MS-05 MANAGEMENT OF MACHINES & MATERIALS

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WHAT IS A PROJECT?
A project can be defined as a set of large number of activities or jobs that are performed in a certain sequence determined logically and it has to be completed within a specified time or a specified cost or meeting the performance standards.
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NETWORK PRESENTATION OF PROJECTS

A network is a graphical representation of a project, depicting the flow as well as the sequence of well defined activities and events. There are two types of network techniques. 1. Critical path method ( CPM) 2. PERT
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DRAWING PROJECT NETWORK

ACTIVITY

A B C D E F G H

IMMEDIATE PREDECESSORS -------

C A,B E,D D F,G

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CALCULATION OF START & FINISH TIMES ACTIVITY 1-2 2-3 2-4 4-5 4-6 3-5 5-6 3-6 DURATION 3 3 2 7 5 3 6 2
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WHAT IS CRITICAL PATH? An activity is said to be critical if a delay in the start of the course makes a delay in the completion time of the entire project. A critical path is the longest path on the network. There is no flexibility in the activities on the critical path.
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PROJECT EVALUTION & REVIEW TECHNIQUES

ACTIVITY A B C D E F G H P.A ----A A A B,C D E,F,G
O.T 2 10 8 10 7 9 3 5 M.T 4 12 9 15 7.5 9 3.5 5 P.T 12 26 10 20 11 9 7 5

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CALCULATIONS
ES= Ei EF= Ei+Tij LS= Lj- Tij LF= Lj TF= ( Lj-Ei)- Tij Te= To+4Tm+Tp 6 S.D= Tp-To 6
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Break-Even Point
A ball bearing manufacturing company is planning to install an additional plant which will require leasing new equipment for a monthly payment of Rs.60,000. Variable cost be Rs.20 per item and each item will retail for Rs.70. 1) How many ball-bearing must be sold in order to break even? 2) What could be the profit (or loss) if 1000 items are made and sold in a month? 3) How any item must be sold to realize a profit of Rs.40000?

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Break-Even Point
A small firm intends to increase the capacity of a bottleneck operation by adding a new machine. Two alternatives A and B have been identified, and the associated costs and revenues have been estimated. Annual fixed costs would be Rs.40,000 for A, and Rs.30,000 for B, variable costs per unit would be Rs.10 for A and Rs.12 for B; and revenue per unite would be Rs.15 for A and Rs.16 for B. Determine the break-even point in terms of units for each alternative. At what volume of output would the two alternatives yield the same profit? If expected annual demand is 12,000 units, which alternative would yield a higher profit?
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i. ii. iii.

Break-Even Analysis
A manager has the option of purchasing one, two or three machines. Fixed costs and potential volumes are as follows:

Number of Machines 1 2 3

Total Annual Fixed Costs Rs.96,000 Rs.1,50,000 Rs.2,00,000

Corresponding Range of Output 0 to 300 301 to 600 601 to 900

Variable cost is Rs.100 per unit, and revenue is Rs.400 per unit
i. ii.

Determine the break-even point for each range. If projected annual demand is between 580 and 660 units, how many machines should the manager purchase?
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Break-Even Analysis
Paradise Airlines offers customers a vacation plan for Rs.5200. The airline estimates that the fixed costs associated with this plan are Rs.72,00,000 and at a volume of 3,000 passengers. Total variable costs would be Rs.48,00,000 and profits should be Rs.36,00,000. Find the break-even volume. If fixed costs remained constant, how many additional passengers (beyond break-even) would be required to increase profits to Rs.50,00,000?
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i. ii.

Job flow time

Five jobs are to be run on the two processes, all in the sequence of first process 1, than process 2. The duration (in hours) of the operations in indicated in the table

Job Process 1 Sanding Time (hours) A B C D E 2.25 2.00 1.00 2.50 1.75

Process 1 Varnish Time (hours) 1.75 2.25 2.00 2.00 1.75

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 The following table contains information regarding jobs that are to be scheduled through one machine.
Job A B C D E F G Processing time (days) 6 12 2 11 10 3 6 Due date (days) 20 30 15 16 18 5 9

Job flow time

Sequence the jobs using i. Shortest processing Time (SPT) ii. Processing with Dates
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 The following table contains information concerning four jobs that are awaiting processing at a work centre. Job Job time (days) Due date (days)

Job flow time

A 14 B 10 C 7 D 6 Sequence the jobs using

i. Shortest processing Time (SPT)

20 16 15 17

ii. Processing with Due Dates Assume the list is by order of arrival For each of the methods, determine the average job flow time, average lateness and average number of jobs at the work centre. Is one method superior to the other? Explain.
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 Processing times (includes set-up times) and due dates for five jobs waiting to be processed at a work centre are given in the following table:

Job flow time

Job A B C D E

Process Time (Days) 12 6 14 3 7

Due Date (Days) 15 24 20 8 6

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1) 2)

Determine the sequence of jobs, the average flow time, average job lateness and average number of jobs at the work centre at the work centre, for each of these rules: First Come First Serve (FCFS) Earliest Due Date (EDD)

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CPM & pert

The R & D Department is planning to bid on a large project for the developing of a new communication system for commercial planes. The accompanying table shows the activities, times and sequences required.

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Activit y A B C D E F G H I

Immediate Predecessor A A A B C,C D,F D E,G,H

Time (Weeks)
3 2 4 4 6 6 2 3 3
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a) Draw the network diagram. b) What is the critical path? c) Suppose you want to shorten the completion time as much as possible, and have the option of shortening any of all of B,C,D and G each by two weeks. Which would you shorten? d) What is the new critical path and earliest completion time?

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CPM & pert

The R & D Department is planning to bid on a large project for the developing of a new communication system for commercial planes. The accompanying table shows the activities, times and sequences required.

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Activity A B C D E F G H

Immediate Predecessor A A A A B C,D,E F

Time (Weeks) 6 2 5 7 1 2 3 6

a)Draw the network diagram b)Find the critical path c)Find the project completion d)Calculate the total float for each of the activities
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 A Project has been defined to contain the following list of activities along with their required times for completion:
Activity Time (Days) Immediate Predecessors

CPM & pert

A B C D E F G H I

1 4 3 7 6 2 7 9 4

A A A B C,D E,F D G,H

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a)

b)
c)

d)

Draw the network diagram. Show the early start and early finish times. Find the critical path. What would happen if activity F was revised to take four Days instead of two?

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Economic Order Quantity

A battery wholesale company purchases batteries for Rs.140, and it costs Rs.110 to process an order. The company sells about 12,000 of a particulars type of battery per year at a uniform rate. The company is open 5 days a week for 52 weeks per year, the order lead time is 3 days, and the company wants to have an average of 2 days sales on hand safety stock when a new order is scheduled to arrive. The holding cost is estimated to be 24 percent of the item cost per year. FIND: 1)EOQ 2)Maximum inventory 3)Reorder level 4)Average inventory level 5)Average annual cost to hold inventory
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Economic Order Quantity

Overland Motors uses 25,000 gear assembler each year and purchases them at Rs.340 each. It costs Rs.5,000 to process and receive an order, and inventory an be carried at a cost of Rs.78 per unit-year. 1) How many assemblies should ordered at a time? 2) How many orders per year should be placed?
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Facility Location
A small manufacturing facility is being planned that will feed parts to three heavy manufacturing facilities. The location of the current plants with their coordinates and volume requirements is given in the following table.

Plant location Coordinates (X,Y)

Volume (parts per year)

Location A Location B Location C

(300,320) (375,470) (470,180)

4000 6000 3000

Use the centre of gravity method to determine the best location for this new facility.
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Facility Location
A small gear manufacturing facility is being planned that will feed parts to five heavy manufacturing facilities. The location of the current plants with their coordinates and volume requirements is given in the following table.
Plant location Location A Location B Location C Location D Location E Coordinates (X,Y) (325,75) (400,150) (450,350) (350,400) (25,450) Volume (parts per year) 1500 250 450 350 450

Use the centre of gravity method to determine the best location for this new facility.
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