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Master of Business Administration

Semester III

Assignment Set – 2
Research Methodology-MB0050

Assignment Set – 2
Research Methodology-MB0050 Assignment Set 2 page:1 of 14
Question 1: What is questionnaire? Discuss the main points that you will take into account
while drafting a questionnaire?

A questionnaire is a research instrument consisting of a series of questions and other prompts for the
purpose of gathering information from respondents. Although they are often designed for statistical analysis of the
responses, this is not always the case. The questionnaire was invented by Sir Francis Galton.

Questionnaires have advantages over some other types of surveys in that they are cheap,
do not require as much effort from the questioner as verbal or telephone surveys, and often have
standardized answers that make it simple to compile data. However, such standardized answers
may frustrate users. Questionnaires are also sharply limited by the fact that respondents must be
able to read the questions and respond to them. Thus, for some demographic groups conducting a
survey by questionnaire may not be practical.

As a type of survey, questionnaires also have many of the same problems relating to
question construction and wording that exist in other types of opinion polls.

Questionnaires may be classified as:

Structured/ Standardized Questionnaire:

Structured questionnaires are those in which there are definite, concrete and preordained questions with
additional questions limited to those necessary to clarify inadequate answers or to elicit more detailed responses.
The questions are presented with exactly the same wording and in the same order to all the respondents.

Unstructured Questionnaire:

In unstructured questionnaires the respondent is given the opportunity to answer in his own terms and in his
own frame of reference.

Points to take into account while drafting a questionnaire:

Writing an effective questionnaire is not a task for novices. At the very least it requires an
understanding of four basics. These are:

Considering the differences that exist when writing a questionnaire that respondent’s will
fill out themselves as opposed to when a professional interviewer administers the
questionnaire to the respondent.
Knowing what questions should be asked early on in the questionnaire,
in the middle or toward the end.
Understanding how to phrase questions.
Being sensitive to questionnaire length.
There are some basic differences in how the questionnaire should be constructed if it is to be
filled out personally by the respondent or if an interviewer is going to administer it. These are:

Self-administered questionnaires should be simple, straightforward and logical. Question
2 should follow question 1. Question 3 should follow question 2, and so forth. Further,
the going-in assumption with self-administered questionnaires should be that respondents
Research Methodology-MB0050 Assignment Set 2 page:2 of 14
will not complete a questionnaire when there are complex skip patterns, when pages are
crowded or hard to read or when instructions for completion are overly complex.

It has been estimated that as many as 50% of respondents who start a self-administered
questionnaire will not complete it because they become irritated and annoyed at the way
it is constructed. When writing a self-administered questionnaire, then, every care must
be taken to ensure that it is easy to complete in that it almost answers itself.

Self-administered questionnaires should be written with an eighth grade mentality in

mind while interviewer-administered questionnaire can be quite complex. Because
interviewers are trained in the flow of the questionnaires they administer and will conduct
a number of practice interviews prior to confronting a respondent, developing a complex
questionnaire that is interviewer-administered does not present a problem for the

Keep the respondent in one mind-set at a time. If at all possible, complete all your
questions about one topic before moving on to the next. For example, don’t ask about a
favorite place to shop, then about brands used and then go back to additional questioning
on favorite place to shop.

Save sensitive questions for the end. Again, this might not always be possible, but when
it doesn’t matter, be aware that sensitive questions such as race or income can alienate
respondents and turn them off to the entire interview process. If asked at the end,
respondents are more likely to answer as they are wholly invested in the questionnaire.

Biased question: What do you like about the last airline flight you took? Assumption here
is that respondent liked something and the question tends to push for a positive response.

Unbiased question. What, if anything, do you like the last airline flight you took? By
simply using if anything as part of the question phrasing, the respondent is not put on the
spot to find something to like.

When conducting telephone interviews, it’s relatively easy to keep respondents on the
phone and answering questions for 15, 20 or 25 minutes if the questionnaire has a good
flow and is thoughtfully written. But try keeping a respondent on the phone for 3 minutes
with a questionnaire that is the least bit confusing, seems redundant or is insensitive to
sensitive issues.

Question 2: What do you mean by primary data? What are the various methods of
collecting primary data?

Primary Date is data that has not been previously published, i.e. the data is derived from a new or original
research study and collected at the source, e.g., in marketing, it is information that is obtained directly from first-
hand sources by means of surveys, observation or experimentation.

Data observed or collected directly from first-hand experience. Published data and the data collected in the
past or other parties are called secondary data. Primary data are directly collected by the researcher from their
original sources. In this case, the researcher can collect the required date precisely according to his research needs,
he can collect them when he wants them and in the form he needs them. But the collection of primary data is costly
and time consuming. Yet, for several types of social science research required data are not available from secondary
sources and they have to be directly gathered from the primary sources.
Research Methodology-MB0050 Assignment Set 2 page:3 of 14
In such cases where the available data are inappropriate, inadequate or obsolete, primary data have to be
gathered. They include: socio economic surveys, social anthropological studies of rural communities and tribal
communities, sociological studies of social problems and social institutions. Marketing research, leadership studies,
opinion polls, attitudinal surveys, readership, radio listening and T.V. viewing surveys, knowledge-awareness
practice (KAP) studies, farm managements studies, business management studies etc.

Primary data are always collected from the source. It is collected either by the investigator
himself or through his agents. There are different methods of collecting primary data. Each
method has its relative merits and demerits. The investigator has to choose a particular method to
collect the information. The choice to a large extent depends on the preliminaries to data
collection some of the commonly used methods are discussed below.

1) Direct Personal observation:

This is a very general method of collecting primary data. Here the investigator directly
contacts the informants, solicits their cooperation and enumerates the data. The information are
collected by direct personal interviews.

The novelty of this method is its simplicity. It is neither difficult for the enumerator nor the
informants because both are present at the spot of data collection. This method provides most
accurate information as the investigator collects them personally. But as the investigator alone is
involved in the process, his personal bias may influence the accuracy of the data. So it is
necessary that the investigator should be honest, unbiased and experienced. In such cases the
data collected may be fairly accurate. However, the method is quite costly and time-consuming.
So the method should be used when the scope of enquiry is small.

2) Indirect Oral Interviews:

This is an indirect method of collecting primary data. Here information is not collected
directly from the source but by interviewing persons closely related with the problem. This
method is applied to apprehend culprits in case of theft, murder etc. The information relating to
one's personal life or which the informant hesitates to reveal are better collected by this method.
Here the investigator prepares 'a small list of questions relating to the enquiry. The answers
(information) are collected by interviewing persons well connected with the incident. The
investigator should cross-examine the informants to get correct information.

This method is time saving and involves relatively less cost. The accuracy of the information
largely depends upon the integrity of the investigator. It is desirable that the investigator should
be experienced and capable enough to inspire and create confidence in the informant to collect
accurate data.

3) Mailed Questionnaire method:

This is a very commonly used method of collecting primary data. Here information is
collected through a set of questionnaire. A questionnaire is a document prepared by the
investigator containing a set of questions. These questions relate to the problem of enquiry
directly or indirectly. Here first the questionnaires are mailed to the informants with a formal
request to answer the question and send them back. For better response the investigator should
bear the postal charges. The questionnaire should carry a polite note explaining the aims and
objective of the enquiry, definition of various terms and concepts used there. Besides this the
investigator should ensure the secrecy of the information as well as the name of the informants,
if required.
Research Methodology-MB0050 Assignment Set 2 page:4 of 14
Success of this method greatly depends upon the way in which the questionnaire is drafted.
So the investigator must be very careful while framing the questions. The questions should be:

Short and clear

Few in number
Simple and intelligible
Corroboratory in nature or there should be provision for cross check
Impersonal, non-aggressive type
Simple alternative, multiple-choice or open-end type

a) In the simple alternative question type, the respondent has to choose between alternatives
such as ‘Yes or No’, ‘right or wrong’ etc.
For example: Is Adam Smith called father of Statistics? Yes/No

b) In the multiple choice type, the respondent has to answer from any of the given alternatives.
Example: To which sector do you belong?
Primary Sector
Secondary Sector
Tertiary or Service Sector

c) In the Open-end or free answer questions the respondents are given complete freedom in
answering the questions. The questions are like –

What are the defects of our educational system?

The questionnaire method is very economical in terms of time, energy and money. The
method is widely used when the scope of enquiry is large. Data collected by this method are not
affected by the personal bias of the investigator. However the accuracy of the information
depends on the cooperation and honesty of the informants. This method can be used only if the
informants are cooperative, conscious and educated. This limits the scope of the method.

4) Schedule Method:

In case the informants are largely uneducated and non-responsive data cannot be collected
by the mailed questionnaire method. In such cases, schedule method is used to collect data. Here
the questionnaires are sent through the enumerators to collect information. Enumerators are
persons appointed by the investigator for the purpose. They directly meet the informants with the
questionnaire. They explain the scope and objective of the enquiry to the informants and solicit
their cooperation. The enumerators ask the questions to the informants and record their answers
in the questionnaire and compile them. The success of this method depends on the sincerity and
efficiency of the enumerators. So the enumerator should be sweet-tempered, good-natured,
trained and well-behaved.

Schedule method is widely used in extensive studies. It gives fairly correct result as the
enumerators directly collect the information. The accuracy of the information depends upon the
honesty of the enumerators. They should be unbiased. This method is relatively more costly and
time-consuming than the mailed questionnaire method.

5) From Local Agents:
Sometimes primary data are collected from local agents or correspondents. These agents are
appointed by the sponsoring authorities. They are well conversant with the local conditions like
Research Methodology-MB0050 Assignment Set 2 page:5 of 14
language, communication, food habits, traditions etc. Being on the spot and well acquainted with
the nature of the enquiry they are capable of furnishing reliable information.

The accuracy of the data collected by this method depends on the honesty and sincerity of
the agents because they actually collect the information from the spot. Information from a wide
area at less cost and time can be collected by this method. The method is generally used by
government agencies, newspapers, periodicals etc. to collect data.

Information is like raw materials or inputs in an enquiry. The result of the enquiry basically
depends on the type of information used. Primary data can be collected by employing any of the
above methods. The investigator should make a rational choice of the methods to be used for
collecting data because collection of data forms the beginning of the statistical enquiry.

Question 3
a. Analyze the case study and descriptive approach to research.

a) Case Study and descriptive approach to research:

Descriptive research, also known as statistical research, describes data and characteristics
about the population or phenomenon being studied. Descriptive research answers the questions
who, what, where, when and how...

Although the data description is factual, accurate and systematic, the research cannot
describe what caused a situation. Thus, Descriptive research cannot be used to create a causal
relationship, where one variable affects another. In other words, descriptive research can be said
to have a low requirement for internal validity.

The description is used for frequencies, averages and other statistical calculations. Often the
best approach, prior to writing descriptive research, is to conduct a survey investigation.
Qualitative research often has the aim of description and researchers may follow-up with
examinations of why the observations exist and what the implications of the findings are.

In short descriptive research deals with everything that can be counted and studied. But there
are always restrictions to that. Your research must have an impact to the lives of the people
around you e.g. finding the most frequent disease that affects the children of a town. The reader
of the research will know what to do to prevent that disease thus; more people will live a healthy

Descriptive research does not fit neatly into the definition of either quantitative or qualitative
research methodologies, but instead it can utilize elements of both, often within the same study.
The term descriptive research refers to the type of research question, design, and data analysis
that will be applied to a given topic. Descriptive statistics tell what is, while inferential statistics
try to determine cause and effect.

A case study is a research method common in social science. It is based on an in-depth

investigation of a single individual, group, or event. Case studies may be descriptive or
explanatory. The latter type is used to explore causation in order to find underlying principles.
They may be prospective, in which criteria are established and cases fitting the criteria are
included as they become available, or retrospective, in which criteria are established for selecting
cases from historical records for inclusion in the study.
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Rather than using samples and following a rigid protocol (strict set of rules) to examine
limited number of variables, case study methods involve an in-depth, longitudinal (over a long
period of time) examination of a single instance or event: a case. They provide a systematic way
of looking at events, collecting data, analyzing information, and reporting the results. As a result
the researcher may gain a sharpened understanding of why the instance happened as it did, and
what might become important to look at more extensively in future research. Case studies lend
themselves to both generating and testing hypotheses.

Another suggestion is that case study should be defined as a research strategy, an empirical
inquiry that investigates a phenomenon within its real-life context. Case study research means
single and multiple case studies, can include quantitative evidence, relies on multiple sources of
evidence and benefits from the prior development of theoretical propositions. Case studies
should not be confused with qualitative research and they can be based on any mix of
quantitative and qualitative evidence. Single-subject research provides the statistical framework
for making inferences from quantitative case-study data

b) Distinction between research methods and research Methodology:

Research Methods Research Methodology

Research methods are the various Research methodology is a systematic way
procedures, schemes, algorithms, etc. used to solve a problem. It is a science of
in research. All the methods used by a studying how research is to be carried out.
researcher during a research study are Essentially, the procedures by which
termed as research methods. They are researchers go about their work of
essentially planned, scientific and value- describing, explaining and predicting
neutral. They include theoretical procedures, phenomena are called research
experimental studies, numerical schemes, methodology. It is also defined as the study
statistical approaches, etc. Research methods of methods by which knowledge is gained.
help us collect samples, data and find a Its aim is to give the work plan of research.
solution to a problem. Particularly, scientific
research methods call for explanations based
on collected facts, measurements and
observations and not on reasoning alone.
They ac- cept only those explanations which
can be verified by experiments.
Research Methodology-MB0050 Assignment Set 2 page:7 of 14

Question 4: Explain the important concepts in Research design?

The research designer understandably cannot hold all his decisions in his head. Even if he
could, he would have difficulty in understanding how these are inter-related. Therefore, he
records his decisions on paper or record disc by using relevant symbols or concepts. Such a
symbolic construction may be called the research design or model. A research design is a logical
and systematic plan prepared for directing a research study. It specifies the objectives of the
study, the methodology and techniques to be adopted for achieving the objectives. It constitutes
the blue print for the plan is the overall scheme or program of research. A research design is the
program that guides the investigator in the process of collecting, analyzing and interpreting
observations. It provides a systematic plan of procedure for the researcher to follow elltiz,
Jahoda and Destsch and Cook describe, “A research design is the arrangement of conditions for
collection and analysis of data in a manner that aims to combine relevance to the research
purpose with economy in procedure.”

Components of Research Design:

It is important to be familiar with the important concepts relating to research design. They are:

1. Dependent and Independent variables:

A magnitude that varies is known as a variable. The concept may assume different quantitative values, like
height, weight, income, etc. Qualitative variables are not quantifiable in the strictest sense of objectivity. However,
the qualitative phenomena may also be quantified in terms of the presence or absence of the attribute considered.
Phenomena that assume different values quantitatively even in decimal points are known as “continuous variables.
But, all variables need not be continuous. Values that can be expressed only in integer values are called” non-
continuous variables. In statistical term, they are also known as „discrete variable. For example, age is a continuous
variable; whereas the number of children is a non-continuous variable. When changes in one variable depends upon
the changes in one or more other variables, it is known as a dependent or endogenous variable, and the variables that
cause the changes in the dependent variable are known as the independent or explanatory or exogenous variables.
For example, if demand depends upon price, then demand is a dependent variable, while price is the independent

And if, more variables determine demand, like income and prices of substitute commodity,
then demand also depends upon them in addition to the own price. Then, demand is a dependent
variable which is determined by the independent variables like own price, income and price of

2. Extraneous variable:

The independent variables which are not directly related to the purpose of the study but affect the
dependent variable are known as extraneous variables. For instance, assume that a researcher wants to test the
hypothesis that there is relationship between children’s school performance and their self-concepts, in which case
the latter is an independent variable and the former, the dependent variable. In this context, intelligence may also
influence the school performance. However, since it is not directly related to the purpose of the study undertaken by
the researcher, it would be known as an extraneous variable. The influence caused by the extraneous variable on the
dependent variable is technically called as an „experimental errors Therefore, a research study should always be
framed in such a manner that the dependent variable completely influences the change in the independent variable
and any other extraneous variable or variables.
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3. Control:

One of the most important features of a good research design is to minimize the effect of extraneous variable.
Technically, the term control is used when a researcher designs the study in such a manner that it minimizes the
effects of extraneous independent variables. The term control is used in experimental research to reflect the restrain
in experimental conditions.

4. Confounded relationship:

The relationship between dependent and independent variables is said to be confounded by an extraneous
variable, when the dependent variable is not free from its effects.

Research hypothesis:

When a prediction or a hypothesized relationship is tested by adopting scientific methods, it is known as

research hypothesis. The research hypothesis is a predictive statement which relates a dependent variable
and an independent variable. Generally, a research hypothesis must consist of at least one dependent
variable and one independent variable. Whereas, the relationships that are assumed but not be tested are
predictive statements that are not to be objectively verified are not classified as research hypothesis.

Experimental and control groups:

When a group is exposed to usual conditions in an experimental hypothesis-testing research, it is known as

„control group. On the other hand, when the group is exposed to certain new or special condition, it is
known as an „experimental group. In the afore-mentioned example, the Group A can be called a control
group and the Group B an experimental one. If both the groups A and B are exposed to some special
feature, then both the groups may be called as „experimental groups. A research design may include only
the experimental group or the both experimental and control groups together.


Treatments are referred to the different conditions to which the experimental and control groups are subject
to. In the example considered, the two treatments are the parents with regular earnings and those with no
regular earnings. Likewise, if a research study attempts to examine through an experiment regarding the
comparative impacts of three different types of fertilizers on the yield of rice crop, then the three types of
fertilizers would be treated as the three treatments.


An experiment refers to the process of verifying the truth of a statistical hypothesis relating to a given
research problem. For instance, experiment may be conducted to examine the yield of a certain new variety
of rice crop developed. Further, Experiments may be categorized into two types namely, absolute
experiment and comparative experiment. If a researcher wishes to determine the impact of a chemical
fertilizer on the yield of a particular variety of rice crop, then it is known as absolute experiment.
Meanwhile, if the researcher wishes to determine the impact of chemical fertilizer as compared to the
impact of bio-fertilizer, then the experiment is known as a comparative experiment.

Experiment unit:

Experimental units refer to the predetermined plots, characteristics or the blocks, to which the different
treatments are applied. It is worth mentioning here that such experimental units must be selected with great
Research Methodology-MB0050 Assignment Set 2 page:9 of 14
Question 5: What are the differences between observation and interviewing as methods of data collection?
Give two specific examples of situations where either observation or interviewing would be more appropriate.

Observation vs. interviewing as Methods of Data Collection:

Collection of data is the most crucial part of any research project as the success or failure of the project is
dependent upon the accuracy of the data. Use of wrong methods of data collection or any inaccuracy in collecting
data can have significant impact on the results of a study and may lead to results that are not valid. There are many
techniques of data collection along a continuum and observation and interviewing are two of the popular methods on
this continuum that has quantitative methods at one end while qualitative methods at the other end. Though there are
many similarities in these two methods and they serve the same basic purpose, there are differences that will be
highlighted in this article.


Observation, as the name implies refers to situations where participants are observed from a safe distance
and their activities are recorded minutely. It is a time consuming method of data collection as you may not get the
desired conditions that are required for your research and you may have to wait till participants are in the situation
you want them to be in. Classic examples of observation are wild life researchers who wait for the animals of birds
to be in a natural habitat and behave in situations that they want to focus upon. As a method of data collection,
observation has limitations but produces accurate results as participants are unaware of being closely inspected and
behave naturally.


Interviewing is another great technique of data collection and it involves asking questions to get direct
answers. These interviews could be either one to one, in the form of questionnaires, or the more recent form of
asking opinions through internet. However, there are limitations of interviewing as participants may not come up
with true or honest answers depending upon privacy level of the questions. Though they try to be honest, there is an
element of lie in answers that can distort results of the project.

Though both observation and interviewing are great techniques of data collection, they have their own
strengths and weaknesses. It is important to keep in mind which one of the two will produce desired results before

Observation vs. interviewing:

Observation Interviewing
Observation requires precise analysis by the Interviewing is easier but suffers from the fact
researcher and often produces most accurate that participants may not come up with honest
results although it is very time consuming. replies.

Interview format:

Interviews take many different forms. It is a good idea to ask the organisation in advance what format the interview
will take.

Competency/criteria based interviews:

These are structured to reflect the competencies or qualities that an employer is seeking for a particular job,
which will usually have been detailed in the job specification or advert. The interviewer is looking for evidence of
your skills and may ask such things as: µ Give an example of a time you worked as part of a team to achieve a
common goal.
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Technical interviews:

If you have applied for a job or course that requires technical knowledge, it is likely that you will be asked
technical questions or has a separate technical interview. Questions may focus on your final year project or on real
or hypothetical technical problems. You should be prepared to prove yourself, but also to admit to what you do not
know and stress that you are keen to learn. Do not worry if you do not know the exact answer - interviewers are
interested in your thought process and logic.

Academic interviews:

These are used for further study or research positions. Questions are likely to centre on your academic
history to date.

Structured interviews:

The interviewer has a set list of questions, and asks all the candidates the same questions.

Formal/informal interviews:

Some interviews may be very formal, while others will feel more like an informal chat about you and your
interests. Be aware that you are still being assessed, however informal the discussion may seem.

Portfolio based interviews:

If the role is within the arts, media or communications industries, you may be asked to bring a portfolio of
your work to the interview, and to have an in-depth discussion about the pieces you have chosen to include.

Senior/case study interviews:

These ranges from straightforward scenario questions (e.g. µ What would you do in a situation where to the
detailed analysis of a hypothetical business problem. You will be evaluated on your analysis of the
problem, how you identify the key issues, how you pursue a particular line of thinking and whether you can
develop and present an appropriate framework for organising your thoughts.
Specific types of interview

The Screening Interview:

Companies use screening tools to ensure that candidates meet minimum qualification requirements.
Computer programs are among the tools used to weed out unqualified candidates. (This is why you need a digital
resume that is screening-friendly. See our resume centre for help.) Sometimes human professionals are the
gatekeepers. Screening interviewers often have honed skills to determine whether there is anything that might
disqualify you for the position. Remember they do not need to know whether you are the best fit for the position,
only whether you are not a match. For this reason, screeners tend to dig for dirt. Screeners will hone in on gaps in
your employment history or pieces of information that look inconsistent. They also will want to know from the
outset whether you will be too expensive for the company.

Some tips for maintaining confidence during screening interviews:

Highlight your accomplishments and qualifications.

Get into the straightforward groove. Personality is not as important to the screener as verifying your
qualifications. Answer questions directly and succinctly. Save your winning personality for the person
making hiring decisions!
Be tactful about addressing income requirements. Give a range, and try to avoid giving specifics by
replying, "I would be willing to consider your best offer."
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If the interview is conducted by phone, it is helpful to have note cards with your vital information sitting
next to the phone. That way, whether the interviewer catches you sleeping or vacuuming the floor, you will
be able to switch gears quickly

The Informational Interview:

On the opposite end of the stress spectrum from screening interviews is the informational interview. A
meeting that you initiate, the informational interview is underutilized by job-seekers who might otherwise consider
themselves savvy to the merits of networking. Jobseekers ostensibly secure informational meetings in order to seek
the advice of someone in their current or desired field as well as to gain further references to people who can lend
insight. Employers that like to stay apprised of available talent even when they do not have current job openings, are
often open to informational interviews, especially if they like to share their knowledge, feel flattered by your
interest, or esteem the mutual friend that connected you to them. During an informational interview, the jobseeker
and employer exchange information and get to know one another better without reference to specific job opening.

This takes off some of the performance pressure, but be intentional nonetheless:

Come prepared with thoughtful questions about the field and the company.

Gain references to other people and make sure that the interviewer would be comfortable if you contact
other people and use his or her name.

Give the interviewer your card, contact information and resume.· Write a thank you note to the interviewer.

The Directive Style:

In this style of interview, the interviewer has a clear agenda that he or she follows unflinchingly.
Sometimes companies use this rigid format to ensure parity between interviews; when interviewers ask each
candidate the same series of questions, they can more readily compare the results. Directive interviewers rely upon
their own questions and methods to tease from you what they wish to know. You might feel like you are being
steam-rolled, or you might find the conversation develops naturally. Their style does not necessarily mean that they
have dominance issues, although you should keep an eye open for these if the interviewer would be your supervisor.
Either way, remember:· Flex with the interviewer, following his or her lead.· Do not relinquish complete control of
the interview. If the interviewer does not ask you for information that you think is important to proving your
superiority as a candidate, politely interject it.

The Meandering Style:

This interview type, usually used by inexperienced interviewers, relies on you to lead the discussion. It might
begin with a statement like "tell me about yourself," which you can use to your advantage. The interviewer might
ask you another broad, open-ended question before falling into silence. This interview style allows you tactfully to
guide the discussion in a way that best serves you. The following strategies, which are helpful for any interview, are
particularly important when interviewers use a non-directive approach:

Come to the interview prepared with highlights and anecdotes of your skills, qualities and experiences. Do
not rely on the interviewer to spark your memory-jot down some notes that you can reference throughout
the interview.
Remain alert to the interviewer. Even if you feel like you can take the driver's seat and go in any direction
you wish, remain respectful of the interviewer's role. If he or she becomes more directive during the
interview, adjust.
Ask well-placed questions. Although the open format allows you significantly to shape
the interview, running with your own agenda and dominating the conversation means that
you run the risk of missing important information about the company and its needs.
Research Methodology-MB0050 Assignment Set 2 page:12 of 14
Question 6: Strictly speaking, would case studies be considered as scientific research? Why or why not?

Case studies are a tool for discussing scientific integrity. Although one of the most frequently used tools for
encouraging discussion, cases are only one of many possible tools. Many of the principles discussed below for
discussing case studies can be generalized to other approaches to encouraging discussion about research ethics.

Cases are designed to confront readers with specific real-life problems that do not lend themselves to easy
answers. Case discussion demands critical and analytical skills and, when implemented in small groups, also fosters
collaboration (Pimple, 2002). By providing a focus for discussion, cases help trainees to define or refine their own
standards, to appreciate alternative approaches to identifying and resolving ethical problems, and to develop skills
for analyzing and dealing with hard problems on their own. The effective use of case studies is comprised of many
factors, including:

appropriate selection of case(s) (topic, relevance, length, complexity)

method of case presentation (verbal, printed, before or during discussion)
format for case discussion (Email or Internet-based, small group, large group)
leadership of case discussion (choice of discussion leader, roles and responsibilities for discussion leader)
outcomes for case discussion (answers to specific questions, answers to general questions, written or verbal

Research methods don't seem so intimidating when you're familiar with the terminology. This is important
whether you're conducting evaluation or merely reading articles about other studies to incorporate in your program.
To help with understanding, here are some basic definitions used.

Variable: Characteristics by which people or things can be described. Must have more than one level; in
other words, to be able to change over time for the same person/object, or from person to person, or object
to object. Some variables, called attributes, cannot be manipulated by the researcher (e.g., socioeconomic
status, IQ score, race, gender, etc.). Some variables can be manipulated but are not in a particular study.
This occurs when subjects self-select the level of the independent variable, or the level is naturally
occurring (as with ex post facto research).
Manipulation: Random assignment of subjects to levels of the independent variable (treatment groups).
Independent variable: The treatment, factor, or presumed cause that will produce a change in the
dependent variable. This is what the experimenter tries to manipulate. It is denoted as "X" on the horizontal
axis of a graph.
Dependent variable: The presumed effect or consequence resulting from changes in the independent
variable. This is the observation made and is denoted by "Y" on the vertical axis of a graph. The score of
"Y" depends on the score of "X."
Population: The complete set of subjects that can be studied: people, objects, animals, plants, etc.
Sample: A subset of subjects that can be studied to make the research project more manageable. There are
a variety of ways samples can be taken. If a large enough random samples are taken, the results can be
statistically similar to taking a census of an entire population--with reduced effort and cost.

Case Study:

A case study is conducted for similar purpose as the above but is usually done with a
smaller sample size for more in-depth study. A case study often involves direct observation or
interviews with single subjects or single small social units such as a family, club, school
classroom, etc. This is typically considered qualitative research.

Purpose: Explain or Predict

Type of Research to Use: Relational Study

In a relational study you start with a research hypothesis, that is, is what you're trying to "prove."
Examples of research hypotheses for a relational study:

The older the person, the more health problems he or she encounters.
Research Methodology-MB0050 Assignment Set 2 page:13 of 14
4-H members attending 4-H summer camp stay enrolled in 4-H longer.
The greater the number of money management classes attended, the greater the amount of annual savings

Types of relational studies include correlation studies and ex post facto studies.

Co relational Study:

A co relational study compares two or more different characteristics from the same group
of people and explains how two characteristics vary together and how well one can be predicted
from knowledge of the other.

A concurrent co relational study draws a relationship between characteristics at the same

point in time. For example, a student's grade point average is related to his or her class rank.

A predictive co relational study could predict a later set of data from an earlier set. For
example, a student's grade point average might predict the same student's grade point average
during senior year. A predictive co relational study could also use one characteristic to predict
what another characteristic will be at another time. For example, a student's SAT score is
designed to predict college freshman grade point average.

Ex Post Facto (After the Fact) Study:

An ex post facto study is used when experimental research is not possible, such as when
people have self-selected levels of an independent variable or when a treatment is naturally
occurring and the researcher could not "control" the degree of its use. The researcher starts by
specifying a dependent variable and then tries to identify possible reasons for its occurrence as
well as alternative (rival) explanations such confounding (intervening, contaminating, or
extraneous) variables are "controlled" using statistics.

This type of study is very common and useful when using human subjects in real-world
situations and the investigator comes in "after the fact." For example, it might be observed that
students from one town have higher grades than students from a different town attending the
same high school. Would just "being from a certain town" explain the differences? In an ex post
facto study, specific reasons for the differences would be explored, such as differences in
income, ethnicity, parent support, etc. It is important to recognize that, in a relational study,
"cause and effect" cannot be claimed. All that can be claimed is that that there is a relationship
between the variables.

For that matter, variables that are completely unrelated could, in fact, vary together due to
nothing more than coincidence. That is why the researcher needs to establish a plausible reason
(research hypothesis) for why there might be a relationship between two variables before
conducting a study. For instance, it might be found that all football teams with blue uniforms
won last week. There is no likely reason why the uniform color had any relationship to the
games' outcomes, and it certainly was not the cause for victory. Similarly, you must be careful
about claiming that your Extension program was the "cause" of possible results.
Research Methodology-MB0050 Assignment Set 2 page:14 of 14
Legal Aspects of Business-

Assignment Set – 2
Legal aspects of Business-MB0051 Assignment Set 2 page:1 of 8
Question 1: What are the situations which cannot be referred to arbitration?

Arbitration law is a process that involves the assistance of one or more neutral parties
known as arbitrators. Arbitrators are charged with hearing evidence from numerous involved
parties in a dispute, and their main duty is to issue an award deciding who gets what in order to
resolve the situation. In some instances of arbitration law, an arbitrator may also issue an opinion
in conjunction with the award, which is designed to explain the award and the reasoning that led
to it. Arbitration law and mediation law are two different processes and should not be confused.
The award and the opinion are not capable of being reviewed by a court, and there is no
availability for appeal. The purpose of arbitration law is to serve as a substitution to a trial and a
review of the decision by a trial court.

Subject matter of arbitration:

Any commercial matter including an action in tort if it arises out of or relates to a

contract can be referred to arbitration. However, public policy would not permit matrimonial
matters, criminal proceedings, insolvency matters anti-competition matters or commercial court
matters to be referred to arbitration. Employment contracts also cannot be referred to arbitration
but director - company disputes are abatable (as there is no master servant relationship here)5.
Generally, matters covered by statutory reliefs through statutory tribunals would be non-

Arbitration is an Alternative Dispute Resolution process whereby a person chosen as an

arbitrator settles disputes between parties. Arbitration is similar to a court trial, with several

The arbitrator makes the decision called an "arbitration award”

The arbitration does not take place in a courtroom
The arbitration award is binding. With rare exceptions, there is no right to appeal
Arbitration is not a matter of public record. It is private and confidential
There is no court reporter or written transcripts
Lawyers generally prepare their cases in an extremely limited manner
The rules of evidence are relaxed so that the parties have a broader scope, more expanded
opportunity to tell their stories to present their cases
With very few exceptions, it is much less expensive than legal litigation
An arbitration time frame is substantially less than that of litigation and going to trial
No jury. The Arbitrator(s) maintain neutrality and conflicts of interests
Generally, all paperwork and evidence presented are destroyed after the Arbitration
The arbitration and arbitration award does not have to adhere to Judicial Case precedent
nor formality of traditional court proceedings

In India, Arbitration is one of the most effective and trusted proceedings in regard to
private dispute settlement are guided by the Arbitration & Conciliation Act, 1996.

Kind of matters cannot be referred for arbitration:

As per general practice, matters involving moral questions or questions of public law cannot
be resolved by arbitration. For instance, the following matters are not referred to arbitration:
Matrimonial matters
Guardianship of a minor or any other person under disability
Testamentary matters
Legal aspects of Business-MB0051 Assignment Set 2 page:2 of 8
Insolvency, proceedings
Criminal proceedings
Questions relating to charity or charitable trusts
Matters relating to anti-trust or competition law
Dissolution or winding up of a company

Indian Arbitration Act follows the guideline of:

The Geneva Convention on the Execution of Foreign Arbitral Awards, 1927

The New York Convention of 1958 on the Recognition and Enforcement of Foreign
Arbitral Awards
The Geneva Protocol on Arbitration Clauses of 1923

Question 2: What is the role of a Conciliator?


Conciliation is a process in which the parties to a dispute, with the assistance of a neutral
third party (the conciliator), identify the disputed issues, develop options, consider alternatives
and endeavour to reach an agreement.

The conciliator may have an advisory role on the content of the dispute or the outcome of
its resolution, but not a determinative role.

The conciliator may advise on or determine the process of conciliation whereby

resolution is attempted, and may make suggestions for terms of settlement, give expert advice on
likely settlement terms, and may actively encourage the participants to reach an agreement.

In order to understand what Parliament meant by ‘Conciliation’, we have necessarily to

refer to the functions of a ‘Conciliator’ as visualized by Part III of the 1996 Act. It is true, section
62 of the said Act deals with reference to ‘Conciliation’ by agreement of parties but sec. 89
permits the Court to refer a dispute for conciliation even where parties do not consent, provided
the Court thinks that the case is one fit for conciliation. This makes no difference as to the
meaning of ‘conciliation’ under sec. 89 because; it says that once a reference is made to a
‘conciliator’, the 1996 Act would apply. Thus the meaning of ‘conciliation’ as can be gathered
from the 1996 Act has to be read into sec. 89 of the Code of Civil Procedure. The 1996 Act is, it
may be noted, based on the UNCITRAL Rules for conciliation.

Role of conciliator:

The conciliator shall assist the parties in an independent and impartial manner in their
attempt to reach an amicable settlement of their dispute.

The conciliator shall be guided by principles of objectivity, fairness and justice, giving
consideration to, among other things, the rights and obligations of the parties, the usages
of the trade concerned and the circumstances surrounding the dispute, including any
previous business practices between the parties.
The conciliator may conduct the conciliation proceedings in such a manner as he
considers appropriate, taking into account the circumstances of the case, the wishes the
Legal aspects of Business-MB0051 Assignment Set 2 page:3 of 8
parties may express, including any request by a party that the conciliator hear oral
statements, and the need for a speedy settlement of the dispute.

The conciliator may, at any stage of the conciliation proceedings, make proposals for a
settlement of the dispute. Such proposals need not be in writing and need not be
accompanied by a statement of the masons therefore.

Conciliators do not:

Make decisions for disputing parties

Make judgments about who is right, who is wrong or what the outcome of the dispute
should be.
Tell people what to do
Make rulings
Force parties to participate in the conciliation process.

Question 3: What are the unfair trade practices under the MRTP Act?



The Monopolies and Restrictive Trade Practices Commission has been constituted under
Section 5(1) of the MRTP Act, 1969. The Commission is empowered to enquire into
Monopolistic or Restrictive Trade Practices upon a reference from the Central Government or
upon its own knowledge or information. The MRTP Act also provides for appointment of a
Director General of Investigation and Registration for making investigations for the purpose of
enquiries by the MRTP Commission and for maintenance of register of agreements relating to
restrictive trade practices.

The MRTP Commission receives complaints both from registered consumer and trade
associations and also from individuals. Complaints regarding Restrictive Trade Practices or
Unfair Trade Practices from an association are required to be referred to the Director General of
Investigation and Registration for conducting preliminary investigation. The Commission can
also order a preliminary investigation by the Director General of Investigation and Registration
when a reference on a restrictive trade practice is received from the Central/State Government, or
when Commission's own knowledge warrants a preliminary investigation. Enquiries are
instituted by the Commission after the Director General of Investigation and Registration
completes preliminary investigation and submits an application to the Commission for an

Unfair Trade Practices:

An unfair trade practice means a trade practice, which, for the purpose of promoting any sale, use or supply
of any goods or services, adopts unfair method, or unfair or deceptive practice.

1) False Representation:

The practice of making any oral or written statement or representation which:
Falsely suggests that the goods are of a particular standard quality, quantity, grade,
composition, style or model;
Falsely suggests that the services are of a particular standard, quantity or grade;
Legal aspects of Business-MB0051 Assignment Set 2 page:4 of 8
Falsely suggests any re-built, second-hand renovated, reconditioned or old goods as new
Represents that the goods or services have sponsorship, approval, performance,
characteristics, accessories, uses or benefits which they do not have;
Represents that the seller or the supplier has a sponsorship or approval or affiliation
which he does not have;
Makes a false or misleading representation concerning the need for, or the usefulness of,
any goods or services;
Gives any warranty or guarantee of the performance, efficacy or length of life of the
goods, that is not based on an adequate or proper test;
Makes to the public a representation in the form that purports to be-
• warranty or guarantee of the goods or services,
• a promise to replace, maintain or repair the goods until it has achieved a specified
If such representation is materially misleading or there is no reasonable prospect that
such warranty, guarantee or promise will be fulfilled
Materially misleads about the prices at which such goods or services are available in the
market; or
Gives false or misleading facts disparaging the goods, services or trade of another person.

2) False Offer Of Bargain Price:

Where an advertisement is published in a newspaper or otherwise, whereby goods or

services are offered at a bargain price when in fact there is no intention that the same may be
offered at that price, for a reasonable period or reasonable quantity, it shall amount to an
unfair trade practice.

The bargain price, for this purpose means:

the price stated in the advertisement in such manner as suggests that it is lesser than the
ordinary price, or
The price which any person coming across the advertisement would believe to be better
than the price at which such goods are ordinarily sold.

3) Free Gifts Offer And Prize Scheme:

The unfair trade practices under this category are:

Offering any gifts, prizes or other items along with the goods when the real intention is
different, or
Creating impression that something is being offered free along with the goods, when in
fact the price is wholly or partly covered by the price of the article sold, or
Offering some prizes to the buyers by the conduct of any contest, lottery or game of
chance or skill, with real intention to promote sales or business.

4) Non-Compliance Of Prescribed Standards:
Any sale or supply of goods, for use by consumers, knowing or having reason to believe
that the goods do not comply with the standards prescribed by some competent authority, in
relation to their performance, composition, contents, design, construction, finishing or
Legal aspects of Business-MB0051 Assignment Set 2 page:5 of 8
packing, as are necessary to prevent or reduce the risk of injury to the person using such
goods, shall amount to an unfair trade practice.

5) Hoarding, Destruction, Etc.:

Any practice that permits the hoarding or destruction of goods, or refusal to sell the
goods or provide any services, with an intention to raise the cost of those or other similar
goods or services, shall be an unfair trade practice.

6) Inquiry Into Unfair Trade Practices:

The Commission may inquire into any unfair trade practice:

Upon receiving a complaint from any trade association, consumer or a registered
consumer association, or
Upon reference made to it by the Central Government or State Government
Upon an application to it by the Director General or
Upon its own knowledge or information.

Relief Available:

After making an inquiry into the unfair trade practices if the Commission is of the opinion
that the practice is prejudicial to the pubic interest, or to the interest of any consumer it may
direct that?

The practice shall be discontinued or shall not be repeated;

The agreement relating thereto shall be void in respect of such unfair trade practice or
shall stand modified.
Any information, statement or advertisement relating to such unfair trade practice shall
be disclosed, issued or published as may be specified
The Commission may permit the party to carry on any trade practice to take steps to
ensure that it is no longer prejudicial to the public interest or to the interest of the

However no order shall be made in respect a trade practice which is expressly authorized by
any law in force.

The Commission is empowered to direct publication of corrective advertisement and

disclosure of additional information while passing orders relating to unfair trade practices.
Legal aspects of Business-MB0051 Assignment Set 2 page:6 of 8
Question 4: What are essentials of a valid offer?

A proposal is an expression of will or intention to do or not to do something. It is also called an "offer". It is
one of the essential elements of an agreement. It is the very basis of the contract. It becomes a promise when it
accepted. Section 2 (a) of the Contract Act defines the proposal as "when one person signifies to another his
willingness to do or to abstain from doing anything, with a view to obtaining the assent of that other, to such act or
abstinence, he is said to make a proposal". The person making the proposal is called the proposer or offer or the
promisor. The person to whom the proposal is made is called the offer or promise.
For example; Sunil offers to sell his car to Padmaja for Rs. 50000. This is a proposal. Sunil is the offer and Padmaja
is the offer.

An offer may be express or implied. An offer which is expressed by words, written or spoken, is called an
express offer. An offer which is expressed by conduct is called an implied offer. An offer may be positive or
negative. It may be in the form of a statement or a question.
for example; Sridhar says to Radhika that he will sell his scooter to her for Rs.20000. This is an express offer.

The Karnataka State Road Transport Corporation runs omnibuses on various routes to carry passengers at
the scheduled fares. This is an implied offer by KSRTC.

The offer must be made in order to create legal relations otherwise there will be an
agreement. If an offer does not give rise to legal obligations between the parties it is not a valid
offer in the eye of law. In business transactions there is a presumption that the parties propose to
make legal relationships. For example a person invite to another person to diner if the other
person accepts the invitation then it is not any legal agreement between the parties it is social

An offer must be definite and clear. If the terms of an offer are not definite and clear it
cannot be called a valid offer. If such offer is accepted it cannot create a binding contract. An
agreement to agree in future is not a contract because the terms of an agreement are not clear. A
person has two motorbikes. He offers to another person to sell his one bike for a certain price
then it is not a legal and valid offer because there is an ambiguity in the offer that which
motorcycle the person wants to sell. There is a difference between the offer and invitation of
offer. Sometime people offer the invitation for the sale.

Essentials of a valid offer:

A valid offer must intend to create legal relations. It must not be a casual statement. If the offer is not intended
to create legal relationship, it is not an offer in the eyes of law e.g. Sunil invites Sridhar to a dinner party and
Sridhar accepts the invitation. Sridhar does not turn up at the dinner party. Sunil cannot sue Sridhar for breach
of contract as there was no intention to create legal obligation. Hence, an offer to perform social, religious or
moral acts without any intention of creating legal relations will not be a valid offer.

The terms of an offer must be definite, unambiguous and certain. They must not be loose and vague. A promise
to pay an extra Rs. 500 if a particular house proves lucky is too vague to be enforceable. E.g. Sridhar says to
Sunil "I will give you some money if you marry my daughter". This is not an offer which can be accepted
because the amount of money to be paid is not certain.

An offer may be made to a definite person or to the general public. When offer is made to a definite person or
to a special class of persons, it is called "specific offer". When an offer is made to the world at large or public
in general, it is called "general offer". A specific offer can be accepted only by that person to whom it has been
made and a general offer can be accepted by any person. E.g. Sunil promises to give Rs.100 to Sridhar, if he
brings back his missing dog. This is a specific offer and can only be accepted by Sridhar. Sunil issues a public
advertisement to the effect that he would give Rs.100 to anyone who brings back his missing dog. This is a
general offer. Any member of the public can accept this offer by searching for and bringing back Sunil's
missing dog.
An offer to do or not to do must be made with a view to obtaining the assent of the other party. Mere enquiry is
not an offer.
Legal aspects of Business-MB0051 Assignment Set 2 page:7 of 8
An offer should may contain any term or condition. The offeror may prescribe any mode of acceptance. But he
cannot prescribe the form or time of refusal so as to fix a contract on the acceptor. He cannot say that if the
acceptor does not communicate his acceptance within a specified time, he is deemed to have accepted the offer.

The offeror is free to lay down any terms any terms and conditions in his offer. If the other party accepts it,
then he has to abide by all the terms and conditions of the offer. It is immaterial whether the terms and
conditions were harsh or ridiculous. The special terms or conditions in an offer must be brought to the notice of
the offeree at the time of making a proposal.

An offer is effective only when it is communicated to the offeree. Communication is necessary whether the
offer is general or specific. The offeror may communicate the offer by choosing any available means such as a
word of mouth, mail, telegram, messenger, a written document, or even signs and gestures. Communication
may also be implied by his conduct. A person can accept the offer only when he knows about it. If he does not
know, he cannot accept it. An acceptance of an offer, in ignorance of the offer, is no acceptance at all.

It should be noted that an invitation to offer is not an offer. The following are only invitations to
offer but not actual offers:

Invitations made by a trade for the sale of goods.

A price list of goods for sale.
Quotations of lowest prices.
An advertisement to sell goods by auction.
An advertisement inviting tenders.
Display of goods with price-tags attached.
Railway time-table.
Prospectus issued by a company.
Loud speaker announcements.

Question 5: Find out a case where a person appealed under the Consumer protection Act
and won.

The Consumer Protection Act was born in 1986. It is described as a unique legislation of
its kind ever enacted in India to offer protection to the consumers. The Act is claimed to have
been designed after an in-depth study of consumer protection laws and arrangements in UK, the
USA, Australia and New Zealand. The main objective of this Act is to provide better protection
to the consumers. Unlike other laws, which are punitive or preventive in nature the provisions of
this Act are compensatory in nature. The Act intends to provide simple, speedy and inexpensive
re-dressal to the consumer’s grievances.
Legal aspects of Business-MB0051 Assignment Set 2 page:8 of 8
Question 6: What does the Information Technology Act enable?

Information Technology Act:

In May 2000, at the height of the dot-com boom, India enacted the IT Act and became
part of a select group of countries to have put in place cyber laws. In all these years, despite the
growing crime rate in the cyber world, only less than 25 cases have been registered under the IT
Act 2000 and no final verdict has been passed in any of these cases as they are now pending with
various courts in the country.

Although the law came into operation on October 17, 2000, it still has an element of
mystery around it. Not only from the perception of the common man, but also from the
perception of lawyers, law enforcing agencies and even the judiciary.

The prime reason for this is the fact that the IT Act is a set of technical laws. Another
major hurdle is the reluctance on the part of companies to report the instances of cyber-crimes, as
they don't want to get negative publicity or worse get entangled in legal proceedings. A major
hurdle in cracking down on the perpetrators of cyber-crimes such as hacking is the fact that most
of them are not in India. The IT Act does give extra-territorial jurisdiction to law enforcement
agencies, but such powers are largely inefficient. This is because India does not have reciprocity
and extradition treaties with a large number of countries.

The Indian IT Act also needs to evolve with the rapidly changing technology
environment that breeds new forms of crimes and criminals. We are now beginning to see new
categories and varieties of cyber-crimes, which have not been addressed in the IT Act. This
includes cyber stalking, cyber nuisance, cyber harassment, cyber defamation and the like.
Though Section 67 of the Information Technology Act, 2000 provides for punishment to
whoever transmits or publishes or causes to be published or transmitted, any material which is
obscene in electronic form with imprisonment for a term which may extend to two years and
with fine which may extend to twenty five thousand rupees on first convection and in the event
of second may extend to five years and also with fine which may extend to fifty thousand rupees,
it does not expressly talk of cyber defamation. The above provision chiefly aim at curbing the
increasing number of child pornography cases and does not encompass other crimes which could
have been expressly brought within its ambit such as cyber defamation.
Operations Management-
OM 0010

Assignment Set – 2
Operations Management-OM 0010 Assignment Set 2 page:1 of 8
Q1. Following table shows figures of weekly demand for a certain brand of toilet soap at a
retail store, in the past eight months.
Period Demand
1 32
2 20
3 47
4 31
5 24
6 50
7 38
8 42
Determine the forecast for the demand of that brand of toilet soap in the 9th week by the 5-
month moving average method.
If the actual demand for the soap in the 9th week turns out to be 56 nos, what would be the
Forecast for the 10th week, calculated on the same basis?
(a) Demand Forecast for the 9th week is given by the average of the respective demands for the
previous 5 weeks; i.e.,
F9 = (42 +38 + 50 + 24 + 31) / 5 = 185 /5 = 37 nos.
(b) Since the actual demand in the ninth month is 56 nos., then the
Forecast for the tenth month would be based on the new Moving
Average for the just previous five months, i.e.,
F10 = (56 +42 + 38 +50 + 24) / 5 = 210/5 = 42 nos.
Operations Management-OM 0010 Assignment Set 2 page:2 of 8
Q2. What do you understand by Line Balancing? Explain Johnson’s rule for sequencing
and how it is different from CDS algorithm.
Assembly Line Balancing, or simply Line Balancing (LB), is the problem of assigning
operations to workstations along an assembly line, in such a way that the assignment be optimal
in some sense. Line Balancing is used to achieve,
1. the minimization of the number of workstations;
2. the minimization of cycle time;
3. the maximization of workload smoothness;
4. the maximization of work relatedness;

Johnsons Algorithm of Sequencing

This algorithm is used for sequencing of n jobs through two work centres. The purpose is to
minimise idle time on machines and reduce the total time taken for completing all the jobs. There
are no priority rules since all jobs have equal priority. The order of the operations will be
machine1 first and machine 2 next.
The steps to be taken are:
i) Choose the job which has the shortest processing time in any of the two work centres.
ii) If it happens to be on machine 1, then load it first; if it is on machine 2, allot it for loading
iii) Eliminate this job. Continue this till all jobs have been allotted.
CDS algorithm given by Campbell, Dudek and Smith, gives m-1 solutions and we can choose
the most optimal between them. We will use the Johnsons rule by converting the number of
machines from m to 2, by considering differing combinations like 1 and m, then1+2, then M-1
and M, then 1+2+3 and a M-2, M-1 and M, and so on. This process is useful, when the numbers
of machines is small. We will work out a problem where we have 4 machines.

Q3. List out the seven forms of waste. Explain how 5S’s are used to eliminate them.
Toyota has recognized seven types of waste, which have been found to be applicable in
many different types of operations both service and production and which form the core of lean
Over-production: According to Toyota, producing more than what is immediately needed by
the next process in the operation is the greatest cause of waste.
Operations Management-OM 0010 Assignment Set 2 page:3 of 8
Waiting time: Waiting time is the pause between two inter-related processes (i.e. waiting for the
inputs from the previous process to get started with the next process). Equipment effectiveness
and labour effectiveness are two popular measures which are widely used to measure equipment
and labour waiting time, respectively.
Transport: Moving items around the operation does not add value. Layout changes which bring
processes closer together such as improvements in transport methods and workplace organisation
can all reduce waste.
Process: The process itself may be a source of waste. Several operations may exist only because
of poor component design or poor maintenance. As such, these processes can be eliminated.
Inventory: All inventories should become an objective for elimination. However, it can be
reduced only by tackling the causes of inventory.
Motion: Simplification of work is a rich source of reduction in the waste of motion. An operator
may look busy but sometimes no value is being added by the work.
Defectives: Quality waste is often very significant in operations. Total costs of quality are much
greater than that has traditionally been considered. It is, therefore, more important to address the
causes of such costs.
The 5-S terminology originated in Japan and even though the translation into English is
approximate, they are generally taken to represent the following:
1. Sort: Remove what is not needed and keep what is needed
2. Straighten: Position things in such a way that they can be easily reached whenever they are
3. Shine: Keep things clean and tidy; no refuse or dirt in the work area
4. Standardise: Maintain cleanliness and order. Ensure perpetual neatness
5. Sustain: Develop a commitment and pride in keeping to standards.

Q4. List various Q C Tools? How does Crosby’s absolute of quality differ from Deming’s
The basic tools for achieving quality control:
• Flow Chart

• Check sheet

• Histogram

• Pareto Analysis

• Scatter Diagram

• Control Chart

• Cause and Effect Diagram

Flow Chart: It is a visual representation of process, showing the various steps. It helps in
locating the points at which a problem exists or an improvement is possible. Detailed data can be
collected, analysed, and methods for correction can be developed.
Check Sheet: These are used to record the number of defects, types of defects, locations at
which they occur, times at which they occur, and the workmen responsible for its occurrence.
These sheets make a record of the frequencies of occurrence with reference to possible defect
causing parameter. It helps to implement a corrective procedure at the point where the
frequencies are more, so that the benefit of correction will be maximum.
Histogram: Histograms are pictorial representations of distribution of data. They are used to
record big volumes of data about a process. They reveal whether the pattern of distribution has a
single peak or many peaks and also the extent of variation around the peak value. This helps in
Operations Management-OM 0010 Assignment Set 2 page:4 of 8
identifying whether the problem is serious. When used in conjunction with parameters that are
comparable, the visual patterns help us to identify the problem which must be attended to.
Pareto Analysis: Pareto Analysis is a tool for dividing problem areas according to the degree of
importance and attending to the most important. Pareto principle, also called 80-20 rule, states
that 80 percent of the problems that we encounter arise out of 20 percent of items. If you find
that, in a day, you have as many as 184 assemblies having problems and there are 11 possible
causes. It is observed that 80 per cent of them, that is, 147 of them have been caused by just two
or three of them. It will be easy to focus on these two or three and reduce the number of defects
to a great extent.
Scatter Diagram: These are used when we have two variables and want to know the degree of
relationship between them. We can determine if there is any cause and effect relationship
existing between and its extent over a range of values. Sometimes, we assume that there is no
relationship, in which we can change one parameter making sure that it does not affect the
Control Charts :These are used to verify whether a process is under control. When variables
remain within a range, they will render the product and maintain the specifications. This is the
quality of conformance. The design parameters determine the range of permitted deviations.
Samples are taken and the mean and range of the variable of each sample (subgroup) is recorded.
The mean of the means, of the samples gives the control lines. Assuming normal distribution, we
expect 99.97 per cent of all values to lie within the Upper Control Limit (UCL) and Lower
Control Limit (LCL). Corresponding to + 3s. The graphical representation of data helps in
changing settings to bring back the process closer to the target.
Cause and Effect Diagram: In this diagram all possible causes are classified on quality
characteristics that lead to a defect. These are arranged in such a way that, different branches
representing causes connect the stem, in the direction of the discovery of the problem. When
each of them is investigated thoroughly, we will be able to pinpoint some factors that cause the
problem. We will also observe that a few of them will have cumulative effect or even a
cascading effect.
Deming Wheel
Deming wheel or PDSA Cycle, as it is called is a constant quality enhancing model; it
consists of a logical sequence of four repetitive steps for constant enhancement and learning
Demings approach is summarised in his 14 points.
Constancy of purpose for continuous improvement.
Adopt the TQM philosophy for economic purposes.
Do not depend on inspection to deliver quality.
Do not award any business based on price alone.
Improve the system of production and service constantly.
Conduct meaningful training on the job.
Adopt modern methods of supervision and leadership.
Eliminate fear from the minds of every individual, connected with the organisation.
Remove barriers between departments and people.
Do not exhort, repeat slogans, and put up posters.
Do not set up numerical quotas and work standards.
Give pride of workmanship to the workmen.
Education and training to be given vigorously.
State and show top managements commitment, for better quality and productivity.
Deming with the help of the above principles gave a four step approach to ensure a purposeful
journey of TQM. The slope illustrated in figure 1 is used to indicate that, if efforts are let up, the
programme will roll back.
Operations Management-OM 0010 Assignment Set 2 page:5 of 8

Figure 1: Deming Wheel

The explanation for every quarter of the Deming Wheel, shown in the above figure is as follows:
Plan means that a problem is detected, processes are stated and relevant theories are checked out.
Do means that the plan is implemented on a trial basis. All inputs are correctly measured and
Check means that the trials taken according to the plan are in accordance with the expected
Act means that regular production is started, so that quality outcomes are assured when the
above steps are satisfying.

Crosbys Absolutes of Quality

Like Deming, Crosby also lays emphasis on top management commitment and
responsibility for designing the system so that, defects are not inevitable. He requested that there
should be no restriction on spending for achieving the best quality. In the long run, maintaining
quality is easier and cheaper or economical rather than compromising on its achievement.
Crosbys absolutes are listed below:
Quality is conformance to requirements, not goodness.
Prevention, not appraisal, is the path to quality.
Quality is measured as the price paid for non-conformance and as indexes.
Quality originates in all factions. There are no quality problems. It is the people, design, and
process who create problems.
Crosby has also given 14 points similar to those of Deming. His approach stresses on, increasing
awareness, measurement of quality, error cause removal, corrective action, and continuously
reinforcing the system, so that advantages derived are not lost over time. He intends that the
quality management regimen must improve the overall health of the firm or organisation and
prescribed a vaccine.The ingredients of the vaccine are:
Commitment Integrity and honesty to produce everything right first time and every time.
Communication Flow of information between suppliers, departments, customers helps in
recognising opportunities.
Systems and operations These must bring in a quality environment so that everybody is
uncomfortable with anything less than the best.
Operations Management-OM 0010 Assignment Set 2 page:6 of 8
Q5. Explain two different Independent demand item techniques.
Independent demand item techniques are subdivided into:
• Reorder point (or Perpetual) Model

• Periodic review models

Reorder Point (or Perpetual) Model

The Reorder Point (ROP) or Perpetual model formula allows determining the Safety Stock (SS)
required to achieve a certain cycle service level. In general, the longer the lead times and greater
the variability of demand and lead times, more is the need for safety stock.
Assume that an inventory holding is continually depleted. The ROP is that level of inventory
which is just sufficient to help during the period that it takes for your supplier to deliver. More
precisely, it is the forecasted demand expected during the lead time.
Of course the demand during the lead time may not materialise as we expect, if:
Demand is lower than expected. You experience excess of stock when the new shipment is
Demand is higher than expected. You experience a shortage or stock-out before the shipment is
To allow this possibility, SS is maintained. As a result, the formula for the reorder point is:
DLT = forecast demand during the lead time = expected average demand per period x number of
periods for lead time
SS = Safety Stock
A well-used variation of the ROP inventory model is called the two bin system. Here each
inventory item is literally kept in two bins, side by side. Inventory is drawn out from the first bin
until it is empty. This is the ROP. There is sufficient inventory in the second bin to cover
expected demand during the delivery lead time. It is a simple, visual system that is commonly
used for low-cost C type items. Figure 2 illustrates the sawtooth pattern.

Figure 2: ROP Inventory Model
Periodic Review Model
In many cases, it is more practical to order several items at the same time, in case if there is a
common supplier. So it makes sense to review all items from the common supplier periodically
and order just what is needed. Normally inventory is topped to a target level, and for this reason
this model is also known as the mm/max model.
Operations Management-OM 0010 Assignment Set 2 page:7 of 8
This inventory model is still widely used because of the following common situations:
Where individual transactions are difficult to record
Where shelf life is a problem
Where joint orders are placed with a supplier
The first of these situations is rapidly disappearing in supermarkets, where there is increased use
of point of sale terminals.
The question with a periodic system is how often we must make the review. Usually, this is a
practical consideration, perhaps coinciding with a scheduled order delivery cycle.
Figure 3 graphically depicts the situation where L is the lead time, R is the review period and Q
is the order quantity.
Note that an order quantity determined at A must be sufficient to last through the review period
and the next lead time. And also note that the quantities are different for each review period.

Figure 3: The Periodic Review Model

The relevant formulas are:
M = DL+DR+SS where,
M = Target inventory level
DL = Forecast demand during the lead time
DR= Forecast demand during the review period
SS = Safety stock
Q = M I-O = D (R+L) + SS (I+O) where,
Q = Order quantity
M = Target Inventory level
I = quantity on hand
O = quantity on order
Operations Management-OM 0010 Assignment Set 2 page:8 of 8
Q6. What is Failure? Explain with an example. Name the mechanisms to detect failure.
There is always a chance that in developing a product or providing a service, things
might go wrong. Mistakes are inevitable and are an intrinsic part of life. Nothing is perfect.
Accepting that failure occurs is not equivalent to ignoring it, and this does not imply that
operations cannot or should not attempt to minimize failure. Not all failures are equally serious.
Some failures are incidental and may not be noticed. In the finale of a concert performance a
violinist may play a wrong note and the effect is unlikely to have any great impact. If he or she is
giving a solo performance, however, then the error may sour the whole performance. The concert
like all systems may be more tolerant to some types and some levels of failure than others.
A failure can also be a process failure, wherein the activity is completed successfully but a
person may still feel dissatisfied if the underlying process is perceived to be below expected
standard or benchmark.
Example: If the cigarette lighter in a car or the pen used by a police officer to write a statement
fails, the effect may be irritating but not necessarily serious. Conversely, the failure of one
component of a system may threaten the whole system. For example, leaking hydraulics in a car
or a prisoner not informed of his or her rights can put the whole process at risk.

Mechanisms to Detect Failure

In-process checks: Employees check if the service is acceptable during the process itself.
Although in some situations this form of failure detection can detract from the service itself.
Machine diagnostic checks: A machine is tested through a prescribed sequence of activities
designed to expose any failures or potential failures. Computer servicing procedures often
include this type of check.
Point-of-departure interviews: At the end of a service, staff may formally or informally check
if the service has been satisfactory and try to solicit problems as well as compliments.
Phone surveys: These can be used to solicit opinions about products or services. Television
rental companies, for example, may check on the installation and servicing of equipment in this
Focus groups: These are groups of customers who are requested to focus on some aspects of a
product or service. These can be used to discover either specific problems or more general
attitudes towards the product or service.
Complaint cards or feedback sheets: These are used by many organisations to solicit views
about the products and services. The problem with this method is that very few people tend to
complete them. It may possible, however, to identify the respondents and so follow up on any
individual problem.
Questionnaires: These may generate a slightly higher response than complaint cards. However,
they may only generate general information from which it is difficult to identify specific
individual complaints.
Enterprise Resource Planning
OM 0011

Assignment Set – 2
Enterprise Resource Planning OM 0011 Assignment Set 2 page:1 of 8
Q1:What is web ERP? What are its benefits? List out the different modules under ERP
Inventory management

Web ERP has become a necessity for businessmen to be aware of their stock and inventory from
anywhere, at anytime. Web ERP is an absolute web-based ERP system that requires only a web
browser and PDF reader. It has now become an open source application and is offered as a free

Web ERP systems are gaining popularity than ever. It allows businessmen to update their
systems in large organisations without the need of installing updates at any remote locations,
almost immediately. It provides real time information about finance, inventory, employee
management, etc by providing advanced levels of service to consumers and suppliers

8.3.1 Benefits of Web ERP

Web ERP Inventory system has many benefits. Some of them include:

· It processes data on the server side. Therefore, no installation is required on the client

· It provides Multilanguage support; users can view the interface in their preferred language.

· It provides Multi-theme support; users can view the interface in their preferred graphical theme.

· It runs on any web server and suitable for both high speed and low speed internet connections.

· It can be installed on any device that has internet access.

Web ERP is developed using PHP as a web development language. These scripts are developed
with stability and ease so that the application becomes readable with a minimum knowledge of
scripting in PHP and the structure of ERP.

The logic is made as clear and simple as possible in order to remove any generalisation from the
code, and to make it readable for all kinds of employees. It can also be configured easily on any
operating system and the processing constraints required are also economical.

Web ERP has many features that make it suitable for maintaining organisations of different
sizes. It provides an easy structure of processing by supporting features such as multiple
inventory locations and multiple currencies. .Web ERP maintains all records that provide
information like, amount of inventory stock available, amount of inventory ordered, amount of
inventory sold, and amount of inventory that is defective.

ERP Inventory management module takes care of transactional workflow in an organisation in

sequential order. ERP Inventory module is subdivided into different modules such as:

Inventory requisition: The function of inventory requisition is to take the inventory constraints
from various departments of an organisation. This is achieved when various departments fill the
inventory requisition form. On filling the form, the head of the department fills up the
quantity/quality of the inventory required, considering the minimum inventory required,
maximum inventory required, and the current inventory available.
Enterprise Resource Planning OM 0011 Assignment Set 2 page:2 of 8
Inventory order assessment: Once the form is filled, inputs are taken from the form and
processed. The inventory wanted by the various departments is compared with the minimum
inventory required. Once the comparison is done, the final requirement for various departments
is fixed and a list of suppliers for the inventory is then formulated

Inventory placing: Once the supplier is chosen, an order is placed by filling the order form

Supplier Performa: In this sub module, the supplier provides quotation for further transactions

Order received: In this sub module, a comparison between order placed and order received is
recorded i.e. a comparison is done between Date of placing order with Date of receiving order,
and Quality with Quantity of order placed. Once the comparison is done, the amount to be paid
to the supplier and the mode of payment is decided.

· Quality checks: It is necessary to check if the deliverables have met the expected outcome.
Therefore, quality check becomes an important phase where Research and Development(R &D)
department performs a check and the department head acknowledges it by filling up a quality
assessment form.

· Inventory bills and challans: In order to ensure safe payment, bills and challans are chosen to
represent the amount paid, payment mode along with the ID of supplier and Receipt ID.

· Minimum inventory assessment: Minimum inventory assessment aims at assessing minimum

inventory inputs or requirements from various departments of an organisation. The assessment is
done by preparing a Performa which is circulated to various departments and they are expected
to fill up their minimum inventory requirements. This assessment is done, considering various
factors such as costumers order received, inventory in hand and scrap.

· Minimum inventory requirement: Minimum inventory requirement is the amount of

inventory less than which employees cannot work i.e. it is that minimum amount of inventory
required to perform any task.

· Maximum inventory assessment: In this sub module an assessment is done for maximum
amount of requirements. This information is gathered from various departments to guarantee that
no wastage happens. The assessment is done by considering factors such as customers order
received, inventory in hand, etc.

· Maximum inventory requirement: It is the amount of inventory which is sufficient to

perform any task.

Q2:Briefly explain the functionalities of CRM sub modules. List out the benefits of CRM

Sub Modules in CRM

The functionality of a CRM system can be studied under three sub modules. They are
Marketing, Service and Sales. All these modules are Operational, Collaborative and Analytical.
Marketing Module

The functionalities of marketing module of CRM comprises short term execution of marketing
related activities and long term planning within a company. It also helps in activities like
Enterprise Resource Planning OM 0011 Assignment Set 2 page:3 of 8
campaign management, lead management, and planning. Marketing module enables your
company to run marketing campaigns using different communication channels. This targets
potential buyers using a product or a group of products as a message. It generates sales related
opportunities which then can be converted into sales.

Service Module

The service module of CRM focuses on managing planned and unplanned customer service. This
module helps in activities such as Service Order Management, Service Contract Management,
Planned Services management, Warranty Management, Installed Base (Equipment)
Management, Service-Level Agreement Management, Resource Planning and Scheduling and
Knowledge Management

Sales Module

The sales module of CRM focuses on managing and executing the pre-sales process of the
company by making it more organised. The sales teams in most companies are responsible for
capturing opportunities and customer interaction. The CRM helps the sales team in processing
this data and following-up it in the future. The CRM also helps in organising all relevant data
received and captured for a deal, into one place. Some of the captured data can include expected
budget, total spending, prospective customers, key players, products interested in, important
dates and expected closing dates of a deal.

Each of these modules can be stand alone applications depending on organisational need. It is
important that the right software is selected and implemented correctly. Then only any CRM can
be effective.

Benefits of CRM

An excellent CRM is the heart of every business success. With CRM, you can easily understand
customer requirements, meet those needs effectively, predict market trends and enhance your
business bottom line.

A properly implemented CRM system can bring significant benefits to your organisations.
System means, the complete consortium of 3 P’s, People (employees, culture), Procedures (way
of doing business), and Programs (supporting applications and not just an application running on
a computer). The advantages that a CRM can bring are:

· Shared or distributed data: Customer relationships are happening at many levels and not just
through customer service or a web presence. They start to understand the need for sharing all
available data throughout the organisation. A CRM system is an enabler for making decisions
and follow-up at levels.

· Better customer service: All data concerning interactions with customers is centralised. The
customer service department can greatly benefit from this because they have all the information
they need. And through the use of push-technology, customer service representatives can lead
the customer towards the information they need. The customer experience is greatly enhanced.
· Increased customer satisfaction: The customer feels that he is more "part of the team" instead
of just a subject for sales and marketing. Customer service is better and the needs of the
customer are anticipated and addressed. Many companies believe that more satisfied customers
means a good predictor for repeat business.
Enterprise Resource Planning OM 0011 Assignment Set 2 page:4 of 8
· Better customer retention: If a CRM system can help to fascinate customers, it increases
customer loyalty. Customers keep coming back to buy again and again. Hence, higher customer
retention is assured

· More business: If you are delivering the ultimate customer experience, this seeds the word-of-
mouth buzz, which brings in more new business.

· More profit: More business at lower cost equals more profit.

Q3:Illustrate the role of ERP systems in Human Resources. List out the benefits of Human
Resource management systems.

Human Resource maintains huge volumes of information of employees and becomes

complicated and difficult for management. Therefore, Enterprise Resource Planning (ERP) that
maintains a centralised database is a powerful tool that can be deployed to maintain an efficient

ERP[3] maintains a database which includes employee details such as contact information, salary
details, attendance, promotion details, and performance details of all employees.

Deploying ERP in Human Resources department reduces processing time and cost issues. ERP
system also helps in decision making and controlling reports. Communication within the
departments of an organisation is very necessary. ERP systems also maintain policies and
standards, suggestion box, opinion surveys, business calendar, recruitment letters, news, forum
and other related features of the organisation

Human Resource (HR) technology bridges the gap between Human Resource Management
(HRM) and information technology. The activities of human resources are generally specific to
company’s norms and policies and vary from one organisation to the other. The function of HR
can vary from keeping track of employees’ skills, achievements and salary. To reduce the burden
of manually managing activities of the organisation, electronic automated process has become

The HRM systems mainly have two objectives. They are:

· To make the workflow cost effective and less time consuming.

· To provide self service benefits to the employees of an organisation. To provide flexibility to

the employees to change their policies taken, update their contact information anytime, etc.

The HRM system has many benefits. This system has many portals that help the HR department
to work faster and efficiently. Some of them include:

· HR employee portal: This portal maintains information such as attendance, leave records and
other employee related activities.
· Employee self service portal: This portal helps employees to avail or claim for travel expenses
and other benefits of an organisation.
Enterprise Resource Planning OM 0011 Assignment Set 2 page:5 of 8
· Security portal: This portal maintains security of an organisation by keeping track of the
visitors visiting the organisation.

· Candidate portal: This portal maintains information of candidates applying for jobs advertised
by the HR department.

The various advantages that the Human Resources derive from deploying ERP system are listed

· Automates the processes which requires minimum customisation

· Allows the user to access computing support for different departments of an organisation

· Provides security of information as database is made centralised

· Facilitates users to authorise accommodating processes between various departments of an

organisation and external agents

· Allows instant updates of information in the database

· Provides access to every employee to browse information such as personnel development, and
personal costs

Q4:Describe how you would go about the different phases of the ERP implementation
lifecycle, if it were being done in your company

One important factor that must be realised is that the post-implementation phase is very critical.
Once the implementation is over, the vendors and the hired consultants will go. To reap the full
benefits of the ERP system, it is very important that the system must get enterprise-wide
acceptance. There must be enough employees who are trained to handle the problems that might
crop-up. There must be people, within the company, who have the technical prowess to make the
necessary enhancements to the system as and when required. The system must be upgraded as
and when new versions or new technologies are introduced. Here the organisation must think in
terms of the incremental benefits of the new enhancements. Since with any up gradation or
enhancements, there will be a lot of other aspects like user training that have to be considered. So
instead of going in for up gradation when vendor announces a new version, the organisation
must first analyse the costs and benefits of he new version.

After finishing the entire phases of the ERP implementation the organisation will need a
different set of roles and skills than those with less integrated kinds of systems. It must be made
sure that every individual who uses these systems needs to be trained on how they work, how
they relate to the business process and how a transaction ripples through the entire company
whenever they press a key. The training will never end. It is an ongoing process. New people
will always be coming in, and new functionality will always be entering the organisation.

We need to know that, the conditions and measures that have to be adopted during the
implementation process are unique. The same cannot be applied by the management of the
company after the implementation. Different set of guidelines and measures have to be adopted
for successful functioning of the system after the implementation. Projects on the ERP system
implementation get a lot of resources and attention. However, an organisation can only get the
maximum value of these inputs if it successfully adopts and effectively uses the system.
Enterprise Resource Planning OM 0011 Assignment Set 2 page:6 of 8
Q5:Discuss briefly about JD Edward’s and PeopleSoft’s applications and their various

PeopleTools is an integrated set of client/server business application development and

customisation tools from PeopleSoft. These tools enable customers to implement, modify, and
maintain PeopleSoft applications as well as to extract, analyse and manipulate data. PeopleTools
includes several tools for reporting, customisation and workflow.

PeopleSoft continually adds and refines technology to optimise their customer’s information
systems. They help customers take advantage of new and emerging technologies, giving them
more choices and freedom to develop their own innovative business processes. Some of them are
given below:

· Self-Service Applications: Helps to improve productivity throughout the organisation.

PeopleSoft focuses on providing the occasional user with easy access to information and
functionality specific to their role. They have developed a set of self-service applications to help
companies quickly and cost-effectively distribute functionality throughout the enterprise over the
Internet, and intranets. Built with a spontaneous interface based on a standard Web browser such
as Netscape Navigator or Microsoft Explorer. These Java-based, cross-platform applications
enable employees, customers, suppliers, and other occasional users to perform self-service
administrative tasks easily. Self-service applications are linked to PeopleSoft core product lines.
Such as PeopleSoft Accounting and Control, Human Resources Management, and Materials

· Web Client: Self-service applications use the PeopleSoft Web Client. The Web Client is
downloadable on demand and runs on a Web browser across multiple platforms. Its affordability,
open architecture and simplicity provide an ideal framework for delivering enterprise solutions
to a large number of people. Applications don’t need to be installed at every desktop; they are
accessed easily through a browser. In addition to supporting self-service applications, the
PeopleSoft Web Client has a Work list and Query interface. This improves the flow of the
company’s business processes and improves access to information for occasional users.
Furthermore, all data transmitted between the Web Client and the application server is coded for
added security. Because the Web Client takes advantage of PeopleTools, self-service
applications can be deployed across the Internet or existing corporate intranets with common
business rules workflow logic and security features.

· Multi-layer Transaction Processing: The ability to support large numbers of parallel users,
while maintaining reliable, and superior performance, is critical to enterprise-wide data
processing. PeopleSoft works in a variety of settings over Local Area Networks (LANs) and
Wide Area Network (WANs), throughout organisations. In the latter, the application logic runs
on an application server instead of the client. The application server is designed to relieve the
client from processing intense SQL transactions, thereby reducing LAN traffic and improving
performance across WANs. Three layered architecture also provides increased scalability to
accommodate high volumes of parallel users while maintaining a consistent and reliable
performance level. PeopleSoft continues to support its traditional two layered architecture as

· OnLine Analytical Processing (OLAP): Companies must be able to quickly extract and
analyse the information they require for effective decision-making. OLAP, or online analytical
processing, is a powerful method for interactively analysing data online. PeopleSoft integrates
popular OLAP tools including Cognos PowerPlay and Arbor Essbase that enable users to easily
Enterprise Resource Planning OM 0011 Assignment Set 2 page:7 of 8
share multidimensional data stored in various locations. With the Cube Manager application,
users can define the data they want to extract into an OLAP cube. It enables them to quickly
view information from all different angles to test conclusions, conduct what-if scenarios and
compare alternative strategies. With multidimensional information presented in quick-read
formats, managers can make better decisions, react faster to competitive threats and identify

· Workflow: An essential part of the solution, PeopleSoft workflow capabilities help

communications companies achieve enterprise-wide integration of information, applications, and
people. Workflow enables a company to automate many time-consuming clerical tasks, while
putting useful data into the hands of users. With workflow, the company’s PeopleSoft
applications do more of the work. For example, if managerial approval is needed for a work
order, the system automatically forwards the request. Workflow can also help the company track
projects, by initiating a workflow message to the appropriate person when a project exceeds a
predetermined cost. The company can even bring non-PeopleSoft users into the workflow
process, using e-mail systems and the Internet for collecting, and distributing data.

The different product modules available from JD Edwards are:

· Foundation Suite: Consists of Back Office, CASE Foundation, Environment/ Toolkit,

Financial Analysis Spreadsheet Tool and Report Writer, WorldVision GUI, Electronic Burst &

· Financial Suite: Consists of General Accounting, Accounts Payable, Accounts Receivable,

Fixed Assets, Financial Modelling and Budgeting, Multi-Currency Processing, Cash Basis
Accounting, Time Accounting)

· Logistics/Distribution Suite: Consists of Forecasting, Requirements Planning, Enterprise

Facilities Planning, Sales Order Management, Advanced Pricing, Procurement, Work Order
Management, Inventory Management, Bulk Stock Management, Quality Management, and
Advanced Warehouse.

· Management: Consists of Equipment Management, Transportation Management, Job Cost and

Service Billing

· Services Suite: Contract Billing, Subcontract Management, Change Management, and Property

· Manufacturing Suite: Consists of Configuration Management, Cost Management, Product

Data Management, Capacity Planning, Shop Floor Management, and Advanced Maintenance

· Architecture, Engineering, Construction, Mining and Real Estate Suite: Consists of

Procurement, Inventory Management, Equipment Management, Job Cost, Work Order
Management, Subcontract Management, Change Management, Contract Management, Contract
Billing, Service Billing, Homebuilder Management, and Property Management.

· Energy and Chemical Suite: Consists of Agreement Management, Advanced Stock
Valuation, Sales Order Management, Bulk Stock Management, and Load and Delivery
Enterprise Resource Planning OM 0011 Assignment Set 2 page:8 of 8
· Government, Education, and Not-for-Profit Solutions: Consist of Financial Administration
and Reporting, Budget Administration, Fund and Encumbrance Accounting, Grant and
Endowment Management, Purchasing and Material Management, Warehousing and Central
Stores Management, Human Resources Management, Service and Work Order Management,
Capital Project and Construction Management, Contract Management, Plant, Equipment, and
Fleet Maintenance.

· Utility and Energy Solutions: Consists of Customer Information System, Human Resources
Management, Work Management, Regulatory Reporting, Supply Chain Management, Project
Management, Enterprise Maintenance Management.

JD Edwards offers customers the means of achieving greater ongoing control of their businesses.
It is enabled by their ability to define and redefine the way they do business as markets,
customers and competitive conditions change. Behind this customer commitment is a twenty-two
year history of listening to customers, understanding what they ask of business technology. At
the same time learning the problems and requirements of their industry and developing solutions
accordingly. By emphasising solutions, relationships, and value, JD Edwards maintains its focus
on what truly matters to its customers.

Q6:What is BAPI? Why BIAP is considered as commanding tool in the SAP consultant’s

BAPI (Business Application Programming Interface) is a set of interfaces to object-oriented

programming methods that enable a programmer to integrate third-party software into the
proprietary R/3 product from SAP. For specific business tasks such as uploading transactional
data, BAPIs are implemented and stored in the R/3 system as remote function call (RFC)

BAPI is the most dominant tool in the SAP consultant’s toolkit. It is one of a set of tools for
interfacing with an SAP R/3 system. The priority of BAPI is calling data in and out of SAP. For
the SAP consultant, BAPIs are the small, powerful ships that keep these barges of data moving.
SAP’s R/3 system is now open by releasing the specifications for some 170 business application
programming interfaces (BAPIs). This helped third-party applications interact with R/3 directly.
BAPIs can be called as sets of methods that allow external applications to collaborate with
specific R/3 business objects such as customers, accounts, or employees. As R/3 data is
addressable through callable methods, BAPIs gives flexibility to the third party application
vendors to build supporting applications for the R/3 system.
Supply Chain Management
OM 0012

Assignment Set – 2
Supply Chain Management OM 0012 Assignment Set 2 page:1 of 8
Q1: Explain briefly assessment tool

Schedule the Assessment

An assessment needs to be planned at least a month in advance of the consensus building

meeting. The appropriate length of time depends on the agendas of the executives that need to be
part of the assessment. Most frequently, planning starts 60 days before the consensus building
meeting. The activities that are involved in conducting the assessment usually occur during a
period of 10 to 14 days.

Figure shows a sample timeline of the activities that are required to conduct an assessment.

Sample Schedule for Conducting an Assessment

For each of the items in the assessment tool, as shown in Figure 8.2, respondent must choose a
score from 1 to 5 for the description that best represents the organisation’s management
practices. Note that only the scores 1, 3, and 5 are anchored in a short description. If the
respondent believes that the item is implemented between two descriptions (1-3 or 3-5), then the
value between those descriptions should be chosen (2 or 4). Using Figure 8.2, as an example, if
the respondent believes that the organisation is between a 3 (We segment customers by classes of
trade) and 5 (We segment customers based on profitability, potential growth and strategic value),
then the appropriate response is a 4.
Supply Chain Management OM 0012 Assignment Set 2 page:2 of 8

Example of Customer Relationship Management Assessment Tool

There might be items in the assessment tool that cannot be answered by a particular individual.
This may occur because the respondent is not familiar with the organisation’s approach to a
particular item.

Each item in the assessment tool includes a box with the option Don’t Know. Respondents
should choose this option if appropriate, rather than leaving the item blank. The fact that
someone does not know about a particular issue is useful information. If that person must know
more about the activity, providing them with the necessary information offers the opportunity for
a quick fix.

Because the assessment tool was designed to be used in any organisation, it is possible that an
individual activity may not be important to a specific organisation at a point in time. For this
reason, we ask participants to rate the important of each item on a three-point scale: minor
importance, important, critical, rating depends on the individual’s perception of the importance
of the item to the organisation’s success now and in the future.

It is important that respondents take the time to include a short justification for the score and the
importance they give to each item. This justification will be necessary during the consensus-
building session in order to explain their scores to the other participations. Completing the
assessment tool individually takes between 45 minutes and one hour. It is recommended that
respondents complete the assessment without interruption because the structure of the process
requires a sequence of thought that if interrupted might result in the respondent forgetting the
reasoning behind previous responses.

Q2:Analyse how Time based Process Mapping (TBPM) facilitates in analysing various
activities visually.

Time Based Process Maps (TBPM):

This mapping facilitates in representing and analysing the various activities visually. The
analysis of the tasks is done with respect to time. TBPM helps the organisation in a great regard
when the managers want to condense the time that is required for performing various activities.
Time compression is defined as the activity that facilitates in reducing or eliminating the
activities that do not add any value to the business of the organisation. The main objective of the
time compression task is to ensure that the productivity of the organisation is increased, the
Supply Chain Management OM 0012 Assignment Set 2 page:3 of 8
quality of the output is met, the cycle times and the lead times between various activities are
reduced. Time is an important unit of analysis; TBPM is the most popular type of mapping that
is considered by all the organisations for mapping the supply chain. It divides time into two
categories such as:

· Value adding time: It is the time in which the processing of the important tasks and activities
takes place. The activities that are able to benefit and add value to the business of the
organisation is processed.

· Non value adding time: It is defined as that time when various activities of the process results
in no loss or reduction in benefit to the customer of the organisation.

For example, consider the Time Based Process Maps (TBPM) for a book printer. The objective
of the process is to define and identify the activities that benefit and add value to the business of
the organisation[2].

Figure : An Example of a Time Based Process Maps

In the process of managing the supply chain, an activity is said to be adding value to the process,
if any one of the following conditions hold good such as:

· The customer accepts the task.
Supply Chain Management OM 0012 Assignment Set 2 page:4 of 8
· Term is physically changed.

· At the initial stage the task is carried right.

However, during the process of activities it is vital for the managers to clearly state the activities
that add value and the activities that do not add value. This further ensures that, the entities
participating in the activities are clear to proceed with the analysis of the task.

Q3:Discuss the different eras of Supply Chain Management. Sketch the traditional
objectives of SCM

Eras in Supply Chain Management

Six major movements are observed in the evolution of Supply Chain Management studies. They

1. Creation

2. Integration

3. Globalisation

4. Specialisation Phase I

5. Specialisation Phase II

6. Supply Chain Management 2.0

1. Creation Era

An American industry consultant in the early 1980s coined the term Supply Chain Management.
However, the perception of Supply Chain in management was of great importance in the early
20th century especially by the creation of the assembly line. The characteristics of this era of
Supply Chain Management, consists of requirement for large-scale changes, re-engineering,
downsizing driven by cost reduction programs, and widespread attention to the Japanese practice
of management.

2. Integration Era

This era of Supply Chain Management was highlighted with the development of Electronic Data
Interchange (EDI) systems in the 1960s. Integration Era developed through the 1990s by the
introduction of Enterprise Resource Planning (ERP) systems. This era has continued to develop
into the 21st century with the development of internet-based collaborative systems. This era of
Supply Chain evolution is characterised by both increasing value-added and cost reduction
through integration.

3. Globalisation Era
Globalisation era can be characterised by the attention towards global systems of supplier
relations and the expansion of Supply Chain over national boundaries and into other continents.
Although the use of worldwide sources in the Supply Chain of organisations can be traced back
to several decades ago (example, the oil industry), it was not until the late 1980s that a
Supply Chain Management OM 0012 Assignment Set 2 page:5 of 8
considerable number of organisations started to integrate global sources into their core business.
This era is characterised by the globalisation of Supply Chain Management in organisations with
the goal of increasing competitive advantage, creating more value added, and reducing costs
through global sourcing.

4. Specialisation Era Phase I: Outsourced Manufacturing and Distribution

In the 1990s, industries started to focus on “core competencies” and adopted a specialisation
model. Companies’ discarded vertical integration, sold off non-core operations, and outsourced
those functions to other companies. This changed management desires by expanding the Supply
Chain well.

Supply Chain specialisation enables companies to develop their overall competencies in the
same way that outsourced manufacturing and distribution has done. It allows them to concentrate
on their core competencies and assemble networks of best in class domain and specific partners
to contribute to the overall value chain itself, thus, increasing overall performance and
efficiency. The ability to quickly obtain and deploy this domain related Supply Chain expertise
without developing and maintaining a distinctive and complex competency in house is the
leading reason why Supply Chain specialisation is gaining popularity.

Outsourced technology for Supply Chain solutions debuted in the late 1990s and has taken root in
transportation and collaboration categories most dominantly. This has developed from the
Application Service Provider (ASP) model from approximately 1998 through 2003 to the On-
Demand model from approximately 2003-2006 to the Software as a Service (SaaS) model we are
currently focused on today.

5. Specialisation Era Phase II: Supply Chain Management as a Service

Specialisation within the supply chain started in the 1980s with the beginning of shipping
brokerages, warehouse management, and non asset based carriers. It has grown beyond shipping
and logistics aspects of supply planning, collaboration, execution and performance management.

Given at any moment, market forces could claim changes from suppliers, logistics providers,
locations, and from any number of specialised participants as components of supply chain
networks. This variability has important effects on the supply chain infrastructure. One of it is
from the foundation levels of establishing and managing electronic communication between the
trading partners.

6. Supply Chain Management 2.0 (SCM 2.0)

To build Globalisation and Specialisation, the term SCM 2.0 has been introduced. It describes
both the changes within the Supply Chain itself as well as the evolution of the processes,
methods and tools that manage it in this new "era

Traditional Objectives :

The major objective of Supply Chain Management is ‘Customer Satisfaction’ and to achieve this
all roadblocks are eliminated in-between ultimate customer and the raw material supplier. The
traditional objectives of Supply Chain Management are

· To minimise total Supply Chain cost to meet fixed and given demand.
Supply Chain Management OM 0012 Assignment Set 2 page:6 of 8
· To maximise the overall value generated.

· To maximise net revenue and gross revenues minus total cost.

· To comprise the right products in the right quantities at the right place at the right moment at
minimal cost.

Q4:“New information technologies have become critical to compete and create competitive
advantages to a firm.” Give a brief description on this topic.

New information technologies have become critical to compete and create competitive
advantages to a firm. Six emerging technologies which were thought to be most critical were:

· E commerce.

· Internet.

· Groupware.

· Automatic transaction system.

· Knowledge management.

· Modelling/Simulation.

Among these, E-commerce and Internet were viewed as most essential. Groupware refers to a
growing set of information technologies that enhance people’s interactions. Examples of
groupware are e-mail, video conferencing, electronic bulletin boards, and Lotus notes.

Overall, firms must recognise the strategic value of having timely and accurate logistics
information. The logistics information system must be considered as strategically important to
the overall firm. As a result, efforts at integrating logistics information requirements with the
capabilities of ERP systems must be successful

An Enterprises Resource Planning (ERP) system is an integrated transaction processing and

reporting system. ERP systems provide the means for tracking organisational resources, people,
processes, and technology. The system serves as the “backbone” to the organisation in terms of
providing the information and support required for making decisions

A typical ERP system is designed around four primary business processes. They are:
Supply Chain Management OM 0012 Assignment Set 2 page:7 of 8
· Selling a Product or Service: Customer order management process.

· Making a Product: Production planning and execution process.

· Buying a Product: Procurement process.

· Costing, Paying the Bills and Collecting: Financial/management accounting and reporting

Q5:Briefly explain the impact of Reverse Supply Chain Management on profitability

Impact of Reverse Supply Chain Management on Profitability

The intention of every organisation in implementing Reverse Supply Chain Management in its
business process is mainly to increase the profits and also to build the companies goodwill in the
eyes of its customers. This again would help in increasing the profits of the company.

Effective Reverse Supply Chain Management yields direct benefits that include improved
customer satisfaction, decreased inventory levels, and decrease in the distribution and storage
costs. Experts in this field have noted that, a well administered Reverse Supply Management
System would result in savings in transportation, inventory carriage and waste disposal cost and
also improves customer satisfaction. It can also be said that an effective Reverse Supply Chain
Management improves customer relationship, improves environmental regulatory obedience that
increases profitability of the organisations.

A well planned Reverse Supply Chain Management brings profits by utilising technology to
evaluate at the point of customer returns. Realising the critical nature of the returns process and
treating returns as perishable assets and by establishing the returns process as a high priority.

In order to earn maximum profits from the implementation of Reverse Supply Chain
Management organisations must first analyse as to how this will contribute to profits. This is an
activity that involves executive management. Initiatives that do not go hand in hand with
executive management either have little ability to support organisations profitability or will end
up in the closure of the firm

Q6:List down the impact of Information Technology in Supply Chain Management.

Impact of IT on Supply Chain Management

After we have assessed the developments of Information Technology applications in Supply

Chain Management, let us now examine the impact of Information Technology in various fields
of Supply Chain Management. We will also examine as to how Information Technology has
contributed to the performance improvement of Supply Chain, by improving efficiency and
thereby bringing in value addition.

The development in the field of Information Technology, in the last few decades has affected the
ways of doing business. With the recent developments in Information Technology, the concept
of Supply Chain management is gaining huge benefits to the organisations. The major reason for
organisations to opt for Information Technology in Supply Chain Management is, the complexity
involved in the process. For example, the use of internet increases the speed of communication,
through greater interactivity, between the organisations and customers. This demonstrates a
development in Supply Chain, towards online technology.
Supply Chain Management OM 0012 Assignment Set 2 page:8 of 8
Information sharing is the major aspect of Supply Chain Management in the process of incurring
profits, increasing performance, and efficiency of business. This has been made possible with the
implementation of Information Technology in Supply Chain Management. The various other
impacts of Information Technology on Supply Chain Management can be evaluated as follows:

· The popular impact of IT in Supply Chain is through the applications related to order
processing. This relates to placement of orders and checking for the status of the order placed.
This had helped in the reduction of cost in order processing, as detection and correction of errors
are done more accurately and easily.

· IT plays a great role in the management of purchases in the Supply Chains. This is possible
because of applications that assist in the communication with vendors, checking price quotes,
and in making purchases.

· IT helps the Supply Chain by assisting the process of tracking shipments to regional
warehouses. This provides the organisations with information on the consistent performance of
the delivery service it is using. This also enables the managers to make sure that the delivery
services that are in use, are meeting their agreed timelines. Reporting, processing, and settlement
of claims are now easier using the IT tracking system applications.

· IT has become vital in inventory management, which is one of the important aspects of Supply
Chain. The IT has facilitated organisations to establish EDI information programs with their

· IT has provided organisations with the facility to offer their customers ways to contact them,
with respect to issues related to the services. It also assists in integrating customer information.
Overall, it is of great use to both customers and the firms.

· The introduction of IT in Supply Chain Management has led to closer buyer and supplier
relationship, through high levels of information sharing.

· IT will assist organisations to deliver the best of services to their customers. For example, use
of internet for e-commerce allows the customers to get information related to the cost of a
product, place orders, track delivery, and pay bills.

Thus, we can conclude that, the impact of IT in Supply Chain Management is much larger as it
enables inter organisational communication and in turn, decreases cycle time and builds up
collaborative work.
Advanced production and
operations management
OM 0013

Assignment Set – 2
Advanced production & operations management OM0013 page:1 of 9
Assignment Set 2
Q1:Differentiate between Product layout and Fixed Position layout with examples

Physical layouts describe the actual placement of people or machines that take part in the
transformation process. Process choice and physical layout are closely linked. To a large extent,
process choice dictates the physical layout of the transformation process.

The process type is reflected in how the operation arranges its activities, or its layout.
Specifically, we now have to decide how the tasks that make up the operation are to be delivered.
The process type determines the nature of the tasks that are performed, for example, are these
project activities or are they part of the work in a line process? The layout determines where and
in what sequence activities that make up a process are located. The three basic layout types –
fixed, process, product and hybrid or cell layouts.

Fixed Position Layout

In a fixed position layout[1], the product or person being acted on remains in one place, while
operations take place around it. Workers come to the product (or to the production location)
instead of the product moving between workers and work centres. Workers carry out single or
multiple activities to modify a product or provide a service until completion.

Fixed-position layouts are used in services, for example, in dental or surgical treatments where
the patient remains in a single location while being treated. In manufacturing, the production of
heavy, bulky or fragile products, such as ships and airplanes, and most construction projects take
place with the people and machines moving around the product. Fixed position layouts are
associated generally with lower volume process types – most usually projects (as in
construction), but sometimes with jobbing processes (specialised contractors in construction) and
batch processes (as with the production of airplanes or construction of many types of the same
house on a housing development).

Product Layout

The product layout was developed during mass production, as an extension of the principles of
scientific management in the context of assembly-line production. In a product layout, people
and machines are dedicated to a single product or small range of similar products. Each
workstation is laid out in a sequence that matches the requirements of the product exactly, and
each stage is separate from the next stage. A typical product layout is as shown in Figure 7.3.
Advanced production & operations management OM0013 page:2 of 9
Assignment Set 2

A Typical Product layout

The sequence of operations in a product layout follows a straightforward sequence, where one
activity in the line cannot be started unless the previous activity has already been completed. In
manufacturing, the product layout is common in automobile assembly and other high volume
applications. In services, this layout can be found in high volume, standard services, especially
where there is a tangible element, such as fast-food preparation. IKEA, the furniture retailer, has
a product layout for its stores. People have to follow a pre-defined route through the store, from
one area to another. In this way IKEA achieve rates of customer throughput that few other
retailers can match. The operation does not need to be laid out in this manner – indeed, space
restrictions often dictate that a straight line cannot be used.

In line operations, workstations need to be located close together to minimise materials

movement. Materials flow and control is critical, especially in ensuring that there is a steady
flow of work to do and that both stock-outs (where materials run out) and large piles of Work-In
Process (WIP) are minimised. Because each workstation is dependent on the next, the speed of
the entire line is determined by the workstation with the lowest capacity. Furthermore, if a single
work centre is not operating the entire line comes to a halt very rapidly. Japanese automotive
manufacturers have made a feature of this for some time – if there is a problem with any part of
the operation, any worker can stop the line. This focuses attention on removing and preventing
recurrence of the problem, which would be

Q2:What is new product development? Explain the impact of internet on new product

Process of developing a new product or service for the market. This type of development is
considered the preliminary step in product or service development and involves a number of
steps that must be completed before the product can be introduced to the market. New product
development may be done to develop an item to compete with a particular product/service or
may be done to improve an already established product. New product development is essential to
any business that must keep up with market trends and changes.
Product development is a broad field of endeavor dealing with the design, creation, and
marketing of new products. Sometimes referred to as new product development (NPD), the
Advanced production & operations management OM0013 page:3 of 9
Assignment Set 2
discipline is focused on developing systematic methods for guiding all the processes involved in
getting a new product to market.

There are a number of organizations dedicated to supporting product development professionals,

such as the Product Development and Management Association (PDMA) and the Product
Development Institute (PDI). According to the PDMA, the organization's mission is "to improve
the effectiveness of people engaged in developing and managing new products - both new
manufactured goods and new services. This mission includes facilitating the generation of new
information, helping convert this information into knowledge which is in a usable format, and
making this new knowledge broadly available to those who might benefit from

The second workshop was held to share information and identify common concerns regarding
the impact of the Internet on product development among the CENDI agencies. The design of
products, the impact of the Internet on the product development life cycle, and the speed with
which products need to be designed and then mature were discussed.

During the planning for the workshop, lead agencies were identified to give presentations on
their experiences and concerns, and to lead the discussions of the group on that topic. The
agenda developed for the meeting included a series of questions under each topic to guide the
lead agency's presentation and the discussions

Q3:What does the word TEAM stand for? What are the three essential elements in team

Decisions on controlling teamwork are really important as this helps in improving the
productivity of an organisation regarding the quality of work delivered. If teamwork is controlled
properly, it has positive impact on productivity.

The word TEAM is popularly known as:

T – Together

E – Everyone

A – Achieves

M – More

“Together Everyone Achieves More” shows the importance of teamwork at the workplace.

The best way to make people work more productively with no additional cost is through
teamwork. A high performing team plays a very vital role in improving the business. Through
teamwork, one can achieve something which is much bigger, more effective and enjoyable rather
than same individuals working individually on their own.

Team building skills is very important and valuable for any business and provides an extra edge.
It is an ongoing process. Through decades of trial and error method, the military has found that
when units of people play and compete together they start thinking as a group and find it easier
to work as complementary parts rather than as individuals. This also improves the
communication which helps them to function as a team.
Advanced production & operations management OM0013 page:4 of 9
Assignment Set 2
There are three essential elements for team building. They are:

· Goal: The team goal should be clearly shared and understood by all through strong
communication channels among the team members.

· Skills and personalities: Availability of a wide range of skills and personalities helps in
complementing strengths which can be used to support team goals and compensate the

· Factors affecting work: Factors affecting team work such as remote working and personal
differences should be either removed or overcome. Those factors should not be allowed to have
negative influence on the team

Q4:List out the inventory decision rules for MRP. Explain the basic strategies for CRP.

Many decision rules can be employed for lot sizing under MRP.

Static Lot-sizing Rules

The static lot sizing rule consists of:

1. Fixed order quantity (FOQ)

The organisation must order or produce a fixed quantity or a multiple of that fixed quantity must
be ordered or produced.

2. Economic Order Quantity (EOQ)

The organisation must order or produce the economic order quantity, plus any additional items
needed to refill safety stock, if it has fallen below its desired level. It yields minimum total
setup/ordering plus holding costs and

assumes relatively constant demand.

Dynamic Lot-sizing Rules

The dynamic lot sizing is made up of:

Lot-for-Lot (L4L)

The L4L rule specifies the following:

· The organisation must order or produce exactly the quantity required in each period, to satisfy
gross requirements and to maintain safety stock at its required level.

· This rule agrees with Just-In-Time philosophy of ordering/producing only when required and is
simple to use.
· Orders or production can be modified easily for purchase discounts or restrictions, scrap
allowances, process constraints and so on.
Advanced production & operations management OM0013 page:5 of 9
Assignment Set 2
· Maximises the number of orders placed and minimises on-hand inventory so can be expensive,
if setup/ordering costs are significant.

Periodic Order Quantity (POQ)

The POQ rule specifies the following:

· Order or produce a quantity equal to the gross requirements for P periods excluding any items
in on-hand inventory, plus any additional items needed to replenish safety stock, if it has fallen
below its desired level.

· Covers exactly P periods of gross requirements and keeps safety stock at constant level.

· Matches the quantity ordered to the quantity required and hence reduces on-hand inventory.

CRP was known since Taylor had showed, how to develop work standards when good computer
software was available early in the 1960s. Failure to develop adequate capacity planning resulted
from poor quality, incomplete processing data, and work standards in most companies. Rough
cut capacity planning techniques were applied to loading and sequence scheduling for the Model
401 computers and later to Capacity Planning and Operations Sequence Scheduling (CAPOSS)
for 370 series computer.

CRP is a technique that allows business to plan in advance. It also determines how large their
future inventory capacity needs to be, in order to meet demand. CRP helps companies to
determine how much space they will need, to hold these materials. It verifies that you have the
sufficient capacity to meet the capacity requirement for the MRP plans. Thus, it helps the
planners to take the correct decisions on scheduling before the problem develops.

The key elements of the CRP are establishing, measuring, and adjusting the limits or levels of the
production capacity. This depends on the process of determining the amount of labor and
machine resources required, to accomplish the tasks of production. Inputs to the CRP process are
the Order Entry modules in a MRP system, which facilitates translating the orders into hours of
work by the work center and by time period, via the use of parts routings and time standards.

CRP assists to determine the timing of capacity expansion. The basic strategies are:

Capacity Lead Strategy

It is a very aggressive strategy and is used to attract customers away from competitors. It is done
according to the expectations of demand and the capacity is increased.

Capacity Lag Strategy

It is done after the demand has increased and then the capacity is increased. It is a conservative
strategy and may result in loss of customers as, it assumes that customers will return after
capacity has been met, which might not be true.

Average Capacity Strategy
It is a moderate strategy, in this the average expected demand is calculated and then capacity is
increased accordingly
Advanced production & operations management OM0013 page:6 of 9
Assignment Set 2

Q5:Enumerate the importance of customer population in the waiting lines. Explain the multi-
server mode
Waiting Line systems is based on the queuing theory. Hence, it is also known as Queuing
systems. It consists of two important components and they are customer’s population source and
the system of service. Customer population can be finite or infinite, arrival process can be
random, and waiting area can be of limited length or more than waiting line. Also, customers can
be served based on first come first serve basis, can have a service area with one or more
channels, and the time taken to serve may be random.

the Customer population can be classified into finite or infinite. Customer population is
considered finite when the count of customers present affects the possible new customers’
service system which is already present in the system. However, the population is considered
infinite when the count of customers waiting in the line does not considerably affect the rate at
which the population makes new customers. The different ways in which customers behave
depend on the characteristics of waiting line. Table 11.1 explains the various processes that a
customer does in order to avoid waiting.

Various processes and their actions

Multi-server model

In this, there is a single phase and the input source is infinite with no balking and no reneging.
Poisson is the arrival distribution. is the mean arrival rate and exponential is the service
distribution with m as the mean service rate and as the mean service time. The waiting line is
single with unlimited length and based on the first come first serve priority order.

Operating characteristics of multiple-server are as follows:

Average utilization:

Probability that no customers are in the system:

Probability that n customers are in the system:
Advanced production & operations management OM0013 page:7 of 9
Assignment Set 2
Q6:Analyse the difference between Mass Production and Toyota Production System.

Dr. Shingo and Mr. Taiichi Ohno have invented/ rediscovered the Just in Time system-which has
become the backbone of the Toyota production system. The synergy created by this industrial
revolution and its powerful effects which influenced the international economic order.

Just-in-Time (JIT) Production is all about supplying customers with what they want and when
they want it and aims to minimize inventories by producing only what is required & when it is
required. Orders are "pulled" through the system when triggered by customer orders, not pushed
through the system in order to achieve economies of scale by producing larger batches.

After Second World War, Eiji Toyoda and Taiichi Ohno at the Toyota motor company in Japan
pioneered the
concept of Toyota Production System. The rise of Japan to its current economic pre-eminence
quickly followed,
as other companies and industries copied this remarkable system. Manufacturers around the
world are now
trying to embrace this innovative system, but they are finding the going rough. The companies
that first
mastered this system were all head-quartered in one country-Japan. However, many Western
companies now
understand Toyota Production System, and at least one is well along the path of introducing it.
this method on the existing mass-production systems causes great pain and dislocation

Production methods
The craft producer uses highly skilled workers and simple but flexible tools to make exactly
what the customer asks for—one item at a time. Few exotic sports cars provide current day
examples. We all love the idea of craft production, but the problem with it is obvious: Goods
produced by the craft method—as automobiles once were exclusively—cost too much for most
of us to afford. So mass production was developed at the beginning of the twentieth century as
an alternative.
The mass-producer uses narrowly skilled professionals to design products made by unskilled or
semiskilled workers tending expensive, single-purpose machines. These churn out standardised
products in very high volume. Because the machinery costs so much and is so intolerant of
disruption, the mass-producer keeps standard designs in production for as long as possible. The
result: The customer gets lower costs but at the expense of variety and by means of work
methods that most employees find boring and dispiriting.

Kanban system
Many people think the Toyota production system a Kanban system: this is incorrect. The Toyota
productionsystem is a way to make products, whereas the Kanban system is the way to manage
the Just-in-timeproduction method. In short, the kanban system is an information system to
harmoniously control theproduction quantities in every process. It is a tool to achieve just-in-
time production. In this system what kindof units and how many units needed are written on a
tag-like card called Kanban. The Kanban is sent to thepeople of the preceding process from the
Advanced production & operations management OM0013 page:8 of 9
Assignment Set 2
subsequent process. As a result, many processes in a plant are
connected with each other. This connecting of processes in a factory allows for better control of
necessaryquantities for various products. The Kanban system is supported by the following:
Smoothing of productionReduction of set-up time design of machine layout
Standardisation of jobsImprovement activities
A kanban is usually a card put in a rectangular vinyl envelope. Two kinds are mainly used:
A Withdrawal Kanban details the kind and quantity of product which the subsequent process
should withdraw from the preceding process, while a Production-ordering Kanban specifies the
kind and quantity of the product which the preceding process must produce.
The Withdrawal kanban in fig.2 shows that the preceding process which makes this part is
forging, and thecarrier of the subsequent part must go to position B-2 of the forging department
to withdraw drive pinions.The subsequent process is machining. The Kanban in fig.3 shows that
the machining process SB-8 mustproduce the crank shaft for the car type. The crank shaft
produced should be placed at store F26-18. These
cards circulate within Toyota factories, between Toyota and its many co-operative companies,
and within the
factories of co-operative companies. In this manner, the Kanban can contribute information on
withdrawal andproduction quantities in order to achieve Just-in-time production.
Suppose we are making products A, B, and C in an assembly line. The parts necessary to
produce these
products are a and b which are produced by the preceding machining line(fig.4). Parts a and b
produced by themachining line are stored behind this line, and the production-ordering Kanbans
of the line are attached to
these parts. The carrier from the assembly line making product A will go to the machining line to
withdraw thenecessary part a with a withdrawal kanban. Then, at store, he picks up as many
boxes of this part as his
withdrawal kanbans and he detaches the production-ordering kanban attached to these boxes. He
then bringsthese boxes back to his assembly line, again with withdrawal kanbans. At this time,
the production-orderingKanbans are left at store a of the machining line showing the number of
units withdrawn. These Kanbans will bethe dispatching information to the machining line. Part a
is then produced in the quantity directed by that
number of Kanbans. In this machining line, actually, parts a and b are both withdrawn, but these
parts areproduced according to the detached order of the production-ordering Kanbans.
In order to realise Just-in-time perfectly, 100 per cent good units must flow to the prior process,
and this flow must be rhythmic without interruption. Therefore, quality control is so important
that it must coexist with the Just-in-time operation throughout the Kanban system. Autonamation
means to build in a mechanism a means to prevent mass-production of defective work in
machines or product lines. Autonamation is not automation, but the autonomous check of
abnormality in the process.
Advanced production & operations management OM0013 page:9 of 9
Assignment Set 2
The autonomous machine is a machine to which an automatic stopping device is attached. In
Toyota factories,almost all the machines are autonomous, so that mass-production of defects can
be prevented and machine
breakdowns are automatically checked. The idea of Autonamation is also expanded to the
product lines ofmanual work. If something abnormal happens in a product line, the worker
pushes stop button, thereby
stopping his whole line. For the purpose of detecting troubles in each process, an electric light
board, calledAndon, indicating a line stop, is hung so high in a factory that it can easily be seen
by everyone. The Andon inthe Toyota system has an important role in helping this autonomous
check, and is a typical example of Toyota's