MODERN OPERASION MANAGEMENT

ROY, DR.RAM NARESH (2005) MODERN OPERASION MANAGEMENT. DHL.

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Abstract

1 PRODUCTION SYSTEMS AND OPERATIONS MANAGEMENT 1 1.0 Introduction.................................................................................................................. 1 1.1 Related Issues of Operations Management ............................................................... 1 1.1.1 Production Function ...................................................................................... 1 1.1.2 Productivity .................................................................................................... 2 1.1.3 Difference between Production and Productivity ........................................ 2 1.1.4 Effectiveness .................................................................................................. 3 1.1.5 Efficiency ........................................................................................................ 3 1.2 Operations Function in Organizations ....................................................................... 4 1.2.1 Manufacturing Operations Vs Service Operations ..................................... 5 1.2.2 Types of Production System .......................................................................... 7 1.3 Role of Models in Operations Management ............................................................. 10 1.3.1 Types of Models in Production Operations Management (POM) ............. 10 1.3.2 Mathematical Models in Production and Operations Management ........ 11 1.3.3 Modeling Benefits ........................................................................................ 11 1.4 Classifying Problems ................................................................................................. 11 1.4.1 Uncertainty of Outcomes ............................................................................ 11 1.4.2 Maximum Rule ............................................................................................ 13 1.4.3 Interdependence Among Decisions ............................................................ 14 2 LOCATION OF PRODUCTION AND SERVICE FACILITIES 17 2.0 Introduction................................................................................................................ 17 2.1 Reasons for Location Changes ................................................................................. 17 2.2 General Factors Influencing Location ...................................................................... 18 2.2.1 Rural and Urban Sites Compared .............................................................. 20 2.3 General Procedures for Facility Location................................................................. 21 2.3.1 Preliminary Screening ................................................................................ 21 2.3.2 Selection of Exact Site ................................................................................. 22 2.4 Some Other Facility Location Models ...................................................................... 23 2.4.1 Simple Median Model .................................................................................. 23 2.4.2 Center of Gravity (GRID) Model ................................................................ 26 2.4.3 Linear Programming (LP) ........................................................................... 27 2.4.4 Simulation .................................................................................................... 33 2.4.5 Break Even Analysis ................................................................................... 33 Preface (v) ( vii ) Dharm N-Manage/Title.pm5 v 3 LAYOUT PLANNING 36 3.0 Introduction................................................................................................................ 36 3.1 Effects of a Plant Layout .......................................................................................... 36 3.2 Factors Affecting Layout .......................................................................................... 37 3.2.1 Types of Industries ...................................................................................... 37 3.2.2 Types of Production System ........................................................................ 37 3.2.3 Type of Product ............................................................................................ 38 3.2.4 Volume of Production .................................................................................. 38 3.3 Systematic Layout Planning (SLP) .......................................................................... 38 3.4 Other Approaches to Plant Layout........................................................................... 41 3.4.1 Principles of Plant Layout........................................................................... 43 3.4.2 Types of Flow Patterns ................................................................................ 43 3.5 Types of Layout......................................................................................................... 43 3.5.1 Fixed Position Layout.................................................................................. 45 3.5.2 Process-Oriented or Functional Layout ..................................................... 46 3.5.3 Repetitive and Product-Oriented Layout................................................... 51 3.5.4 Office Layout................................................................................................ 55 3.5.5 Retail Layout ............................................................................................... 56 3.5.6 Warehousing and Storage Layouts ............................................................ 57 3.5.7 Combination Layout .................................................................................... 57 3.6 Material Handling ..................................................................................................... 57 3.6.1 Principles of Material Handling ................................................................. 58 3.6.2 Simplified Version of Principles of Material Handling ............................. 59 3.6.3 Material Handling Equipment ................................................................... 59 3.6.4 Relationship Between Material Handling and Factory Building Design or Layout.......................................................................................... 60 4 PURCHASING SYSTEMS AND VENDOR RATING 62 4.0 Introduction................................................................................................................ 62 4.1 Functions of Material Management ......................................................................... 62 4.2 Objectives of Materials Management....................................................................... 62 4.3 Purchasing or Procurement Function ...................................................................... 63 4.3.1 Objectives of Purchasing Department ....................................................... 63 4.3.2 Activities, Duties and Functions of Purchasing Department ................... 63 4.3.3 Centralized and Decentralized Purchasing Organizations ...................... 64 4.4 Modes of Purchasing Materials................................................................................. 65 4.4.1 Spot Quotations ........................................................................................... 65 4.4.2 Floating the Limited Inquiry ...................................................................... 65 4.4.3 Tender .......................................................................................................... 65 4.5 Steps in One Complete Purchasing Cycle ................................................................ 66 4.5.1 Some Questions Related to Purchase ......................................................... 66 4.5.2 Tender Procedure ........................................................................................ 67 ( viii ) Dharm N-Manage/Title.pm5 vi 4.6 Vendor Rating ............................................................................................................ 73 4.7 What is Expected of a Better Buyer ......................................................................... 74 4.8 Some Working Definitions ........................................................................................ 74 4.8.1 Quality Index (QI) ....................................................................................... 75 4.8.2 Delivery Reliability Index (DRI) ................................................................. 75 4.8.3 Flexibility Index (FI) ................................................................................... 76 4.8.4 Price Performance Index (PPI) ................................................................... 77 4.8.5 Frequency of Rating .................................................................................... 78 4.8.6 Use of the Indices ........................................................................................ 78 4.9 Stores and Material Control...................................................................................... 78 4.9.1 Requirements of a Material Control System ............................................. 79 4.10 Stores Management................................................................................................... 79 4.10.1 Functions of Stores Department and the Duties of the Storekeeper ....... 79 4.10.2 Location and Layout of Stores .................................................................... 80 4.10.3 Advantages of Centralization of Stores ...................................................... 80 4.10.4 Advantages of Decentralization of Stores .................................................. 81 5 OPERATIONS PLANNING AND CONTROL 82 5.0 Introduction................................................................................................................ 82 5.1 Benefits of Better Operations Planning and Control .............................................. 83 5.2 Main Functions of OPC ............................................................................................. 83 5.2.1 Some Specific Activities of OPC.................................................................. 83 5.3 Detailed Functions of OPC ........................................................................................ 84 5.3.1 Planning Phases .......................................................................................... 84 5.3.2 Routing or Sequencing ................................................................................ 84 5.3.3 Loading or Assignment ............................................................................... 86 5.3.4 Scheduling .................................................................................................... 89 5.3.5 Sequencing and Dispatching Phase ........................................................... 93 5.3.6 Controlling or Follow-up Phase .................................................................. 98 6 INVENTORY CONTROL 100 6.0 Introduction.............................................................................................................. 100 6.1 Purpose of Inventories ............................................................................................. 100 6.2 Objective of Inventory Management ...................................................................... 101 6.2.1 Requirements for Effective Inventory Management............................... 101 6.2.2 Inventory Counting Systems .................................................................... 102 6.2.3 A Perpetual Inventory System ................................................................. 102 6.2.4 Ordering Cycle System.............................................................................. 103 6.2.5 Demand Forecasts and Lead-Time Information...................................... 104 6.2.6 Inventory Cost Information ...................................................................... 104 6.3 Types of Inventory Control Techniques ................................................................. 105 6.3.1 Qualitative Techniques ............................................................................. 105 6.3.2 Quantitative Techniques or Models ......................................................... 108 6.4 Stocking of Perishables ........................................................................................... 125 ( ix ) Dharm N-Manage/Title.pm5 vii 7 MATERIAL REQUIREMENT PLANNING 130 7.0 Introduction.............................................................................................................. 130 7.1 Need for Materials Planning ................................................................................... 130 7.1.1 Terms Used in MRP .................................................................................. 131 7.2 Basic MRP Concepts ................................................................................................ 131 7.2.1 Independent Demand ................................................................................ 132 7.2.2 Dependent Demand ................................................................................... 132 7.2.3 Lumpy Demand ......................................................................................... 132 7.2.4 Lead Time of Item ..................................................................................... 132 7.2.5 Common Use Items ................................................................................... 133 7.2.6 Time Phasing ............................................................................................. 133 7.3 Factor Affecting the Computation of MRP............................................................. 134 7.3.1 Production Structure ................................................................................. 134 7.3.2 Lot Sizing ................................................................................................... 135 7.3.3 Recurrence of Requirements within Planning Horizon .......................... 136 7.4 Objectives of MRP System ...................................................................................... 137 7.5 Prerequisites and Assumptions of MRP................................................................. 138 7.5.1 Prerequisites .............................................................................................. 138 7.5.2 Assumptions ............................................................................................... 138 7.6 Inputs to MRP .......................................................................................................... 139 7.6.1 Master Production Schedule (MPS) ......................................................... 139 7.6.2 Bill of Material (BOM)............................................................................... 140 7.6.3 Inventory Record File ................................................................................ 141 7.7 MRP Outputs ........................................................................................................... 142 7.7.1 Primary Outputs ........................................................................................ 143 7.7.2 Secondary Outputs .................................................................................... 143 7.8 MRP Logic in Brief .................................................................................................. 143 7.8.1 A Sample of Management Information (Output) from MRP .................. 144 7.8.2 Limitations and Advantages of MRP ....................................................... 152 7.9 Manufacturing Resource Planning (MRP II) ......................................................... 152 7.10 MRP Implementation .............................................................................................. 154 7.10.1 An Inventory Control System ................................................................... 154 7.10.2 A Production and Inventory Control System........................................... 154 7.10.3 A Manufacturing Resource Planning System.......................................... 154 7.11 How Can Industry Benefit From MRP? ................................................................. 156 8 JUST-IN-TIME APPROACH 160 8.0 Introduction.............................................................................................................. 160 8.1 History of Relations Between Management and Workers .................................... 161 8.1.1 Adaptation to New Production Environment .......................................... 161 8.1.2 The Kanban Control .................................................................................. 161 8.1.3 JIT Today ................................................................................................... 162 8.1.4 JIT Application Profile .............................................................................. 1638.2 Keys to Successful JIT Implementation................................................................. 165 8.2.1 The Kanban System .................................................................................. 166 8.3 Japanese Vs American Management ..................................................................... 169 8.3.1 Downsides of Japanese Management....................................................... 169 8.3.2 JIT Manufacturing System Overview ...................................................... 170 8.3.3 The Seven Wastes in JIT........................................................................... 172 8.3.4 Value-Added Manufacturing .................................................................... 172 8.4 How Japanese Manufacturing Ideally Works? ...................................................... 173 8.4.1 Stockless Production.................................................................................. 173 8.5 Comparison of MRP and JIT................................................................................... 174 8.5.1 Push Vs Pull System ................................................................................. 174 8.6 Requirements for Successful Implementation of JIT ............................................ 175 8.7 Goals of JIT Manufacturing System....................................................................... 176 8.7.1 Important Aspects in JIT Manufacturing ................................................ 178 8.7.2 Advantages and Disadvantages of JIT..................................................... 179 8.8 Theory of Constraints (TOC)................................................................................... 181 8.8.1 Systems Thinking ...................................................................................... 181 8.8.2 Five Focusing Steps of TOC ...................................................................... 182 8.8.3 The Five Layers of Resistance .................................................................. 183 8.8.4 Quantifying the Improvement.................................................................. 183 8.9 TOC Tools ................................................................................................................. 183 8.9.1 Current Reality Tree (CRT) ...................................................................... 183 8.9.2 Conflict Resolution Diagram (CRD) or Evaporating Cloud .................... 184 8.9.3 Future Reality Tree (FRT) ........................................................................ 185 8.9.4 Prerequisite Tree (PRT) ............................................................................ 186 8.9.5 Transition Tree (TT) .................................................................................. 187 9 PROJECT MANAGEMENT 188 9.0 Introduction.............................................................................................................. 188 9.1 Some Terms Related to Network Planning............................................................ 188 9.2 CPM and PERT Model............................................................................................. 191 9.2.1 Time Estimates in PERT........................................................................... 192 9.2.2 Algorithm Used in Calculating Critical Path .......................................... 193 9.3 Variability of Activity Times ................................................................................... 194 9.4 Probability of Completing a Project by a Given Date ............................................ 195 9.5 Project Crashing and Time-Cost Trade-off ............................................................ 196 9.6 Resource Leveling .................................................................................................... 208 9.6.1 Heuristic Methods ..................................................................................... 208 9.7 Resource Leveling of Project Schedules ................................................................. 209 9.8 Project Delay ............................................................................................................ 213 ( xi ) 10 QUALITY CONTROL 215 10.0 Introduction.............................................................................................................. 215 10.1 Inspection ................................................................................................................. 215 10.1.1 Types of Inspection .................................................................................... 215 10.1.2 Purpose of Inspections ............................................................................... 216 10.2 Some Quality Related Terms .................................................................................. 216 10.3 Statistical Quality Control (SQC) ........................................................................... 216 10.4 Acceptance Sampling ............................................................................................... 217 10.4.1 Where do we use Sampling ? .................................................................... 217 10.4.2 Advantages and Disadvantages of Acceptance Sampling ....................... 217 10.4.3 Representative Sample ............................................................................. 217 10.5 Sampling Plans ........................................................................................................ 218 10.5.1 Single Sampling Plan (SSP) ...................................................................... 218 10.5.2 Double Sampling Plan (DSP) .................................................................... 219 10.5.3 Sequential or Multiple Sampling Plan ..................................................... 221 10.6 Process Variability and Control .............................................................................. 221 10.7 Control Charts ......................................................................................................... 222 10.7.1 The p-Chart................................................................................................ 223 10.7.2 The c-Chart ................................................................................................ 225 10.7.3 Steps in Constructing S-Chart.................................................................. 226 10.7.4 Steps in Constructing the X Chart .......................................................... 227 10.8 Use of Computers in Quality Control ..................................................................... 233 11 TOTAL QUALITY MANAGEMENT AND ISO-9000 234 11.0 What is TQM? .......................................................................................................... 234 11.1 TQM Need Commitment ......................................................................................... 234 11.2 Various Approaches to TQM ................................................................................... 235 11.2.1 Deming’s Approach to TQM ...................................................................... 235 11.2.2 Juran’s Approach to TQM ......................................................................... 236 11.2.3 Crosby’s Approach to TQM ....................................................................... 237 11.2.4 Feigenbaum’s Approach to TQM .............................................................. 238 11.2.5 Ishikawa’s Approach to TQM.................................................................... 239 11.3 Some Quality and TQM Related Terms ................................................................. 240 11.4 Relationship Between ISO 9000 and Quality ........................................................ 248 11.5 Relationship Between ISO 9000 and TQM ............................................................ 248 11.5.1 Principles of ISO 9000 ............................................................................... 249 11.5.2 Benefits of ISO 9000 .................................................................................. 249 12 LINEAR PROGRAMMING 251 12.0 Introduction.............................................................................................................. 251 12.1 The LP Formulation and Underlying Assumptions .............................................. 251 12.2 The General LP Formulation .................................................................................. 253 ( xii ) 12.2.1 Graphical Solution of 2-Variables LP ....................................................... 254 12.2.2 A 2-Var LP with a Unique Optimal Solution ........................................... 254 12.3 Different Forms of Linear Programs ...................................................................... 255 12.4 The Assignment Problem ........................................................................................ 264 12.5 Transportation Problem .......................................................................................... 267 12.5.1 Transportation Algorithm (Modi Method) ............................................... 271 13 METHODS ENGINEERING 273 13.0 Introduction.............................................................................................................. 273 13.1 Objective of Work Study .......................................................................................... 273 13.2 Tools and Techniques of Work Study .................................................................... 274 13.2.1 Method Study ............................................................................................. 274 13.2.2 Work Measurement (Time Study) ............................................................ 283 13.3 Standardization ....................................................................................................... 293 13.3.1 What is a Standard? .................................................................................. 293 13.3.2 Examples of Standards ............................................................................. 294 13.3.3 What is Conformity Assessment? ............................................................. 294 13.3.4 Standards Development, Acceptance/Implementation ........................... 294 13.3.5 Benefits of Standards to Industry ............................................................ 295 13.3.6 Benefits of Standards to Government...................................................... 295 13.3.7 Benefits of Standards to Consumers ........................................................ 296 13.3.8 Cardinal Principles of International Standardization ............................ 296 14 MECHANIZATION, AUTOMATION AND PRODUCTIVITY 298 14.0 Introduction.............................................................................................................. 298 14.1 Assembly Line .......................................................................................................... 298 14.1.1 History of the Assembly Line .................................................................... 298 14.1.2 History of Moving Assembly Line............................................................. 299 14.1.3 Pre Industrial Revolution ......................................................................... 299 14.1.4 Industrial Robot......................................................................................... 299 14.2 Postal Mechanization/Early Automation ............................................................... 299 14.3 The Age of Automation ............................................................................................ 300 14.3.1 Automation................................................................................................. 302 14.3.2 Social Issues of Automation ...................................................................... 303 14.3.3 The Automated Workplace........................................................................ 303 14.4 Productivity Improvement Stories ......................................................................... 305 14.4.1 Story of US Agriculture ............................................................................. 305 14.4.2 Automation Improves Productivity in a Tire Company .......................... 305 14.4.3 Automation Sends Productivity Soaring .................................................. 306 14.4.4 Story of Increased Productivity in Photographic Industry .................... 309 14.5 Automation Systems Today .................................................................................... 310 ( xiii) 15 VALUE ANALYSIS AND VALUE ENGINEERING 312 15.0 Introduction.............................................................................................................. 312 15.1 Some Basic Concepts ............................................................................................... 312 15.1.1 Definition of Value ..................................................................................... 312 15.1.2 Reasons Behind Poor Value ...................................................................... 313 15.1.3 Types of Values .......................................................................................... 313 15.1.4 Types of Functions ..................................................................................... 313 15.2 Value Tests ............................................................................................................... 313 15.3 Steps in Value Analysis ........................................................................................... 314 15.4 Examples of Value Engineering ............................................................................. 318 15.4.1 Some Simple Case Studies of VE.............................................................. 318 15.5 Value Engineering and Simplification Analysis .................................................... 319 15.5.1 The Primary Questions ............................................................................. 319 15.5.2 The Secondary Questions .......................................................................... 320 15.5.3 Checklist..................................................................................................... 321 15.6 Benefits of Value Engineering ................................................................................ 327 Index ......................................................................................................................... 328

Item Type: Book
Subjects: H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management
Depositing User: Unnamed user with email [email protected]
Date Deposited: 16 May 2023 02:43
Last Modified: 16 May 2023 02:43
URI: http://eprint.ulbi.ac.id/id/eprint/1847

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