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DINA BUSINESS SCHOOL


DINA INSTITUTE OF HOTEL AND BUSINESS MANAGEMENT
PUNE – 411 028
CENTRE CODE – 02758

ASSIGNMENT – SET 1 / SET 2

NAME : TAHA MOHAMMED DHILAWALA

ROLL.NO. : 520850852

PAPER / SUBJECT : PRODUCTION & OPERATIONS


MANAGEMENT
CODE : MB0028

SEMESTER : I / II / III / IV

SIKKIM MANIPAL UNIVERSITY

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1. EXPLAIN WHAT IS MENT BY CAPITAL


PRODUCTIVITY?
ANS.
CAPITAL PRODUCTVITY
Capital deployed in plant, machinery, buildings and the
distribution system as well as working capital are components of the cost
of manufacture and need to be productive. Demand fluctuation,
uncertainties of productivity down. Therefore, strategies are needed to
maximize the utilization of the funds allotted towards capital. Adapting to
new technologies, outsourcing and balancing of the workstations to
reduce the proportion of idle times on equipment are the focus of this
section.

OUTSOURCING STRATEGIES
When capacity requirement are determined it will be easy
to determine whether some goods or services can be outsourced so
that the capital and manpower requirement can be reduced and the
available capacities are used to augment core competencies thus
reducing the cost of the product or services to the customer. However,
the following factors may restricts outsourcing.

I. Lack of expertise – the outsourcing firm may not have the


requisite expertise to do the job required
II. Quality considerations- loss of control over operations
may result in lower quality. This is risk that the firm gets
exposed to.
III. Nature of demand- when the load is uniform and steady, it
may not be worthwhile to outsourcing. Absence of
supervisions and control may be a hindrance to meet any
urgent requirements of the customer. This affects the
business especially if no production facilities bare built in
the organization
IV. Cost- when the fixed costs that go along with making the
product does not get reduced considerably

MATHODS IMPROVEMENT
Methods improvement start with methods analysis.
The focus of this process is to find out how a job is done breaking it down
to elemental tasks so that they are amenable for analysis. This is done for
both running jobs and new jobs.

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For the new job, the description becomes the inputs for analysis. For
current jobs, the analyst depends on observation, records and suggestions
of the persons involved in the job. When improved methods are
suggested, they are implemented and records created for assessing the
consequences of the methods improvement procedures. The analyst
should involve all concerned persons in the process so that acceptance
becomes possible and opportunities open up for further improvements.
Moreover, the people actually involved would be interested in improving
their productivity and will help the analyst in the process.

BALANCING OF WORKSSATIONS
Assembly lines necessitate out stringing together
workstations which carry out operations in a sequence so that the product
gets completed in stages. Since the workflows has to be uniform and
operation may require different periods for completion the necessity of
line balancing is felt. Capacities at workstation and the workforce to man
so adjusted that a products in the process of assembly almost
approximately the same amount of time.

RATIONALIZATION OF PACKAGING METHODS


With logistics becoming an important function of the
supply chain
And outsourcing becoming the norm, packaging has become an important
aspect, packaging has become important. Space is at a premium and
therefore stacking and storing have to more scientific. Movement inside
the premise from one location to another location are being done with
automated systems and they need that the packaging system are designed
for safe transit, continuous monitoring-both for quantities and operations.
In case of outsourcing product the material used and their design should
facilitate reuse of the same, which brings in economy.

QUALITY CIRCLES
Kaoru is generally considered to have promoted the
concept of quality circles. It is well known that he is the originator of
fishbone diagrams to identify the root cause of any problem. The causes
for the existence of a problem are classified as pertaining to the material,
processes or method or any factor that goes into production. The matter is
further investigated and pursued till the exact is determined. Quality
circles use these principal in solving problems. The teams select project
selected on the above basis and implement action to achieve improvement
in the process with a view to improve quality. Since these activities are
carried out without affecting the regular day to day work and involve

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little continuous improvement in methods and quality. The capital


deployed is minimal, if at all, and therefore productivity is enhanced.

2. WRITE A DETAILED NOTE ON SPLIT-CASE ORDER


FULFILLMENT METHODS AND MECHANIZATION.
ANS. This system looks at situations when bulk supplies in full cases to
one or more destination are not done. Fulfilment of order which need
different merchandise in different quantities requires that ‘cases’ will
have to be split, and pieces picked, repacked in cartons and ship to the
customer. Mechanisation helps in improving identification, pick-up and
repacking the material in addition to relieving monotony of the workers.
A few strategies of achieving this objective optimally are discussed here.

ORDER PICKING METHODS


Items as per customer requirement have to be picked and packed in a
logical manner and assigned to personnel so that their productivity is
maximized.
Accuracy of fulfilment of order is ensured by basic factors:
I. Order extent- it is defined as the number of order to be
picked simultaneously by a picker in an assignment. This is
categorized as discrete order picking in which case a single
order is selected at a time; and batch order picking in which
case the merchandise requirements of many orders are put
together and selected for pick up in the geographical area
which is covered in single pass.
II. Coverage extent – it is the physical area to be traversed by
the picker in selecting merchandise for an assignment within
the picking system. The personnel pick up the merchandise
from a zone, the being a contiguous area with different
picking location. The boundaries may be fixed or
dynamically adjusted to accommodate either personnel or
customers. This zone is identified within the picking area is
considered for picking merchandise. Either of strategies is
adopted to meet the constraints or opportunities which
maximize employee productivity and the customers’ needs.

SORTING AND ROUTING


Sorting is done for the purpose of easing the
operation of matching orders, merchandise and the customers for whom
they done. This activity can be done as when order are picked i.e. sort
immediate or by merging a number of order and batches are made to
consolidate the priorities for execution. This methods is called merge and

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sort. The strategy used depends on the total area of the zone, the number
of order, and the type of merchandise. And the economics of balancing
all the above.
When order are routed among those zones where
picks are required, we call them routing the picks. When order are routed
from zone to zone, in a particular order, whether any picks are there or
not, we call them chaining. When multiple zones are covered
simultaneously in different zones we call them parallel routing. As can be
discerned, no one single method is suitable for actual situations on site.
They are formulated as a strategy for optimization of resources in view of
the constraints.

ORDER PACKING METHODS


Order fulfilling methodology cover one more
aspects i.e. the order pacing methods. When split-case is executed it
becomes necessary that the merchandise is repackaged for shipment to
meet the requirement of the customers. In the first method they
merchandise is usable by the customer directly and when the tools and
packaging materials are available with the picker and he can pack
throughout the picking area.

CLASSIFICATION SCHEMES
In this section you will come to know about the coding of various
methods of splits picking and packing. The letters will uniquely identify
the method intended to be used and all personnel in the process will know
disposition status of the merchandise.
Discrete order picking or batch order picking- letter D or B is used
zone picking or tour picking
Pack immediate assemble and pack
BS – BATCH ORDER PICKING – SORT IMMEDIATE
BM –BATCH ORDER PICKING - MERGE& SORT
ZR – ZONE PICKING WITH ROUTING
ZP – ZONE PICKING IN PARALLEL
For example, BSDZCA means – batch order picking, sort immediate-
discrete order packing, zone picking with chaining and assemble.
With this type of coding 24 ways representing the type of split order
picking and packing are identifiable.

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CHOICE OF OPTIMAL FULFILLMENT STRATEGIES


The choice of order fulfilment strategy depends upon the predominant
order characteristics and category of distribution. They are determined by
general order characteristics such as-
a) Number of line- items;
b) Quality of pieces per line – item
General order categories are
a) Wholesale distribution – usually large number of pieces of a
few items;
b) Retail distribution-order for large quantities for a large
number of items;
c) Direct marketing – order for a small quality;
d) Consumer distribution – small quantities of different items –
for purposes of evaluation promotion and consumption
The performance measures to be satisfied by the choice of strategy are to
minimize the costs involved and maximize desirable characteristics…

They are
a) Minimize the cost of pick and pack for every order;
b) Minimize the cost of shipping per order;
c) Reduce the time required per cycle;
d) To increase the fill rate;
e) Improve accuracy of the elements of the process;
f) Traceability and accountability of all transaction….
Advance technology involving bar coding, feeding on line data ,high
speed processing an distribution of information across all nodes of the
supply chain help in improving efficiency, reduce costs and improve
customer satisfaction.

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3. EXPLAIN STRATEGIC MANAGEMENT PROCESS AND


STRATEGIC DECISION MAKING IN DETAIL.
ANS.
STRATEGIC MANAGEMENT PROCESS
Most of organization process depend upon the structure
of the organisation, the hierarchical level, decision arrival mechanisms,
communication system, authorization process, implementation
procedures, feedback and monitoring devices to formulate and implement
strategies. It is necessary to ensure that the process is effective and
efficient and avoid loss of control. In essence, the purpose of strategies is
to leverage the company’s advantages, prepare of strategies is to leverage
the company’s advantages, prepare for the eventualities of uncertain
external happening and maximize the chances of success in its
endeavours. Organizational goals necessitate the adoption of certain
strategies, which are converted to function goals in the areas of finance,
marketing and operations. These goals are achieved by adopting
strategies arrived at using organizational processes mentioned above.
When these long term strategies are being implemented tactics may have
to be employed to meet short term challenges depending upon situations.
The actual activities which result in out comes are called operations.
A business strategy is the result of a decision taken at the highest level.
They are specific programme of action which outline hoe the resources
are deployed to achieve goals in an environment. A general framework to
guide and activate think-tanks in the organization to come up with
proposals. Action plans with time frames, authority hierarchies and feed-
back mechanisms are formulated and designed. At this stage detailed
scenarios as to the likely consequences are considered and contingency
plans worked out for implementation, if situations call for the same.
Being in readiness with alternatives is a good way assuring the success of
any plan.
For example the production of a model of motor cycle is to be increased
by 25% and possibly reduce the price by 10%. This decision would have
been taken as strategy to meet the increasing demand which are e real
- to enter a niche market of the competitor
- to augment marketing department’s claim after a vigorous
sales campaign
- or any other reason.
The strategy for the marketing function would be many like promising
freebies, make the commission attractive for the dealer, to open more
service outlets. The operations strategy would consider the following

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- additional machinery or sub-contracting


- methods to improve productivity
- revamping assembly lines
- measures to improve motivation
- promoting existing employees new suppliers
look for opportunities to reduce costs as scaling up provides
scope.
The above measures will be under consideration at all times. When a
change is considered, identification of areas of cooperation and
collaboration become visible. Opportunities arise for understanding and
resolution of problems. Setting up visible targets to meet deadlines
encourages application of constancy of purpose’ as per Deming. This in
itself would be strategy for improvement quality and productivity.

STRATEGIC DECISION MAKING


Decision making is the most crucial management function. Decision
commit the organisation and its member to activities which have financial
repercussions and affect the functioning of other who are connected with
those. Therefore decisions are taken after lot of deliberation which
involve data gathering, analysis and the predicting outcome. Accuracy of
data, their relevance for the matter under consideration are matter which
affect the quality of decision. In addition, the following also form the
basis of decision making:
a) environmental scanning – the business environment in which
the firm exists and has to compete continually exhibits potential
for opportunities and threats. Becoming aware of those and
their impact on the firm by a process of scanning is called
environmental scanning. The environment include the industry,
the marketplace, the governmental agencies, society, ecology,
technology, etc. competitors may be gaining edge by
diversification, making forays into the firm’s niche market
making by new and better products; supplier could be forming
cartel and preparing to drive hard bargains; the government
could be passing laws and issuing order which could affect the
supply of materials or restrictions on import and export or even
employment conditions. adaptation to these dynamic factors by
environment scanning and basic strategy decisions is vital.
b) Core competencies – each organisation is started by an
entrepreneur or a small group of them who believed in some
unique strengths which would give them a place in market.
Utilizing those strengths the venture would have succeeded and

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development and expansion take place either laterally or


vertically or in both ways. However, additional strengths or
competences would have been acquires to augment of the
workforce an d additional facilities created, would be
continuously demanding and satisfying new needs. investor and
suppliers would be wiling to back an enterprise, who, they
have, seen grow in strength. the developments and
improvement both in knowledge and skills make the core
strengths better. This tends to make these an advantage over the
competencies. Using these advantages would from a part of the
decision strategy of the firm.
Core process of an organisation are determined by core competencies.
Four main core process are – customer relationship, new product/services
development, supplier relationship and order fulfilment. The emphasis
on these process depends on the order of industry, the length of its
existence and the consequent strengths built up in certain areas, the way
earlier successes have been achieved and the reinforcement they have
given to the organisation. One should remember that the environment is
always dynamic and the strategy formulation needs to be constantly
updated for making implementation effective. Ultimately every
organisation depends on the core compete cities which gives it an
advantage over the competitors.

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4. WHAT IS TQM? EXPLAIN QULITY APPROACHES OF


DEMING WHEEL AND JURANS QUALITY TRIOLOGY.
ANS. INTRODUCTION TO TQM
TQM is viewed from many angels – as a philosophy
as an approach and journey toward excellence. The main thrust is to
achieve customer satisfaction by involving every body in the
organisation, across all functions with continuous improvement driving
all activities. TQM systems are designed to prevent poor quality from
occurring. The following steps are implemented to achieve total quality.
a) Take all measures to know what the customer wants – voice of
the customer. Develop methods that generate facts which can be
used for decision making. do not ignore the internal customer –
the next person in the process.
b) Convert the wants in to design specification, that meet or
exceed customer expectation.
c) Process are to be designed so that they facilitate doing the job
right the first time. Incorporate elements that make it impossible
to make mistake. It is called fail – sating or fool proofing. The
Japanese call it POKAYOKE.
d) Keeping record of all occurrences, procedures followed and
consequences. They help in validating the processes so that
continuous improvement becomes possible. More importantly
any gaps can be seen and rectified immediately.
One of the basic tenets of TQM is – just because something is working
well improvement is not necessary. The search must be continuous to find
ways and means to improve every aspects of the business process finance,
operation and management. Complacency should never be allowed to
creep in at any time. In this aspects, culture plays an important role. All
these require top management commitment

APPROACHES TO TQM:
Being practiced worldwide by different organisation, TQM has different
approaches towards its achievement. The basic thrust of each of these is
realising excellence. All the approaches have a lot in common, but the
emphasis shifts from one other. Needless to say, each organisation will
use any of these or even a combination to suit its structure, culture and
need. Some emphasise on the philosophy of TQM and the role of
management and employees in being aware, committed and act. Some
expect us to use statistics more intensely. Some give us an ‘integrated
approach’.

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DEMING WHEEL:
Deming’s approach is summarised in his 15 points.
1. constancy of purpose for continuous improvement
2. adopt the TQM philosophy for economic purposes
3. do not depend on inspection to deliver quality
4. do not award any business based on price alone
5. improve the system of production and service constantly
6. conduct meaningful training on the job
7. adopt modern method of supervision and leadership
8. remove fear from the mind of everyone connected with the
organisation
9. remove barriers between department and people
10.do not exhort, repeat slogan and put up poster.
11.do not set up numerical quotas and work standards
12.give pride of workmanship to the workmen
13.education and training to be given vigorously
14. sate and exhibit top management’s commitment for quality and
productivity
15.using the above principles, Deming gave a four step approach to
ensure a purposeful journey of TQM. The slope is shown to indicate
that if efforts are let up the programme will roll back.

ACT PLAN
A P

CHECK DO
C D

DEMING CYCLE –PLAN – DO - CHECK –ACT

PLAN – means that a problem is identified, process are determined and


relevant theories are checked out.

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DO – means that the plan is implemented on a trial basis. All inputs are
correctly measured and recorded.
CHECK – means that he trial taken according to the are in accordance
with the expected results.
ACT – when all the above steps are satisfactory regular production is
started so that quality outcomes are assured

JURAN’S QUALITY TRIOLOGY


- JURAN’S uses his famous breakthrough sequence to
implement quality programmes. They are
 Proof of need – there should be compelling need to
make changes
 Project identification – here what is to be changed
is identified. Specific project with time frames and
the resource allocation are decided.
 Organisation with top management’s commitment
is made in terms of assignment of persons,
responsibilities fixed
 Diagnostic journey – each team will determine the
problem result from systemic causes or random or
deliberately caused. Root causes are ascertained
with utmost certainty.
 Remedial action – this is the stage when changes
are introduced. Inspection, testing and validation
are also included at this point
 Holding on to the gains – the above steps results in
beneficiary results. Having records or all action and
consequences will help in further improvements.
The action that resulted in the benefits derived
should be the norm for establishing standards.
JURAN has categorized cost of quality into four categories
1) Failure costs – internal – these are costs of
rejection, repairs etc in terms of materials,
labour, machine time and loss of morale;
2) Failure costs – external – these are costs of
replacement, on site rework including spare
parts and expenses of the personnel, warranty
costs and loss of goodwill;
3) Appraisal costs – costs of inspection, including
maintenance of records, certification,
segregation costs, etc.
4) Prevention costs – the sequence of three sets of
activities – quality planning, quality control

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and quality improvement from the triology to


achieve total quality management.

His arguments are that


1. Quality is the results of goods planning considering the needs of
both internal and external customers and develops processes to
meet them. The processes are also planned to meet them.
2. Quality is built in to the system of manufacture, inputs and
processes that are on stream like raw material, spare parts, labour,
machine maintenance, training, warehousing, inspection
procedures, packaging, etc . They have to be made to follow
standards and control exercised to make sure that mistake does not
occur often and if they are corrected at the source.
3. Quality improvement measures are essential to keep the quality
culture alive. Newer methods will be founds, some operations can
be eliminated, improved technology available. In short as
experience is gained things can always be done better. It is for the
management to take the initiative and encourage the employees to
be on the look out for opportunities for improvement.

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5. COMPARE WORKFLOW WITH BPM. EXPLAIN IN


DETAIL THE PROJECT DEVELOPMENT PROCESS
CYCLES?
ANS.
WORKFLOW VS. BPM
Workflow contains a number of entities in a unidirectional path with
nodes. each of these nodes may contain a number of elements – material,
data, attributes, value. They come together for integration or even for
division and will have transformation going on. The activities that make
these transformations are the sub – process. So, there changes taking
place along the path and at the end we have a completed process. Every
detail has been worked out, the outcomes verified and correct brought
into the flow so that nothing outward cocker. The only thing lacking is
flexibility that business situation demand all the time and because the
enterprise has to perform and excel in conditions of uncertainty,
improvement and competition. Fortunately these are exceptions. While
majority of the humdrum goes on smoothly, we need to manage
exceptions. Notably, exceptions create new process, opportunities and
help us get new insight in to the processes. It has been found that 80% of
process cost arise out of managing exceptions. These happen at many
points in the value chain. Managing these is business process
management. Workflow does not offer option in the way processes are
conducted. They have fixed routes, activities and schedules. Actually,
there is not much ‘management’. BPM goes ahead not on a fixed track,
but on bumpy roads, swerving sharply to avoid collisions and overtaking
the vehicles that re ahead. It calls for all management skills.

THE PROJECT DEVELOPMENT PROCESS CYCLE


EVERY COMPANY WOULD BE INTERESTED TO IMPROVE
THEIR PERFORMANCE OVER THE THEIR PERVIOUS
PERFORMANCE IN PROJECTS. IN ORDER TO IMPROVE
PROJECT PERFORMANCE, THE COMPANY MUST ASSURE
QUALITY CONTROL AT EVERY STAGE OF THE PROJECT
THROUGHOUT THE PROJECT LIFE CYCLE.
The various steps which may be considered in the development of the
process cycle in any project are listed below:
I. Planning for review: - in this step the main focus is on collection of
data. Data is the main input requirement of any successful project
information system and therefore the project. Once the data has

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been gathered prepare a suitable plan for its analysis. Obtain


necessary commitment from management and team member to
participate actively and take action on findings. It is necessary that
every project member gives his or her commitment to participate
and deliver the service/product in the project. Reviews are
necessary for every stage of the project. Prepare schedule for each
project for each project review.
II. Conducting the review: - before the review prepare an agenda. The
agenda should be well structured in terms of time and content.
Make necessary arrangement to gather in puts to the review. The
review leader is the project manager. Incorporate points, which are
external to the project. These external points have to be well
structured to be reviewed. A reporter must be designated to
document key points of the meeting. An automated checklist must
be formulated for the session. The use of flipcharts may be helpful
to collect data from participants.
III. Take action on findings: - during the meeting, determine the points
which are critical to the project and its performance. The member
may have brain storming session to discuss critical points. Make a
list of all such items discussed and items suggested and group the
data into categories and then prioritize, either by group discussion
or voting. Identify action items and assign a project member or a
team the task pertaining to the action planned. For all such action
and recommendations, prioritize the items depending upon the task
for execution. After reaching consensus on results, summarize
project success factor, recommendation for further study and action
items with responsibilities and due dates. Set expectations of scope,
investment, time, etc., for each item and send a copy the team.
Follow up all the actions. Place review reports in the project
documents file, in the quality/productivity department and in the
library. Make reports available to manager of the life process for
similar projects.
IV. Do continuous improvement: - continual improvement is one of the
management mantras. Every organization wants to improve
continuously. It is not possible to achieve improvement unless
sufficient measures are adapted to measure improvement.
Encourage the quality manager to take for quality themes that
emerge from review meetings. The quality manager should
highlight trends and de – escalate chronic problems. Reviews re a
check process in the ‘PLAN – DO – CHECK – ACT’ (PDCA)
cycle of quality cycle. They are not just a one- time events. In this
context, act on recommendation from pervious project; plan to
capture data about project; do continuous. Improvement; check on

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hoe you are doing write a retrospective analysis. Do periodic


project review that will trigger mid – project corrections. Conduct
immediate, informal retrospective after solving unexpected
obstacles. Understand any impact on the reminder of the project.
Recognize people for extra efforts and noteworthy contributions.
Be open to attend review for other project. Learn from similar
ventures, warranty failures, customer survey and experience of
other division and companies. Be a part of continuous
organizational learning program that includes experimentation,
evaluation and documentation with easy access and retrieval.
V. Critical success factors:- it is necessary that a company identifies
factor in a project. These factor may slacken the project if not
focused. Routines tasks may be assigned to lower level team
members as this may relive the project team from wasting their
skill set on routine matters. In terms of project delivery, the project
office can relieve project managers of takes, like filling forms and
templates, getting these forms signed off, mailing, receiving and
checking items etc. regarding project management skills the project
office can help the project manager in the project scope definition,
project kick off preparation and planning tasks, trough mentoring
and coaching services. These are the combining strengths that
make the project manager to move forward and achieve the project
success.
Regarding project quality reviews, the project management office
adds value providing processes, tools and project management
experience but any quality review process can be implemented by
the team without sponsorship from the management level.
It is necessary to identify the entire critical success factor. One of
the critical successes factor for the project quality review process
implementation is to convince and sell the benefits to the
management team of the organization. The team should show
exhibit better control of their project portfolio and then
demonstrate better control about business profitability.
VI. Results and benefits of the project quality reviews:- the main
benefits of the project quality review are the project status is
formally visible to the whole organization. It creates awareness and
room for improvement. Only reviewing, in a detailed manner,
every project we can have a clear idea about the lack of knowledge
mistakes, errors, deviations, and their reasons.
The project quality reviews helps the project manager and his/her
manager to enable the necessary and taking the action needed to
achieve the project goals finishing the project on time, scope and
budget.

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The team can find benefits the project manager, for the customer
and for the sponsor.
For the project manager because that process helps in terma of
discipline and control for the customer because, in the way that
process is anticipating results, also create some kind of proactive
behaviour in the project manager anticipating potential problem to
the customer and finally for the sponsor because this process helps
him to know project details and then to ask the customer upper
management level for clarifications.
Management expectations are crucial for the project success but
project reviews add value to such expectations.
The above steps can be represented in the from a diagram to show
various process items in a project. These diagrams will help in the
review process es to pin point facts and figures of concern post
delivery. Every flow and process can be studied and reviewed for
enhancement in the product or service deliverable in future.

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As an example consider packaging of a tonic bottle in a box;

OUTLER PRINTED
BOX LABEL
BOTTEL TONIC CAP

ASSEMBLE STICK LABEL


ON BOX

CHECK THE CHECK THE


FUTMENT OF CAP ALIGMENT AND
ON BOTTLE POSITION OF LABEL

ASSEMBLE

PACKED
TONIC

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6. WHAT IS JIT? EXPLAIN VALUE ENGINEERING WITH


EXAMPLES.
ANS. INTRODUCTION TO JIT
JIT can be considered to be philosophy of manufacturing
founded on the principal of elimination of all waste and thereby
increasing productivity. When the philosophy is applied at workplace, the
approach results in providing parts in just right quantities at the right
time, thus lowering the costs and increasing productivity. Since no extra
parts are available, production of only good parts is forced on the system.
JIT has been extended to mean continuous improvement. These principal
are being applied to engineering, purchasing, accounting and data
processing also. We will see how JIT helps in implementing lean
production systems. In these days when technology is able to provide us
with highly accurate equipment which have high capacities and the
business has become global meaning that both suppliers and customers
are widely accessible. To remain competitive, cost efficiencies have
become compulsory. JIT helps in this process. It is extended to the shop
floor and inventory systems of the vendors also. One of the main
challenges for JIT is frequent changes in production schedules owing to
the changes in demand. This causes the procurements plans to changes. In
the present day scenario where most manufacturing concerns depends
upon a number of suppliers, who in turn may outsource parts and
services, disruptions have a cascading effect. However, there is a limit to
the agility that a company can build into the system. Communication
right through the supply chain helps in reducing inventories and keep the
flow lines smooth. Success of JIT depends upon a lot of preparation and
committed implementation.
VALUE ENGINEERING/ VALUE ANALYSIS –
Basically it is a methodology by which we try to find substitutes for a
product or an operation. It can be conducted both internally and
externally. The concept took shape during the Second World War. The
thinking process calls for a deep study of a product and the purpose for
which it is used, the raw materials used, the processes of transformation,
the equipment need etc. and question whether what is being used is the
most appropriate and economical. This applies to all aspects of the
product. For examples, let us consider a component needs a round brass
rod as raw material in size 21.5 mm. diameter. It has seven operations:
cutting, drilling, chamfering boring. Milling, a different size, a different
tool, a different machine, a different cot sequence, a different tool for an

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operation, a different chemical, a different concentration, a different


voltage, shorter time or processing. Studies can be conducted to verify
whether any operation can be eliminated. Simplification of processes
reduces the cost of manufacture. Every piece of material and the process
should add value to of the product so as to render the best performance.
Thus there is an opportunity at every stage of the manufacturing and
delivery process to find alternatives which will increase the functionality
or reduce cost in terms of material, process and time. It should be
remembered that we are not seeking a cost reduction sacrificing quality. It
has been found that there will be an improvement in quality when
systematic value engineering principles are employed.

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