a operation function: Achieving the objectives

of the organisations.

➢ Decision
making system: Operation managers are required to
make a series of decisions in production function.

➢ EX:Plan,organise,staff,directing and control all the activities

in the process of converting all the inputs into finished
products.
➢ Production planning and control
➢ Scheduling, dispatching and rooting

➢ Job shop or flow shop scheduling

➢ Planning for mass production

➢ Designing plant layout

➢ Plant location and the factors influencing location

➢ Program Evolution Review Techniques

➢ Total Quality Management

➢ Time study

➢ Inventory control

➢ Safety management
Year contribution contributor

1799 Standardized parts, Cost Eli Whitney and others

accounting
1832 Job and Measures study Charles Babbage

1900 Scientific management, Motion F.W.Taylor Frank

study B.Gilberth
1901 Gantt chart and incentive pay Henry L.Gantt
system
1915 Inventory control F.W.Harris

1927 Human relations and Hortheren Elton Mayo

studies
Year contribution contributor

1931 Quality control charts W.A.Shewart

1935 Statistical sampling applied to quality H.F.Dodge &
control H.G.Roming
1940 Operation research application in P.M.Blacker
world war II and others
1946 Digital computer John Mauchlly and
J.P.Eckert
1947 Linear Programming G.B.Dantzig,
1950 Mathematical programming on- Williams
linear and stochastic process A.Charnes,W.W.Cooper
1951 Commercial digital computer. and others
1960 Organizational behavior: Continued Sperry Univac
study of people at work L.Cummings, L.Porter
Year contribution contributor

1970 Integrating operations into overall W.Skinner J.Orlicky and

strategy and policy, Computer G.Wright
applications to manufacturing,
Scheduling and control, Material
requirement planning (MRP)

1980 Quality and productivity applications W.E.Deming and J.Juran

from Japan:
Robotics, CAD-CAM
These are 2 types.
1. Flow or Continuous
production. 2.Intermittent
production.

➢ Flow or Continuous production : This is also classified into

2types.
➢ A)Mass production

➢ B)Process production

➢ Intermittent production : This is classified into 2 types.

➢ A)Job production

➢ B)Batch production.
➢ Improved work/material flow

➢ Reduced skills

➢ Added value/completed work faster

➢ Standardisation is the fundamental of the mass
production.

➢ Large quantity of production .

➢ Ex: Steel plant and text tile mills

➢ In this process are inter linked and production is carried
on continuously thorough a uniform and
standardized sequence of operations.

➢ This type of production is used in bulk processing of

crude oil into petroleum,kerosene,diesel oil etc.
➢ Job,‘one-off ” or ‘make complete’’ are descriptions given into
the organisation where by the complete task is handled by
a single worker or group of workers.

➢ Usually associated with low technology ,through to the large

scale ,often relying on higher technology.

➢ Volume of output is small

➢ Machines and equipment are arranged at one place.

➢ It is not usually to see the conversation process-( The
exchange of information , idea , thoughts between two or
more parties) organised so that batch methods can be used.
➢ Such methods required that the work for any task is divided
into parts or operations and that each operation is
completed throughout the hole batch before the next
operation is under taken.
Aims of batch productions:
➢ Concentrate skills

➢High equipment utilization.

Characteristics:
➢ Organizationally difficult
➢ Use of specialised skills
➢ Possibility of high equipment
utilization
These are three types:

➢ Forging process

➢ Machining process

➢ Assembly process
▶ Casting: This process is transforming of metals into
required shape
▶ Forging: In this process the metal is heated to plastic
state and then forced to the desired shape by
pressure or impact
▶ Stamping: In this process, force is applied on the metal
to get required shape of the product
▶ Embossing and coining: In embossing the metal is
stitched or formed as per the configuration were as
coining is performed in an enclosed die and the metal
flow is restricted
▶ Spinning : It is process of shaping a metal by pressing it
against a from while it is rotating on a high speed lathe
▶ Turning: in this process , work piece is yield in the lathe
and rotated whiled cutting tool
▶ Drilling: the using metal bits (drill bit and boring
bit) necessary changes will be made in the work
piece
▶ Grinding: the process refers to the whirring aware by
friction of metals. A rotating grinding wheel will
be useful for finishing product
▶ Milling: operation removes metals by feeding the work
piece against roofing multipoint cutting tool (milling
cutter)
▶ Electro chemical machining: in this process the metal to
be removed is dissolved off the piece and carried away
by the electro type.
▶ Vending process.

▶ Bracing process.

▶ Shouldering.

▶ Riveting.
▶ Meaning: a service is any or performance that one party
can offer to another that is essentially intangible and does
not result in the ownership of anything.

▶ Definition: According to American Marketing Association “

activities ,benefits and satisfaction that are offered for sale or
provided in connection with the sale of goods”.
Characteristics:

1. Service is intangible.
2. Service output is variable.
3. High customer contacts.

Services are Classified into three types:

1. Personal services.
2. Domestic services.
3. Maintenance services.
 Manufacturing
➢ It is concern with the production
or Manufacturing of goods.
➢ In this the output is Tangible.
➢ There is less consumer contact.
➢There is easiness is
quality control .
➢Capacity planning is
easily possible .
➢ Capital intensive.
➢ Long lead time.
➢ Products quality stored.
Services
➢It is concerned with
providing services.
➢In this output is InTangible.
➢There is more consumer
contact.
➢In this quality control is
difficult. planning is difficult.
➢Capacity
➢ Labour intensive.
➢ Short lead time.
➢ Not measured it is difficult.
Duties of Production Manager :
1) Production manager should concern itself with
production planning.
2) Production control.

3) Production manager should concern itself with quality

control.
4) Plant layout

Plant layout is three types:

➢ Product layout.

➢ Process layout.

➢ Fixed layout.
5) Materiel handling.
6) Proper inventory control.
These are five types:
a) Re-Order level.
b) Minimum level.

c) Maximum level.
d) Danger
level.
e) Average stock level.

7) Systematic control ( it refers to control of cost of

products )
 Difference between
Manufacturing and Service
Operations
• Businesses that manufacture goods or products by
utilizing labor, machinery, and raw materials are
manufacturing concerns.
• Factory, plant, or workshop that produces consumer
goods or industrial materials can be included here.

• Businesses that provide services to their customers

are called service-concern businesses.
• Among the businesses that fall into the category of
service concern are consulting firms, law firms,
accounting firms, and healthcare providers.
S.No. Manufacturing Operations Service Operations

Manufacturing operations produce a tangible Service Operations produce intangible output(i.e.;

1. output (i.e.; which can be physically seen) from the which cannot be physically seen) from the conversion
conversion process. process.

The output from the manufacturing operations can The output from the service operations is consumed
2.
be consumed over a longer period of time. immediately.

Manufacturing Operations are generally based on

Service Operations are generally based on people-
capital-intensive techniques as they use more
3. intensive techniques as they use more machines and
capital(i.e.; more use of machines and equipment)
equipment than machines and equipment.
and less labor.

In service operations, there is a need to contact

In manufacturing Operations, there is no need to
customers frequently and a need for customer
4. contact customers frequently and no need for
participation as without customer contact no service
customer participation.
can be generated.

In order to measure the performance of the

In order to measure the performance of the service
5. manufacturing operations, sophisticated methods
operations, simple methods(fast and easier) are used.
are used.

Manufacturing operations cover a large area as they

Service Operations covers small areas as they
6. produce goods at the local level, national level, or
generally provide services for local people.
international level.

Manufacturing operations which include the Service operations are mainly knowledge and skill but
7. production of goods and services are generally sometimes technology is also required to produce
technology-based. services.
• Here are some of the main differences between manufacturing and service
operations, including the processes, outputs, customer interactions, and
more.
Below is a list of the most important differences between
these two types of operations:
• Nature Of Output
• Tangibility
• Inventory
• Production Process
• Customer Interaction
• Quality Control
• Custamization
• Resource Allocation
• Lead Time
• Quality Measurement
• Maintenance & Repair
• Cost Stricture
• Scalability
• Environment Impact
• Regulatory Compliance
Nature of Output:
•Manufacturing: Creates tangible, physical goods (e.g., cars,
smartphones, furniture).
•Service: Provides intangible services (for example,
healthcare, banking, and consulting).

Tangibility:
•Manufacturing: Produces physical goods with distinctive
characteristics.
•Service: Provides intangible experiences to customers, often
customized for their specific needs.

Inventory:
•Manufacturing: Responsible for managing raw materials,
work-in-progress, and finished goods inventories.
•Service: No physical inventories are kept, but resource
management and scheduling may be involved.
Production Process:
•Manufacturing: Consists of a series of production steps, such
as assembly lines, machining, and quality control.
•Service: Customer interaction is often real-time, and the
production process is centered around people.

Customer Interaction:
•Manufacturing: Limited direct customer interaction during
production, but feedback can impact future product design.
•Service: Direct and continuous interaction with customers is
common, and customer satisfaction is immediate.

Quality Control:
•Manufacturing: Quality is primarily assessed through product
inspections and testing.
•Service: Quality is assessed based on customer satisfaction,
feedback, and service delivery.
Customization:
•Manufacturing: Customization is often limited to product
variations, which may require reconfiguration of production
processes.
•Service: High degree of customization is possible, tailored to
individual customer preferences and needs.

Resource Allocation:
•Manufacturing: Resources allocation focuses on machinery,
materials, and production capacity.
•Service: Resources allocation includes personnel, time, and
expertise.
Lead Time:
•Manufacturing: Lead times can be longer due to the production
of physical goods and supply chain considerations.
•Service: Generally shorter lead times, with services often
delivered in real-time or scheduled appointments.
Quality Measurement:
Manufacturing: Quality is typically measured using standards
and specifications.
Service: Quality is measured by customer satisfaction,
feedback, and meeting service expectations.

Maintenance and Repairs:

Manufacturing: Involves maintenance and repair of machinery
and equipment.
Service: May require ongoing maintenance but is primarily
focused on delivering consistent service quality.

Cost Structure:
Manufacturing: Cost structure includes materials, labor,
machinery, and production overhead.
Service: Cost structure involves labor, training, facilities, and
technology infrastructure.
Scalability:
•Manufacturing: Scaling up production can be capital-intensive
and time-consuming.
•Service: Scaling up services often involves hiring and training
more personnel, making it relatively flexible.

Environmental Impact:
•Manufacturing: Often has a more significant environmental
footprint due to material usage and production processes.
•Service: Generally has a lower environmental impact, although
it depends on the specific service.

Regulatory Compliance:
•Manufacturing: Subject to industry-specific regulations and
product standards.
•Service: Subject to service industry regulations and standards,
which vary by sector.
Interlink Between Operations &
Productions Management with
other functions
• Operations management links with other functional
areas in a business through coordination of resources,
processes, and strategies to achieve organisational
goals.

• Operations management is the heart of any

organisation, responsible for the creation and delivery
of goods or services.
• It works closely with other functional areas such as
marketing, finance, human resources, and information
technology to ensure smooth operation and
achievement of business objectives.
• Marketing and operations management often work hand
in hand.
• The marketing department identifies customer needs and
wants, and operations management ensures these needs
are met through the production of goods or services.

• For instance, if the marketing department identifies a

trend for eco-friendly products, operations management
would need to adjust production processes to meet this
demand, perhaps by sourcing sustainable materials or
implementing energy-efficient manufacturing processes.
• Finance is another key area linked with operations management. The
finance department is responsible for budgeting, cost control, and
financial forecasting. Operations management needs to work within
these financial constraints to ensure cost-effective production.
• For instance, if the finance department sets a budget for raw materials,
operations management must find ways to stay within this budget while
still meeting production targets.

• Human resources (HR) and operations management also have a close

relationship. HR is responsible for recruiting, training, and managing
staff. Operations management relies on HR to provide skilled and
motivated employees who can carry out the tasks required in the
production process.
• For example, if operations management introduces a new production
technique, HR would need to ensure staff are trained to use this
technique effectively.
• Lastly, information technology (IT) plays a crucial role in
modern operations management.
• IT systems can be used to monitor and control production
processes, manage inventory, and analyse performance data.
Operations management works closely with the IT department
to ensure these systems are fit for purpose and used effectively.

• In conclusion, operations management is closely linked with

other functional areas in a business.
• It relies on these areas for resources, information, and support,
and in turn, helps these areas to achieve their own objectives.
• This interdependence highlights the importance of good
communication and coordination within a business.
ENVIRONMENTAL AND
SAFETY
CONSIDERATION
ENVIRONMENT:
The air, water, minerals, organisms, and all other
external factors surrounding and affecting a given
organism at any time.
FACTORS OF ENVIRONMENTAL
CONSIDERATIONS
 Construction practices that fail to control pollution can cause
damage to waterways and wetlands, kill fish, upset aquatic
ecological systems and wildlife communities, and result in
contamination of land and groundwater.
 The risk to the environment is particularly high when work is done
near coastal areas, streams and creeks, or along a river valley.
 When construction occurs near built-up areas, poor practices may
result in air and noise pollution which may cause annoyance and
affect the health of neighbouring communities.
 Environmental risk should be managed and possibilities of
environmental disaster should be minimized
 Strict legal compliance and environmental risk management should
be practiced.
PRELIMINARY
CONSIDERATIONS

 Environmental affects of construction work should be identified.

 Environmental works and targets should be set.
 Preparing Construction Environmental Management Plan.
 New works should be provided with environmental studies and
training.
MAJOR CONSIDERATIONS
 Purpose and application  Strom water management
 Pre-construction planning  De-water work sites
and design  Noise and vibration
 Environmental management  Air quality
plan
 Storing fuels and material
 Land disturbance
 Keeping road clean
 Noise and vibration
 Protecting infrastructure
SAFETY
CONSIDERATION
: freedom from harm or danger :
the state of being safe
: the state of not being dangerous or harmful
: a place that is free from harm or danger :
a safe place
SAFETY
CONSIDERATION
Safety and health hazards present in the assigned and general work
area
• Required personal protective equipment
• Method for reporting any unsafe conditions that the worker(s) may
encounter
• Emergency procedures including emergency telephone contact
numbers, emergency escape routes, and areas of refuge, nearest
hospitals and accurate directions and route maps to hospitals
• Electronic Device Policy, including cellular phones, texting, etc.
• When it is necessary to maintain public use of work areas involving
sidewalks, entrances to buildings, lobbies, corridors, aisles,
stairways, rail tracks, and vehicular roadways, the contractor shall
protect the public with substantial guardrails, barricades, temporary
fences, overhead protection, partitions, and shields
CRANESAFETY REQUIREMENT
• The use of a crane to lift/lower and/or suspend work
platforms and man cages will be permitted only when other
means of reaching the work areas are not feasible.
• Power-up and power-down load line, power shall not be
disengaged while handling personnel.
• The load line attached to the work platform or man cage shall
have a minimum safety factor of eight (8), manufacturer’s
specifications shall be submitted, weight of loaded platform
shall be submitted
• Automatic braking (dead-man control), load will stop when
operator releases controls.
• Anti-two block device shall be provided capable of
preventing damage to the hoist rope and/or other machine
components.
• Boom angle indicator.
• Telescoping crane boom shall be marked to indicate, to the
operator, its extended length.
ACCIDENTAL REQUIREMENT
• All job related accidents and incidents shall be reported
and investigated.
• All data relative to an accident or incident shall be
complete and timely, with verification of the facts, and
recommendations for specificaction to control the cause
of similar accidents or incidents.
• The prime contractor shall be responsible for the
reporting and investigation of all accidents and
incidents occurring incidental to work performed under
the contract.
ACCIDENTS
• Fire
• Injury to employee.
• Injury to general public resulting from a possible slip, fall
or vehicular injury.
• Property damage, particular to utilities; i.e., water, gas,
sewage, electrical, telephone or pedestrian and vehicle
routes.
• Public demonstrations.
• Bomb and threats.
• Emergency evacuation.
• Hazardous chemical releases.
• Other incidents at contractor’s job site.