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- 1 (60 Marks) Note: Each question carries 10 Marks. Answer all the questions.
Vendor-managed inventory (VMI) is a family of business models in which the buyer of a product provides certain information to a supplier of that product and the supplier takes full responsibility for maintaining an agreed inventory of the material, usually at the buyer's consumption location (usually a store). A third-party logistics provider can also be involved to make sure that the buyer has the required level of inventory by adjusting the demand and supply gaps. As a symbiotic relationship, VMI makes it less likely that a business will unintentionally become out of stock of a good and reduces inventory in the supply chain. Furthermore, vendor (supplier) representatives in a store benefit the vendor by ensuring the product is properly displayed and store staff are familiar with the features of the product line, all the while helping to clean and organize their product lines for the store. One of the keys to making VMI work is shared risk. In some cases, if the inventory does not sell, the vendor (supplier) will repurchase the product from the buyer (retailer). In other cases, the product may be in the possession of the retailer but is not owned by the retailer until the sale takes place, meaning that the retailer simply houses (and assists with the sale of) the product in exchange for a predetermined commission or profit (sometimes referred to as consignment stock). A special form of this commission business is scanbased trading whereas VMI is usually applied but not mandatory to be used. This is one of the successful business models used by Wal-Mart and many other big box retailers. Oil companies often use technology to manage the gasoline inventories at the service stations that they supply (see Petrolsoft Corporation). Home Depot uses the technique with larger suppliers of manufactured goods (i.e. Moen, Delta, RIDGID, Paulin). VMI helps foster a closer understanding between the supplier and manufacturer by using Electronic Data Interchange formats, EDI software and statistical methodologies to forecast and maintain correct inventory in the supply chain.
Vendors benefit from more control of displays and more customer contact for their employees; retailers benefit from reduced risk, better store staff knowledge (which builds brand loyalty for both the vendor and the retailer), and reduced display maintenance outlays. Consumers benefit from knowledgeable store staff who are in frequent and familiar contact with manufacturer (vendor) representatives when parts or service are required. Store staff have good knowledge of most product lines offered by the entire range of vendors. They can help the consumer choose from competing products for items most suited to them and offer service support being offered by the store.
Q.2 Explain briefly the four classification of scheduling strategies & its approaches. ANS:-
Scheduling strategies
A typical scheduling strategy used in Argentinian radio and television is called pase (Spanish for a pass as in a player passing the ball to another player of the same team). A few minutes before the end of a live broadcast show, followed by another live broadcast show, people from both programmes will share some air time together. This may be used for people from the starting programme to anticipate its contents of the day, or to participate in an ongoing discussion in the previous show, or simply for an entirely independent debate or chat that will not be furthered after the pase. On the radio, where newscasts are usually broadcast every thirty minutes, often in coincidence with the end of a show, the pase may take some minutes before the news, and sometimes some minutes afterwards, too. Q.3 Define production management. What are the various functions involved in production management?
JURAN has categorised cost of quality in to four categories: 1. Failure CostsInternal : These are cost of rejections, repairs in terms of materials,labour, machine time and loss of morale. 2.
Failure Costs-External: These are cost of replacement, on-site rework including spareparts and expenses of the personnel, warranty costs and loss of goodwill. 3. Appraisal Costs: These are cost inspection, including maintenance of records,certification, segregation costs, and others. 4. Prevention costs: Prevention cost is the sequence of three sets of activities, Qualityplanning, Quality control, and Quality improvement, forming the triology to achieve TOTAL QUALITY MANAGEMENT. JURANs argument says that;
Quality is the result of good planning consideration the needs of both internal and externalcustomers and develops processes to meet them. The processes are also planned to meet them.
Quality is built into the system of manufacture, inputs and processes that are on stream like rawmaterial, spare parts, labour, machine maintenance, training, warehousing, inspectionprocedures, packaging, and other. All these have to follow standards and control exercises tomake sure that mistake do not occur often and that if mistakes do occur then they are correctedat the source.
Quality improvement measures are essential to keep the quality culture alive. Newer methodswill be found, some operations can be eliminated, improved technology available. In short, asexperience is gained things can always be done better. IT is for the management to take theinitiative and encourage the employees to be on lookout for opportunities for improvement. CROSBYS Absolutes of Quality
Like Deming, Crosby also lays emphasis on top management commitment and responsibilityfor designing the system so that defects are not inevitable. He urged that there be no restriction onspending for achieving quality. In the long run, maintaining quality is more economical thancompromising on its achievement. His absolutes can be listed as under: Quality is conformance to requirements, not goodness
Quality originates in all factors. There are no quality problems. It is the people designs andprocesses that create problems.Crosby also has given 14 points similar to those of Deming. His approach emphasizes onmeasurement of quality, increasing awareness, corrective action, error cause removal and continuouslyreinforcing the system, so that advantages derived are not lost over time. He opined that the qualitymanagement regimen should improve that overall health of the organization and prescribed a vaccine.The ingredients are.1. Integrity: Honesty and commitment help in producing everything right first time, everytime. 2. Communication: Flow of information between departments, suppliers, customers helpsin indentifying opportunities. 3. Systems and operations: These should bring in a quality environment so that nobody iscomfortable with anything less than the best. Total Production Maintenance (TPM)
Maintenance is a function in any operations system. Maintenance keeps the equipments ingood condition. Generally equipments deteriorate because usage wear to the parts introducinginaccuracies on the products made on them. When the deterioration produces a component whichexceeds the permitted deviations rendering them unacceptable, maintenance is undertaken to bringback the machine to produce acceptable components. Sometimes the failure is sudden and serious andthe equipment stops working. Disruption of production and emergency repairs works are costly andschedules are missed causing delays in supplies and consequent losses. These breakdowns occurbecause the equipment was carrying hidden defects which were not apparent. All theses are attendedto by the maintenances department. Historical records indicate the probability of failures over differentperiods thus enabling us to plan to attend to them. With progress in automation, we have costlyequipments. We have flow lines and any one machine breaking down causes a series of machine to beidle. So, we have to move towards zero breakdowns like we want to move towards zero defects byimplementing TQM Tools.TPM puts the responsibility of maintenance where it belongs to and the operator who uses theequipment. It is a companywide activity which involves all the people. The main thrust is eliminatingall break downs. The focus is on the operating personnel because they would know aboutmalfunctioning earlier and more than anybody else. They work on the machine and are aware of theslightest variations that occur and thus should be able to plan to remove the cause before it becomes
serious. So every planned maintenance activity reduces the probability of a breakdown, Ownership of the operation and machine increases the commitment of the workmen. Autonomy is the starting pointfor learning and excellence. The worker can suggest better ways of improving quality, productivity,and design. This help in continuous improvement, Team work and participation improves the qualityculture. The principles of 5S- the housekeeping activities which improve efficiency at workplace isconsidered a measurable standard to aid the implementation at TPM even in the office rooms
Q.4 Explain the various phases in project management life cycle. ANS:This is the initial phase of any project. In this phase information is collectedfrom the customer pertaining to the project and the requirements areanalyzed. The entire project has to be planned and it should be done in astrategic manner. The project manager conducts the analysis of the problemand submits a detailed report to the top project justification, details on whatthe problem is a method of solving the problem, list of the objectives to beachieved, project budget and the success rate of completing the project.The report must also contain information and the project feasibility, and therisks involved in the project. Project management life cycle is the integratedpart of management. It is attach with project responsibility or failure of aproject.The important tasks of this phase are as follows:Specification Requirements Analysis (SRA): It has to be conducted todetermine the essential requirements of a project in order to achieve thetarget. Feasibility study: To analyze whether the project is technically,economically and practically feasible to be undertaken.Trade off analysis: To understand and examine the various alternatives whichcould be considered. Estimation: To estimate the project cost, effort requires for the project andfunctionality of various process in the project. System design: Choose a general design that can fusil the requirements. Project evolution: Evaluate the project in terms of expected profit, cost andrisks involved marketing phase. A project proposal is prepared by a group of people including the project manager. This proposal has to contain thestrategiesadopted to market the product to the customers. Design phase: This phase involves the study of inputs and outputs of thevarious project stages. Execution phase: In this phase the project manager and the teamsmembers work on the project objectives as per the plan. At every stageduring the execution reports are prepared. Control : Inspecting, Testing and Delivery phase during this phase. Theproject team works under the guidance of the project manager. The projectmanager has to ensure that the team working under his, implements theproject designs accurately, the project manager has to ensure ways of managing the customer, perform quality control work.Closure and post completion analysis phase upon satisfactory completion anddelivery of the intended product or service the staff performance has to beevaluated. Document the lessons from the project. Prepare the reports onproject feedback analysis followed by the project execution report.The phase which involve in the above are:The preparation stage involves the preparation and approval of projectoutline, project plan and project budget.The next stage involves selecting and briefing the project team about theproposals followed by discussions on the roles and responsibility of theproject member and the organization. The project management life cycle: A Life cycle of a project consists of the following: Understanding the scope of the project
Establishing objectives of the project Formulating and planning various activities Project execution and Monitor and control the project resources.Risk Management:Risk is defined in ISO 31000 as the effect of uncertaintyon objectives (whether positive or negative). Risk management can thereforebe considered the identification, assessment, and prioritization of risksfollowed by coordinated and economical application of resources to minimize,monitor, and control the probability and/or impact of unfortunate events or tomaximize the realization of opportunities. Risks can come from uncertainty infinancial markets, project failures, legal liabilities, credit risk, accidents,natural causes and disasters as well as deliberate attacks from an adversary.Several risk management standards have been developed including theProject Management Institute, the National Institute of Science andTechnology, actuarial societies, and ISO standards. Methods, definitions andgoals vary widely according to whether the risk management method is inthe context of project management, security, engineering, industrialprocesses, financial portfolios, actuarial assessments, or public health andsafety.The strategies to manage risk include transferring the risk to another party,avoiding the risk, reducing the negative effect of the risk, and acceptingsome or all of the consequences of a particular risk. Certain aspects of many of the risk management standards have comeunder criticism for having no measurable improvement on risk even thoughthe confidence in estimates and decisions increase. Necessity and objectives of SCM:SCM is the abbreviation of supply chain Management. It is considered bymany express worldwide as the ultimate solution towards efficient enterprisemanagement.SCM is required by and enterprise as a tow to enhance managementeffectiveness with a following organizational objective: Reduction of inventory:Enactment in functional effectiveness of existingsystems like ERP, Accounting. Software and Documentation like financialreports statements ISO 9000 Documents etc.Enhancement of participation level and empowerment level:- Effectiveintegration of multiple systems like ERP, communication systems,documentation system and secure, Design R&D systems etc. Better utilization of resources - men, material, equipment and money.Optimization of money flow cycle within the organization as well as to andfrom external agencies.Enhancement of value of products, operations and services andconsequently, enhancements of profitability.Enhancement of satisfaction level of customer and clients, supportinginstitutions, statutory controlagencies, supporting institutions, statutorycontrol agencies, suppliers and vendors, employees and executives .Enhancement of flexibility in the organization to help in easy implementationof schemes involving modernization, expansion and divestment, merges andacquisitions.Enhancement of coverage and accuracy of management informationsystems. With the objectives of SCM its implementation are required.Implementation is in the form of various functional blocks of an organizationinterpenetrated through which a smooth flow of the product development ispossible.A relatively new SCM option involves web based software with a browserinterface. Several electronic marketplaces for buying and selling goods andmaterials. Steps involved in the implementation of SCM:There is many steps which involved in SCM implementation are- BusinessProcess, sales and marketing. Logistics, costing, demand planning, trade- off
analysis, environmental requirement, process stability, integrated supply,supplier management, product design, suppliers, customers, materialspecifications, etc. Some important aspect of SCMThe level of competition existing in the market and the impact of competitiveforces on the product development. Designing and working on a strategiclogic for better growth through value invention. Working out new value curvein the product development along with necessary break point. Using it toanalyze markets and the economies in product design. Time, customer,quality of product and the concept of survival of fittest. Steps of SCM principals: Group customer by need: Effective SCM groups, customer by tie tinct servicemeets those particular segment.Customize the logistics networks: In designing their logistics network,companies need to focus on the service requirement and profit potential of the customer segments identified. Listen to signals of market demand andplan accordingly- sales and operations planners must monitor the entiresupply chain to detect early warning signals of changing customer demandand needs. Differentiate the product closer to the customer: companies today nolonger can afford to stock pile inventory to compensate for possibleforecasting errors, instead, they need to postpone product differentiation inthe manufacturing. Process closer to actual customer demand. Strategically manage the source of supply: by working closely with theirkey suppliers to reduce the overall casts of owning materials and services;SCM maximizes profit margins both for themselves, and their supplies. Develop a supply chain wide technology strategy: as one of thecornerstones of successful SCM information technology must be able tosupport multiple levels of decision making.Adopt channel spanning performance measures- Excellent supplyperformance measurement systems do more than just monitor internalfunctions. They apply performance criteria that embrace bathe service andfinancial metrics, including as such as each accounts true profitability. Q.5 Explain the ingredients of a business process. Explain Physical Modelling. ANS: To harness the work done in organizations, and to increase productivity, it is essential to understand how to model business processes. This course explores the need for modeling business processes, how process modeling is one part of a larger framework for achieving higher quality through Business Process Management, the essential steps to process modeling, and the critical success factors for making the effort successful. It provides a practical framework for understanding and modeling business processes and describes how to develop a variety of process model types. The most common process modeling standards are taught, assuring you the maximum applicability to your environment. Last, it provides valuable facilitation tips and techniques to help ensure that your modeling sessions stay focused, and are viewed as successful by all involved.
Business Process Modeling A process is a coordinated set of activities designed to produce a specific outcome. There are processes for saving a file, constructing a building, and cooking a meal. In fact, there is a process for almost
everything we do. A business process is a type of process designed to achieve a particular business objective. Business processes consist of many components, including: The data needed to accomplish the desired business objective Individual work tasks that manipulate, review, or act upon the data in some way Decisions that affect the data in the process or the manner in which the process is conducted The movement of data between tasks in the process Individuals and groups which perform tasks Processes can be manual or automated, fully documented or simply knowledge in the minds of one or more people. They can be simple or complex. They can be formal, requiring exact adherence to all details; or flexible, provided the desired outcome is achieved. Logical Process Modeling Logical Process Modeling is the representation of a business process, detailing all the activities in the process from gathering the initial data to reaching the desired outcome. These are the kinds of activities described in a logical process model: Gathering the data to be acted upon Controlling access to the data during the process execution Determining which work task in the process should be accomplished next Delivering the appropriate subset of the data to the corresponding work task Assuring that all necessary data exists and all required actions have been performed at each task by divyapizzacom A physical model exists while a conceptual model does not exist. As an example, a physicial model of a house is a scaled down version of the house made from miniature pieces of wood, concrete, etc... whereas a conceptual model of the house is a drawing on a piece of paper or a software 3-D picture made by an architect. 6 years ago Q.6 Define the term quality. Explain the concept of quality at source. ANS:In order thoroughly to examine costs and benefits of schemes aimed at differentiating products and processes on the basis of quality criteria, it is important to define the concept of . Quality is to be built in to the process with appropriate checks and built in measures-Quality need not to be inspected as it increases the cost if rejected; Lot many Techniques are in place likezero defect concept six sigma poka yoke kinds It means Quality has to be Produced (While in process) and not to be inspected after producing ; Quality has to be built in (In the process) and no need for inspection; three sigma concept,(Parts per Million),Zero Defect,Mistaking Proofing or fool proof -Poka Yoke-all defect prevention methods ) etc etc are the outcome of this concept- CPk and PPK are again used for this Process capability.Appropriate Built in measures are to be ensured; In a nut shell I did give you some inputs _Clear now!!