Management Consulting/process management
briefly explain the contribution made by the following concepts to development of the operation management?
1 computer application and MPR system
3supply chain management
4.moving assembly line and BPR
THE OPERATION MANAGEMENT IS A
THIS IS FOR A OPERATION/ PRODUCTION SET UP.
OPERATIONS MANAGEMENT [ PRODUCTION ], as a function ,normally includes the
-TOTAL QUALITY MANAGEMENT
-JUST IN TIME INVENTORY MANAGEMENT
-STRATEGIC CAPACITY PLANNING
-PROJECT PLANNING AND CONTROL
-MATERIAL REQUIREMENT PLANNING [ MRP]
-BUSINESS PROCESS ENGINEERING
ETC ETC ETC
THE INTEGRATED FUNCTION BRINGS IN A NUMBER OF ADVANTAGES TO THE
*Manage and Control the logistics function to ensure supplies of
raw materials, finished goods, parts and accessories are
available within required time frames and budgets.
*With the Planning & Production Manager, develop, direct the
implementation of production business strategies and activities
to enable the production to achieve output and quality objectives.
*With the R&D Engineering Manager, develop, direct the
the research & development/ engineering activities to ensure
products and techniques achieve business needs within the
standards set by the market and the regulatory standards bodies.
*With the Demand Planning Manager, develop, direct and control
the supply activities to maximise the quality and reliability
of raw materials, parts, accessories and finished goods.
*With the Warehouse and Distribution Manager, develop, direct
and control the warehouse and distribution activities to
ensure the efficient and economical utilisation of facilities
for storing and distributing the finished goods.
*Wtih the Manufacturing Services Manager, develop, direct the
implementation of manufacturing sustainability strategies/
actions plans and continuous improvement programs.
*Wtih the Factory Services Manager, develop, direct the
service operations and the factory warehousing management
THE BELOW LISTED ELEMENTS IN THE OPERATION SHOW
CLEARLY HOW THE ''CUSTOMER SERVICE'' / ''PACKAGING'' /
''PRODUCTION SCHEDULING'' ARE INTERLINKED FUNCTIONALLY
IN THE PROCESS OF OPERATION.
THE EFFECTIVENESS OF EACH OF THESE ELEMENTS ARE
IMPROVED THROUGH ''ACTION PLANNING''.
-demand planning for core products
-demand planning for parts/accessories
-demand planning for critical items
-developing product life cycle trends
-product life cycle forecast for new products
-remove stock shortages
-improve inventory levels.
-quicker stock replenishment
-continual stock replenishment
-reduction in lead time
-improving stock availability
-reduction working capital
-better supply coordination
-more effective communication with supplier
-faster / timely communication
-developing supplier profile
-developing suppliers networking
-customer focused inventory building
-logistical lead time reduction
-demand based inventory
-better material availability
-good/ usable inventory levels
5.MANUFACTURING/ PACKAGING INCLUDES
-elimination of wastages in production
-improving throughput effiiciency
-reducing back orders
-improving targeted delivery date
-reduction in logical leadtime
-full stock availability
-full total inventory
-full stock / range availability
-short--response time to query
-shortening order cycle time
-making targeted delivery date
-providing order status
-order fill rate
-backorder by age
-service/ parts availability
-targeted delivery date
-improve order fill rate
-improve on-time delivery
-reduce shipment delays
-timely order status
-timely delivery status.
THE EFFECTIVE OPERATION AIMS TO MAXIMIZE THE COMPANY RESULTS
-IMPROVING CUSTOMER SERVICE
-ADDS VALUE TO CUSTOMER SERVICE
-TAILORING SERVICE TO CUSTOMER REQUIREMENTS
-LEVERAGING OPPORTUNITIES T O BETTER RESULTS.
THE OPERATION MANAGEMENT IMPROVES THE EFFECIVENESS
-IMPROVING MATERIAL FLOWS
-REDUCE RAW MATERIAL INVENTORY LEVELS
-REDUCING PURCHASING COST
-REDUCE FREIGHT COST
-REDUCE OBSOLETE STOCK LEVELS
-IMPROVING WAREHOUSING OPERATIONS EFFICIENCY
-OPTIMISE STOCK LEVELS
-REDUCE LEAD TIME
-REDUCE TOTAL INVENTORY LEVELS
-REDUCE FINISHED STOCKS
-IMPROVE DEMAND FORECASTING
-IMPROVE MATERIAL RESOURCE PLANNING
THE BELOW LISTED ELEMENTS SHOWS HOW THE ELEMENTS
ARE CHAINED / LINKED IN THE OPERATION.
1 Daily production and distribution planning, including all nodes in the supply chain.
2 Production scheduling for each manufacturing facility in the supply chain (minute by minute).
3 Demand planning and forecasting, coordinating the demand forecast of all customers and sharing the forecast with all suppliers.
4 Sourcing planning, including current inventory and forecast demand, in collaboration with all suppliers.
5 Inbound operations, including transportation from suppliers and receiving inventory.
6 Production operations, including the consumption of materials and flow of finished goods.
7 Outbound operations, including all fulfillment activities and transportation to customers.
8 Order promising, accounting for all constraints in the supply chain, including all suppliers, manufacturing facilities, distribution centers, and other customers.
9 Performance tracking of all activities
ALL THESE INTERLINKED INTEGRATION
-better sales results
-better return on investment.
PLANT LAYOUT AND MATERIAL HANDLING
Plant layout refers to the physical arrangement of facilities. It is the configuration of departments, work centres and equipment in the conversion process. The overall objective of the plant layout
is to design a physical arrangement that meets the required output quality and quantity most economically.
According to James Moore, “Plant layout is a plan of an optimum arrangement of facilities including personnel, operating equipment, storage space, material handling
equipments and all other supporting services along with the design of best structure to contain all these facilities”.
‘Material Handling’ refers to the ‘moving of materials from the store room to the machine and from one machine to the next during the process of manufacture’. It is also defined as the
‘art and science of moving, packing and storing of products in any form’. It is a specialized activity for a modern manufacturing concern, with 50 to 75% of the cost of production. This cost can be reduced by proper section, operation and maintenance of material handling devices.
Material handling devices increases the output, improves quality, speeds up the deliveries and decreases the cost of production. Hence, material handling is a prime consideration in the designing new plant and several existing plants.
Product design deals with conversion of ideas into reality. Every business organization have to design, develop and introduce new products as a survival and growth strategy. Developing the
new products and launching them in the market is the biggest challenge faced by the organizations.
The entire process of need identification to physical manufactures of product involves three
functions: marketing, product development, manufacturing.
Product development translates the
needs of customers given by marketing into technical specifications and designing the various
features into the product to these specifications. Manufacturing has the responsibility of selecting the processes by which the product can be manufactured. Product design and development
provides link between marketing, customer needs and expectations and the activities required to
manufacture the product.
Process design is a macroscopic decision-making of an overall process route for converting the raw material into finished goods. These decisions encompass the selection of a process, choice of technology, process flow analysis and layout of the facilities. Hence, the important decisions
in process design are to analyse the workflow for converting raw material into finished product
and to select the workstation for each included in the workflow.
PRODUCTION PLANNING AND CONTROL
Production planning and control can be defined as the process of planning the production in advance,
setting the exact route of each item, fixing the starting and finishing dates for each item, to give
production orders to shops and to follow up the progress of products according to orders.
The principle of production planning and control lies in the statement ‘First Plan Your Work and then Work on Your Plan’. Main functions of production planning and control includes
planning, routing, scheduling, dispatching and follow-up.
Planning is deciding in advance what to do, how to do it, when to do it and who is to do it. Planning bridges the gap from where we are, to where we want to go. It makes it possible
for things to occur which would not otherwise happen.
Routing may be defined as the selection of path which each part of the product will follow, which being transformed from raw material to finished products. Routing determines the most
advantageous path to be followed from department to department and machine to machine till
raw material gets its final shape.
Scheduling determines the programme for the operations. Scheduling may be defined as ‘the fixation of time and date for each operation’ as well as it determines the sequence of
operations to be followed.
Scope of production and operations management
Dispatching is concerned with the starting the processes. It gives necessary authority so as to start a particular work, which has already been planned under ‘Routing’ and ‘Scheduling’.
Therefore, dispatching is ‘release of orders and instruction for the starting of production for any item in acceptance with the route sheet and schedule charts’.
The function of follow-up is to report daily the progress of work in each shop in a prescribed proforma and to investigate the causes of deviations from the planned performance.
Quality Control (QC) may be defined as ‘a system that is used to maintain a desired level of quality in a product or service’. It is a systematic control of various factors that affect the quality
of the product. Quality control aims at prevention of defects at the source, relies on effective feed back system and corrective action procedure.
Quality control can also be defined as ‘that industrial management technique by means of which
product of uniform acceptable quality is manufactured’. It is the entire collection of activities which
ensures that the operation will produce the optimum quality products at minimum cost.
The main objectives of quality control are:
_ To improve the companies income by making the production more acceptable to the customers i.e., by providing long life, greater usefulness, maintainability, etc.
_ To reduce companies cost through reduction of losses due to defects.
_ To achieve interchangeability of manufacture in large scale production.
_ To produce optimal quality at reduced price.
_ To ensure satisfaction of customers with productions or services or high quality level, to
build customer goodwill, confidence and reputation of manufacturer.
_ To make inspection prompt to ensure quality control.
_ To check the variation during manufacturing.
Materials management is that aspect of management function which is primarily concerned with
the acquisition, control and use of materials needed and flow of goods and services connected
with the production process having some predetermined objectives in view.
The main objectives of materials management are:
_ To minimise material cost.
_ To purchase, receive, transport and store materials efficiently and to reduce the related cost.
_ To cut down costs through simplification, standardisation, value analysis, import substitution, etc.
_ To trace new sources of supply and to develop cordial relations with them in order to
ensure continuous supply at reasonable rates.
_ To reduce investment tied in the inventories for use in other productive purposes and to
develop high inventory turnover ratios.
In modern industry, equipment and machinery are a very important part of the total productive
effort. Therefore, their idleness or downtime becomes are very expensive. Hence, it is very
important that the plant machinery should be properly maintained.
The main objectives of maintenance management are:
1. To achieve minimum breakdown and to keep the plant in good working condition at the
lowest possible cost.
2. To keep the machines and other facilities in such a condition that permits them to be used
at their optimal capacity without interruption.
3. To ensure the availability of the machines, buildings and services required by other sections
of the factory for the performance of their functions at optimal return on investment.
ROLE OF computer application IN OPERATION MANAGEMENT
The use of computers and Information Technology (IT)-based systems in OPERATION MANAGEMENT has redefined workplace practices, operational metrics and business models. Top management and key business executives have been able to leverage the various capabilities of computer-based systems and productivity software technologies to get a better handle on business operations, channelize employee productivity and address strategic goals. The importance of computers in OPERATION management cannot be overstated.
o In order to be competitive, mega corporations, large-workforce organizations and even small and medium businesses need to do long range corporate planning in a systematic manner. Such organization development initiatives encompass human resources development, finance and budget allocation, procurement and supply chain, sales and marketing, research and development. Automated business processes, advanced computer systems and allied software applications provide companies with reports, tools and practices to address strategic objectives and the techniques and methods to achieve organizational goals.
o Computer networks connected over an intranet-based system or Web-based environment can communicate with one another. In modern businesses, business owners and enterprise decision makers need employees to communicate instantly with each other, collaborate and share files, information and relevant documents quickly in order to execute work-related tasks and pursuits. Use of e-mail systems, instant messaging tools and more recently social networking applications has also enhanced swifter communication with business partners, customers, suppliers and other key external stakeholders.
o Organizations and businesses perform thousands of transactions at varied customer and business partner --facing interfaces. Purchase managers, inventory system professionals and accounts and financial personnel need to keep track of invoices, purchase orders, payment gateways on organization websites and all transactions at the operational level. Computer systems integrate varied transaction processes and activities and facilitate real-time tracking of transactions. IT applications speed the process of transaction activities and help in calculations, generation of accurate summaries and reports.
o In contemporary businesses, gigabytes and masses of data and information is generated on a daily basis. Computers, IT systems and allied software programs help companies to classify, arrange, systematize and analyze information. Use of CRM solutions, Enterprise Resource Planning (ERP) systems Management Information Systems (MIS) and database systems enable companies to operationally manage business processes and functional areas. Market intelligence, sales reports and customer insights generated from such systems aid business managers, top management and project heads in important decision making processes.
o One of the primary purposes of deploying large-scale computer systems, software, networking and IT tools is to gain productivity on all levels in an organization. All departments, manufacturing and production facilities and offshore centers should be able to leverage the capabilities and of modern IT systems and technologies and function more effectively and efficiently. Used strategically, computers streamline employee workflows, operational activities and functional processes, ensure better control in business management and impact the bottom-line.
ROLE OF JIT IN OPERATION MANAGEMENT
Just In Time (JIT)
Just In Time is set of strategic activities, which are formulated to achieve maximum production with minimal maintenance of inventory. JIT as philosophy is applicable to various types of organization but on implement side it is more relevant with manufacturing operations.
For JIT system to be successful, there are two critical elements, attitude of workers/management and practice.
Fundamentals of JIT
JIT is based on the following fundamentals:
JIT manufacturing and ordering
Elimination of waste
Signal System (Kanban)
With the above fundamentals in place, JIT delivers the following:
Continuous improvement of production and order processing.
Elimination of non-value added activities and procedures.
Simplification and advancement of the existing systems.
Creation of safety environment and ensuring total quality management.
Creation crossed skilled workers.
JIT purchasing refers to the technique of eliminating waste during the purchasing phase with the help of the mutual understanding with good suppliers. The major elements of JIT purchasing include locating, choosing and then developing mutual relations with the suppliers the number of the suppliers should be limited and both the buyer and the supplier should possess mutual dependence, having long term contracts which results in reduction of the lead time, aiming at finding solutions to the problems by involving participation of the supplier at an earlier stage during the decision making process.
JIT purchasing is more applicable and helpful in the flow production than the batch production and is also not very suitable for the low cost ‘C’ class bought out items. JIT cannot work properly in those organizations, where there is no proper involvement of the people.
JIT purchasing aims at the following –
1. Elimination of the waste or at least minimization of the waste during the purchase process.
2. Elimination of the waste at the supplier’s end.
3. Elimination of the purchased inventory.
JIT manufacturing refers to the technique of eliminating waste during the manufacturing process. During the production of the products one important factor to be kept in mind is to fulfill or to meet the customer’s requirement in context of the quality. JIT manufacturing aims at eliminating all those factors or activities that act as a hindrance in the achievement of such goals of quality maintenance.
Key factors in the working of the JIT manufacturing
1. Trying to improve quality automatically results in the minimization of the costs.
2. Considers employees as the experts in their work.
3. Mistakes act as an opportunity to improve.
4. JIT prefers working in small batches.
In this case, JIT manufacturing works as small autonomous modules or cells, which are designed in such a way that flow of materials is minimized within the cells and also between the cells. Cell may consist of a single machine or more than one machine arranged in a line and it must allow one at a time flow by possessing flexibility of being operated at the rate required by the operation or the customer it is supposed to feed.
In a JIT work cell, the operator who is in motion, is responsible for picking up the material and then performing the operation at the first machine. Then moves to the next machine, performing the next operation and in this way it reaches the last machine, when the unit is put into the completed container. In this case, the total time spent at all machine is equal to the desired cycle time. For achieving higher rate of production more number of men is assigned to the work cell and if the lower rate of production is needed in the next period less number of workmen are assigned to the work cell then. Cellular manufacturing helps in reducing cost of quality of works made parts and also the manufacturing lead time. By cellular manufacturing, work in process inventory is lowered, accompanied by lowering of labour work content.
ROLE OF TQM IN OPERATION MANAGEMENT
Principles Of TQM
1- Be Customer focused: Whatever you do for quality improvement, remember that ONLY customers determine the level of quality. Whatever you do to foster quality improvement, training employees, integrating quality into processes management, ONLY customers determine whether your efforts were worthwhile.
2-Insure Total Employee Involvement: You must remove fear from work place, then empower employee... you provide the proper environment.
3- Process Centered: Fundamental part of TQM is to focus on process thinking.
4- Integrated system: All employee must know the business mission and vision. An integrated business system may be modeled.
5- Strategic and systematic approach: Strategic plan must integrate quality as core component.
6- Continual Improvement: Using analytical, quality tools, and creative thinking to become more efficient and effective.
7- Fact Based Decision Making: Decision making must be ONLY on data, not personal or situational thinking.
8- Communication: Communication strategy, method and timeliness must be well defined.
THE COMMON OUTCOME THEY ARE SEEKING
1.delivery of ever-improving value .
2.improvement of overall organizational effectiveness and capabilities
3.organizational and personal learning
THE COMMON CRITERIA ARE
3.Customer and Market Focus
4. EMPHASIS ON Measurement, Analysis, and Knowledge Management
6.EFFECTIVE Process Management
The Criteria for Performance Excellence are the basis for organizational self-assessments, for making Awards, and for giving feedback to applicants. The Criteria are designed to help provide organizations with an integrated approach to organizational performance management that results in
delivery of ever-improving value to patients/customers/students
improvement of overall organizational effectiveness and capabilities
organizational and personal learning
The Criteria are built upon a set of core values and concepts that include visionary leadership, customer-driven excellence, valuing employees and partners, management by fact, and a focus on results and creating value. These core values are embedded in the BALRIDGE seven Categories:
Customer/Patient/Student and Market Focus
Measurement, Analysis, and Knowledge Management
The emphasis of examination is on the implementation of TQM
The actual implementation of TQM practices is appreciated
Usage of advanced statistical methods is not the basis
for success; appreciation and implementation of statistical
methodology are more important
Similar patterns of evaluation are adopted for both
manufacturing and non-manufacturing companies
Examination viewpoint criteria are not a check-list for
assessment. These provide an overall picture of TQM.
Examiners judge features that have been applied by
The Examination Viewpoint includes:
• Top Management Leadership, Vision, Strategies
• TQM Frameworks
• Quality Assurance Systems
• Management Systems for Business Elements
• Human Resource Development
• Effective Utilisation of Information
• TQM Concepts and Values
• Scientific Methods
• Organisational Powers (Core Technology, Speed, Vitality)
• Contribution to Realisation of Corporate Objectives
Successful companies should score
• 70 points or higher in the Executive Session
• 70 points or higher as the company average,
excluding the Executive Session
• 50 points or higher for any examined unit of the company
WHAT IS THE MODERN OPERATION SEEKING
- Access wider geographic markets by complying with a recognised standard.
- New customers who require ISO 9000 compliance.
- Reduce customer rejection of products/services because of poor quality.
- Improve customer loyalty.
- Reduce or eliminate repetition of work.
- Reduce warranty and customer support costs.
- Reduce management time spent on “putting out fires”.
- Improve productivity by “doing it right the first time”.
WHAT DOES TQM paradigm OFFER :
-Developing a corporate quality policy.
-Designing and implementing a quality system.
-Developing measures for capturing quality costs and benefits from improved quality.
-Encouragement of teamwork and participation of the management and the workforce.
-Continuous education and training to foster employee attitudes, management beliefs and value system.
-Usage of problem solving tools and techniques.
-Benchmarking of business results and processes.
-Improvement of managerial and technical processes.
-Integrating the customers’ and suppliers’ expectations.
-Carrying out quality audits and reviews on a continuous basis.
WHAT ARE THE BENEFITS OF TQM TO AN ORGANIZATION.
TQM leads to a synergy of benefits to the firm.
1.A philosophy that improves business from top to bottom
[everybody in the organization is involved towards the same objective]
2.A focused, systematic and structured approach to enhancing customer's satisfaction
[helps to increase sales / profit of the organization ]
3.Process improvement methods that reduce or eliminate problems i.e. non conformance costs
[improves the efficiency of the process and better results]
4.Tools and techniques for improvement - quality operating system
[improved working methods for improves results ]
5.Delivering what the customer want's in terms of service, product and the whole experience
[helps to tailor the product/service to match customer requirements and the
6.Intrinsic motivation and improved attitudes throughout the workforce
[improved work conditions means employees are motivated to perform better]
7.Workforce is proactive - prevention orientated
[it helps to prevent accidents / quality rejects etc ]
[it encourages discussion among employees/ between managers and employees]
9.Reduction in waste and rework
[continual discussion /continual improvements / proactive attitude
helps to prevent waste / rework/ reduces rejects.]
10.Increase in process ownership- employee involvement and empowerment
[setting of quality circles/ problem solving teams improves
the employee involvement and empowers employee to make decisions]
11.Everyone from top to bottom educated.
[TQM involves continual training at all levels which helps the development of the individuals ]
12.Improved customer/supplier relationships (internally & externall)
[TQM takes the system across all working units including all departments internally and external stakeholders integration]
[TQM helps to improve the customer servicing and helps the competitive positioning of the company in the market]
14. TQM Through education, management and staff are given the tools to achieve all the above. Education provides for guided innovation from all levels. Training, which is a cost, shows a commitment by management .
15. TQM HELPS Individual staff self improvement, which is a motivator.
Staff will collectively provide continual improvement of company systems. By working together, communication/departmental barriers will be broken down. The standard of service can be set, maintained and then improved. Suppliers will be working with rather than working for the company . The standard of staff and management will improve through education. The adoption of a new attitude to work, by everyone embracing the ideas of TQM.
Direct benefits of TQM are as follows:
- Increased pride of workmanship among individual workers
- Increased readiness
- Improved sustainability caused by extended time between equipment failures
- Greater mission survivability
- Better justification for budgets because of more efficient operations
- Streamlined maintenance and production processes.
The bottom line of TQM is “more bang for the buck.” The Concept of Quality Management The concept behind quality management revolves around a change from management by results to management by process (quality) improvement. Managers are tasked with con- tinuously improving each and every process in their organization. That means combining quantitative methods and human resource management techniques to improve customer-supplier .
The overall benefits of an TQM/ ISO 9000 quality management system are the following:
- Access wider geographic markets by complying with a globally recognised standard.
- New customers who require ISO 9000 compliance.
Preserve Existing Revenue
- Reduce customer rejection of products/services because of poor quality.
- Improve customer loyalty.
- Reduce or eliminate repetition of work.
- Reduce warranty and customer support costs.
- Reduce management time spent on “putting out fires”.
- Improve productivity by “doing it right the first time”.
ROLE OF supply chain management IN OPERATION MANAGEMENT
Changes in five factors are largely responsible for the increased IMPORTANCE.
1 Information technology
2 Visibility of best practices
3 Consumer behavior
5 The importance of speed
Technology. Although people have been talking about the idea of the integrated supply chain for a long time, it's only been in the last decade or so that information technology has made it possible to bring many concepts to life. However, information technology is merely the facilitator.
Visibility of best practices. People are realizing the enormous amounts of money they've been leaving on the table in supply chain management because they have not been doing things right. So we're really talking about a need for greater understanding of supply chain economics and the visibility of successful firms.
Some firms have completely changed the competitive dynamics of their industries because of the kind of competitive advantage they've been able to gain in the supply chain. Wal-Mart, of course, is the obvious one. The impact of their ability to get products to the customer and the impact of the economics have really changed the nature of competition. Not only did others start to emulate this model, but more visible models of different ways to do things in the supply chain have also emerged.
Consumer behavior. Today, customers are much more demanding than they have ever been in business history. They have the information at their fingertips, they know exactly what they want, and they know when and how they want it.
Competition. The behavior of customers has changed the way we view competition. Companies are forced to do better because customers aren't going to stay around if they don't.
Speed. During the last decade, it's all been about competing through speed—being able to satisfy changing customer needs quickly, accurately, and efficiently.
Supply Chain Management transformation is a strategic imperative for any manufacturer. This new perspective, one that will continue to gain importance, sees all suppliers and customers as part of one complex supply chain network and understands that transforming that supply chain into a synchronized chain is the primary goal.
Supply chain management transformation provides fast access to relevant and accurate information. This timely supply chain information can pay off handsomely in lower costs, less inventory, improved throughput, shorter cycle times, and the highest levels of customer service. The very essence of supply chain management is effective information and material flow throughout a network of customers and suppliers. By using the Internet, companies simply have better and more far-reaching ways to speed up the information flow process and make it more effective.
For many companies, it is now clear that the supply chain that best manages the flows of both information and material can significantly differentiate itself from its competitors. As customers and suppliers band together in mutually beneficial partnerships, the need for better and better supply chain management processes and systems becomes more critical. Within the boardroom, improving supply chain management is getting lots of attention because forward-thinking management teams know it is the best strategy to increase and maintain market share while at the same time increasing profits. Experts now agree that in many industries, market share will be won and lost based on supply chain performance.
Good supply chain practitioners know that information should be passed on only to those who need to know it, when they need to know it, and in the form they need to have it in. Changes in demand information, inventory positions, order fulfillment, supply management, and a whole host of other information exchange activities will transform how we sell products, supply products, and make and receive payments for goods and services. Tomorrow’s supply chain will link customers and suppliers together seamlessly throughout the world. The higher speed of information flow itself will in turn mandate faster flows of material, which only lean manufacturing operations can generate.
Executive management is taking a good hard look at supply chains and finding a dysfunctional mix of processes, policies, systems, communications, performance measures, and organizational accountability . Some of these processes are clearly functionally divided silos; those barricaded “power pockets” of the internally focused corporate hierarchical maze that was the standard for decades. Other processes are hybrid and include everything from manual order entry to faxes and phone communications and e-mail. Still other processes reveal the current trend toward full electronic communication and collaboration throughout the supply chain, including automated order entry, delivery tracking, and inventory planning systems. Whatever the exact mix, it is clear that most companies have a long way to go before they will have fully transformed their supply chain for the twenty-first century.
The standard manufacturing supply chain shows the traditional flow of information and materials to and from the customers and the suppliers through the company. The processes within the supply chain typically have a strong correlation to the traditional silo organizational functions within a manufacturing company, including sales, engineering, manufacturing, distribution, and accounting. The business process flows across an organization, but communication, accountability, and reward systems flow vertically. This organizational and process contradiction often impedes supply chain effectiveness.
Where’s the Payoff?
Two very compelling reasons justify pursuing e-supply chain management. First, suppliers are now integrating, rather than just interfacing, with their customers.
There’s no small difference between interfacing and integrating. Whereas interfacing indicates communication through some means or other, integrating indicates a more far-reaching connection through electronic business processes. Before, a company might send a monthly report to suppliers about what orders they expect to come in that month, now it is feasible to let suppliers check your order status at any and every point during the month, including in real time. In an integrated supply chain, customers and suppliers become mutually dependent by collaborating through the shared goal of the streamlined, efficient demand and supply process. The objective is for everyone in the supply chain to increase market share through quick responses to customer needs. This can only happen when information, materials, and products flow smoothly and freely, in sync with demand. It’s a formidable task but the effort can pay big dividends, including making (or breaking) marketplace leadership.
The second reason to pursue the e-supply chain is related but different in emphasis. While the first reason emphasizes filling customers’ product needs, the second emphasizes improving the performance of manufacturing material flow and all the benefits those improvements can bring. Many companies now recognize that flow through the entire supply chain is the critical factor for success. In fact, in the future, customers will want to work only with suppliers who are consistently flexible and responsive in meeting their supply needs. The objectives for improved supply chain management are twofold, affecting both the cost and revenue sides of the business equation. The goals are:
1 Gain a competitive advantage and increase market share by being more flexible, quicker, more dependable, and less costly.
2 Achieve better cost efficiency through high-speed information and material flows with lower inventories and decreased overhead activity costs.
Essential Components of SCM
Like manufacturing processes, supply chain processes involve the flow of information and materials. The information flow precedes and causes material to continue (or stop) flowing through the supply chain. Thus, your supply chain material flow will, by and large, only be as good as the information that drives it. The supply chain management overview depicts the flows of information and material and their relative timing. Manufacturers need to develop supply chain management processes and systems to support this model’s components. It is important to understand the distinctions between these components and what position each holds in the supply chain.
Collaborative Product Life Cycle Management
Objective is to share relevant information with appropriate partners and enlist their expertise in design activities at the earliest possible time in Product Life Cycle Management (PLM).
Emphasis is to acquire and apply the skills, knowledge, and experience of your extended enterprise to develop the products that best serve customer needs at low cost in a short cycle time.
Objective is to provide the entire extended supply chain network with the demand planning information needed for optimum planning and schedule execution.
Emphasis is on accurate and real time, collaborative demand planning to support production and supply chain execution.
Supply Source Planning
Objective is to optimize projected customer demand with supply source planning through Collaborative Planning, Forecasting and Replenishment (CPFR) and subsequent schedule execution by supplier partners.
Emphasis is on compatibility of collaborative business process and precise and timely communications to minimize nonperformance risk.
Objective is to make reliable, short-cycle, capable-to-promise schedules and achieve100% schedule performance.
Emphasis is on schedule reliability and responsiveness to planned demand and unforeseen changes in demand.
Objective is to optimally deliver product to customers as promised while minimizing logistics costs.
Emphasis is on warehouse and transportation management systems that efficiently plan and control the movement of goods while continually seeking to lower logistics costs.
Objective is to proactively monitor and trigger signals about undesirable events requiring action somewhere in the supply chain. In addition, logic may exist that will identify opportunities to minimize costs and increase customer service.
Emphasis is on preventing internal and external problems that are likely to interrupt material flow by sending alert messages to the first level and escalating the alert signal up the organization until the alert is shut down.
Throughout the supply chain, there are some absolutely critical and predictive event questions your system should accurately and quickly answer:
1 When will specific orders really ship?
2 Which orders will be late?
3 Why will these orders be late?
4 What are the specific problems that are delaying the schedule?
5 What are the future schedule problems and when will they occur?
6 What is the best schedule that can be executed now?
If management can accurately answer predictive questions, decision quality will greatly improve. Preventive actions can offset what were once unforeseen events. The supply chain will be managed more effectively and improve your chances of gaining a competitive advantage.
ROLE OF MOVING ASSEMBLY LINE IN OPERATION MANAGEMENT
Assembly Line Balancing
Line Balancing and Work Cell Balancing is an effective tool to increase the output of the Assembly line and Work Cell line to reduce manpower and cost. Assembly Line Balancing is nothing but the Simple Line Balancing is the calculation of assigning works to workstation alongside an Assembly Line and that operation will be optima in sense. Henry Ford who introduced the Assembly Line Balancing and in early times it was simple line balancing (LB) which has optimized the industrial importance, the effective difference between the optimal and sub-optimal operation can afford savings which will be million dollars every year.
LB: it is a Classical Operation Research (OR) which optimizes the problem, and it has been handled by OR for many decades. Most of the algorithms have been proposed to this problem and it contempt the usual importance of the issue and the OR use to handle this. It’s commercial software which is available to optimize the industry and their lines.
Assembly Line Balancing is dependent on 3 models and it is described that these 3 kinds of models is related to Assembly Line Balancing and they are Single-Model Assembly lines, mixed models, and multi-model Assembly lines.
Singe-Model Assembly Line: in early times assembly lines were used in high level production of a single product. But now the products will attract customers without any difference and allows the profitable utilization of Assembly Lines. An advanced technology of production which enables the automated setup of operations and it is negotiated time and money. Once the product is assembled in the same line and it won’t variant the setup or significant setup and it’s time that is used, this assembly system is called as Single Model Line.
Mixed Model Assembly Line: in this model the setup time between the models would be decreased sufficiently and enough to be ignored. So this internal mixed model determines the assembled on the same line. And the type of assembly line in which workers work in different models of a product in the same assembly line is called Mixed Assembly Line.
Multi-Model Assembly Line: in this model the uniformity of the assembled products and the production system is not that much sufficient to accept the enabling of the product and the production levels. To reduce the time and money this assembly is arranged in batches, and this allows the short term lot-sizing issues which made in groups of the models to batches and the result will be on the assembly levels.
MODERN ASSEMBLY LINE METHODS
Using modern assembly line methods, manufacturing has become a highly refined process in which value is added to parts along the line. Assembly line manufacturing is characterized by concurrent processes, or multiple parallel activities that feed into a final assembly stage. These processes require a well-planned flow of materials and the development of an advanced materials and supply infrastructure.
Modular assembly is another advanced assembly line method that is designed to improve throughput by increasing the efficiency of parallel subassembly lines feeding into the final assembly line. As applied to automobile manufacturing, modular assembly would involve assembling separate moduleshassis, interior, bodyn their own assembly lines, then joining them together on a final assembly line.
The recognized efficiency of machines performing multiple tasks has evolved into cell manufacturing. Cells of machines can be run by one operator or a multiperson work cell. In these machine cells it is possible to link older machines with newer ones, thus reducing the amount of investment required for new machinery. Cell operators can handle three or four tasks, and robots are used for such operations as materials handling and welding.
Team-style production is another development in assembly line methods. Where workers used to work at one- or two-person workstations and perform repetitive tasks, now teams of workers can follow a job down the assembly line through its final quality checks. Team production creates greater worker involvement and was adopted by Swedish automakers Saab and Volvo in the early 1980s. On the Sportster line at the Harley-Davidson, Inc. plant in Milwaukee, ten three-person teams follow the motorcycle through 20 assembly stations and its final check.
While assembly line methods are typically applied to high-volume runs, they can be just as successfully applied to one-of-a-kind products such as molds and dies. One shop improved the throughput and accuracy of the production of its molds and dies by breaking down operations into manufacturing steps and arranging for the steps to occur simultaneously. Detailed preproduction plans were made by a process engineering group, and the smooth production flow was coordinated by electronic communication tools. All of the employees were engaged in continuous training and skills upgrading, which included cross training in the various specialties involved in the production process.
Custom lines represent another innovation in assembly line methods. Rather than relying on a common assembly line, one automotive supplier that specialized in after-model-year parts such as hoods and fenders developed a system to make custom assembly lines that could be put together and dismantled in a short time. With floor space at a premium, the facility was designed so that nothing was attached to the floor; all of the machinery could either be lifted and carried, or it had wheels or forklift notches for easy movement.
Assembly line designers are able to use special software to make optimal use of workstations, minimize parts, and reduce production costs. Three basic types of software are available. One is called design-for-assembly (DFA) software. It is used to minimize the number of parts in a product. A second type of software evaluates the order in which the pieces are assembled to achieve greater economy. The third type is assembly system design software that helps designers select the best mix of automation and people in the assembly line.
As new assembly line methods are introduced into manufacturing processes, business managers look at the techniques for possible application to other areas of business. New methods all share the common goal of improving throughput by reducing the amount of time individual workers and their machines spend on specific tasks. By reducing the amount of time required to produce an item, be it an automobile, a new product, or a report, assembly line methods have made it possible to produce more with less.
ROLE OF business Process reengeineering IN OPERATION MANAGEMENT
Business process reengineering (BPR) is, an approach aiming at improvements by means of elevating efficency and effectiveness of the business process that exist within and across organizations. The key to BPR is for organizations to look at their business processes from a "clean slate" perspective and determine how they can best construct these processes to improve how they conduct business.
Business process reengineering is also known as BPR, Business Process Redesign, Business Transformation, or Business Process Change Management. It is the radical redesign of an organization's processes , especially its business processes . Rather than organizing a firm into functional specialties (like production, accounting, marketing, etc.) and considering the tasks that each function performs; complete processes from materials acquisition, to production, to marketing and distribution should be considered. The firm should be re-engineered into a series of processes.
Business process reengineering is one approach for redesigning the way work is done to better support the organization's mission and reduce . Reengineering starts with a high-level assessment of the organization's mission, strategic goals, and customer needs. Basic questions are asked, such as "Does our mission need to be redefined? Are our strategic goals aligned with our mission? Who are our customers?" An organization may find that it is operating on questionable assumptions, particularly in terms of the wants and needs of its customers. Only after the organization rethinks what it should be doing, does it go on to decide how best to do it.
Within the framework of this basic assessment of mission and goals, reengineering focuses on the organization's business processes--the steps and procedures that govern how resources are used to create products and services that meet the needs of particular customers/ markets. As a structured ordering of work steps across time and place, a business process can be decomposed into specific activities, measured, modeled, and improved. It can also be completely redesigned or eliminated altogether. Reengineering identifies, analyzes, and redesigns an organization's core business processes with the aim of achieving dramatic improvements in critical performance measures, such as cost, quality, service, and speed.
Reengineering recognizes that an organization's business processes are usually fragmented into subprocesses and tasks that are carried out by several specialized functional areas within the organization. Often, no one is responsible for the overall performance of the entire process. Reengineering maintains that optimizing the performance of subprocesses can result in some benefits, but cannot yield dramatic improvements if the process itself is fundamentally inefficient and outmoded. For that reason, reengineering focuses on redesigning the process as a whole in order to achieve the greatest possible benefits to the organization and their customers. This drive for realizing dramatic improvements by fundamentally rethinking how the organization's work should be done distinguishes reengineering from process improvement efforts that focus on functional or incremental improvement.
Seven principles of reengineering to streamline the work process and thereby achieve significant levels of improvement in quality, time management, and cost:
1. Organize around outcomes, not tasks.
2. Identify all the processes in an organization and prioritize them in order of redesign urgency.
3. Integrate information processing work into the real work that produces the information.
4. Treat geographically dispersed resources as though they were centralized.
5. Link parallel activities in the workflow instead of just integrating their results.
6. Put the decision point where the work is performed, and build control into the process.
7. Capture information once and at the source.
Methodology in BPR
Envision new processes
Secure management support
Identify reengineering opportunities
Identify enabling technologies
Align with CORPORATE STRATEGY
Set up reengineering team
Outline performance goals
Describe existing processes
Uncover pathologies in existing processes
Develop alternative process scenarios
Develop new process design
Design HR architecture
Select IT platform
Develop overall BLUEPRINT and gather feedback
Develop/install IT solution
Establish process changes
Performance measurement, including time, quality, cost, IT performance
Link to continuous improvement