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1.9
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SCOPE OF PRODUCTION AND OPERATIONS MANAGEMENT
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Production and operations
management concern with the conversion of inputs into outputs, using physical
resources, so as to provide the desired utilities to the customer while meeting
the other organizational objectives of effectiveness, efficiency and
adoptability. It distinguishes itself from other functions such as personnel,
marketing, finance, etc., by its primary concern for ‘conversion by using
physical resources.’ Following are the activities which are listed under
production and operations management functions:
1. Location of facilities
2. Plant layouts and material handling
3. Product design
4. Process design
5. Production and planning control
6. Quality control
7. Materials management
8.
Maintenance
management.
LOCATION OF FACILITIES
Location of facilities for
operations is a long-term capacity decision which involves a long term
commitment about the geographically static factors that affect a business organization.
It is an important strategic level decision-making for an organization. It
deals with the questions such as ‘where our main operations should be based?’
The selection
of location is a key-decision as large investment is made in building plant and
machinery. An improper location of plant may lead to waste of all the
investments made in plant and machinery equipments. Hence, location of plant
should be based on the company’s expansion
plan and policy,
diversification plan for the products, changing sources of raw materials and
many other factors. The purpose of the location study is to find the optimal
location that will results in the greatest advantage to the organization.
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 specialised 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
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
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.
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
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
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.
