1. OPERATIONS MANAGEMENT Planning

2. PRODUCT PROCESSES FACILITIES LAYOUT PLANNING OPERATION MANAGEMENT HR
MATERIALS
LAYOUT
SCHEDULING
PLANNING

3. Operations Management Product Definition Process
Product: The end result of the manufacturing process to be offered to the market place to satisfy a need or a want.

4. Operations Management Product Design and Development
Marketing and Product Design and Development are the two most critical contributors for the success of any New Product in the market;
- Product definition is conceptualised through market lead
- The concept is translated into the tangible product by the design and development team.
Will be suicidal, if the conceptualization of the Product definition on the basis of customer need/want is insufficient/incorrect and/or
the Product designed on the basis of market lead fails to meet the customer need/want and/or inefficient vis-à-vis competition and/or is not cost effective (capital costs and operating costs) or any other reason that may hinder sales of the Product.

5. Operations Management Product Design
Critical Factors:
- Must meet the required need/want of customers, critical for the success of the organisation
- Must be manufacturable, with minimum additional capital investments
- Must have an edge over competition
- Must have versatility yet cost effective
- Must be cost effective
- Must be an out come of a team work – Marketing,
Manufacturing, Industrial Engineering and
Design/Development teams

6. Operations Management Product Design
Importance:
- Basis for investments and long term commitments
- Organisation profitability depends on success of the
Product/Service acceptance by market
- Decides the Product/Service Cost
- Failures discourage management in considering launch of
the new products

7. Operations Management
Capacity planning
Capacity is the maximum output rate of a facility
Capacity planning is the process of establishing the output rate that can be achieved at a facility:
Capacity is usually purchased in “chunks”
Strategic issues: how much and when to spend capital for additional facility & equipment
Tactical issues: workforce & inventory levels, & day-to-day use of equipment
Operations Management

8. PRODUCTION MANAGEMENT To achieve the objectives, key areas of interest are; - Manufacturing Systems - Materials Management - Methods - Plant layout - Human Resource

9. DISTINCT STAGES OF PRODUCTION SYSTEM
Planning
To analyze given data and devise scheme for the best utilization of resources
Operations
To perform action as per the plan
Control
To supervise operations with appropriate control mechanism that feeds back information about the progress of the work. The mechanism is also responsible for subsequent adjusting, modifying and redefining plans and targets to attain the goal.

10. Aggregate Planning
Concerned with the overall operations over a specified time horizon.
Determines the efficient way of responding (allocating resources) to market conditions
Effective allocate system capacity (plant, equipment and manpower) over designated period.
A good production plan should
> be consistent with organisation policy
> meet demand requirements
> be within capacity constraints
> minimizes costs

11. Aggregate Planning
Game plan to consider an integrated view of Marketing, Finance and Operations
Managerial objective is to develop an integrated game plan whose manufacturing portion is the production plan
States the mission manufacturing must accomplish as a part of the Corporate objectives
Production plan will link strategic goals to production and is coordinated with sales objectives, resource availabilities and financial budgets

12. Aggregate Planning Planning Level Orientation Policy, Product, Process
Long Range & Plant decisions Strategic
Intermediate Range Aggregate Planning Linking Activity
Short Range Operations Decisions Operations
Relationship between aggregate planning and other planning stages

13. Aggregate Planning Long Range: - Products - Processes - Plant Location
- Plant Layout
Intermediate Range (Aggregate):
- Output rates
- Employment level
- Inventory
- Subcontracting
Short Range:
- Job assignments
- Machine loading
- Job Sequencing
- Lot sizes

14. Aggregate Planning Key Linkages of Production Planning
Marketing Planning
The Game Plan
The Financial Plan
Resource planning
Production planning
Demand Management
Master Production Scheduling

15. Aggregate Planning Top Down Planning Strategic Planning
Master Production Planning
Material Requirement Planning
Detailed Scheduling (Shop Floor Level)

16. Aggregate Planning Planning Stages Aggregate Plan Product Groups
Master Production Schedule Products
Material Requirement Planning Components
The production plan needs to be expressed in meaningful units, but it also needs to be expressed in manageable number of units.

17. Aggregate Planning - Production plan is not a Forecast of a Demand
It is the planned production, stated on an aggregate basis, for which manufacturing management is responsible.
Organisations attempt to satisfy variations in demand by manipulating the variables in its control
Pure and Mixed Strategies can be used to indicate the variables in its control.
PURE STRATEGY:
Output is changed by varying only one of the variables under control
MIXED STRATEGY:
- Output is changed by varying two or more variables at a time

18. Aggregate Planning Potential responses to demand fluctuations:
- Vary workforce size
- Carry Product Inventory
- Use Overtime
- Extra Shifts
- Vary load via Product mix
- Subcontract
- Vary customer services
- Add contracyclical products
- Vary marketing (price, advertising)

19. Aggregate Planning Strategies
Supply:
- Workforce :
Hire/Fire
Overtime/Slack
Temporaries
Extra shifts
- Demand:
Pricing
Promotion
Customer Service
Backorders

20. Aggregate Planning Functions
Current Status Production rates, work force size, inventory levels Demand Forecasts AGGREGATE PLANNING Aggregate Plan Customer Orders MODEL Production rates, workforce size Inventory levels Capacity Constraints equipment, materials personnel, overtime, extra shifts, subcontracting

21. Structured approach to Aggregate Planning
Set policies on controllable variables
Establish forecast interval and horizon
Develop demand forecasting system
Select unit of aggregate capacity
Determine relevant cost structure
Apply aggregate planning techniques

22. PRODUCTION MANAGEMENT The management of those resources & activities that are required to produce goods for consumers or to the organizations. The Production Management is generally concerned with Manufacturing Industries.

23. PRODUCTION MANAGEMENT To be effective, requires the focus and attention to details related to; - Utilization of materials - Utilization of plant & machinery - Utilization of men with the Product design and plant design being optimum for the requirements.

24. PRODUCTION MANAGEMENT To achieve the objectives, key areas of interest are; - Manufacturing Systems - Materials Management - Methods - Plant layout - Human Resource

25. Production Management
Preplanning:
Covers an analysis of data and outline of basic sales reports, market research, product development and design.
Problems of equipment policy and replacement
New processes and materials, layout and workflow
Collection of data on 4 Ms –materials, methods, machines and manpower (and money) with respect to availability, scope and capacity

26. Production Management
Planning:
Once task specified, thorough analysis of 4Ms to select appropriate materials, methods and facilities
Followed by routing, estimating and scheduling
Detailed, realistic and precise planning leads to achieving schedules with greater efficiencies
Short term and long term planning , for immediate and more distant future
Functions include , standardization and simplification of products, materials and methods

27. Production Management
Controls:
Through dispatching, inspection and expediting
Control of inventories, scrap, analysis of WIP, transportation

28. FUNCTION OF PPC Materials Methods Machines & Equipment Routing
Estimating
Loading & Scheduling
Expediting
Inspection
Evaluating

30. Production Management
Materials
Raw materials
Semi Finished Products
Standard Finished Parts
> Specifications (dimensions and quality)
> Quantities and availability
> Delivery Dates
> Standardisation and variety reduction
> Procurement and Inspection
- including semi finished from subcontractors

31. Production Management
Methods:
- Analyze possible methods of manufacture
Define best method, for given facilities/circumstances
Selection of processes for components and assemblies
Sequence of Operations
Division of Products into assemblies/subassemblies, within limitations of the layout

32. Production Management
Machines and Equipment:
- Relate methods to machines/facilities
Maintenance Policy
Tool Management
Design and economy of jigs and fixtures
Replacement policy for plant and machinery

33. Production Management
Routing:
Once methods and sequence of operations have been laid down
> Define each operation in detail
> Plan for production orders
- Routing prescribes the flow of work in the plant and related to considerations of layout, of temporary storages, location of raw materials and components and of material handling system.
- A fundamental production function on which all subsequent planning is based.

34. Production Management
Estimating:
- Based on Production Orders and detailed operation sheets, operation times are worked out
Application of Methods and Routing, work measurement, with performance standards
Human factor in Time and Motion study and hence time schedule

35. Production Management
Loading and Scheduling:
Machine loading to their capability and capacity for the task
In conjunction with routing to ensure smooth work flow
Together with estimating to ensure prescribed methods, feeds, speeds
Toughest job as determines the utilisation of the resources and hence efficiency of the plant
Scheduling must dovetail the operations, to avoid delays on subsequent operations, and minimise WIP
Requires careful analysis of process capacities, coordination and knowledge of allowances, maintenance breakdowns etc.

36. Production Management
Dispatching:
- Execution of planning function
Routine of setting productive activities in motion, through,
> Release of orders and instructions
> As per the sequence-route sheets, loading schedules
- Authorizes start of production operations by releasing materials, components, tools, fixtures and instructions sheets to the operator
- Ensures material movement according to the planned routing sheets and to schedules

37. Production Management
Expediting:
To keep close watch on the progress of the work
Expediting- Follow up- Progress is a logical step after dispatching
Dispatching initiates the execution production plan, expediting maintains and sees them through to their successful completion.
Keeps close liasion with scheduling to have prompt feedback and corrections.

38. Production Management
Inspection:
Generally not a part of the PPC but critical in execution of the execution of the current plan.
The limitations forms the basis for improvements and also planning.

39. Production Management
Evaluating:
Most essential function as link between control and future planning
Dispatching and Expediting are concerned with immediate issues, but valuable information gathered in the process with proper feedback mechanism is very useful for evaluation and hence for improvement in utilsation of methods and facilities
Must get its due attention as future profits depend on utilising best feedback for corrections

40. Production Management
Layout:
Affects allocation of machines to perform given tasks
Important at design stage inselection of production processes
Rigid layout may hamper integration of additional equipment, lack of space or limited mobility of equipment
May have long transportation lines, increase production costs, WIP and cycle time
Restrictions imposed affect PPC.

41. Production Management
Simplification and Standardisation
Different types of materials and methods for production of different components, models or products
Leads to variety of materials at different stages – bought outs, manufactured, sub assemblies/assemblies etc.
Also in processes – tools, machines, jigs and fixtures etc.
Simplification and Standardisation aims at defining a limited variety of different types which can satisfy the basic requirements with higher plant efficiency
Joint responsibility of Design, Materials management, R&D,PPC and others

42. Production Management
Time and Motion Study:
Relates to efficient utilisation of manpoer and to scheduling problems.
Consists of Operation analysis and Work Measurement
Operation analysis/Method study: Evaluation,selection and development of an efficient method for a given task
Work Measurement: relates to establishing standard times for the various operations in the process of estimating function in production planning. Scheduling cannot be performed without such data.

43. Inventory Control
Importance of materials availability at various stages of production.
Inventory Control & Stores Management
Complex Function
No over stocking
Finance
Obsolescence
Space etc

44. Inventory Control No stock Outs Loss of production, Loss of business
Imbalances adding costs

45. Inventory Management What is meant by Inventory?
Why inventory is necessary?
What are the various forms of the inventory?
What are the costs involved in inventories?
What are the risks associated with the inventories?

46. Materials Management Importance :
- Materials form major part of the Product cost – 60% or so
- With contribution at say 15%, every % saved in materials is
equal to approx 4% increase in Sales.
- Has direct bearing on the profitability
- Timely and right quality of materials availability decides the
overall productivity of any organisation.
- Cannot afford too much or too little – both dangerous for
survival and growth.

47. Materials Management Functions: - Material Planning and controlling
- Purchasing/Vendor development
- Stores and inventory control

48. Inventory Management Forms bulk of current assets. Stock outs
- Loss of profit from the missed sales
- Loss of customer and good will
- Loss of production
- Reduced machine/men utilization
Excessive Inventory
- Inventory carrying costs
- Cost of storage
- Deterioration/obsolescence/pilferage

49. Thank you