1. Production and Operation Management
Prepared by
Prof. T. K. JANA.
Dean, School of Engineering
Haldia Institute of Technology

2. Production Management
Operation Management is a systematic procedure to be followed to achieve the end objectives in the most optimized manner.
Production Management: A set of inputs to be converted to some end products by value addition in the most optimized manner.
Example: Production of a car or its components
Service Management: Inputs are utilized to provide services to the customer.
Example: A restaurant, hotel, hospital, bank etc.

3. Production Management
Management is all about designing, implementing, and maintaining a system that channelizes the endeavors to achieve the end objectives in the best possible way. Management is intangible but its success can be felt by measuring a number of attributes.

4. Closed loop control of Management Systems

5. Productivity: No. of items produced per unit time
Various Attributes
Productivity: No. of items produced per unit time
Efficiency: “doing the thing right"
Effectiveness: “doing the right thing"
Flexibility: Ability to adapt changes
Reliability: Guaranteed performance
Quality: Fitness for use
Lead time: Time span between conceiving an idea and realization of the item.

6. Manufacturing vs Production
It is misnomer to consider that both are interchangeable.
Manufacturing is a collection of interrelated activities such as design and documentation, material selection, planning, production, quality and marketing of goods.
Production is a subset of manufacturing.

7. Types of Production Systems
A production system can be defined as a transformation system in which a saleable product or service is created by working upon a set of inputs. Inputs are usually in the form of men, machine, money, materials etc.
Production systems are usually classified on the basis of the following:
Type of product
Type of production line
Rate of production
Equipments used

8. Types of Production Systems
They are broadly classified into three categories:
Job shop production or Tailor made
Batch production
Mass production 
The new trend of production is called
“Mass Customization”

9. There is hardly any likelihood of getting repeat order.
Job shop production
In this system, only a specific product is made (usually only once) to satisfy a specific need of the customer.
There is hardly any likelihood of getting repeat order.
Example: A heavy duty crane, Missile, ship, Special aircraft etc.
Characteristics:
Usually gigantic in size
The work is regarded as a project

10. Use of general purpose machines are justified
Job shop production
Use of general purpose machines are justified
Planning and control system should be flexible
Skilled man power is required to satisfy the different requirements of work
Schedule is difficult to prepare
In process inventory is high
Fixed position layout is followed
Very high lead time

11. Batch production
Batch production relies on manufacturing of different product variants (models) in batch mode.
Once a particular model in a batch is produced, set ups are changed to deal with next models.
Example: Different models of Maruti. E.g. Alto 800, Wagon R, Swift, Dezire etc.
Characteristics:
High flexibility in operation is required
Computerized machines and equipment are recommended

12. Process layout is followed
Batch production
Process layout is followed
Planning and control system should be flexible
Labor should be skilled enough to work upon different product batches
In process inventory is usually high owing to the type of layout and material handling policies adopted
Productivity is rather low owing to high set up time
Moderate lead time

13. Example: Nuts, bolts, washers, Bearings etc.
Mass production
Mass production system deals with manufacturing of a single product in large quantities without any provision for variation.
Example: Nuts, bolts, washers, Bearings etc.
Characteristics:
A single product is manufactured with no variation
Use of special purpose machines and high productive machines such as Capstan & Turret lathe, single spindle automatics, transfer lines etc. are recommended
Product layout is followed
Planning and control system is easier to implement

14. Mass Production Skilled labor is not required
Less In process inventory
Productivity is very high
No flexibility
Less scrap and rejection
Change over time is negligibly small
Lead time is very less

15. Flow Production
Flow Production is a subset of mass production where a raw material passes through different machine stations sequentially so as to convert it to a finished component or product.
Example: An assembly line used in automotive industries

16. Different Production Systems
Production systems are also classified based on business strategy.
Make to Stock (MTS)
Assembly to Stock (ATS)
Make to Order (MTO)
Engineer to Order (ETO)
A new addition in the recent times is
E. Configure to Order (CTO)

17. Managerial Decisions
Strategic planning is a process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy.
Generally, strategic planning deals with the overall business rather than just an unit or issue.
Strategic planning would answer at least any one of following three key questions:
What do we do? Business types
For whom do we do it? The potential customer
How do we excel? The means to success

18. Generally, top level management is responsible for such decisions.
Strategic Decisions
Key features:
Generally, top level management is responsible for such decisions.
These decisions are for long-term goals
Financial involvement are extremely high
Strategic decision is unstructured and therefore one has to apply his business judgment, evaluation and intuition into the process.
Such decisions are highly dynamic and uncertain

19. Tactical Decisions
Tactical decisions deals with the implementation of strategic decisions.
These are directed towards developing sectional plans, structuring workflows, establishing distribution channels, mobilizing resources such as men, materials and money. 

20. Tactical Decisions
Key features:
Middle level management takes such decisions
These decisions are for mid range goals
Financial involvement are reasonably high
These decisions are made section wise
Duration of such decisions are usually one year

21. Operational Decisions
Operational planning relates to day-to-day operations of the enterprise.
It describes milestones, criteria for success and explains how, or what portion of a strategic plan will be put into operation during a given operational period.

22. Operational Planning
Key features:
These planning spans over short-term horizon, e. g day by day
These decisions are based on facts regarding the events and do not require much of business judgment.
Operational decisions are taken at lower levels of management.
Financial involvement is not very high

23. Life-Cycle of a Product
When any new product is introduced in the market, it is told that the product takes its birth.
Then the product passes through a sequence of stages from introduction to growth, maturity, and decline.
This sequence is known as the product life cycle and is associated with changes in the marketing situation, thus impacting the marketing strategy and the marketing mix.

24. Life-Cycle of a Product

25. Island of PPC PPC Forecasting Finance Inventory Industrial Engineering
Quality
Control
Routing
Forecasting
Inventory
Planning
Dispatching
Process planning
&
Scheduling

26. Thank You