OM01 Operations Management

Assignment No.I
Assignment Code: 2012OM01A1 Last Date of Submission: 15th April 2012 Maximum Marks:100

Attempt all the questions. All the questions are compulsory and carry equal marks.

Section-A Ques. 1 Ques. 2 Ques. 3 Ques. 4 What is Corporate Strategy and how Operations Strategy is related to the Corporate Strategy? Explain. Why are some industries located near the source of raw materials, whereas some near the market for their finished goods? How does a good plant layout help to improve productivity? The desired daily output for an assembly line is 360 units. This assembly line will operate 450 minutes per day. The following table contains information on this products task times and precedence relationship. Task Task time ( sec) Immediate Precedence A B C D E F G H 30 35 30 35 15 65 40 25 A A B C C E,F D,G

a) Draw the precedence diagram b) What is the workstation cycle time c) Balance the line using the longest task time heuristic and determine the efficiency of the line.

Section-B Case Study : Productivity Gains at Whirlpool Workers and management at Whirlpool Applicances Benton Harbor plant in Michigan have set an example of how to achieve productivity gains, which has benefited not only the company and its stockholders, but Whirlpool customers, and workers themselves. Things werent always rosy at the plant. Productivity and quality werent good. Neither were labor-management relations. Workers hide defective parts so management wouldnt find them, and when a machine broke down, workers would simply sit down until sooner or later someone came to fix it. All that changed in the late 1080s. Faced with the possibility that the plant would be shut down, management and labor worked together to find a way to keep the plant open. The way was to increase productivity producing more without using more resources. Interestingly, the improvement in productivity didnt come by spending money on fancy machines. Rather, it was accomplished by placing more emphasis on quality. That was a shift

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from the old way, which emphasized volume, often at the expense of quality. To motivate workers, the company agreed to gain sharing, a plan that rewarded workers by increasing their pay for productivity increases. The company overhauled the manufacturing process, and taught its workers how to improve quality. As quality improved, productivity went up because more of the output was good, and costs went down because of fewer defective parts that had to be scrapped or reworked. Costs of inventory also decreased, because fewer spare parts were needed to replace defective output, both at the factory and for warranty repairs. And workers were able to see the connection between their efforts to improve quality and productivity, and their pay. Not only was Whirlpool able to use the productivity gains to increase workers pay, it was also able to hold the lid on price increases and to funnel some of the savings into research, which added to cost savings and quality improvement. Questions 1. 2. 3. 4. What were the two key things that Whirlpool management did to achieve productivity gains? Who has benefited from the productivity gains? How are productivity and quality related? How can a company afford to pay its workers for productivity gains?

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OM01 Operations Management

Assignment No.II
Assignment Code: 2012OM01A2 Last Date of Submission: 15th May 2012 Maximum Marks:100

Attempt all the questions. All the questions are compulsory and carry equal marks.

Section-A Ques. 1 Ques. 2 Explain the role of Control Charts in Quality Control. Explain the uses and the need for having the mean chart, range chart and proportion chart. (a) (b) What are the key areas to address when improving the cost of quality? Is ISO 9000 certification a guarantee for the firms product quality? Explain your answer. What is materials management (MM) and who does it? Detail the functions for receiving, inspection, and storage. How are they a part of M1M?

Ques. 3

(a) (b)

Ques. 4

Daily demand for a product is normally distributed with mean at 60 units and a standard deviation of 6 units. The lead time is constant at 9 working days. The cost of placing an order is Rs. 20 and annual holding costs are 20% of the unit price of Rs. 10. A 95% service level is required for the customers who place orders during the re-order period. Determine the Economic Order Quantity and Re-order level assuming there are 300 working days annually. Section-B

The following table gives data on normal time, its cost and crash time, its cost for a project. Normal Time (weeks) 3 3 7 9 5 0 6 4 13 10 Crash Time (weeks) 2 3 5 7 4 0 4 3 10 9

Activity 1-2 2-3 2-4 2-5 3-5 4-5 5-6 6-7 6-8 7-8

Cost (Rs) 300 30 420 720 250 0 320 400 780 1,000

Cost (Rs) 400 30 580 810 300 0 410 470 900 1,200

Indirect cost is Rs 50 per week i. Draw the network and identify the critical path with a double line.

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ii. iii.

What are the normal project duration and associated cost? Find out the total float associated with each activity. Crash the relevant activities systematically and determine the optimal project

iv.

completion time and cost.

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