aMB0044

PRODUCTION AND OPERATIONS MANAGEMENT

SET-1

Q1.Explain in brief the origins of Just In Time. Explain how JIT is implemented?
Just-In-time manufacturing, or JIT, is a management philosophy aimed at eliminating manufacturing wastes by producing only the right amount and combination of parts at the right place at the right time. This is based on the fact that wastes result from any activity that adds cost without adding value to the product, such as transferring of inventories from one place to another or even the mere act of storing them. The goal of JIT, therefore, is to minimize the presence of non-value-adding operations and nonmoving inventories in the production line. This will result in shorter throughput times, better on-time delivery performance, higher equipment utilization, lesser space requirement, lower dpms, lower costs, and greater profits. JIT finds its origin in Japan, where it has been in practice since the early 1970s. It was developed and perfected by Taiichi Ohno of Toyota, who is now referred to as the father of JIT. Taiichi Ohno developed this philosophy as a means of meeting customer demands with minimum delays. Thus, in the olden days, JIT is used not to reduce manufacturing wastage, but primarily to produce goods so that customer orders are met exactly when they need the products
Although the history of JIT traces back to Henry Ford who applied Just in Time principles to manage inventory in the Ford Automobile Company during the early part of the 20th Century, the origins of the JIT as a management strategy traces to Taiichi Onho of the Toyota Manufacturing Company. He developed Just in Time strategy as a means of competitive advantage during the post World War II period in Japan. The post-World War II Japanese automobile industry faced a crisis of existence, and companies such as Toyota looked to benchmark their thriving American counterparts. The productivity of an American car worker was nine times that of a Japanese car worker at that time, and Taiichi Onho sought ways to reach such levels. Two pressing challenges however prevented Toyota from adopting the American way: 1. American car manufacturers made lots or a batch of a model or a component before switching over to a new model or component. This system was not suited to the Japanese conditions where a small market required manufacturing in small quantities. 2. The car pricing policy of US manufacturers was to charge a mark-up on the cost price. The low demand in Japan led to price resistance. The need of the hour was thus to reduce manufacturing costs to increase profits. To overcome these two challenges, Taiichi Onho identified waste as the primary evil. The categories of waste identified included

overproduction inventory or waste associated with keeping dead stock time spent by workers waiting for materials to appear in the assembly line time spend on transportation or movement workers spending more time than necessary processing an item

waste associated with defective items

Taiichi Onho then sought to eliminate waste through the just-in-time philosophy, where items moved through the production system only as and when needed.

Implementation of JIT JIT, total quality management (TQM) and other developmental measures, are possible only with top management commitment and a learning culture in the organization. The main handicap to any programme is the resistance by the organizational members, even at the top, to make changes. This resistance may take the from of non-cooperation and may enlarge to become sabotage. These usually shows up at the implementation stage. So, communication of the goals is to be realized and the objective of each team are to be framed effectively. Initially, a milestone chart helps in establishing various steps to be taken and correcting the activities as the process is on . this is the best way of ensuring success. It is well to remind you at this stage that JIT is not a destination, but an ongoing continuous improvement programme in the process of achieving TQM. Pre-requisites for implementation Like any advanced method of production and quality improvement , some pre-requisites are needed to be in place so that, implementation is easy and the results are identifiable . (a) design flow process: 1.link operations 2.balance workstation capacities 3.relay-out for flow 4.emphasise preventive maintenance 5.reduce lot sizes 6.reduce set-up and changeover times (b) total quality control: 1.worker responsibility for quality 2.measures SQC 3.enforce compliance 4.fail-safe method 5.automatic inspection (c) stabilize schedule 1level schedule 2.under utilize capacity (d) kanban pull 1.demand pull 2.back flush 3.reduce lot size (e) work with vendor 1.reduce lead times 2.frequent deliveries 3.project usage requirement 4.quality expectation (f) reduce inventories

1.look for other areas 2.stores 3.transit 4.carousales 5.convayours (g) improved product design 1.standard product configuration 2.standardise and reduce number of parts 3.process design with product design 4.quality expectation The above activities lead to: (A) solving problems concurrently 1.root cause 2.solve permanently 3.team approach 4.line and specialist responsibility 5.continual education (B) measuring performances 1.emphasise improvement 2.track trends Shop floor control Realistic planning and scheduling take the frequency with which setups have to changed to manage material flow without building up inventories into consideration and leads to JIT manufacturing. SMED( single minute exchange of dies) gives flexible for production process. Advocated by Shigeo Shingo, SMED method calls for designing, making fixtures, and tooling which are instrumental in changing setups so that changes are to be effected with in a minute . the declamping and clamping elements should be made for this process. Application for kanban, wherever suitable is another mechanism for controlling flow of the material. Maintenance of the machines and periodic shop floor inspection is necessary. Purchasing The essence of JIT purchasing lies in treating the purchaser as a participant in your activities. Cooperative relationship leads to the development of the supplier who understands companys requirements. being open and trusting help the organizations to identify the problems and go to the source which is like implementing TQM. Every problem or discovery of a defect is considered an opportunity, which the supplier and the company together get a deeper understanding of the problem, and the solutions will not only solve that problem, but also the ones that were hidden. It is also the practice of many companies who procure a large number of parts manufactured from their vendors to have supplies made to the assembly in specific quantities to meet the needs just in time. Self certification by the vendor is resorted to ensure quality of the material. The actual users are given autonomy to demand from the supplier, the quantities required as well as the time of its need. Any change in demand is conveyed and complied. This requires cooperation and trust between the supplier and the customer. This is how JIT purchases work.

Vendor managed inventory The very purpose of JIT is to reduce inventory at all places in the supply chain. Inventory is considered a waste because inventory is created by using materials, machines and efforts of persons. All of these are resources which have already been used up and that portion of it which is not consumed and sent up the value chain causes a drag on the system. However ,inventories are inevitable because uncertainties exist at every stage, making it necessary to provide a buffer so that demands do not go unfulfilled. The challenge is to keep it to the minimum. To make this happen ,the calculation involving the following are necessary: For cast of the market demand Capacities of the equipments Worker absenteeism Suppliers lead times Quality of the produced components .

Q2.Bring out the historical background of Value Engineering. Elucidate three companies which have incorporated VE with brief explanation.
Value Engineering aims at a systematic identification and elimination of unnecessary costs resulting in the increased use of alternatives, less expensive material, cheaper designs, less costly methods of manufacturing etc. to provide the same performance, quality and efficiency and in a decrease of overall unit costs and consequently greater profits.

Historical Background: During the Second World War, one of the most serious problems faced by companies engaged in the war effort was the shortage of materials. This led to experimenting with substitutes, quite often in very unorthodox ways. In many cases, the experiments clicked and surprisingly there were a large number of instances where the substitutes were much cheaper and functioned more efficiently than the original material. After the war, Harry Erlicher, the Vice President of Purchasing, General Electric Co (USA) felt that this problem of finding out substitute could be done in a more scientific way and as a deliberate approach, rather than by an ad hoc crisis approach. He entrusted this job to a team of engineers headed by Lawrence Miles. In fact it was Miles who coined the term Value Analysis and its synonym, Value Engineering. This team under his stewardship pioneered this technique and perfected it and, it is said, saved their company $ 200 million over a period of 17 years. In America, the technique is very widely used and is given a great deal of importance. LD Miles, the father of this concept, wrote in 1961, a book, Techniques of Value Analysis and Engineering. Navy Bureau of Ships was the first organization to use VA in 1954. Society for American value Engineers (SAVE) was established in 1959. VE programs came in vogue in

many companies of the US, UK, and Japan. In India, now we have Indian Value Engineering Society (INVEST) to create awareness of this approach and to propagate this concept. The companies which have incorporate value engineering are: 1. General Electrical Corporation (GEC)The concepts of value engineering originated in 1947 in General Electricals corporation (GEC)When a substitute for asbestos for flooring had to be found. Specialized dealers could provide an equally good material at a lesser price. Initially, the practioners were the people in charge of purchasing who tried to locate substitute material which would be equally good, if not better, at a lower price. This is the first and basic approach to value engineering. The concept percolated to the manufacturing departments, engineers applied the same principles and found that, they could use alternate materials, which were cheaper giving the same performance. It was also fund that dimensions and tolerance could be altered without affecting the performance of the part or the product. The investigations took them on the path of eliminating some operations. The focus was on the value of each bit materials, each operation. This approach led to the design stage. 2. Ashok Leyland In implementation of VA, Ashok Leyland changed gear material from phosphor bronze to a less expensive cast iron and eliminated frequent field complaint of gear seizure in trucks. 3. TVS :T.V. Sundaram Lyenger (TVS) Limited is one of the largest automobile distribution companies in India. During the mid 1940 to 1960s, TVS based in Madurai was ranked as the best bus transportation system in India. It could manage to run the fleets for about 96% of the time.TVS used the VE approach to restore the mobility of buses that had broken down. They stocked their garage with some critical assemblies of a bus. Whenever, a part or an assembly failed of a bus, they replaced it immediately with a new one, thus restoring mobility within a couple of hours. When compared to the traditional method, this approach has gained much more benefits to the company, it helped to save time, reduce cost, efficient, quicker, and competitive. 4. MODI Xerox: Modi Xerox designed the VE-d low cost copier 1025 ST, which uses a single tray. The advantage of new design is that it is easy to operate and the cost is also very low. 5. TITAN : Titan watches introduced new designs adopting a strategy of innovation.

Q.3. Explain the key elements of quantitative modeling . what is work study and motion study.
Quantitative models are needed for a variety of management tasks, including(a) Identification of critical variables to use for health monitoring,(b) Anticipating service level violations by using predictive models, and(c) On-going optimization of configurations. Unfortunately, constructing quantitative models requires specialized skills that are in short supply. Even worse, rapid changes in provider configurations and the evolution of business demands mean that quantitative models must be updated on an on-going basis. This paper de-scribes an architecture and algorithms for on-line discovery of quantitative models without prior knowledge of the managed elements. The architecture makes use of an element schema that describes managed elements using the common information model (CIM). Algorithms are presented for selecting a subset of the

element metrics to use as explanatory variables in a quantitative model and for constructing the quantitative model itself. We further describe a prototype system based on this architecture that incorporates these algo-rithms. We apply the prototype to on-line estimation of response times for DB2 Universal Database under a TPC-W workload. Of the approximately 500 metrics available from theDB2 performance monitor, our system chooses 3 to construct a model that explains 72% of the variability of response time. In production and operations management, models refer to any simple representation of reality indifferent forms such as mathematical equations, graphical representation, pictorial representation, and physical models. Thus a model could be the well known economic order quantity (EOQ) formula, a PERT network chart, a motion picture of an operation, or pieces of strings stretched on a drawing of a plant layout to study the movement of material. The models help us to analyze and understand the reality. These also help us to work determine optimal conditions to for decision making. For example, the EOQ formula helps us to determine the optimum replenishment quantities that minimize the cost of storing plus replenishing. The number of different models we use in production and operations management run in to hundreds, or even more than a thousand. These are really too many to enumerate in a place like these. I am listing below a random list of broad categories of models used in production and operations model. Operations research models. This is actually a very broad classification and covers many of the other categories in the list given here: 1 Inventory models 2 Forecasting models 3 Network models 4 Linear programming models 5 Queuing models 6 Production planning and control models 7 Engineering drawings 8 Photographs and motion pictures used in time and motion studies. 9 Material movement charts 10 Process flow diagrams 11 Systems charts 12 Statistical process control charts. 13 Variance analysis 14 Regression analysis 15 Organization chart 16 Fishbone chartFew of the above are explained below, 1.LINEAR PROGRAMMING: Linear programming technique is often used for optimizing agiven objective like; profit or revenue maximization, or cost outgo minimization. Distribution of the revenues is the critical issue, when there are limited resources and they have to meetcompeting demands. 2.TRANSPORTATION MODEL: Transportation model is concerned with goods frommanufacturing centres or warehouses which have to be supplied to depots or retails outlets. Thedemand and supply position of the places where they are required or produced and the cost of transportation are considered in the model. We use this model to economize. 3.ASSISGNMENT MODEL: Allocating jobs or persons to machines, awarding different projectsto contractors is done so that maximum returns occur or less expenses are incurred. Hence, callsfor the use of this model.

4.INVENTORY CONTROL MODEL: Inventory control model considers the: * Frequency of placing orders. * Quantities per order considering the cost of placing an order. * Number of pieces that are to be kept in reserve. * Rate of consumption. * Lead time required for the supplier. * Cost involved in storage. We have different models which give solutions to optimization depending upon the probabilities of consumption and supply. 5. WAITINGLINE MODELS: Queues are formed when the rate of services is at a variance withthe rate of arrival. They are formed when the rate of production is less at particular pointscompared to the previous one. Sometimes we see multiple service points and a single queue areformed for feeding them. Number of items which includes the following is studied with somespecial techniques. * People to be serviced. * Rate of service * Type of queue discipline that is intended to be followed. * Policy of priority * Tolerable amounts of waiting 6. SIMULATION MODELS: Simulation models are used when we will not be able to formulate mathematical model. So, we develop a model which resembles a real life situation. Based on this pattern, we predict and plan our procurement, production, delivery and other actions. 7. PERT (PROJECT EVALUATION AND REVIEW TECHNIQUE) AND CPM(CRTICALPATHMETHOD)MODELS: When projects are undertaken with a number of activities, some happens in sequence, with gaps of weeks or months and some happens simultaneously. It is important to estimate the time required for completion of the project. A lot of coordination is needed while supplying the resources. It is also equally important to identify the bottlenecks and smoothen resources so that time schedules are maintained. Delayed completion may entail penalties. In this model, we adopt special methods to make the system. Work study and Motions study. We can say that work study is being conducted when analysis of work methods is conducted during the period when a job is done on a machine or equipment. Method study is on studying the method currently being used and developing a new method of performing the task in a better way. The study helps in designing the optimum work method and standardization of the work method. Operation flow charts, motion charts, flow process charts, which are the elements of the task are studied to find the purpose of each activity, the sequences in which they are done, and the effect of these on the work. The study enables the

methods engineer to search for better methods for higher utilization of man and machine and accomplishment of higher productivity. The study may help in changing some of them and even eliminate some of them to effect improvements. The study gives an opportunity to the workmen to learn the process of study thus making them able to offer suggestions for improved methods. The new method should result in saving of time, reduced motions and simpler activities.

Q.4. what is Rapid Prototyping? Explain the difference between automated flow line and automated assembly line with example. Ans: Rapid Prototyping: Prototyping is a process by which a new product is developed in small numbers so as to determine the suitability of the materials, study the various methods of manufacture, type of machinery required and to develop techniques to overcome problems that may be encountered when full scale manufacture is undertaken. Prototypes do meet the specifications of the components that enter a product and performance can be measured on those. It helps in confirming the design and any shortcomings can be rectified at low cost. If serious defects or problems arise during the manufacture, a thorough change in design or even its replacement may be considered. To arrive at decisions to make use of the advantages stated above, it is important that the prototypes are made within the shortest possible time. Rapid prototyping facilitates this. It uses virtual designs from Computer Aided Design CAD or animation modeling which transforms dimensional data to 3dimensional views. The physical space of the product is amenable to have cross sections made. Cross sections taken at very close positions gives thin layers which enable the generation of a solid model of the designed product. The data that is thus created helps build a solid model exactly as per the drawings. Any shape can be generated in this method. Advanced technologies like SLS (Selective Laser Sintering), FDM (Fused Deposition Modeling), LOM (Laminated Object Manufacture), EBM (Electronic Beam Melting) are some of Rapid Prototype Modeling Processes. Since the basis data about the product is already available in CAD, the above processes can produce models in a matter of a few days. Conventional machines like lathes, milling machines, grinding machines, EDM (Electro Discharge Machining) also help in the production of prototypes. Because of their advantages Rapid Prototyping is being increasingly used.

Difference between Automated Flow lines and Assembly Flow line.

AUTOMATED FLOW LINES Several Automated machines are linked by a transfer system. Handling machine have main role to move semi finished product to the next stage. Semi-finished products are the main core activities. Here raw materials are achieving to get required shapes and acquire special properties. The materials are needed to be moved, held, rotated, fitted and positioned for completing different operations. Human intervention may be needed to verify that the operations are taking place according to standards.

ASSEMBLY FLOW LINES All equipments are needed to in automated Assesmbly line All equipments make role of making subassemblies put together and fitted. Here Sub-assemblies product are the core activites. Here intermediated products are achieving to get finished product. Here All parts or sub-assemblies are fitted to enables the product to be in readiness to perform the function it was designed to. This process is called assembly. No human intervention is needed, methodologies are framed to achieve the final result, basic principle is to fit parts together and ensure linkages so that the functions are integrated and give out the desired output.

Q.5. list different methods for selecting a suitable plant location and explain any two.
Plant location : Plant location Meaning-the establishment of an industry at a particular place. It is of 2 types- Localization /centralization-means concentration of similar type of industries at some particular place. E.g. textile in Mumbai. Delocalization /Decentralization-means spreading of similar type of industries at different places. E.g. banking industries.

Factors affecting location & site decisions : Factors affecting location & site decisions Availability of raw material Nearness to the potential market Near to the source of operating requirements like electricity, disposal of waste, drainage facilities. Supply of labor Transport & communication facilities Integration with other group of companies Suitability of land & climate Availability of housing, other amenities & services Local building & planning regulations Safety requirements Others like low interest on loans, special grants, living standards

selection of the site for the factory : selection of the site for the factory Known as location analysis where firstly some geographical area is selected & from that area a particular site is selected for the establishment of the plant. Methods for the evaluation of plant location1. Involving quantitative factors a. Comparative cost chart, b. dimensional analysis. 2. Comparison of qualitative factors.

Comparative cost chart : Comparative cost chart Is appropriate where the location problem concerns the placement of a single plant. This is based on location cost summary chart. A comparative chart of total costs involved in setting up a plant of desired size is prepared.

The total cost is represented by the height of column for each location. we select a location for which total cost is minimum. The cost summary chart has advantage of clarity in presentation. but analysis is restricted to certain specified factors only. Least cost centre analysis- Here transportation cost associated with various location alternatives is considered. Limitation of these techniques- 1.Choice of plant location assumed to be entirely dependent upon minimization of operational costs. 2.Operational costs are assumed to be linearly related to distance involved.

Dimensional analysis : Dimensional analysis It involves calculation of the relative merits or cost ratios for each of the factors, giving each of the cost factor an appropriate weightage by means of an index to which the cost ratio is raised & multiplying these weighted ratios in order to arrive at a figure on the relative merits of alternative sites. Let Cm1,Cm2,Cm3,..Cmz are the costs associated with site M for various cost factors. Cn1,Cn2,Cn3,.Cnz are of site N.W1,W2,W3,.Wz are weightage for various factors. Merit of location M=(Cm1)W1*(Cm2)W2*(Cmz)Wz Merit of location N=(Cn1)W1*(Cn2)W2*(Cnz)Wz Relative merits of sites M & N aremerit of M merit of N If this value is > 1, then select site M & vice-versa. Advantages- it compares both subjective & objective factors & gives a quantitative figure. Comparison of qualitative factors. : Comparison of qualitative factors. These are the factors to which cost values cant be assigned. Like lack of good schools, community attitude. These can be termed as good or excellent. Clearly location B appears to be better one.

Q.6. explain Jurans Quality Triology and Crosbys absolutes of quality. List out Demings 14 points. JURANs Quality Triology Juran uses his famous universal Breakthrough Sequence to implement quality programmes. The universal break through sequences are ; Proof of need: there should be a compelling need to make changes. Project identification: here what is to be changed is identified. Specific projects with time frames and the resource allocation are decided. Top management commitment: Commitment of the top management is to assign people and fix responsibilities to complete the project. Diagnostic journey: Each team will determine whether the problems result from systemic causes or are random or are 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 actions and consequences will help in further improvements. The actions that results in the benefits derived should be the norm for establishing standards. JURAN has categorised cost of quality in to four categories:1. Failure CostsInternal :These are cost of rejections, repairs in terms of materials, labour, machine time and loss of morale. 2. Failure Costs-External: These are cost of replacement, on-site rework including spareparts and expenses of the personnel, warranty costs and loss of goodwill. 3. Appraisal Costs: These are cost inspection, including maintenance of records, certification, segregation costs, and others. 4. Prevention costs: Prevention cost is the sequence of three sets of activities, Quality planning, Quality control, and Quality improvement, forming the triology to achieve TOTAL QUALITY MANAGEMENT. JURANs argument says that; Quality is the result of good planning consideration the needs of both internal and external customers and develops processes to meet them. The processes are also planned to meet them. Quality is built into the system of manufacture, inputs and processes that are on stream like raw material, spare parts, labour, machine maintenance, training, warehousing, inspection procedures, packaging, and other. All these have to follow standards and control exercises to make sure that mistake do not occur often and that if mistakes do occur then they are corrected at the source. Quality improvement measures are essential to keep the quality culture alive. Newer methods will be found, 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 lookout for opportunities for improvement. CROSBY'S FOUR ABSOLUTES OF QUALITY. Crosby espoused his basic theories about quality in four Absolutes of Quality Management as follows: 1. 2. 3. 4. Quality means conformance to requirements, not goodness. The system for causing quality is prevention, not appraisal. The performance standard must be zero defects, not "that's close enough." The measurement of quality is the price of nonconformance, not indexes.

To support his Four Absolutes of Quality Management, Crosby developed the Quality Management Maturity Grid and Fourteen Steps of Quality Improvement. Crosby sees the Quality Management Maturity Grid as a first step in moving an organization towards quality management. After a company has located its position on the grid, it implements a quality improvement system based on Crosby's Fourteen Steps of Quality Improvement as shown in Figure 4. Crosby's Absolutes of Quality Management are further delineated in his Fourteen Steps of Quality Improvement as shown below:

Step 1. Management Commitment Step 2. Quality Improvement Teams Step 3. Quality Measurement Step 4. Cost of Quality Evaluation Step 5. Quality Awareness Step 6. Corrective Action Step 7. Zero-Defects Planning Step 8. Supervisory Training Step 9. Zero Defects Step 10. Goal Setting Step 11. Error Cause Removal Step 12. Recognition Step 13. Quality Councils Step 14. Do It All Over Again Different between Automated Flow lines and Assembly Flow line. Automated Flow Lines Assembly Flow Lines 1. Several Automated machines are linkedby a transfer system.1. All equipments are needed to in automated Assembly line2. Handling machine have main role to move semi finished product to the nextstage.2. All equipments make role of making subassemblies put together andfitted.3. Semi-finished products are the main core activities.3. Here Sub-assemblies products are the core activities.

DEMING'S FOURTEEN POINTS Deming formulated the following Fourteen Points to cure (eliminate) the Seven Deadly Diseases and help organizations to survive and flourish in the long term:
1. Create constancy of purpose toward improvement of product and service. Develop a plan to be competitive and stay in business. Everyone in the organization, from top management to shop floor workers, should learn the new philosophy. 2. Adopt the new philosophy. Commonly accepted levels of delays, mistakes, defective materials, and defective workmanship are now intolerable. We must prevent mistakes. 3. Cease dependence on mass inspection. Instead, design and build in quality. The purpose of inspection is not to send the product for rework because it does not add value. Instead of leaving the problems for someone else down the production line, workers must take responsibility for their work. Quality has to be designed and built into the product; it cannot be

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inspected into it. Inspection should be used as an information-gathering device, not as a means of "assuring" quality or blaming workers. Don't award business on price tag alone (but also on quality, value, speed and long term relationship). Minimize total cost. Many companies and organizations award contracts to the lowest bidder as long as they meet certain requirements. However, low bids do not guarantee quality; and unless the quality aspect is considered, the effective price per unit that a company pays its vendors may be understated and, in some cases, unknown. Deming urged businesses to move toward single-sourcing, to establish long-term relationships with a few suppliers (one supplier per purchased part, for example) leading to loyalty and opportunities for mutual improvement. Using multiple suppliers has been long justified for reasons such as providing protection against strikes or natural disasters or making the suppliers compete against each other on cost. However, this approach has ignored "hidden" costs such as increased travel to visit suppliers, loss of volume discounts, increased set-up charges resulting in higher unit costs, and increased inventory and administrative expenses. Also constantly changing suppliers solely on the base of price increases the variation in the material supplied to production, since each supplier's process is different. Continuously improve the system of production and service. Management's job is to continuously improve the system with input from workers and management. Deming was a disciple of Walter A. Shewhart, the developer of control charts and the continuous cycle of process improvement known as the Shewhart cycle. Deming popularized the Shewhart Cycle as the Plan-Do-Check-Act (PDCA) or Plan-Do-Study-Act (PDSA) cycle; therefore, it is also often referred to as the Deming cycle. In the planning stage, opportunities for improvement are recognized and operationally defined. In the doing stage, the theory and course of action developed in the previous stage is tested on a small scale through conducting trial runs in a laboratory or prototype setting. The results of the testing phase are analyzed in the check/study stage using statistical methods. In the action stage, a decision is made regarding the implementation of the proposed plan. If the results were positive in the pilot stage, then the plan will be implemented. Otherwise alternative plans are developed. After full scale implementation, customer and process feedback will again be obtained and the process of continuous improvement continues. Institute training on the job. When training is an integral part of the system, operators are better able to prevent defects. Deming understood that employees are the fundamental asset of every company, and they must know and buy into a company's goals. Training enables employees to understand their responsibilities in meeting customers' needs. Institute leadership (modern methods of supervision). The best supervisors are leaders and coaches, not dictators. Deming high-lighted the key role of supervisors who serve as a vital link between managers and workers. Supervisors first have to be trained in the quality management before they can communicate management's commitment to quality improvement and serve as role models and leaders. Drive out fear. Create a fear-free environment where everyone can contribute and work effectively. There is an economic loss associated with fear in an organization. Employees try to please their superiors. Also, because they feel that they might lose their jobs, they are hesitant to ask questions about their jobs, production methods, and process parameters. If a supervisor or manager gives the impression that asking such questions is a waste of time, then employees will be more concerned about pleasing their supervisors than meeting long-term goals of the organization. Therefore, creating an environment of trust is a key task of management. Break down barriers between areas. People should work cooperatively with mutual trust, respect, and appreciation for the needs of others in their work. Internal and external

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organizational barriers impede the flow of information, prevent entities from perceiving organizational goals, and foster the pursuit of subunit goals that are not necessarily consistent with the organizational goals. Barriers between organizational levels and departments are internal barriers. External barriers are between the company and its suppliers, customers, investors, and community. Barriers can be eliminated through better communication, crossfunctional teams, and changing attitudes and cultures. Eliminate slogans aimed solely at the work force. Most problems are system-related and require managerial involvement to rectify or change. Slogans don't help. Deming believed that people want to do work right the first time. It is the system that 80 to 90 percent of the time prevents people from doing their work right the first time. Eliminate numerical goals, work standards, and quotas. Objectives set for others can force suboptimization or defective output in order to achieve them. Instead, learn the capabilities of processes and how to improve them. Numerical goals set arbitrarily by management, especially if they are not accompanied by feasible courses of action, have a demoralizing effect. Goals should be set in a participative style together with methods for accomplishment. Deming argued that the quota or work standard system is a short-term solution and that quotas emphasize quantity over quality. They do not provide data about the process that can be used to meet the quota, and they fail to distinguish between special and common causes when seeking improvements to the process. Remove barriers that hinder workers (and hinder pride in workmanship). The direct effect of pride in workmanship is increased motivation and a greater ability for employees to see themselves as part of the same team. This pride can be diminished by several factors: (1) management may be insensitive to workers' problems; (2) they may not communicate the company's goals to all levels; and (3) they may blame employees for failing to meet company goals when the real fault lies with the management. Institute a vigorous program of education and self improvement. Deming's philosophy is based on long-term, continuous process improvement that cannot be carried out without properly trained and motivated employees. This point addresses the need for ongoing and continuous education and self-improvement for the entire organization. This educational investment serves the following objectives: (1) it leads to better motivated employees; (2) it communicates the company goals to the employees; (3) it keeps the employees up-to-date on the latest techniques and promotes teamwork; (4) training and retraining provides a mechanism to ensure adequate performance as the job responsibilities change; and (5) through increasing job loyalty, it reduces the number of people who "job-hop." Take action to accomplish the transformation. Create a structure in top management that will promote the previous thirteen points. It is the top management's responsibility to create and maintain a structure for the dissemination of the concepts outlined in the first thirteen points. Deming felt that people at all levels in the organization should learn and apply his Fourteen Points if statistical process control is to be a successful approach to process improvement and if organizations are to be transformed. However, he encouraged top management to learn them first. He believed that these points represent an all-or-nothing commitment and that they cannot be implemented selectively.

MB0044

PRODUCTION AND OPERATIONS MANAGEMENT

SET-2

Q1.Sketch the business process model and define the terms. Differentiate between Logical process Modeling and Physical Process modeling.

Business process models consist of simple diagrams constructed from a limited set of graphical elements. For both business users and developers, they simplify understanding business activities' flow and process. BPM's four basic element categories are:
*Flow objects Events, activities, gateways *Connecting objects Sequence flow, message flow, association *Swim lanes Pool, lane *Artifacts Data object group, annotation

These four categories enable creation of simple business process diagrams (BPDs). BPDs also permit making new types of flow object or artifact, to make the diagram more understandable.

Flow objects and connecting objects

EVENT

ACTIVITY

GATE WAY

CONNECTION

Flow objects are the main describing elements within BPMN, and consist of three core elements: events, activities, and gateways.

Event An Event is represented with a circle and denotes something that happens (compared with an activity, which is something that is done). Icons within the circle denote the type of event (e.g., an envelope representing a message, or a clock representing time). Events are also classified as Catching (for example, if catching an incoming message starts a process) or Throwing (such as throwing a completion message when a process ends). Start event Acts as a process trigger; indicated by a single narrow border, and can only be Catch, so is shown with an open (outline) icon. End event Represents the result of a process; indicated by a single thick or bold border, and can only Throw, so is shown with a solid icon. Intermediate event Represents something that happens between the start and end events; is indicated by a tramline border, and can Throw or Catch (using solid or open icons as appropriate). For example, a task could flow to an event that throws a message across to another pool, where a subsequent event waits to catch the response before continuing. Activity An activity is represented with a rounded-corner rectangle and describes the kind of work which must be done.

Task A task represents a single unit of work that is not or cannot be broken down to a further level of business process detail without diagramming the steps in a procedure (which is not the purpose of BPMN) Sub-process Used to hide or reveal additional levels of business process detail. When collapsed, a subprocess is indicated by a plus sign against the bottom line of the rectangle; when expanded, the rounded rectangle expands to show all flow objects, connecting objects, and artifacts. Has its own self-contained start and end events; sequence flows from the parent process must not cross the boundary.

Transaction A form of sub-process in which all contained activities must be treated as a whole; i.e., they must all be completed to meet an objective, and if any one of them fails, they must all be compensated (undone). Transactions are differentiated from expanded sub-processes by being surrounded by a tramline border. Gateway A gateway is represented with a diamond shape and determines forking and merging of paths, depending on the conditions expressed.

Flow objects are connected to each other using Connecting objects, which are of three types: sequences, messages, and associations.
Sequence Flow A Sequence Flow is represented with a solid line and arrowhead, and shows in which order the activities are performed. The sequence flow may also have a symbol at its start, a small diamond indicates one of a number of conditional flows from an activity, while a diagonal slash indicates the default flow from a decision or activity with conditional flows. Message Flow A Message Flow is represented with a dashed line, an open circle at the start, and an open arrowhead at the end. It tells us what messages flow across organizational boundaries (i.e., between pools). A message flow can never be used to connect activities or events within the same pool. Association

An Association is represented with a dotted line. It is used to associate an Artifact or text to a Flow Object, and can indicate some directionality using an open arrowhead (toward the artifact to represent a result, from the artifact to represent an input, and both to indicate it is read and updated). No directionality is used when the Artifact or text is associated with a sequence or message flow (as that flow already shows the direction). Swimlanes and artifacts

Swimlanes

Data objects

Groups

Annotation

Swim lanes are a visual mechanism of organising and categorising activities, based on cross functional flowcharting, and in BPMN consist of two types:
Pool Represents major participants in a process, typically separating different organisations. A pool contains one or more lanes (like a real swimming pool). A pool can be open (i.e., showing internal detail) when it is depicted as a large rectangle showing one or more lanes, or collapsed (i.e., hiding internal detail) when it is depicted as an empty rectangle stretching the width or height of the diagram. Lane Used to organise and categorise activities within a pool according to function or role, and depicted as a rectangle stretching the width or height of the pool. A lane contains the flow objects, connecting objects and artifacts.

Artifacts allow developers to bring some more information into the model/diagram. In this way the model/diagram becomes more readable. There are three pre-defined Artifacts and they are:
Data objects Data objects show the reader which data is required or produced in an activity. Group A Group is represented with a rounded-corner rectangle and dashed lines. The group is used to group different activities but does not affect the flow in the diagram.

Annotation An annotation is used to give the reader of the model/diagram an understandable impression. Examples of business process diagrams

A process with a normal

flow Discussion

cycle E-mail voting

process Collect votes

Business requirements have been gathered for a proposed database, they must be modeled. Models are created to visually represent the proposed database so that business requirements can easily be associated with database objects to ensure that all requirements have been completely and accurately gathered. Different types of diagrams are typically produced to illustrate the business processes, rules, entities, and organizational units that have been identified. These diagrams often include entity relationship diagrams, process flow diagrams, and server model diagramsBasically, data modeling serves as a link between business needs and system requirements.

Two types of data modeling are as follows:

Logical Process Modeling Physical Process Modeling

Logical Modeling

vs

Physical Modeling

*Logical modeling deals with gathering business requirements and converting those requirements into a
model.whereas, Physical modeling involves the actual design of a database according to the requirements that were established during logical modeling.

*Logical modeling involves gathering information about business processes, business entities (categories
of data), and organizational units. After this information is gathered, diagrams and reports are produced including entity relationship diagrams, business process diagrams, and eventually process flow diagrams. Whereas, Physical modeling deals with the conversion of the logical, or business model, into a relational database model. When physical modeling occurs, objects are being defined at the schema level. A

schema is a group of related objects in a database. A database design effort is normally associated with one schema. *The diagrams and documentation generated during logical modeling is used to determine whether the requirements of the business have been completely gathered. Management, developers, and end users alike review these diagrams and documentation to determine if more work is required before physical modeling commences.

During physical modeling, objects such as tables and columns are created based on entities and attributes that were defined during logical modeling. Constraints are also defined, including primary keys, foreign keys, other unique keys, and check constraints. Views can be created from database tables to summarize data or to simply provide the user with another perspective of certain data. Other objects such as indexes and snapshots can also be defined during physical modeling. Physical modeling is when all the pieces come together to complete the process of defining a database for a business.

*Logical modeling affects not only the direction of database design, but also indirectly affects the performance and administration of an implemented database. When time is invested performing logical modeling, more options become available for planning the design of the physical database.

Physical modeling is database software specific, meaning that the objects defined during physical modeling can vary depending on the relational database software being used. For example, most relational database systems have variations with the way data types are represented and the way data is stored, although basic data types are conceptually the same among different implementations. Additionally, some database systems have objects that are not available in other database systems.

*Typical deliverables of logical modeling include

Entity relationship diagrams An Entity Relationship Diagram is also referred to as an analysis ERD. The point of the initial ERD is to provide the development team with a picture of the different categories of data for the business, as well as how these categories of data are related to one another.

Business process diagrams The process model illustrates all the parent and child processes that are performed by individuals within a company. The process model gives the development team an idea of how data moves within the organization. Because process models illustrate the activities of individuals in the company, the process model can be used to determine how a database application interface is design.

User feedback documentation

Typical deliverables of physical modeling include the following:

Server model diagrams The server model diagram shows tables, columns, and relationships within a database. User feedback documentation Database design documentation

Q2.Explain project management lifecycle and its phases with an example. Explain Work Breakdown Structure. Project management lifecycle A life cycle of a project consists of the following steps: Understanding the scope of the project. Establishing objectives of the projects. Formulating and planning various activities. Executing the project. Monitoring and controlling the project resources. Closing and post completion analysis. Phases of project management life cycle

Project management life cycle has six phases: 1. 2. 3. 4. 5. 6. Analysis and evaluation phases Marketing phases. Design phases. Execution phases. Control-inspecting , testing, and delivery phases. Closure and post completion analysis phases.

Analysis and evaluation phase is the initial phase of any project. In this phase , information is collected from the customer pertaining to the project. From the collected information , the requirement of the project are analyzed . according to the customer requirement , the entire project is planned in a strategic manner. The project manager conducts the analysis of the problem and submits a detailed report to the top management. Marketing phases 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

Design phase involves the study of inputs and outputs of the various project stages. Inputs received consist of project feasibility study, preliminary project evaluation details, project proposal and customer interviews. Outputs produced consist of system design specifications, functional specifications of the project ,design specifications of the project and project plan. Execution phase In this phase the project manager and the team 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 him is implementing the project design accurately. The project has to be monitored through its cost, manpower and schedule. The project manager has to ensure ways of managing the customer and marketing the future work. Closure and post completion analysis phase Upon satisfactory completion and delivery of the intended product of service the staff performance has to be evaluated . the project manager has to be document the lessons from the project . Work Breakdown Structure (WBS) The entire process of a project may be considered to made up on number of sub process placed in different stage called the work Breakdown Structure. WBS is the technique to analyze the content of work and cost by breaking it down in to its component parts. Project key stages from the highest level of the WBS, which is than used to show the details of the lower levels of the projects. Each key stage comprises many tasks identified at the start of the planning and latter this list will have to be validated.WBS is produced by identifying the key elements. Breaking each elements down into component parts and continuing to breakdown until manageable work packages have been identified. These can be allocated to the appropriate person. The WBS does not show dependencies other than grouping under the key stages. It is not time based.

Example of a product oriented work breakdown structure is an aircraft system.

Q3.Define industries best practices? Explain any one popular industry best practice followed by all companies.

A best practice is a method or technique that has consistently shown results superior to those achieved with other means, and that is used as a benchmark. In addition, a "best" practice can evolve to become better as improvements are discovered. Best practice is considered by some as a business buzzword, used to describe the process of developing and following a standard way of doing things that multiple organizations can use. Best practices are used to maintain quality as an alternative to mandatory legislated standards and can be based on self-assessment or bench marking. Best practice is a feature of accredited management standards such as ISO 9000 and ISO 14001 Documenting and charting procedures and practices is a complicated and time-consuming process often skipped by companies, even though they may practice the proper processes consistently. Some consulting firms specialize in the area of Best Practice and offer pre-made 'templates' to standardize business process documentation. Sometimes a "best practice" is not applicable or is inappropriate for a particular organization's needs. A key strategic talent required when applying best practice to organizations is the ability to balance the unique qualities of an organization with the practices that it has in common with others. A best practice tends to spread throughout a field or industry after a success has been demonstrated. However, it is often noted that demonstrated best practices can be slow to spread, even within an organization. According to the American Productivity & Quality Center, the three main barriers to adoption of a best practice are a lack of knowledge about current best practices, a lack of motivation to make changes involved in their adoption, and a lack of knowledge and skills required to do so.
Companies are constantly trying to find ways to improve performance and warehouse operations is area where supply chain managers can focus to gain maximum efficiency for minimum cost. To get the most out of the operation, a number of best practices can be adopted to improve productivity and overall customer satisfaction. Although best practices vary from industry to industry and by the products shipped there are a number of best practices that can be applied to most companies. When considering the level of effort involved in warehouse operations, the greatest expenditure of effort is in the picking process. To gain efficiencies in picking the labor time to pick orders needs to be reduced and this can achieved in a number of ways. Companies with the most efficient warehouses have the most frequently picked items closest to the shipping areas to minimize picking time. These companies achieve their competitive advantage by constantly reviewing their sales data to ensure that the items are stored close to the shipping area are still the most frequently picked. Warehouse layout is also important in achieve greater efficiencies. Minimizing travel time between picking locations can greatly improve productivity. However, to achieve this increase in efficiency, companies must develop processes to regularly monitor picking travel times and storage locations.

Warehouse operations that still use hard copy pick tickets find that it is not very efficient and prone to human errors. To combat this and to maximize efficiency, world class warehouse operations had adopted technology that is some of todays most advanced systems. In addition to hand-held RF readers and printers, companies are introducing pick-to-light and voice recognition technology. In a pick-to-light system, an operator will scan a bar-coded label attached to a box. A digital display located in front of the pick bin will inform the operator of the item and quantity that they need to pick. Companies are typically using pick-to-light systems for their top 5 to 20% selling products. By introducing this system companies can gain significant efficiencies as it is totally paperless and eliminates the errors caused by pick tickets. Voice picking systems inform the operator of pick instructions through a headset. The pick instructions are sent via RF from the companys ERP or order management software. The system allows operators to perform pick operations without looking at a computer screen or deal with paper pick tickets. Many world class warehouse operations have adopted voice picking to complement the pick-to-light systems in place for their fast moving products. Although many companies will not be able to afford new technologies for picking, weve seen here that there are a number of best practices that can be adopted to improve efficiency and reduce cost.

Q4.Explain PMIS. What is Key Success Factor(KSF),Explain with example. A project management information system (PMIS) is a part of management information systems (MIS) and manage information of a project centric organization. Project Management Information System (PMIS) are system tools and techniques used in project management to deliver information. Project managers use the techniques and tools to collect, combine and distribute information through electronic and manual means. Project Management Information System (PMIS) is used by upper and lower management to communicate with each other. Upper managers need information on all projects regarding progress, problems, resource uses, costs and project goals. This info helps them take decision on the project. They should review the projects at each milestone and arrive at appropriate decision. Project managers and department managers need info to see each project schedule, priority and use of resources to determine the most efficient use across the organization. Project team members need information to see schedule, task list and specification so that they know what needs to be done next. The four major aspects of a PIMS are: 1. Providing information to the major stakeholders. 2. Assisting the team members, stakeholders, managers with necessary information and summary of the information shared to the higher level managers. 3. Assisting the manager in doing what if analyses about project staffing. Proposed staffing changes and total allocation of recourses. 4. Helping organizational learning by helping the members of the organization learn about project management.

Usually, the team members , and not the systems administrations of the company, develop a good PIMS . organizations tend to allocate such responsibility by rotation among members with a well designed and structured data entry and analytical format. Project Management Information System (PMIS) help plan, execute and close project management goals. During the planning process, project managers use PMIS for budget framework such as estimating costs. The Project Management Information System is also used to create a specific schedule and define the scope baseline. At the execution of the project management goals, the project management team collects information into one database. The PMIS is used to compare the baseline with the actual accomplishment of each activity, manage materials, collect financial data, and keep a record for reporting purposes. During the close of the project, the Project Management Information System is used to review the goals to check if the tasks were accomplished. Then, it is used to create a final report of the project close. To conclude, the project management information system (PMIS) is used to plan schedules, budget and execute work to be accomplished in project management.

Key Success Factors:

Key Success Factors, also known as Critical Success Factors, is the term for elements necessary for an organization or project to achieve its mission. This methodology is commonly used in data analysis and business analysis. When writing a business plan, it's crucial to identify what will make your business a success. Think of key success factors as the small towns you must pass through to reach your destination. If you don't consult a map to found out where those towns are, you may miss a turnoff and your destination. Key success factors, also known as critical success factors, keep you and your employees on track to make your business a success. Measurable key success factors Increasing the sales of a product or service is a common key success factor, but it should be linked to a measurable goal, such as "sales of product X will increase by 30 percent in the fourth quarter." Measuring the outcome of the goals related to your key success factors is essential to keeping your business on target. General key success factors Almost all businesses can benefit from having the key success factor "attract new customers." Decide how many new customers your business needs to succeed, and set a related goal, such as "increase walk-in traffic by 25 percent by offering samples at the door." Other examples of common key success factors are, "retain quality employees," "increase profit margin" and "increase customer satisfaction. Regulatory key success factors Some businesses are subject to more regulation than others. Manufacturing facilities must comply with OSHA regulations, and they may want to develop a key success factor that addresses the company's compliance. For example, "Provide all employees with hazardous material training." Industry specific key success factors

Key success factors should always be relevant to the business you are in. An example of an industry specific key success factor is "increase load factor relative to the industry average." This key success factor is specific to the airline industry, as referenced in "Airline Industry Key Success Factors" in the Graziadio Business Report. Fleet management is essential to airlines, limousine companies and taxi services, but it's not relevant to the development of computer games. Temporal key success factor The key success factor "Build a manufacturing facility to produce 80 percent of inventory" is an example of what RapidBi.com calls temporal factors. According to the web site, temporal factors "relate to short-term situations, often crises. These CSF's may be important, but are usually shortlived." In this example, once the manufacturing facility is constructed and operational, the key success factor is no longer needed and can be replaced by a currently relevant one.

Q5.Explain the seven principles of Supply Chain Management. Take an example of any product in the market and explain Bullwhip effect. A supply chain is a network of facilities and distribution options that performs the function of procurement of materials, transformation of these materials into intermediate and finished products and the distribution of these finished products to customers. supply chains exist in both service and manufacturing organization. Supply Chain Management is the practice of coordinating the flow of goods, service, information, and finances as they move from raw materials to parts supplier to manufacture to wholesaler to retailer to consumer. The seven principals of SCM are 1. Group customers by needs: effective SCM groups customers by distinct service needs, regardless of industry and then tailor services to those particular segments. 2. Customize the logistic network : in designing their logistic network , companies need to focus on the service requirement and profit potential of the customer segments identified. 3. Listen to signals of the market demand and plan accordingly: sales and operations planners must monitor the entire supply chain to detect early warning signals of changing customers 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 stockpile 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 changes customers 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 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 matrices. Bullwhip effect on SCM: The uncertainty caused from distorted information flowing up and down the supply chain is known as BULLWHIP EFFECT. This has its effect on almost all the industries , posses a risk to firms that experience large variations in demand, and also those firms which are dependent on suppliers, distributors and retails. A bullwhip effect may arise because of: Increase in the lead time of the project due to increase in variability of demand. Increase in the stocks to accommodate the increasing demand arising out of complicated demand models and forecasting techniques. Reduced service level in the organization. Inefficient allocation of recourses. Increased transportation cost.
The bullwhip effect is phenomenon observed in supply chains whereby unpredictable elements introduced by human behavior in the lower part of the chain become more pronounced the higher up the chain they move. The effect is important because it is frequently the cause of serious inefficiencies that result from ordering too much or too little of a given product as links in the chain overreact to changes further downstream. Example of bullwhip effect The bullwhip effect is seen in real life as well. It originally takes its name from executives at Proctor & Gamble who began to see disturbing and often inexplicable variations in supply and ordering figures on diapers, despite a relatively stable demand from consumers. Oddly, the company even saw that variability increased further when examining its own orders to its suppliers.

5. Time taken by three machines on five jobs in a factory is tabulated below in table below. Find out the optimal sequence to be followed to minimise the idle time taken by the jobs on the machines.

Ans.

Consider M1 and M3

Using Johnsons algorithm , the job order sequence obtained is: D E C A B

The organizations that have incorporated VE: General Electricals Corporation (GE Corp):
The concept of VE originated in 1947 in GE Corp when a substitute for asbestos flooring had to be found. Specialized dealers could provide an equally good 'material' at a lesser price. Initially the practitioners were the people in charge of purchasing who tried to locate substitute material which would be equally good or at a lower price. This concept then made its way to the other units and departments of the organization. Ashok Leyland: In implementation of VA, Ashok Leyland changed gear material from phosphor bronze to a less expensive cast iron and eliminated frequent field complaint of gear seizure in trucks. T.V.Sundaram Iyenger & Sons Limited (TVS Ltd): During the 1940s to 1960s,Madurai based TVS was ranked as the best bus transportation system in India. It could manage to run the fleets for about 96% of the time. TVS used the VE approach to restore the mobility of the buses that had broken down. They stocked their garages with some of the critical assemblies of the bus. Whenever, a part or an assembly of the bus failed, an immediate replacement was always at hand.