MB0028: PRODUCTION & OPERATIONS MANAGEMENT

Assignment Set – I

1. Explain the various automated systems for transfer of materials in the

production plant? Illustrate your answer by considering an example of an
automobile showroom.

Ans: - Automated Production Systems: All operation systems are based on the following criteria:

i) Output of the product – whether they are goods or services

ii) Specification of the product – Standard or customized
iii) The flow pattern – whether it is job shop or batch production, Assembly or continuous.

Let us see the evolution of the production systems the goods required by society were produced in
small quantities by craftsmen who would know the needs of the community and produced them by
their own hands with simple tools. The tools were made by himself with the help of apprentices or
by another craftsman, who would make them to meet the requests made. He would be responsible
for the design, procurement of the required materials and the processes, he considered fit.
Repeated performance would improve them and his customers got the benefit of the improvements
of his skills and creativity. As demand increased and more people were involved in the process,
apprentices would join these craftsmen and additional supplies made. The sources of power, apart
from the humans, were horses and oxen. Water was lifted from the wells using pulleys. Later on
windmills were used for irrigation. Transportation was by horses. Wind sails were used for
transportation on water. All equipments were made to serve these purposes. The advent of the
steam changed much of all this. It needed coal to produce steam an iron parts became necessary to
generate and transfer which steam engines could produce. Locomotives changed the way people
moved themselves as well the materials. Spinning and power looms changed the way clothes were
made. More importantly, the quantities produced could be distributed. The parts and components
used to make these machines had to be replaced when they wore. Making parts so that
interchangeability was achieved made setting up standards and specifications important for
meeting. The craftsmen gave way to engineers, workers, supervisors, and inspectors. Division of
labor became necessary to achieve efficiencies and the jobs that became specialized. Invention of
the internal combustion engine – petrol and diesel – led to mass production of components.
Frederick Taylor introduced the “science of management” Observation, documentation, analysis –
became the backbone of achieving efficiencies. Machines in huge numbers had to be placed to
maximize production, to achieve quality and we see the improvements leading to Special Purpose
Machines, Numerically Controlled Machines and Robots. Competition has necessitated improved
quality, reduced rates and better service to the customer. These have generated various
methodologies of achieving efficiencies in all aspects of business – procurement, manufacture,
distribution, customer care, acquisition utilization of funds. Emphasis on Research and
Development improved materials and new processes are brought forth. Advent of computers,
information technology has become the biggest player in all aspects of business including
operations.

The equipments and processes selected depend on the volumes of output.

The other important dimensions which are considered are – job variety, flexibility of the process
and volume. The cost per unit determines the extent of automation required. Automation systems
cost huge sums of money and therefore a deep analysis of the various factors has to be done.

For services, automation usually means labour saving devices In education, long distance learning
technology helps in supplementing class room instruction. The facilitating goods that are used are
web site and videos. Automation in the banking sector has resulted in ATMs which save the banks a
huge amount of labour and it is found to have given greater customer satisfaction. Automation is
ideal when the service provided or the product manufactured is highly standardized. Some extent
of automation can be designed even with customization – i.e. product or service s meant to produce
or deliver low volumes specific to a requirement. The advantage of automation is it has low
variability and will be more consistent on a repetitive basis. On the shop floor variability causes loss
of quality. There are three kinds of automation – fixed, programmable and flexible. By its very
nature, fixed automation is rigid. They are designed for high volume production and their rigidity
ensures less variability. They are not amenable to change in product or process. They need minimal
human intervention. The machines have sensing and control devices that enable them to operate
automatically. The simplest of them – called machine attachments – they replace human effort.
They guide, locate, move and achieve relative positions by means of cams, optical sensing, load
sensing mechanisms and activate the controls to remove human intervention. Numerically
controlled machines read instructions and convert them to machine operations. Computer/s are
used for controlling one machine or a number of them and they have programmes written into
them for operations. They are Computer Numerically Controlled or, for short, CNC machines.
Robots are higher in the order of automation as they perform a variety of tasks. They are designed
to move materials by holding them in their arms and make precise movements according to
programmers written into the computers that reside in them. They simulate human actions – they
can grip and hold tools and with the help of sensors which are sensitive to touch and force to ‘know’
that the material is to be held with the requisite pressure for the conduct of operations. Vision
sensors are used for inspection, identification and guidance. They use optics based instruments to
gather data and feed them to the computers for activating the other parts of the robot. With the
help of automation, inspection of components can be done 100% which ensures highest quality
Identification and movement of materials are helped by bar codes which are read and fed into the
system for monitoring quantity, location, movement etc. They help the automated systems to sort
information and provide information for effecting any changes necessary. To make effective use of
automated machines, we need to have the movement of materials from and to different stations as
also stores, automated. Automated Storage and Retrieval Systems – ASRS – receive orders for
materials from anywhere in the production area, collect materials and deliver materials to the
workstations. Computers and information systems are used for placing orders for materials, give
commands, and adjust inventory records – which show the location and quantity of materials
available/needed. Continuous updating gives a clear picture for all concerned to enable them
initiate action to keep the throughput smooth. Automated Guided Vehicle Systems – AGVS – are
pallet trucks and unit load carriers follow embedded guide wires or paint strips to reach
destinations as programmed.

Automated Flow Lines: When several automated machines are linked by a transfer system which
moves the parts by using handling machines which are also automated, we have an automated flow
line. After completing an operation on a machine, the semi-finished parts are moved to the next
machine in the sequence determined by the process requirements – a flow line is established. The
parts at various stages – raw material to ready for fitment or assembly – are processed
continuously to attain the required shapes or acquire special properties to enable them to perform
desired functions. The materials need to be moved, held, rotated, lifted, positioned etc. for
completing different operations. Sometimes, a few of the operations can be done on a single
machine with a number of attachments. They are moved further to other machines for performing
further operations. Human intervention may be needed to verify that the operations are taking
place according to standards. When these can be achieved with the help of automation and the
processes are conducted with self regulation, we will have automated flow lines established. One
important consideration is to balance times that different machines take to complete the operations
assigned to them. It is necessary to design the machines in such a way that the operation times are
the same throughout the sequence in the flow of the martial. In fixed automation or hard
automation, where one component is manufactured using several operations and machines it is
possible to achieve this condition – or very nearly. We assume that product life cycles are
sufficiently stable to invest heavily on the automated flow lines to achieve reduced cost per unit.
The global trends are favoring flexibility in the manufacturing systems. The costs involved in
changing the set up of automated flow lines are high. So, automated flow lines are considered only
when the product is required to be made in high volumes over a relatively long period. Designers
now incorporate flexibility in the machines which will take care of small changes in dimensions by
making adjustments or minor changes in the existing machine or layout. The change in movements
needed can be achieved by programming the machines. Provision for extra pallets or tool holders or
conveyors is made in the original design to accommodate anticipated changes. The logic to be
followed is to find out whether the reduction in cost per piece justifies the costs of designing,
manufacturing and setting up automated flow lines. Group Technology, Cellular Manufacturing
along with conventional Product and Process Layouts are still resorted to as they allow flexibility
for the production system. With methodologies of JIT and Lean Manufacturing finding importance
and relevance in the competitive field of manufacturing, many companies have found that well
designed flow lines suit their purpose well. Flow lines compel engineers to put in place equipments
that balance their production rates. It is not possible to think of inventories (Work In Process) in a
flow line. Bottlenecks cannot be permitted. By necessity, every bottleneck gets focused upon and
solutions found to ease them. Production managers see every bottleneck as an opportunity to
hasten the flow and reduce inventories. However, it is important to note that setting up automated
flow lines will not be suitable for many industries

Automated Assembly Lines

All equipments needed to make a finished product are laid out in such a way as to follow the
sequence in which the parts or sub-assemblies are put together and fitted. Usually, a frame, body,
base will be the starting point of an assembly. The frame itself consists of a construction made up of
several components and would have been ‘assembled’ or ‘fabricated’ in a separate bay or plant and
brought to the assembly line. All parts or sub-assemblies are fitted to enable the product to be in
readiness to perform the function it was designed to. This process is called assembly.
Methodologies of achieving the final result may vary, but the basic principle is to fit all parts
together and ensure linkages – mechanical, electrical or electronic – so that their functions are
integrated and give out the desired output.

Product Layouts are designed so that the assembly tasks are performed in the sequence they are
designed. You will note that the same task gets repeated at each station continuously. The finished
item comes out at the end of the line
The material goes from station 1 to 5 sequentially. Operation 2 takes longer time, say twice as long.
To see that the flow is kept at the same pace we provide two locations 2a and 2b so that operations
3, 4 and 5 need not wait. At 5, we may provide more personnel to complete operations. The time
taken at any of the locations should be the same. Otherwise the flow is interrupted. In automated
assembly lines the moving pallets move the materials from station to station and moving arms pick
up parts, place them at specified places and fasten them by pressing, riveting, screwing or even
welding. Sensors will keep track of these activities and move the assemblies to the next stage. An
operator will oversee that the assemblies are happening and there are no stoppages. The main
consideration for using automated assembly lines is that the volumes justify the huge expenses
involved in setting up the system.

2. State the important considerations for locating an automobile plant? Collect

information on layout planning of an automobile plant from various sources and
furnish the same.

Ans: - Facility Planning Process: Planning is perhaps the most important function of management.
Especially when we have to deal with land and buildings and machinery which are high cost
requirements and they cannot be changed easily, a lot of thought, data gathering and estimates for
the future are also considered vital for the success of any firm. We will consider them in two parts.
The first will be the location of the plant and the second manufacturing facility lay-outs and
planning for them.

Facility Location: We will consider the identification of the location of the facility. We identify the
various factors that affect the economics of competing locations and helps in choosing the most
optimal.

Factors influencing Plant Location can be broadly divided into two types namely –
General Factors:
a. Availability of land – Our plans, calculations and forecasts suggest a particular area as the best,
but availability of land may be in question. Many times we will have to choose the second best
location on this count.
b. Availability of inputs – labour, raw materials.
c. Closeness to market places
d. Communication facilities
e. Infrastructure – power, water
f. Transport
g. Government support – subsidies etc
h. Housing and recreation – educational facilities

Special Factors:
a. Economic stability – outside investments
b. Cultural factors
c. Wages
d. Joint ventures – support of big time players

The various factors have their relative importance and therefore ranking them and giving
weightage for them is one of the ways of determining the location.

A. Rating Plan Method to evaluate Major Factors for Plant Location: In this Method the various
factors are given rating depending upon the perception of the management. The location which gets
the maximum rating, considering all the factors is chosen for locating the plant. It can be seen that
not all factors are considered. And the value attached to each factor may vary from manager to
manager

B. Factor Rating Method: In this method each of the factors for location are rated and the rating of
the competitive locations are considered. The products of the rating are added. The location which
gets the maximum product of rating is selected.

C. Point Rating Method: In this method, we apportion a fraction of a suitably selected total rating
and see how many points we can allocate to the locations under consideration. We compare the
totalled ratings and decide the preference. For example, suppose we decide to have 1000 points as
the maximum possible score considering all factors. We evaluate each location and allocate points.
The location which gets the maximum rating would be chosen.

D. Break-even Analysis: Every manufacturing will have three major contributors to cost.
Investments made for land, plant and machinery resulting in interest and depreciation, recurring
expenses which are not proportional to the quantity of production and variable costs which are
directly proportional to the quantities produced. For our calculations, we combine the first two
costs together and call them fixed costs and those that depend on the quantity of production as
variable costs. We compare the total costs for the different locations on estimated amounts per
annum and select whichever location costs the least. However, we will have to consider the possible
variations in production levels during the foreseeable time spans and take a decision.

E. Centre of gravity Method: This method is used mainly where transportation costs either for
distribution of products or collection of materials from different suppliers is the main criteria.
When production rates are high or the volume and weights of materials that have to be moved are
huge and time taken either to receive material from suppliers or delivery to customers is critical, it
is better to locate the facility at such a place which caters to the different points most optimally. The
vital factor is the load – i.e. number of items, or the weights that need to be moved from the central
location to the existing or demanding points. When both distance and load have to be considered
for optimality in terms of cost, we use this method.

3. Who are the players in a project management? What are the various roles
and responsibilities of the players in a project management?

Ans:- The Players in a Project Management are the Individuals and organizations ,
 That are actively involved in the project
 Whose interests may be affected (positively or negatively) by the outcome (success or failure) of
the project
 Exert influence over the project and its results
 Players are also called “stakeholders” of the project
 Project manager- the individual responsible for managing the project
 Customer- the individual or organization that will use the product- the end result of the project.
 Performing organization- the enterprise whose employees are most directly involved in doing
the work of the project.
 Sponsor-the individual or group within or external to the performing organization that funds the
project.

The various roles and responsibilities of players in project management are:

 There are number of projects which an organization works on. It is not possible for one
individual to manage all the projects. There is a team of managers who manage the projects.
 There may be different teams working on different projects.
 An experienced project manager and his team may manage more than one project at a time.
 The project team is responsible for ensuring that the project upon completion shall deliver the
gain in the business for which it is intended for.
 The project team has to properly coordinate with each other working on different aspects of the
project.
 The team members are responsible for the completion of the project as per the plans of the
project.

4. What are the various steps in project monitoring and controlling a project?

Ans: -The various steps involved in monitoring and controlling a project from start to end are as
follows –

a) Preliminary work – the team members understand the project plans, project stage schedule,
progress controls, tracking schedules, summary of the stage cost and related worksheets. The entire
member has to understand the tolerances in any change and maintain a change control log. They
must realize the need and importance of quality for which they have to follow strictly a quality
review schedule and frequently discuss on the quality agendas. They must understand the stage
status reports, stage end reports, stage end approval reports.

b) Project Progress – The members must keep a track of the project progress and communicate
the same to other related members of the project. The project manager ensures that these changes
are made smoothly and organizes review meeting with the project management group.

c) Stage Control – The manager must establish a project check point cycle. For this suitable stage
version control procedures may be followed. The details are to be documented stage wise. Project
files have to be frequently updated with suitable version control number and revision status should
be maintained for each change. Team members are identified who will exercise controls at various
points of the project.

d) Resources – Plan the resources required for various stage of the project. Brief both the project
team and the key resources about the objectives of every stage, planned activities, products,
organization, metrics and project controls.

e) Quality Control- This is very important in any project. Quality control is possible if the project
members follow –
 Schedule Quality Review– It is recommended that quality review be scheduled at the beginning
of the stage and also ending of every stage.
 Agenda for quality review – create and distribute a quality review agenda specifying the
objective, products, logistics, roles, responsibilities and time frame.
 Conduct quality review – the quality review is to be conducted in a structured and formal
manner. Quality review should focus on product development and its quality factors. Focus on
whether it meets the prescribed quality standard.
 Follow up – QR complete product status revised from ‘In progresses to ‘QR Complete’. Follow up
the actions planned in strict manner which ensures conformity to the standards.
 Review quality control procedures – verify that the quality objectives for each product are
appropriate and that all participants are satisfied both with the process and its outcome.

f) Progress Control-

 Monitor Performance: The team members log in details of actual start date, actual finish date,
actual hours worked per task, estimated hours to complete the task, elapsed time in hours to
complete the task, any miscellaneous costs incurred during a stage. These inputs become the
base to monitor the performance of the project and its stages.
 Update Schedule - Update the schedule for actual start date for tasks started, actual finish date
for tasks finished, and actual hours worked per task, latest estimated work in hours to complete
the task.
 Update costs - Update the stage cost summary worksheet with actual costs incurred this period,
estimated remaining costs. Miscellaneous costs will be automatically updated from the
scheduler, since they are calculated from actual work.
 Re-plan stage schedule - Review the tracking Gantt and Cost workbook and identify any
deviation from the baseline. Establish why the deviation has occurred. Refer back to the project
control factors to help determine the appropriate corrective action and adjust the schedule
accordingly. Determine if the stage has exceeded the progress, cost and quality tolerance levels
agreed with the project management team. Review status of open issues and determine any
further action required on these issues. Review the status of any outstanding quality reviews
Review any new change requests.
 Conduct team status review- Conduct a status meeting with the project team. Items for
discussion are achievements this period planned activities that are incomplete or overdue,
activities for the next period, new issues identified this period, issues closed this period,
summary of results of quality reviews , summary of schedule and cost status, suggested revisions
to the plan.
 Create status report - The status report provides a record of current achievement and
immediate expectations of the project. The status has to be effectively communicated to all
interested parties.
 Create Flash report - Summarizes the accomplishments for the month, schedule status,
upcoming tasks for the month and any major issues. Distribute to the project team and project
management team
 Project Status Reports - As discussed earlier, the status report provides a record of current
achievements and immediate expectations of the project.

A weekly status report includes:

 Accomplishments during the period
 Items not completed during the period
 Proposed activities for the next period
 Any predicted slippage to the stage schedule, along with cause and corrective action.
 Any predicted cost overrun along with cause and corrective action.

g) Approvals – Project stage reviews and the decisions taken and actions planned need to be
approved by the top management. The goals of such review are to improve quality by finding
defects and to improve productivity by finding defects in a cost effective manner. The group review
process includes several stages like planning, preparation and overview a group review meeting
and rework recommendations and follow-up.

5. Explain the necessity and objectives of SCM?

Ans: - Need and objectives of Supply Chain Management: SCM is required by and Enterprise as
a tool to enhance management effectiveness with the following organizational objectives:

 Reduction of inventory
 enhancement of participation level and empowerment level
 Increase in functional effectiveness of existing systems like ERP, Accounting Software and
Documentation like Financial reports/ Statements/ ISO 9000 Documents etc.
 Effective integration 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 and from external
agencies
 Enhancement of value of products, operations and services and consequently, enhancement of
profitability
 Enhancement of satisfaction level of customers and clients, supporting institutions, statutory
control agencies, suppliers and vendors, employees and executives
 Enhancement of flexibility in the organization to help in easy implementation of schemes
involving modernization, expansion and diversification – even divestments, mergers and
acquisitions
 Enhancement of coverage and accuracy of management information systems.

6. What are the steps involved in SCM implementation?

Ans: -The various steps involved in SCM implementation are as follows:

I. Study the strengths and weaknesses within the enterprise as well as of External Agencies
involved.
II. Understand the organization objectives
III. Study the existing systems and identify the gaps and propose solutions to plug the
loopholes.
IV. evolve consensus and test fire individual solutions
V. integrate solutions which are adjudged successful into the mainstream
VI. study overall impact after all proposals in a section are implemented , review consensus
VII. finalize SCM document, circulate and implement