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Introduction to

Production & Operations


Management

© Oxford University Press 2007. All rights 1


reserved.
The Product/Process Continuum

Automobile
Photocopier retailers Banks Consultancies
Automobile manufacturers &
manufacturers service providers Restaurants Airlines Undertakers

Product Process
orientation orientation

Organizations on a
Product/Process Continuum

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The Transformation Process

Quality of inputs Quality of outputs


monitored monitored

Random disturbances

INPUTS Transformation OUTPUTS


Process

Feedback Mechanisms

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The Transformation Process
For a Service Organization (An MBA Institute)

Random disturbances
• Strikes of students,
Quality of
Quality of teachers or staff
• Undue interference of outputs
inputs monitored
Raw minds monitored the government in the
(students) working of institutions

Teachers
Class rooms Enlightened students with:
Transformation • Good communication skills
Computer lab Process • Pleasant personalities
• Leadership qualities
Library • Good analytical ability
Projectors • Team spirit
(OHP, • Decision making abilities
LCD etc) • Computer skills
Administrative
staff Feedback Mechanisms
• Success at placement interviews
• Grades obtained in examinations
INPUTS • Rising career graph of alumni in the industry OUTPUTS
• Number of applications for admission
in the institute
• Ratings of surveys
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reserved.
The Transformation Process For a Hybrid Service
& Manufacturing Organization
(A Restaurant)
Random disturbances
• High turnover of chefs,
Quality of
Customers Quality of waiters, etc.
• Inflation outputs
Building inputs monitored
monitored • Government’s taxation
Chef policy
Vegetables
Furniture
Customers satisfied with:
Mutton, Transformation • Good preparation of the
chicken, Process food
pork, • Pleasant behavior and
etc. personality of the waiter
Cooking oil,
• Genuine prices charged
Spices, etc.
Waiters
Manager
Feedback Mechanisms
• Rising Revenues
INPUTS • Repeat Customers OUTPUTS
• Appreciation of customers

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reserved.
The Transformation Process For a Purely
Manufacturing Organization
(A Refrigerator Manufacturer)

Random disturbances
• High turnover of workers
Quality of
Machines & Quality of and managers
• Recession outputs
Equipments inputs monitored
monitored • Government’s taxation
Building policy
Components, • Strikes instigated by trade
parts, sub- unions
assemblies, etc. Customers satisfied with:
Transformation • Good cooling performance
Workers Process • Less consumption with
electricity
Office • Good after-sales service
infrastructure • New advanced features
(computers,
furniture, etc.)
Packaging
material
Feedback Mechanisms
Capital • Rising sales volume
• Lesser customer complaints
Managers
• Positive response of customers in
the feedback forms
INPUTS OUTPUTS

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Production & Operations Management (POM)
Defined

Production & Operations Management is


defined as the design, operation, and
improvement of the transformation
process, which converts the various inputs
into desired outputs of products and
services.

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Product/Process Steps in the production/operations
Choice process from the point of view of
an entrepreneur
Service Operations
Management

Business Process Outsourcing


and Off-shoring

Facility Facility Facility


Location Layout Capacity
Planning Planning Planning

Project
Management

Inventory Materials Total


Management Requirement Productive
for Planning (MRP)/ Maintenance
Independent Just-In-Time (JIT) (TPM)
Demand System/ Supply
Items Chain Mgt. (SCM)

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Steps in the production/operations
process from the point of view of
an entrepreneur

Aggregate Production/
Operations Planning

Work Design Operations Quality


Scheduling Management

Demand
Forecasting

Operations
Strategies

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Product Design

Manufacturability Reverse Engineering

Research &
Standardization Development

Concepts
Product Life in Product
Cycle Robust Design
Design

Concurrent
Engineering Modular Design
Computer Aided
Design (CAD)

Concepts in Product Design

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Process Design

Types of Processes

Continuous Semi-continuous Intermittent Project


Process (Repetitive/Assembly) Process
Process

Batch Process Job Shop

Types of Processes

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Automation
State-of-the-art fully Machines take Behavioral problems in
automated plants exactly the humans like boredom,
increase the market same time in frustration, fatigue, etc.
value of the firm/ repetitive tasks can be avoided by
improve client base using machines
in international
markets
Industrial relations
problems like
More reliable Advantages strikes, lockouts,
and consistent
etc. can be avoided
performance
than that of
humans Automation

Usually more Loss of


expensive Disadvantages creativity on
than the the part of
human work workers due
force to inflexibility
in automation

Less flexible Leads to


than the unemployment/
humans; even retrenchment of
small changes the labor force
in the process
are expensive

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reserved.
Emerging Role of the Production &
Operations Manager in India today

To act as internal quality


To take part in To implement total
auditors in certification strategic decision
programmes like productive
making of the
ISO 9000 maintenance (TPM)
organization programme

Increased attention
to technology To take part in the
management in view implementation & use
of JVs of MNCs with of ERP software in the
domestic companies organization
New
To act as supply Responsibilities To automate the
chain managers in of Operations processes according
forging long-term Managers to the requirements of
strategic the organization
relationships with
suppliers To enhance the R & D
effort of the
To act as a member organization for
of the concurrent becoming self-reliant in
engineering team developing new
in new product technologies
design
To implement the To oversee timely To take care of issues
environmental and implementation of projects
To take decisions relating to services
pollution norms (like
regarding operations
established by the commissioning of facilities,
outsourcing/ off- management
government from launching of new products/
shoring of business time to time services, etc.) in view of the
processes increased competition
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reserved.