PRODUCTION AND OPERATIONS MANAGEMENT
TOPIC 1: Foundatonn
STUDY UNIT 1: Introductonnton productonn ndno psnm n gement
1.1 Introducton
What in operatonn anaage ent
o Then ctivttynofnm n gvngnthenresourcesnwhhvchn rendeiotedntonthen productonn ndndelviertynofn productsn ndnserivces n
Itnvsn ncorenfunctonnofn ntynbusvnessn lthoughnvtnm tynnotnbenc lledno psnm n gement
o Itnvsnconcernednwhvthnm n gvngn processes nBec usen llnm n gementnfunctonsnm n gen processesnvtnvsnrelei ntnton lln
m n gers
What are the ni ilariten etween all operatonn
o Allno per tonsnc nnbenmodelledn snvn put-tr nsform ton-out putn processes
o Fewhno per tonsn producenonltyn productsnornonltynserivcesnbutnr thern nmvxturenofnboth
o Allno per tonsn ren p rtnofn nl rgernsu p pltynnetwhorknthroughnwhhvchne chno per tonncontrvbutesntons tsftyvngnendn
customernrequvrement
o Allno psn renm denu pnofn nnetwhorknofnvntern lncustomer-su p plvernrel tonshv psnwhvthvnntheno per tons
How are operatonn diferent fro one another
o Thetyndvfernvnntermsnofntheniolumenofnout put,ntheni rvettynofnout put,ni rv tonnofndem ndn ndndegreenofnivsvbvlvttynorn
customerncont ct
What do opn anaagern do and why in it no i portant
o Tr nsl tonnofnstr tegtynvntono per ton ln cton
o Desvgn,n pl nnvng,ncontrollvngn ndnvm proiementnofno per ton/ processes
o C nn vdnvnnreducvngnofncosts,nvncre svngnreienuen ndnreducvngnthenvniestmentncostnfornfuturenvnnoi ton
o Bec usenofnthen nturbulentn ndndtyn mvcnbusvnessnenivronmentno psnm n gersnneedntonthvnknonnthevrnfeet
o Im proivngno per tonsnc nnbenthenmostnefectienwh tyntonvm proienfn ncv ln perform nce
Thenbro dnsco penofno per tons
M n gementnres ponsvbvlvtes
Technvc ln
Functon
Accountngn/n Processntechnologty
Fvn ncen needs Product/
functon Processntechnologty
serivcesn
o ptons
Communvc tngnthen deielo pmentn
Fvn ncv ln n ltysvsnforn c p bvlvtesn ndnconstr vntsn functon
perform ncenme surementn Proivsvonnor ofno per tonsn process Newhn product/nserivcen
ndndecvsvonnm kvng Relei ntnd t vde s
O per tons
Functon Communvc tngnthen
Communvc tenhum nn c p bvlvtesn ndnconstr vntsn
Thenbro dnsco penofno per tons resourcenneeds ofno per tonsn process
M n gementnres ponsvbvlvtes
Stystemsnforn
Communvc tngn desvgn,n pl nnvngn
vnform tonnstystemn controln ndn Proivsvonnor
Recruvtment,n needs vm proiement Relei ntnd t
Hum nn deielo pmentn ndn
resources(nHR)n tr vnvng Product/
functon serivcesn
deielo pmentn
functon
Inform tonn
Stystemsn(IS)n
functon
1n|nP ge
,1.2 What in operatonn anaage ent? (Efectte productonnsoperatonn anaage ent)
Three ain core functon of operatonn anaage ent include
o Then arketnag functonn-ncommunvc tonnthenentttyysn productsn ndnserivcesntonvtsnm rketsntongener tenrequests
o Thenproductsnertice detelop ent functonn-ncre tngnnewhn productsn ndnserivcesntongener tenserivcenrequests
o Thenoperaton functonn–nres ponsvblenfornfulfllvngncustomernrequestsnthroughn productonn ndndelvierty
Othernsu p portnfunctonsnth tnf cvlvt tenthenthreencorenfunctonss
o Thenaccountnags/nance functonn–nvnform tonnton ssvstnvnneconomvcndecvsvonnm kvngn&nm n gesnfn ncv ln
resources
o Thenhu an renourcen functonn–nrecruvts,ndeielo psnentttyysnst fn snwhelln snlookvngn fernthevrnwhelf re n
Operatonn anaage entn–nThen ctivtes,ndecvsvonsn ndnres ponsvbvlvtesnofnm n gvngnthen productonn ndndelviertynofn productsn ndn
serivces
Operatonn functonn–nThen rr ngementnofnresourcesnth tn rendeiotedntonthen productonn ndndelviertynofn productsn ndnserivces n
Operaton anaagernn–nThenst fnofnthenorg nvs tonnwhhonh ien p rtcul rnres ponsvbvlvttynfornm n gvngnsomenorn llnofnthenresourcesn
whhvchncom prvsentheno per tonsnfuncton
Input and Outputn
o Then processnofno per tonsnton producen productsn ndnserivcesnbtynch ngvngnvn putsntonout puts n
o ThenTr nsform tonn processnmodel
Transformed resources
M terv ls
Inform ton THE TRANSFORMATION Out putn productsn ndn Customers
In putnresources
Customers PROCESS serivces
Tr nsformvngnresources
F cvlvtes
St f
Trannfor ed renourcenn–nThenresourcesnth tn rentre tedntr nsformednornconiertednvnn n process,nusu lltyn nmvxturenofn
m terv lsnvnform tonn ndncustomers
M terv lsn–n processnwhhvchnm terv lsntr nsformnthevrn phtysvc ln pro pertes,nsh penorncom posvtonnsuchn snm nuf cturvngn
o per tons nOthernch ngenloc ton(logvstcncom p nves),n posvtonn(ret vl),nstor ge(wh rehousvng)
Inform tonn–nO per tonsnth tntr nsformnthevrnvnform ton ln pro pertesnsuchn sn ccount ntsn ndnm rketngncom p nves
Customersn–nProcessnwhherencustomersnm tynch ngenthevrn phtysvc ln pro pertesn(h vrdressvng),nstor gen(hotels)n ndn
loc tonsn(tr ns port ton)
Trannfor inag renourcenn–nThenresourcesnth tn ctnu ponnthentr nsformednresources,nusu lltyncl ssvfedn snf cvlvtesn(then
buvldvng,nequv pment,n ndn pl ntnofn nno per ton)n ndnst fnthen peo plenwhhonm vnt vnn ndnm n gentheno per ton
F cvlvtesn–nThenbuvldvngs,nequv pment,n pl ntn ndn processntechnologtynofntheno per ton
St fnn-Then peo plen tn ntynleielnwhhono per te,nm vnt vn,n pl nn ndnm n gentheno per ton
Out putsnfromnthen processnofn productsn ndnserivcesndvfernvnnthevrnres pectient ngvbvlvtty nTanagi le productn,ntyounc nn phtysvc lltyn
touchnsuchn snteleivsvonnornnewhs p per nIntanagi le productnnornserivcesnc nnotnbentouchednsuchn snconsult nctynserivcesnorn n
h vrcut,n lthoughntyounc nnseenthenresults n
Mostno per tonsn producenbothn productsn ndnserivcesnbutnsomen producenjustn productsn ndnothersnjustnserivces
Puren productn producersn–nCrudenovln ndn lumvnvumnsmelters
PurenSerivcesn–nConsult nctynserivces
F cvlvt tngnserivcesn–nserivcesn ren producednbtyn nno per tonntonsu p portnvtsn productsnsuchn sntechnvc lnsu p portnorn
divce
F cvlvt tngn productsn–n productsnth tn ren producednbtyn nno per tonntonsu p portnvtsnserivces n
1.3 Operatonn anaage ent in a out anaaginag procenn (Do inant focun of productonsoperatonn anaage ent)
Procennn–nAnn rr ngementnofnresourcesnth tn producersnsomenmvxturenofngoodsn ndnserivces nItnvsnthenmech nvsmnofntr nsform ton n
Threenleielsnofno per tonn n ltysvs
1 Supply network – Thennetwhorknofnsu p plvern ndncustomerno per tonsnth tnh ienrel tonshv psnwhvthn nno per ton
2 Internal nupplier –nProcessnornvndvivdu lsnwhvthvnn nno per tonnth tnsu p pltyn productsnornserivcesntonothern processesnorn
vndvivdu lsnwhvthvnntheno per ton
3 Internal cunto ern –nProcessesnornvndvivdu lsnwhvthvnn nno per tonnwhhon renthencustomersnfornothernvntern ln processesnorn
vndvivdu lnout puts
Hierarchy of operatonn –nThenvde nth tn llno per tonsn processesn renm denu pnofnsm llerno per tonsn process n
2n|nP ge
,O per tonsnm n gementnvsnrelei ntnton lln p rtsnofnthenbusvnessn processnv e nth tnvsn llnfunctonsnm n gen processes n
o Operaton an a functon,nme nvngnthen p rtnofnthenorg nvs tonnwhhvchn producesnthen productsn ndnserivcesnfornthen
org nvs tonysnextern lncustomers
o Operaton an an acttity,nme nvngnthenm n gementnofnthen processesnwhvthvnn ntynofnthenorg nvs tonsnfunctons
BusvnessnProcess
Whenn ntynorg nvs tonsn tem ptntons tsftynvtsncustomersnneedsnvtnwhvllnusenm ntyn processes,nvnnbothno per tonsn ndnfunctons n
o End-to-end uninenn procenn – Whenn ncom p ntyndecvsedntonreorg nvsenvtsno per tonsnsonthene chn productnvsn producednfrom
st rtntonfnvshnwhvthvnnthencom p nty nAn processnth tnvsntot lltyndefnednextern lncustomernneeds
o Buninenn procenn re-engvneervngn–nThen phvloso phtynth tnrecommendsnthenredesvgnnofn processesntonfulflndefnednextern ln
customernneeds
1.4 Operaton procennen hate diferent characterintcn (Diferent characterintcn of productonsoperaton procennen)
Allno per tonsn rensvmvl rnbutnthetyndondvfernslvghtltynvnndvferentnwh tys,nfournofnthenfollowhvngn renvm port nts
1. Volu e – Thenleielnornr tenofnout putnfromn n process,n nketynch r ctervstcsnth tndetermvnesn processnbeh ivour
2. Variety – Thenr ngenofndvferentn productsn ndnserivcesn producednbtyn n process,n nketynch r ctervstcnth tndetermvnesn processn
beh ivour
3. Variaton – Thendegreentonwhhvchnthenr tenofnleielnofnout putni rvesnfromn n processnofntme
4. Vini ility – Then mountnofni luen ddedn ctivttynth tnt kesn pl cenvnnthen presence,nvnnre lvttynornivrtu llty,nofnthencustomern lson
c lledncustomerncont ct
Theniolumendvmensvonsn
o Re pe t bvlvttyn–nThenextentntonwhhvchn nn ctivttyndoesnnotni rty
o Stystemvs tonn–nThenextentntonwhhvchnst nd rdn proceduresn renm denex plvcvt nThencostn pernvtemnvsnlvkeltyntonbenhvgher
vfnthenqu ntttynvsnlowher nRe pe t bvlvttyn ndnstystemvs tonngviesnlowhnunvtncosts
Theni rvettynDvmensvon
o St nd rdvs tonn–nthendegreentonwhhvchn processes,n productsnornserivcesn ren preientednfromni rtyvngnoierntme nThen
morenregul rn ndnst nd rdvzedn processnm tynresultnvnnlowherncosts
Theni rv tonndvmensvon
o Anroutnen ndn predvct blenschedulenresultsnvnn nhvghnutlvs tonnofnresources n
Thenivsvbvlvttyndvmensvon
o Howhnmuchnofntheno per tonsn ctivtesndonvtsncustomersnex pervencenornhowhnmuchnofntheno per tonnvsnex posed n
o Customerncont ctnskvllsn renthenskvllsn ndnknowhledgenth tnst fnneedntonmeetncustomernex pect tons
o Mvxednhvghnivsvbvlvtty,nthesenst fno per tenvnn nfrontnofcenenivronment
o Lowhnivsvbvlvttynenivronment,nthesenst fno per tenvnn nb cknofcenenivronment
o
Thenvm plvc tonnofnthen‘fourniysynofno per tons nAnTty pologtynofnO per tons
Lowhnre petton n Hvghnre pe t bvlvtty
E chnst fnmembern performsnmoren S pecv lvs ton
ofn njob LowhVOLUMEHvgh Stystemvs ton
Lessnstystemvs ton C pvt lnvntensvie
Hvghnunvtncosts Lowhnunvtncosts
Flexvble Wellndefned
Com plex Routne
Muchncustomernneeds LowhVARIETYHvgh St nd rdvsed
Hvghnunvtncosts Regul r
Lowhnunvtncosts
Ch ngvngnc p cvtty St ble
Antcv p ton Routne
Inntouchnwhvthndem nd LowhVARIATIONHvgh Predvct ble
Hvghnunvtncosts Hvghnutlvs ton
Lowhnunvtncosts
Shortnwh vtngntoler nce Tvmnl gnbetwheenn productonn ndn
S tsf ctonngoiernednbtyncustomern consum pton
perce pton St nd rdvsed
Customerncont ctnskvllsnneeded LowhVISIBILITYHvgh Lowhncont ctnskvlls
Receviedni rvettynvsnhvgh Hvghnst fnutlvs ton
Hvghnunvtncosts Centr lvs ton
Lowhnunvtncosts
3n|nP ge
, 1.5 The acttiten of operaton anaage ent (Acttiten of productonsoperaton anaage ent)
Whvlenthenex ctnn turenofno per tonsnm n gementnm tyni rtynwhvthvnndvferentnorg nvz tons,nthenfollowhvngngener ln ctivtesn
p pltynton llntty pesnofno per ton
o Underntandinag the operatonn ntrateagic o jecttenn–nFvrstnres ponsvbvlvttynofn ntynm n gementnte mnvsntonunderst nd
whh tnvtnvsntrtyvngnton chveienv e ndeielo pvngn ncle rnivsvon n
o Detelopinag an operatonn ntrateagy for the oraganizatonn–nM n gersnneedntonh ien nsetnofngener ln prvncv plesnton
guvdendecvsvonnm kvng
o Deniagninag the operatonnn productn, nerticen and procennenn–nThen ctivttynofndetermvnvngnthen phtysvc lnform,nsh pen
ndncom posvtonnofn productsn ndnserivces n
o Planninag and controllinag the operatonn–nWh tntheno per tonsnresourcesnshouldnbendovngn ndnm kvngnsurenth tn
thetyn rendovngnvt
o I protinag the perfor ance of the operaton
o The road renponni iliten of operatonn anaage entn–nFvienres ponsvbvlvtesnth tn ren p rtcul rnrelei nts
1 Thenefectsnofnglob lvz ton
2 Then pressuresnofnenivronment ln protecton
3 Thenvncre svngnrelei ncenofnsocv lnres ponsvbvlvtty
4 Thenneednforntechnologtyn wh reness
5 Howhnknowhledgenm n gementnvsnbecomvngn nnvm port ntn p rtnofno per tons
Annefectien ndnefcventno per tonnwhvllngvien nbusvnessnthenfollowhvngntty pesnofn di nt gesn mongnotherss
) Reducedncontn ofn productonnthroughnlessnwh ste,nrewhorkvng,netc
b) nvncre sednretenuenfromnvncre sedncustomerns tsf ctonnwhvthnbeternqu lvtty
c) reducednintent entnvnnf cvlvtesn ndnequv pmentnthroughnbeternutlvz ton
d) setnthen pl tormnfornfuture innotatonnbtyn cquvrvngnnewhnknowhledgen ndndeielo pvngnnewhnskvllsnnn
Thennewhno per tonsn gend nvsnthenresultnofnthench ngesnvnnthenbusvnessnenivronmentn
Gener lnmodelnofn producton/o per tonsnm n gement
o Thengener lnmodelncom prvsesnofntwhonvde s
Thenvn put-tr nsform ton-out putnmodel
Thenc tegorvz tonnofno psnm n gementn ctivttyn re sn(o psnstr tegty,ndesvgn,n pl nnvngn ndncontrol,n
vm proiement)
………………………………………………………………………………………………………………………………………………………
TOPIC 2: Perfor ance o jectten of opn anaage ent
STUDYnUNITn2snPerform ncenobjectiesnofn productonn ndno psnm n gement
2.2 Perfor ance o jectten for achietinag productonsoperatonn aned adtantaagen.
Allno per tonsnh ien nr ngenofnst keholders nO per tonsnshouldns tsftynst keholders n
St keholdersn ren
o then peo plenwhhonm tynbenvnfuencednbtyntheno per tonsn ctivtes
o Somen renvntern lnsuchn sncustomers
o Somen renextern lnsuchn sncustomers,ncommunvtty,ncom p ntyysnsh reholders n
o E chngrou pnh sn ndvferentnconcern,nbutncollectieltynthesenconcernsnwhvlln fectnthenlong-termn pros pectsnornoutlookn
fornthencom p nty
ThenFvien perform ncenobjecties
o Quality – Anconsvstencenconform ncentoncustomernex pect tons
o Speed –nThenel psedntmenbetwheenncustomersnrequestngn productsnornserivcesn ndnthevrnrecevivngnthem
o Dependa ility –nDelviervngnornm kvngn i vl blen productsnornserivcesnwhhennthetynwheren promvsedntonthencustomer
o Flexi ility –nThendegreentonwhhvchn nno per tonsn processnc nnch ngenwhh tnvtndoes,nhowhnvtnvsndovng n
o Cont –nThen bvlvttynton producengoodsn ndnserivcesn tncostsntonen blenthemntonben prvcedn p pro prv telty n
The Quality O jectte:
o Isn nm jornvnfuencenonncustomerns tsf ctonnorndvss tsf cton
o Qu lvttynreducesncostsn snfewhernmvst kesn renm de n
o Qu lvttynvncre sesnde pend bvlvtty
4n|nP ge
TOPIC 1: Foundatonn
STUDY UNIT 1: Introductonnton productonn ndno psnm n gement
1.1 Introducton
What in operatonn anaage ent
o Then ctivttynofnm n gvngnthenresourcesnwhhvchn rendeiotedntonthen productonn ndndelviertynofn productsn ndnserivces n
Itnvsn ncorenfunctonnofn ntynbusvnessn lthoughnvtnm tynnotnbenc lledno psnm n gement
o Itnvsnconcernednwhvthnm n gvngn processes nBec usen llnm n gementnfunctonsnm n gen processesnvtnvsnrelei ntnton lln
m n gers
What are the ni ilariten etween all operatonn
o Allno per tonsnc nnbenmodelledn snvn put-tr nsform ton-out putn processes
o Fewhno per tonsn producenonltyn productsnornonltynserivcesnbutnr thern nmvxturenofnboth
o Allno per tonsn ren p rtnofn nl rgernsu p pltynnetwhorknthroughnwhhvchne chno per tonncontrvbutesntons tsftyvngnendn
customernrequvrement
o Allno psn renm denu pnofn nnetwhorknofnvntern lncustomer-su p plvernrel tonshv psnwhvthvnntheno per tons
How are operatonn diferent fro one another
o Thetyndvfernvnntermsnofntheniolumenofnout put,ntheni rvettynofnout put,ni rv tonnofndem ndn ndndegreenofnivsvbvlvttynorn
customerncont ct
What do opn anaagern do and why in it no i portant
o Tr nsl tonnofnstr tegtynvntono per ton ln cton
o Desvgn,n pl nnvng,ncontrollvngn ndnvm proiementnofno per ton/ processes
o C nn vdnvnnreducvngnofncosts,nvncre svngnreienuen ndnreducvngnthenvniestmentncostnfornfuturenvnnoi ton
o Bec usenofnthen nturbulentn ndndtyn mvcnbusvnessnenivronmentno psnm n gersnneedntonthvnknonnthevrnfeet
o Im proivngno per tonsnc nnbenthenmostnefectienwh tyntonvm proienfn ncv ln perform nce
Thenbro dnsco penofno per tons
M n gementnres ponsvbvlvtes
Technvc ln
Functon
Accountngn/n Processntechnologty
Fvn ncen needs Product/
functon Processntechnologty
serivcesn
o ptons
Communvc tngnthen deielo pmentn
Fvn ncv ln n ltysvsnforn c p bvlvtesn ndnconstr vntsn functon
perform ncenme surementn Proivsvonnor ofno per tonsn process Newhn product/nserivcen
ndndecvsvonnm kvng Relei ntnd t vde s
O per tons
Functon Communvc tngnthen
Communvc tenhum nn c p bvlvtesn ndnconstr vntsn
Thenbro dnsco penofno per tons resourcenneeds ofno per tonsn process
M n gementnres ponsvbvlvtes
Stystemsnforn
Communvc tngn desvgn,n pl nnvngn
vnform tonnstystemn controln ndn Proivsvonnor
Recruvtment,n needs vm proiement Relei ntnd t
Hum nn deielo pmentn ndn
resources(nHR)n tr vnvng Product/
functon serivcesn
deielo pmentn
functon
Inform tonn
Stystemsn(IS)n
functon
1n|nP ge
,1.2 What in operatonn anaage ent? (Efectte productonnsoperatonn anaage ent)
Three ain core functon of operatonn anaage ent include
o Then arketnag functonn-ncommunvc tonnthenentttyysn productsn ndnserivcesntonvtsnm rketsntongener tenrequests
o Thenproductsnertice detelop ent functonn-ncre tngnnewhn productsn ndnserivcesntongener tenserivcenrequests
o Thenoperaton functonn–nres ponsvblenfornfulfllvngncustomernrequestsnthroughn productonn ndndelvierty
Othernsu p portnfunctonsnth tnf cvlvt tenthenthreencorenfunctonss
o Thenaccountnags/nance functonn–nvnform tonnton ssvstnvnneconomvcndecvsvonnm kvngn&nm n gesnfn ncv ln
resources
o Thenhu an renourcen functonn–nrecruvts,ndeielo psnentttyysnst fn snwhelln snlookvngn fernthevrnwhelf re n
Operatonn anaage entn–nThen ctivtes,ndecvsvonsn ndnres ponsvbvlvtesnofnm n gvngnthen productonn ndndelviertynofn productsn ndn
serivces
Operatonn functonn–nThen rr ngementnofnresourcesnth tn rendeiotedntonthen productonn ndndelviertynofn productsn ndnserivces n
Operaton anaagernn–nThenst fnofnthenorg nvs tonnwhhonh ien p rtcul rnres ponsvbvlvttynfornm n gvngnsomenorn llnofnthenresourcesn
whhvchncom prvsentheno per tonsnfuncton
Input and Outputn
o Then processnofno per tonsnton producen productsn ndnserivcesnbtynch ngvngnvn putsntonout puts n
o ThenTr nsform tonn processnmodel
Transformed resources
M terv ls
Inform ton THE TRANSFORMATION Out putn productsn ndn Customers
In putnresources
Customers PROCESS serivces
Tr nsformvngnresources
F cvlvtes
St f
Trannfor ed renourcenn–nThenresourcesnth tn rentre tedntr nsformednornconiertednvnn n process,nusu lltyn nmvxturenofn
m terv lsnvnform tonn ndncustomers
M terv lsn–n processnwhhvchnm terv lsntr nsformnthevrn phtysvc ln pro pertes,nsh penorncom posvtonnsuchn snm nuf cturvngn
o per tons nOthernch ngenloc ton(logvstcncom p nves),n posvtonn(ret vl),nstor ge(wh rehousvng)
Inform tonn–nO per tonsnth tntr nsformnthevrnvnform ton ln pro pertesnsuchn sn ccount ntsn ndnm rketngncom p nves
Customersn–nProcessnwhherencustomersnm tynch ngenthevrn phtysvc ln pro pertesn(h vrdressvng),nstor gen(hotels)n ndn
loc tonsn(tr ns port ton)
Trannfor inag renourcenn–nThenresourcesnth tn ctnu ponnthentr nsformednresources,nusu lltyncl ssvfedn snf cvlvtesn(then
buvldvng,nequv pment,n ndn pl ntnofn nno per ton)n ndnst fnthen peo plenwhhonm vnt vnn ndnm n gentheno per ton
F cvlvtesn–nThenbuvldvngs,nequv pment,n pl ntn ndn processntechnologtynofntheno per ton
St fnn-Then peo plen tn ntynleielnwhhono per te,nm vnt vn,n pl nn ndnm n gentheno per ton
Out putsnfromnthen processnofn productsn ndnserivcesndvfernvnnthevrnres pectient ngvbvlvtty nTanagi le productn,ntyounc nn phtysvc lltyn
touchnsuchn snteleivsvonnornnewhs p per nIntanagi le productnnornserivcesnc nnotnbentouchednsuchn snconsult nctynserivcesnorn n
h vrcut,n lthoughntyounc nnseenthenresults n
Mostno per tonsn producenbothn productsn ndnserivcesnbutnsomen producenjustn productsn ndnothersnjustnserivces
Puren productn producersn–nCrudenovln ndn lumvnvumnsmelters
PurenSerivcesn–nConsult nctynserivces
F cvlvt tngnserivcesn–nserivcesn ren producednbtyn nno per tonntonsu p portnvtsn productsnsuchn sntechnvc lnsu p portnorn
divce
F cvlvt tngn productsn–n productsnth tn ren producednbtyn nno per tonntonsu p portnvtsnserivces n
1.3 Operatonn anaage ent in a out anaaginag procenn (Do inant focun of productonsoperatonn anaage ent)
Procennn–nAnn rr ngementnofnresourcesnth tn producersnsomenmvxturenofngoodsn ndnserivces nItnvsnthenmech nvsmnofntr nsform ton n
Threenleielsnofno per tonn n ltysvs
1 Supply network – Thennetwhorknofnsu p plvern ndncustomerno per tonsnth tnh ienrel tonshv psnwhvthn nno per ton
2 Internal nupplier –nProcessnornvndvivdu lsnwhvthvnn nno per tonnth tnsu p pltyn productsnornserivcesntonothern processesnorn
vndvivdu lsnwhvthvnntheno per ton
3 Internal cunto ern –nProcessesnornvndvivdu lsnwhvthvnn nno per tonnwhhon renthencustomersnfornothernvntern ln processesnorn
vndvivdu lnout puts
Hierarchy of operatonn –nThenvde nth tn llno per tonsn processesn renm denu pnofnsm llerno per tonsn process n
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,O per tonsnm n gementnvsnrelei ntnton lln p rtsnofnthenbusvnessn processnv e nth tnvsn llnfunctonsnm n gen processes n
o Operaton an a functon,nme nvngnthen p rtnofnthenorg nvs tonnwhhvchn producesnthen productsn ndnserivcesnfornthen
org nvs tonysnextern lncustomers
o Operaton an an acttity,nme nvngnthenm n gementnofnthen processesnwhvthvnn ntynofnthenorg nvs tonsnfunctons
BusvnessnProcess
Whenn ntynorg nvs tonsn tem ptntons tsftynvtsncustomersnneedsnvtnwhvllnusenm ntyn processes,nvnnbothno per tonsn ndnfunctons n
o End-to-end uninenn procenn – Whenn ncom p ntyndecvsedntonreorg nvsenvtsno per tonsnsonthene chn productnvsn producednfrom
st rtntonfnvshnwhvthvnnthencom p nty nAn processnth tnvsntot lltyndefnednextern lncustomernneeds
o Buninenn procenn re-engvneervngn–nThen phvloso phtynth tnrecommendsnthenredesvgnnofn processesntonfulflndefnednextern ln
customernneeds
1.4 Operaton procennen hate diferent characterintcn (Diferent characterintcn of productonsoperaton procennen)
Allno per tonsn rensvmvl rnbutnthetyndondvfernslvghtltynvnndvferentnwh tys,nfournofnthenfollowhvngn renvm port nts
1. Volu e – Thenleielnornr tenofnout putnfromn n process,n nketynch r ctervstcsnth tndetermvnesn processnbeh ivour
2. Variety – Thenr ngenofndvferentn productsn ndnserivcesn producednbtyn n process,n nketynch r ctervstcnth tndetermvnesn processn
beh ivour
3. Variaton – Thendegreentonwhhvchnthenr tenofnleielnofnout putni rvesnfromn n processnofntme
4. Vini ility – Then mountnofni luen ddedn ctivttynth tnt kesn pl cenvnnthen presence,nvnnre lvttynornivrtu llty,nofnthencustomern lson
c lledncustomerncont ct
Theniolumendvmensvonsn
o Re pe t bvlvttyn–nThenextentntonwhhvchn nn ctivttyndoesnnotni rty
o Stystemvs tonn–nThenextentntonwhhvchnst nd rdn proceduresn renm denex plvcvt nThencostn pernvtemnvsnlvkeltyntonbenhvgher
vfnthenqu ntttynvsnlowher nRe pe t bvlvttyn ndnstystemvs tonngviesnlowhnunvtncosts
Theni rvettynDvmensvon
o St nd rdvs tonn–nthendegreentonwhhvchn processes,n productsnornserivcesn ren preientednfromni rtyvngnoierntme nThen
morenregul rn ndnst nd rdvzedn processnm tynresultnvnnlowherncosts
Theni rv tonndvmensvon
o Anroutnen ndn predvct blenschedulenresultsnvnn nhvghnutlvs tonnofnresources n
Thenivsvbvlvttyndvmensvon
o Howhnmuchnofntheno per tonsn ctivtesndonvtsncustomersnex pervencenornhowhnmuchnofntheno per tonnvsnex posed n
o Customerncont ctnskvllsn renthenskvllsn ndnknowhledgenth tnst fnneedntonmeetncustomernex pect tons
o Mvxednhvghnivsvbvlvtty,nthesenst fno per tenvnn nfrontnofcenenivronment
o Lowhnivsvbvlvttynenivronment,nthesenst fno per tenvnn nb cknofcenenivronment
o
Thenvm plvc tonnofnthen‘fourniysynofno per tons nAnTty pologtynofnO per tons
Lowhnre petton n Hvghnre pe t bvlvtty
E chnst fnmembern performsnmoren S pecv lvs ton
ofn njob LowhVOLUMEHvgh Stystemvs ton
Lessnstystemvs ton C pvt lnvntensvie
Hvghnunvtncosts Lowhnunvtncosts
Flexvble Wellndefned
Com plex Routne
Muchncustomernneeds LowhVARIETYHvgh St nd rdvsed
Hvghnunvtncosts Regul r
Lowhnunvtncosts
Ch ngvngnc p cvtty St ble
Antcv p ton Routne
Inntouchnwhvthndem nd LowhVARIATIONHvgh Predvct ble
Hvghnunvtncosts Hvghnutlvs ton
Lowhnunvtncosts
Shortnwh vtngntoler nce Tvmnl gnbetwheenn productonn ndn
S tsf ctonngoiernednbtyncustomern consum pton
perce pton St nd rdvsed
Customerncont ctnskvllsnneeded LowhVISIBILITYHvgh Lowhncont ctnskvlls
Receviedni rvettynvsnhvgh Hvghnst fnutlvs ton
Hvghnunvtncosts Centr lvs ton
Lowhnunvtncosts
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, 1.5 The acttiten of operaton anaage ent (Acttiten of productonsoperaton anaage ent)
Whvlenthenex ctnn turenofno per tonsnm n gementnm tyni rtynwhvthvnndvferentnorg nvz tons,nthenfollowhvngngener ln ctivtesn
p pltynton llntty pesnofno per ton
o Underntandinag the operatonn ntrateagic o jecttenn–nFvrstnres ponsvbvlvttynofn ntynm n gementnte mnvsntonunderst nd
whh tnvtnvsntrtyvngnton chveienv e ndeielo pvngn ncle rnivsvon n
o Detelopinag an operatonn ntrateagy for the oraganizatonn–nM n gersnneedntonh ien nsetnofngener ln prvncv plesnton
guvdendecvsvonnm kvng
o Deniagninag the operatonnn productn, nerticen and procennenn–nThen ctivttynofndetermvnvngnthen phtysvc lnform,nsh pen
ndncom posvtonnofn productsn ndnserivces n
o Planninag and controllinag the operatonn–nWh tntheno per tonsnresourcesnshouldnbendovngn ndnm kvngnsurenth tn
thetyn rendovngnvt
o I protinag the perfor ance of the operaton
o The road renponni iliten of operatonn anaage entn–nFvienres ponsvbvlvtesnth tn ren p rtcul rnrelei nts
1 Thenefectsnofnglob lvz ton
2 Then pressuresnofnenivronment ln protecton
3 Thenvncre svngnrelei ncenofnsocv lnres ponsvbvlvtty
4 Thenneednforntechnologtyn wh reness
5 Howhnknowhledgenm n gementnvsnbecomvngn nnvm port ntn p rtnofno per tons
Annefectien ndnefcventno per tonnwhvllngvien nbusvnessnthenfollowhvngntty pesnofn di nt gesn mongnotherss
) Reducedncontn ofn productonnthroughnlessnwh ste,nrewhorkvng,netc
b) nvncre sednretenuenfromnvncre sedncustomerns tsf ctonnwhvthnbeternqu lvtty
c) reducednintent entnvnnf cvlvtesn ndnequv pmentnthroughnbeternutlvz ton
d) setnthen pl tormnfornfuture innotatonnbtyn cquvrvngnnewhnknowhledgen ndndeielo pvngnnewhnskvllsnnn
Thennewhno per tonsn gend nvsnthenresultnofnthench ngesnvnnthenbusvnessnenivronmentn
Gener lnmodelnofn producton/o per tonsnm n gement
o Thengener lnmodelncom prvsesnofntwhonvde s
Thenvn put-tr nsform ton-out putnmodel
Thenc tegorvz tonnofno psnm n gementn ctivttyn re sn(o psnstr tegty,ndesvgn,n pl nnvngn ndncontrol,n
vm proiement)
………………………………………………………………………………………………………………………………………………………
TOPIC 2: Perfor ance o jectten of opn anaage ent
STUDYnUNITn2snPerform ncenobjectiesnofn productonn ndno psnm n gement
2.2 Perfor ance o jectten for achietinag productonsoperatonn aned adtantaagen.
Allno per tonsnh ien nr ngenofnst keholders nO per tonsnshouldns tsftynst keholders n
St keholdersn ren
o then peo plenwhhonm tynbenvnfuencednbtyntheno per tonsn ctivtes
o Somen renvntern lnsuchn sncustomers
o Somen renextern lnsuchn sncustomers,ncommunvtty,ncom p ntyysnsh reholders n
o E chngrou pnh sn ndvferentnconcern,nbutncollectieltynthesenconcernsnwhvlln fectnthenlong-termn pros pectsnornoutlookn
fornthencom p nty
ThenFvien perform ncenobjecties
o Quality – Anconsvstencenconform ncentoncustomernex pect tons
o Speed –nThenel psedntmenbetwheenncustomersnrequestngn productsnornserivcesn ndnthevrnrecevivngnthem
o Dependa ility –nDelviervngnornm kvngn i vl blen productsnornserivcesnwhhennthetynwheren promvsedntonthencustomer
o Flexi ility –nThendegreentonwhhvchn nno per tonsn processnc nnch ngenwhh tnvtndoes,nhowhnvtnvsndovng n
o Cont –nThen bvlvttynton producengoodsn ndnserivcesn tncostsntonen blenthemntonben prvcedn p pro prv telty n
The Quality O jectte:
o Isn nm jornvnfuencenonncustomerns tsf ctonnorndvss tsf cton
o Qu lvttynreducesncostsn snfewhernmvst kesn renm de n
o Qu lvttynvncre sesnde pend bvlvtty
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