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Operation Management Ebook

Read "Operations Management Managing Global Supply Chains" by Ray R. Venkataraman available from Rakuten Kobo. Sign up today and get $5 off your first. 1 Introduction to Operations. Management. 2 Competitiveness, Strategy, and. Productivity. 3 Forecasting. 4 Product and Service Design. 5 Strategic Capacity. Whether it is tangible or intangible production items the "Operations Management " book will guide you through concepts such as Supply Chain Management to LEAN, and much more. download the eBook: $ Access this.

Operational Risk Management Yokogawa's Operational Risk Management deals with managing safety, health and environmental risks on both individual and process levels in a reliable and risk-free manner. It involves the end-to-end process of designing, visualizing and orchestrating plant production and business systems. Our Operational Risk Management scope does not only cover partial improvements in the organization, but also optimizations in plant operations to achieve continuously improving safety, reliability and operability. This provides operators with the agility to take full advantage of market conditions. This assures the asset always meets expectations and is always available to capitalize on short term market opportunities. Operations Management System Operations Management solution helps to ensure Safe, Reliable and Efficient plant operations and regulatory compliance by digitization of information related to key Operations Management Practices. This results in improved productivity through standardized work practices, streamlined processes, plus improved communications and coordination across departments.

Surely all organizations will have to deal with these concepts sooner or later. Operations Management is about how organisations produce or deliver the goods and services that provide the reason for their existence. Operations can be seen as one of many functions e. The operations function can be described as that part of the organisation devoted to the production or delivery of goods and services. Find the book you need Go! We are terribly sorry, but in order to download our books or watch our videos, you will need a browser that allows JavaScript.

For more information, please check our privacy policy. Your email address: Not you? Depending on the industry, a load may be shipments from suppliers, between plants, or to customers, or it may be customers or employees travelling to or from the facility. The firm seeks to minimize its load- distance, generally by choosing a location so that large loads go short distances.

To calculate a load-distance for any potential location, we use either of the distance measures and simply multiply the loads flowing to and from the facility by the distances travelled. These loads may be expressed as tones or number of trips per week. This calls for a practical example to appreciate the relevance of the concept.

Let us visit a new Health-care facility, once again. The new Health-care facility is targeted to serve seven census tracts in Delhi. The table given below shows the coordinates for the centre of each census tract, along with the projected populations, measured in thousands.

Customers will travel from the seven census tract centres to the new facility when they need health-care. Two locations being considered for the new facility are at 5. Details of seven census tract centres, co-ordinate distances along with the population for each centre are given below.

If we use the population as the loads and use rectilinear distance, which location is better in terms of its total load- distance score? Census tract x, y Population l 1 A 2. Calculate the load-distance score for each location. Using the coordinates from the above table. Calculate the load-distance score for each tract. Therefore, the location in census tract F is a better location. This method can be used to assist managers in balancing cost and service objectives.

The centre of gravity method takes into account the locations of plants and markets, the volume of goods moved, and transportation costs in arriving at the best location for a single intermediate warehouse. The centre of gravity is defined to be the location that minimizes the weighted distance between the warehouse and its supply and distribution points, where the distance is weighted by the number of tones supplied or consumed.

The first step in this procedure is to place the locations on a coordinate system. The origin of the coordinate system and scale used are arbitrary, just as long as the relative distances are correctly represented.

This can be easily done by placing a grid over an ordinary map. The centre of gravity is determined by the formula. Customers will travel from the seven census tract centres to the new facility when they need health- care. Details of seven census tract centres, coordinate distances along with the population for each centre are given below.

To calculate the centre of gravity, start with the following information, where population is given in thousands. Census tract x, y Population l Lx Ly 1 A 2. Using the centre of gravity as starting point, managers can now search in its vicinity for the optimal location. Break even analysis is concerned with finding the point at which revenues and costs agree exactly. The Fig. Break even point is the volume of output at which neither a profit is made nor a loss is incurred.

This will be helpful in identifying the range of production volume over which location can be selected. Potential locations X, Y and Z have the cost structures shown below. The ABC company has a demand of 1,30, units of a new product. Three potential locations X, Y and Z having following cost structures shown are available.

Select which location is to be selected and also identify the volume ranges where each location is suited? Solve for the crossover between X and Y: From the graph Fig. These costs are influenced by a number of factors as discussed earlier. The various costs which decide locational economy are those of land, building, equipment, labour, material, etc. Other factors like community attitude, community facilities and housing facilities will also influence the selection of best location.

Economic analysis is carried out to decide as to which locate best location. The following illustration will clarify the method of evaluation of best layout selection. From the following data select the most advantageous location for setting a plant for making transistor radios.

It is a floor plan of the physical facilities, which are used in production. The objectives of plant layout are: Streamline the flow of materials through the plant. Facilitate the manufacturing process. Maintain high turnover of in-process inventory. Minimise materials handling and cost. Effective utilisation of men, equipment and space. Make effective utilisation of cubic space. Flexibility of manufacturing operations and arrangements.

Provide for employee convenience, safety and comfort. Minimize investment in equipment. Minimize overall production time. Maintain flexibility of arrangement and operation. Facilitate the organizational structure. Principle of integration: A good layout is one that integrates men, materials, machines and supporting services and others in order to get the optimum utilisation of resources and maximum effectiveness.

Principle of minimum distance: This principle is concerned with the minimum travel or movement of man and materials. The facilities should be arranged such that, the total distance travelled by the men and materials should be minimum and as far as possible straight line movement should be preferred.

Principle of cubic space utilisation: The good layout is one that utilise both horizontal and vertical space. It is not only enough if only the floor space is utilised optimally but the third dimension, i. Principle of flow: A good layout is one that makes the materials to move in forward direction towards the completion stage, i. Principle of maximum flexibility: The good layout is one that can be altered without much cost and time, i. Principle of safety, security and satisfaction: A good layout is one that gives due consideration to workers safety and satisfaction and safeguards the plant and machinery against fire, theft, etc.

Principle of minimum handling: A good layout is one that reduces the material handling to the minimum. Process layout 2. Product layout 3. Combination layout 4. Fixed position layout 5. Group layout 2. All machines performing similar type of operations are grouped at one location in the process layout e.

Thus, in process layout the arrangement of facilities are grouped together according to their functions. A typical process layout is shown in Fig.

The flow paths of material through the facilities from one functional area to another vary from product to product. Usually the paths are long and there will be possibility of backtracking. Process layout is normally used when the production volume is not sufficient to justify a product layout. Typically, job shops employ process layouts due to the variety of products manufactured and their low production volumes. In process layout machines are better utilized and fewer machines are required.

Flexibility of equipment and personnel is possible in process layout. Lower investment on account of comparatively less number of machines and lower cost of general purpose machines.

Higher utilisation of production facilities. A high degree of flexibility with regards to work distribution to machineries and workers. The diversity of tasks and variety of job makes the job challenging and interesting. Supervisors will become highly knowledgeable about the functions under their department. Limitations 1.

Backtracking and long movements may occur in the handling of materials thus, reducing material handling efficiency. Material handling cannot be mechanised which adds to cost. Process time is prolonged which reduce the inventory turnover and increases the in- process inventory. Lowered productivity due to number of set-ups. Throughput time gap between in and out in the process time is longer. Space and capital are tied up by work-in-process.

If the volume of production of one or more products is large, the facilities can be arranged to achieve efficient flow of materials and lower cost per unit. Special purpose machines are used which perform the required function quickly and reliably. The product layout is selected when the volume of production of a product is high such that a separate production line to manufacture it can be justified.

In a strict product layout, machines are not shared by different products. Therefore, the production volume must be sufficient to achieve satisfactory utilisation of the equipment. A typical product layout is shown in Fig. The flow of product will be smooth and logical in flow lines.

In-process inventory is less. Throughput time is less. Minimum material handling cost. Simplified production, planning and control systems are possible. Less space is occupied by work transit and for temporary storage. Reduced material handling cost due to mechanised handling systems and straight flow. Perfect line balancing which eliminates bottlenecks and idle capacity. Manufacturing cycle is short due to uninterrupted flow of materials.

Operation Management Books

Small amount of work-in-process inventory. Unskilled workers can learn and manage the production. A breakdown of one machine in a product line may cause stoppages of machines in the downstream of the line. A change in product design may require major alterations in the layout. The line output is decided by the bottleneck machine.

Comparatively high investment in equipments is required. Lack of flexibility.

A change in product may require the facility modification. A combination layout is possible where an item is being made in different types and sizes. Here machinery is arranged in a process layout but the process grouping is then arranged in a sequence to manufacture various types and sizes of products.

It is to be noted that the sequence of operations remains same with the variety of products and sizes. Figure 2. In this type of layout, the material, or major components remain in a fixed location and tools, machinery, men and other materials are brought to this location. This type of layout is suitable when one or a few pieces of identical heavy products are to be manufactured and when the assembly consists of large number of heavy parts, the cost of transportation of these parts is very high.

Helps in job enlargement and upgrades the skills of the operators. The workers identify themselves with a product in which they take interest and pride in doing the job. Greater flexibility with this type of layout. Layout capital investment is lower. A grouping of equipment for performing a sequence of operations on family of similar components or products has become all the important.

Group technology GT is the analysis and comparisons of items to group them into families with similar characteristics. GT can be used to develop a hybrid between pure process layout and pure flow line product layout. This technique is very useful for companies that produce variety of parts in small batches to enable them to take advantage and economics of flow line layout.

The application of group technology involves two basic steps; first step is to determine component families or groups. The second step in applying group technology is to arrange the plants equipment used to process a particular family of components. This represents small plants within the plants. The group technology reduces production planning time for jobs.

It reduces the set-up time. Thus group layout is a combination of the product layout and process layout. It combines the advantages of both layout systems. Here, the objective is to minimize the intercell movements. The basic aim of a group technology layout is to identify families of components that require similar of satisfying all the requirements of the machines are grouped into cells.

Each cell is capable of satisfying all the requirements of the component family assigned to it. The layout design process considers mostly a single objective while designing layouts. In process layout, the objective is to minimize the total cost of materials handling. Because of the nature of the layout, the cost of equipments will be the minimum in this type of layout.

In product layout, the cost of materials handling will be at the absolute minimum. But the cost of equipments would not be at the minimum if the equipments are not fully utilized. In-group technology layout, the objective is to minimize the sum of the cost of transportation and the cost of equipments. So, this is called as multi-objective layout. Component standardization and rationalization. Reliability of estimates. Effective machine operation and productivity. Customer service.

It can decrease the— 1. Paper work and overall production time. Work-in-progress and work movement. Overall cost. If the product mix is completely dissimilar, then we may not have meaningful cell formation. Adopting a product layout makes sense when the batch size of a given product or part is large relative to the number of different products or parts produced.

Assembly lines are a special case of product layout. In a general sense, the term assembly line refers to progressive assembly linked by some material-handling device.

The usual assumption is that some form of pacing is present and the allowable processing time is equivalent for all workstations. Within this broad definition, there are important differences among line types. A few of these are material handling devices belt or roller conveyor, overhead crane ; line configuration U-shape, straight, branching ; pacing mechanical, human ; product mix one product or multiple products ; workstation characteristics workers may sit, stand, walk with the line, or ride the line ; and length of the line few or many workers.

The range of products partially or completely assembled on lines includes toys, appliances, autos, clothing and a wide variety of electronic components. In fact, virtually any product that has multiple parts and is produced in large volume uses assembly lines to some degree. A more-challenging problem is the determination of the optimum configuration of operators and buffers in a production flow process. A major design consideration in production lines is the assignment of operation so that all stages are more or less equally loaded.

Consider the case of traditional assembly lines illustrated in Fig. The first operation requires 3 minutes per unit; the second operation requires 1 minute per unit; and the third requires 2 minutes per unit. The first workstation consists of three operators; the second, one operator; and the third, two operators. An operator removes a part from the conveyor and performs some assembly task at his or her workstation. The completed part is returned to the conveyor and transported to the next operation.

The number of operators at each workstation was chosen so that the line is balanced. This is also true for other two stations. Since the parts arrive at a rate of one per minute, parts are also completed at this rate.

Assembly-line systems work well when there is a low variance in the times required to perform the individual subassemblies. If the tasks are somewhat complex, thus resulting in a higher assembly-time variance, operators down the line may not be able to keep up with the flow of parts from the preceding workstation or may experience excessive idle time.

An alternative to a conveyor-paced assembly-line is a sequence of workstations linked by gravity conveyors, which act as buffers between successive operations. This would occur when, for balance purposes, workstation size or the number used would have to be physically modified. The most common assembly-line is a moving conveyor that passes a series of workstations in a uniform time interval called the workstation cycle time which is also the time between successive units coming off the end of the line.

At each workstation, work is performed on a product either by adding parts or by completing assembly operations. The work performed at each station is made up of many bits of work, termed tasks, elements, and work units. Such tasks are described by motion-time analysis. Generally, they are grouping that cannot be subdivided on the assembly-line without paying a penalty in extra motions.

The total work to be performed at a workstation is equal to the sum of the tasks assigned to that workstation. The line-balancing problem is one of assigning all tasks to a series of workstations so that each workstation has no more than can be done in the workstation cycle time, and so that the unassigned idle time across all workstations is minimized.

The problem is complicated by the relationships among tasks imposed by product design and process technologies. This is called the precedence relationship, which specifies the order in which tasks must be performed in the assembly process. The steps in balancing an assembly line are: Specify the sequential relationships among tasks using a precedence diagram.

Select a primary rule by which tasks are to be assigned to workstations, and a secondary rule to break ties. Assign tasks, one at a time, to the first workstation until the sum of the task times is equal to the workstation cycle time, or no other tasks are feasible because of time or sequence restrictions.

Repeat the process for workstation 2, workstation 3, and so on until all tasks are assigned. If efficiency is unsatisfactory, rebalance using a different decision rule.

The MS car is to be assembled on a conveyor belt. Five hundred cars are required per day. Production time per day is minutes, and the assembly steps and times for the wagon are given below. Find the balance that minimizes the number of workstations, subject to cycle time and precedence constraints. Draw a precedence diagram as follows: Determine workstation cycle time. Select assignment rules.

Note that D should be assigned before B, and E assigned before C due to this tie-breaking rule. Make task assignments to form workstation 1, workstation 2, and so forth until all tasks are assigned.

It is important to meet precedence and cycle time requirements as the assignments are made. Station Task Task time Remaining Feasible Task with Task with in sec unassigned remaining most longest ope- time in sec tasks followers ration time Station 1 A 45 5.

Calculate the efficiency. Evaluate the solution. An efficiency of 77 per cent indicates an imbalance or idle time of 23 per cent 1. In addition to balancing a line for a given cycle time, managers must also consider four other options: Pacing is the movement of product from one station to the next after the cycle time has elapsed. Paced lines have no buffer inventory. Unpaced lines require inventory storage areas to be placed between stations. Studies have shown that paced production and high specialization lower job satisfaction.

One study has shown that productivity increased on unpaced lines. Many companies are exploring job enlargement and rotation to increase job variety and reduce excessive specialization. For example, New York Life has redesigned the jobs of workers who process and evaluate claims applications.

Instead of using a production line approach with several workers doing specialized tasks, New York Life has made each worker solely responsible for an entire application. This approach increased worker responsibility and raised morale. In manufacturing, at its plant in Kohda, Japan, Sony Corporation dismantled the conveyor belts on which as many as 50 people assembled camcorders.

It set up tables for workers to assemble an entire camera themselves, doing everything from soldering to testing. And if something goes wrong, only a small section of the plant is affected. This approach also allows the line to match actual demand better and avoid frequent shutdown because of inventory buildups. A single-model line produces one model with no variations. Mixed model production enables a plant to achieve both high-volume production and product variety. However, it complicates scheduling and increases the need for good communication about the specific parts to be produced at each station.

In turn, the maximum line efficiency varies considerably with the cycle time selected. Thus, exploring a range of cycle times makes sense. A manager might go with a particularly efficient solution even if it does not match the output rate. The manager can compensate for the mismatch by varying the number of hours the line operates through overtime, extending shifts, or adding shifts. Multiple lines might even be the answer. For process layouts, the relative arrangement of departments and machines is the critical factor because of the large amount of transportation and handling involved.

Work centres that interact frequently, with movement of material or people, should be located close together, whereas those that have little interaction can be spatially separated. One approach of designing an efficient functional layout is described below. List and describe each functional work centre. Obtain a drawing and description of the facility being designed. Identify and estimate the amount of material and personnel flow among work centres 4.

Use structured analytical methods to obtain a good general layout. Evaluate and modify the layout, incorporating details such as machine orientation, storage area location, and equipment access.

The first step in the layout process is to identify and describe each work centre. The description should include the primary function of the work centre; drilling, new accounts, or cashier; its major components, including equipment and number of personnel; and the space required.

The description should also include any special access needs such as access to running water or an elevator or restrictions it must be in a clean area or away from heat. For a new facility, the spatial configuration of the work centres and the size and shape of the facility are determined simultaneously.

Determining the locations of special structures and fixtures such as elevators, loading docks, and bathrooms becomes part of the layout process.

Production and operations management

However, in many cases the facility and its characteristics are a given. In these situations, it is necessary to obtain a drawing of the facility being designed, including shape and dimensions, locations of fixed structures, and restrictions on activities, such as weight limits on certain parts of a floor or foundation. Fig 2. For manufacturing systems, material flows and transporting costs can be estimated reasonably well using historical routings for products or through work sampling techniques applied to workers or jobs.

The flow of people, especially in a service system such as a business office or a university administration building, may be difficult to estimate precisely, although work sampling can be used to obtain rough estimates. Flow Matrix A flow matrix is a matrix of the estimated amounts of flow between each pair of work centres. The flow may be materials expressed as the number of loads transported or people who move between centres.

Each work centre corresponds to one row and one column, and the element fij designates the amount of flow from work centre row I to work centre column j. Normally, the direction of flow between work centres is not important, only the total amount, so fij and fji can be combined and the flows represented using only the upper right half of a matrix.

Flow-cost Matrix A basic assumption of facility layout is that the cost of moving materials or people between work centers is a function of distance travelled.

Although more complicated cost functions can be accommodated, often we assume that the per unit cost of material and personnel flows between work centres is proportional to the distance between the centres.

So for each type of flow between each pair of departments, i and j, we estimate the cost per unit per unit distance, cij. Proximity Chart Proximity charts relationship charts are distinguished from flow and flow-cost matrices by the fact that they describe qualitatively the desirability or need for work centres to be close together, rather than providing quantitative measures of flow and cost. These charts are used when it is difficult to measure or estimate precise amounts or costs of flow among work centres.

This is common when the primary flows involve people and do not have a direct cost but rather an indirect cost, such as when employees in a corporate headquarters move among departments payroll, printing, information systems to carry out their work.

Hence, service facility layouts should provide for easy entrance to these facilities from the freeways. Well-organized packing areas, easily accessible facilities, well designed walkways and parking areas are some of the requirements of service facility layout. Service facility layout will be designed based on degree of customer contact and the service needed by a customer. These service layouts follow conventional layouts as required.

For example, for car service station, product layout is adopted, where the activities for servicing a car follows a sequence of operation irrespective of the type of car.

Hospital service is the best example for adaptation of process layout. Here, the service required for a customer will follow an independent path. The layout of car servicing and hospital is shown in Figs. Factory building 2. Lighting 3. Claimatic conditions 4. Ventilation 5. Work-related welfare facilities I. It has to serve as a part of the production facilities and as a factor to maximise economy and efficiency in plant operations. Factory building is like skin and bones of a living body for an organisation.

It is for these reasons that the factory building acquires great importance. Following factors are considered for an Industrial Building: Design of the building. Types of buildings. Following factors are considerations in the designing of a factory building: Flexibility is one of the important considerations because the building is likely to become obsolete and provides greater operating efficiency even when processes and technology change.

Flexibility is necessary because it is not always feasible and economical to build a new plant, every time a new firm is organised or the layout is changed. With minor alternations, the building should be able to accommodate different types of operations.

Product and equipment: The type of product that is to be manufactured, determines column-spacing, type of floor, ceiling, heating and air-conditioning. A product of a temporary nature may call for a less expensive building and that would be a product of a more permanent nature. Similarly, a heavy product demands a far more different building than a product which is light in weight. Growth and expansion are natural to any manufacturing enterprises. They are the indicators of the prosperity of a business.

The following factors should be borne in mind if the future expansion of the concern is to be provided for: Rectangular shapes facilitate expansion on any side. Employee facilities and service area: Employee facilities must find a proper place in the building design because they profoundly affect the morale, comfort and productivity. The building plan should include facilities for lunch rooms, cafeteria, water coolers, parking area and the like.

The provision of some of these facilities is a legal requirement.

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Others make good working conditions possible. And a good working condition is good business. Types of Buildings Industrial buildings may be grouped under three types: Single-storey buildings, 2.

Multi-storey buildings The decision on choosing a suitable type for a particular firm depends on the manufacturing process and the area of land and the cost of construction. Single-storey buildings offer several operating advantages.

A single-storey construction is preferable when materials handling is difficult because the product is big or heavy, natural lighting is desired, heavy floor loads are required and frequent changes in layout are anticipated. Advantages Advantages of single-storey building are: There is a greater flexibility in layout and production routing. The maintenance cost resulting from the vibration of machinery is reduced considerably because of the housing of the machinery on the ground.

Expansion is easily ensured by the removal of walls. The cost of transportation of materials is reduced because of the absence of materials handling equipment between floors. All the equipment is on the same level, making for an easier and more effective layout supervision and control.

Greater floor load-bearing capacity for heavy equipment is ensured. The danger of fire hazards is reduced because of the lateral spread of the building. Limitations Single-storey buildings suffer from some limitations. High cost of land, particularly in the city.

High cost of heating, ventilating and cleaning of windows. High cost of transportation for moving men and materials to the factory which is generally located far from the city.

Multi-storey buildings are useful in manufacture of light products, when the acquisition of land becomes difficult and expensive and when the floor load is less. Maximum operating floor space per sq. This is best suited in areas where land is very costly. Lower cost of heating and ventilation.

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Reduced cost of materials handling because the advantage of the use of gravity for the flow of materials. Limitations Following are the disadvantages of multi-storey building: Materials handling becomes very complicated. A lot of time is wasted in moving them between floors. A lot of floor space is wasted on elevators, stairways and fire escapes. Floor load-bearing capacity is limited, unless special construction is used, which is very expensive. Natural lighting is poor in the centres of the shop, particularly when the width of the building is somewhat great.

Layout changes cannot be effected easily and quickly. Generally speaking, textile mills, food industries, detergent plants, chemical industries and software industry use these types of buildings. Good visibility of the equipment, the product and the data involved in the work process is an essential factor in accelerating production, reducing the number of defective products, cutting down waste and preventing visual fatigue and headaches among the workers.

This study book intends to provide both the introduction to and advanced knowledge in the SCOM field. Providing readers with a working knowledge of SCOM, this textbook can be used in core, special and advanced classes. Therefore, the book is targeted at a broad range of students and professionals involved in SCOM.

Since the managers use both quantitative and qualitative methods in making their decisions, the book follows these practical knowledge requirements. Decision-oriented and method-oriented perspectives determine the philosophy of the book.

In addition, because of the extensive use of information technology and optimization techniques in SCOM, we pay particular attention to this aspect. Next, a strong global focus with more than 50 up-to-date case studies from all over the world is a distinguishing feature of this study book. The case studies encompass different industries and services and consider examples of successful and failed SCOM practices in Europe, America, Asia, Africa and Australia. Finally, following the expectations of modern students and the positive teaching experiences in SCOM over the past ten years, we divided this textbook into a hardback and an electronic part.

In the hardback, basic theoretical concepts, case studies, applications,and numerical examples are explained. The e-supplement supports the hardback and provides students and teachers with additional case studies, video streams, numerical tasks, Excel files, slides and solutions.

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