ASSIGNMENTS- MBA

SEM-II

Subject code: MB0028

Subject Name: PRODUCTION & OPERATION
MANAGEMENT

Submitted By

Halma Faizy

Reg. No: 540910825

1. Explain how material flow information helps in work centre decision.
Consider the example of a shopping centre to illustrate your answer.

Each work center receives information along with material that enters it. The
material also leaves the work center with information. The route sheet contains
information about the material, process, quantities, and inspection procedures
etc. The drawings or instructions tell the condition of the malarial of entry and the
required condition at exit.
In this sense every operation consists of material transformation occurring on the
basis of information. Activities conducted are on the basis of information that
flows with material. Different locations have to accommodate the constraints of
the basis of darning maximums benefit of the information that is available.
Basically, each location is determined on the basis of from and to: where does it
receive material goes. Some centers have to close as a matter of necessity, some
need not to be and some need to be as far away as possible.
This aspect has been given a rating scale in terms of alphabets as under:
• Absolutely necessary to be close.
• Essential to be close.
• Ordinary closeness.
• Unimportant that they are close or not.
• Not desirable that the centers are close.
It can be seen that this is only a guide for Indian location as the work centers as
there will many competing factors that have to be accommodated.

2. What are the reasons for failure of a project? Give suitable examples.

Project is a set of activities which are networked in order and aimed towards
achieving goal of a project.
The reasons for project failure are:
Incidence of Project failure
• Projects being initiated of random at all levels.
• Project objective not in line with business objective.
• Project management not observed.
• Project manager with no prior experience in the related project.
• Non- dedicated team.
• Lack of complete support from clients.
Factors contributing to project success not emphasized:
• Project objective in alignment with business objective.
• Working within the framework of project management methodology.
• Effective scoping planning, estimation, execution, controls and reviews,
project bottlenecks.
• Communication and managing expectations effectively with clients, team
merits and stake holders.
• Prior expectance of PM in a similar project.
Problems concerned with Information and Communication Technologies
(ICT) project:
• No prioritization of project activity from an organizational position.
• One or more of the stages in the project mishandled.
• Less qualified non-dedicated manpower.
• Absence of smooth flow of communication between the involved parties.

3. Explain the various phases in project management life cycle?

In this initial phase, information is collected from the customer pertaining to the
project and the requirements are analyzed. The entire project has to be planned
and it should be done in a strategic manner. The project manager conducts the
analysis of the problem and submits a detailed report to the top project
justification, details on what the problem is a method of solving the problem, list
of the objectives to be achieved, project budget and the success rate of
completing the project. The report must also contain information and the project
feasibility, and the risks involved in the project.
Specification Requirements Analysis (SRA): It has to be conducted to
determine the essential requirements of a project in order to achieve the target.
• Feasibility study: To analyze whether the project is technically, economically
and practically feasible to be undertaken.
• Trade off analysis: To understand and examine the various alternatives
which could be considered.
• Estimation: To estimate the project cost, effort requires for the project and
functionality of various process in the project.
• System design: Choose a general design that can fusil the requirements.
• Project evolution: Evaluate the project in terms of expected profit, cost and
risks involved.
• Marketing phase: A project proposal is prepared by a group of people
including the project manager. This proposal has to contain the strategies
adopted to market the product to the customers.
• Design phase: This phase involves the study of inputs and outputs of the
various project stages.
• Execution phase: In this phase the project manager and the teams members
work on the project objectives as per the plan. At every stage during the
execution reports are prepared.
• Control – Inspecting, Testing and Delivery phase: During this phase. The
project team works under the guidance of the project manager. The project
manager has to ensure that the team working under his, implements the project
designs accurately, the project manager has to ensure ways of managing the
customer, perform quality control work.
• Closure and post completion analysis phase: Upon satisfactory
completion and delivery of the intended product or service the staff performance
has to be evaluated. Document the lessons from the project. Prepare the reports
on project feedback analysis followed by the project execution report.
4. What are the seven principles of SCM?

Seven principles of SCM are:

1. Group customer by needs- Effective SCM groups, customer by distinct service
needs, regardless of industry and then tailors services to this particular segment.
2. Customize the logistic network- In designing their logistics network; companies
need to focus on the service requirement and profit of the customer segments
identified.
3. Listen to signals of market demand and plan accordingly - Sales and operations
planners must monitor the entire supply chain to detect early warning signals of
changing customer demand and needs. This demand driven approach leads to
more consistent forecast and optimal resource allocation.
4. Differentiate the product closer to the customer- companies today no longer
can afford to stock pile inventory to compensate for possible forecasting errors.
Instead, they need to postpone product differentiation in the manufacturing
process closer to actual consumer demand. This strategy allows the supply chain
to respond quickly and cost effectively to change in customer needs.
5. Strategically manage the sources of supply- by working closely with their key
suppliers to reduce the overall costs of owning materials and services; SCM
maximizes profit margins both for themselves and their suppliers.
6. Develop a supply chain wide technology strategy- as one of the cornerstones
of successful SCM information technology must be able to support multiple levels
of decision making. It also should afford a clear view and ability to measure the
flow of products, services and information.
7. Adopt channel spanning chain performance measures- Excellent supply chain
performance measurement system do more than just monitor internal functions.
They apply performance criteria to every link in the supply chain-criteria that
embrace both service and financial metrics.
5. Explain what is meant by bullwhip effect and how it could be
prevented?

An unmanaged supply chain is not inherently stable. Demand variability

increases as one move up the supply chain away from the retail customer, and
small changes in consumer demand can result in large variations in orders placed
upstream. Eventually, the network can oscillate in very large swings as each
organization in the supply chain seeks to solve the problem from its own
perspective. This phenomenon is known as the bullwhip effect and has been
observed across most industries, resulting in increased cost and poorer service.
The following all can contribute to the bullwhip effect:
• Overreaction to backlogs.
• Neglecting to order in an attempt to reduce inventory.
• No communication up and down the supply chain.
• No coordination up and down the supply chain.
• Delay times for information and material flow.
• Order batching - Order batching occurs in an effort to reduce ordering costs, to
take advantage of transportation economics such as full truck load economies,
and to benefit from sales incentives. Promotions often result in forward buying to
benefit more from the lower prices.
• Shortage gaming - customers order more than they need during a period of
short supply, hoping that the partial shipments they receive will be sufficient.
• Demand forecast inaccuracies: everybody in the chain adds a certain
percentage to the demand estimates. The result is no visibility of true customer
demand.
• Free return policies.
Countermeasures to the Bullwhip Effect:
While the bullwhip effect is a common problem, many leading companies have
been able to apply countermeasures to overcome it. Here are some of these
solutions:
• Countermeasures to order batching - High order cost is countered with
Electronic Data Interchange (EDI) and computer aided ordering (CAO). Full truck
load economics are countered with third-party logistics and assorted truckloads.
Random or correlated ordering is countered with regular delivery appointments.
More frequent ordering results in smaller orders and smaller variance. However,
when an entity orders more often, it will not see a reduction in its own demand
variance - the reduction is seen by the upstream entities. Also, when an entity
orders more frequently, its required safety stock may increase or decrease; see
the standard loss function in the Inventory Management section.
• Countermeasures to shortage gaming - Proportional rationing schemes
are countered by allocating units based on past sales. Ignorance of supply chain
conditions can be addressed by sharing capacity and supply information.
Unrestricted ordering capability can be addressed by reducing the order size
flexibility and implementing capacity reservations. For example, one can reserve
a fixed quantity for a given year and specify the quantity of each order shortly
before it is needed, as long as the sum of the order quantities equals to the
reserved quantity.
• Countermeasures to fluctuating prices - High-low pricing can be replaced
with everyday low prices (EDLP). Special purchase contracts can be implemented
in order to specify ordering at regular intervals to better synchronize delivery and
purchase.
• Countermeasures to demand forecast inaccuracies - Lack of demand
visibility can be addressed by providing access to point of sale (POS) data. Single
control of replenishment or Vendor Managed Inventory (VMI) can overcome
exaggerated demand forecasts. Long lead times should be reduced where
economically advantageous.
• Free return policies are not addressed easily. Often, such policies simply
must be prohibited or limited.

6. What do you understand by Line Balancing? What is the importance of

order picking in material handling? Give suitable examples.

Production lines have a number of work centers in a particular sequence so that

the material that gets proceed has to move further without encountering any
bottlenecks. The quantities produced the rate of production at each center, the
number of operations and the total production required are factors taken into
account.
The purpose of taking place between work centers and minimum inventory gets
created. We use the principles of JIT and lean Manufacturing to achieve these.
Linear programming, Dynamic programming and other mathematical models are
used to study these problems.
Order picking is a process by which items of products for supply is to be made
haves to be retrieved from specific storage location. It is found to take 60% of
labour activities in the warehouse. Since it is critical to the business to meet
customer’s demand expeditiously and accurately, lot of attention is being given
to this aspect of operations. In the manufacturing arena, we desire to move
towards small lot sizes and cycle time reductions.
Efficient order picking is necessary for being competitive. In the supply chain
Storage, retrieval and delivery do not add value to the product, but are
necessary.
Material Handling: The purpose is to take the job through the technological
steps in which the processing needs to be done for the transformation that is to
be effected on the material that is getting processed. The major concerns are
about the quantities that need to be processed and the time that the different
operations required. In case the product has to enter assembly, along with other
parts that are being manufactured parallel, will all the required parts arrive at
that point at the same time. Some components may be outsourced. To handle
different parts, we have material handling equipments such as cranes lifting
forks, trucks etc.
The problem for the manager is the limited supply of these equipments and the
need to optimize utilization of the equipment and see that the manufacturing line
has smooth flow. Our concern is to reduced inventory, minimums movement and
timely availability.