40 40 Production and Operations Management

8/6/2019 40 40 Production and Operations Management

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(Book ID: B1133)

Set- 1 (60 Marks)

1. Explainin briefthe origins ofJust in Time. Explain the different types ofwastes that can be

eliminated using JIT.

Ans. Just in time were developed to minimize wastage across the organization. If a firm is

optimistic about the demand, then that firm increases their planned inventories. On the other hand

if the demand is weak when compared to the expectations, then that firm s unplanned inventories

are high. That means companies dont keep a lot of excess inventory, then manufacture a product

as an order comes in. It is management philosophy of continuous and forced problem solving.

Theseven types ofwastes to beeliminated according to JIT are :

1 Over production

Over production is to manufacture products before it is actually needed. If the demand for that

product decreases, the extra parts or products produced may not be useful or needed. Also

over production results in high storage costs and is also difficult to detect defects. So, over

productions is considered a waste.

2 Inventory.

Excess procurement or production builds up stock of materials which are not immediately use,

this locking space and fund carrying heavy cost.

3 Waiting time.

Waste of time happen when goods are not moving or being processed. The operator, the

machine or the part will either be not working or be worked upon. The duration is can be said to

be unproductive and may create more serious consequences.

4. Movement

Any unnecessary movement is a waste of energy; it causes blockages, disrupting movements

and delaying the flow of other items creating delays.


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5. Effort:

The people, who work, do not make a study as to how the products on which they are making

are utilized and do not realize the purpose for which they are made. This lack of education will

lead to waste of resources. Finally, they end up in shortage of resources whenneeded.

6. Defectiveproducts.

The defective products leads to a tremendous loss to the company. This is because they use up

the same equipments, workmen and the time that would be used to make good products. Thus

defective products use up resources and result in losses.

7. Over Processing

Some steps like unnecessary processing or production do not add value to the final output. As a

results, it is waste of all the inputs that go into the process.

Q.2 What isvalueengineering or valueanalysis ? Elucidatefive companies which have

incorporate VE with briefexplanation.

Ans. Value of engineering (VE) or value Analysis is a methodology by which we try to find

substitutes for a product or an operation.

The concept of value engineering originated during the second world war . It was developed by the

General Electric corporations (GEC). Value Engineering has gained popularity due to its potential for

gaining high Returns on investment (ROI). This methodology is widely used in business re-

engineering, government projects, construction, assembling and machining processes, health care

and environmental engineering, and many others. Value engineering process calls for a deep study

of a product and the purpose for which it is used, such as the raw materials used; the processes of

transformation; the equipment needed, and many others. It is also questions whether what is

being used is the most appropriate and economical. This applies to all aspects of the products.

1. GENERAL ELECTICALS CORPORATION (GEC)


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The concepts of value engineering originated in 1947 in General Electricals

corporation (GEC) When a substitute for asbestos for flooring had to be found.

Specialized dealers could provide an equally good material at a lesser price.

Initially, the practioners were the people in charge of purchasing who tried to locate

substitute material which would be equally good, ifnot better, at a lower price. This

the first and basic approach to value engineering. A the concept percolated to the

manufacturing departments, engineers applied the same principles and found that,

they could use alternate materials, which were cheaper giving the same

performance. It was also fund that dimensions and tolerance could be altered

without affecting the performance of the part or the product. The investigations took

them on the path of eliminating some operations. The focus was on the value of each

bit materials, each operation. This approach led to the design stage.

2. ASHOK LEYLAND.

In implementation of VA, Ashok Leyland changed gear material from phosphor

bronze to a less expensive cast iron and eliminated frequent field complaint of gear

seizure in trucks.

3. TVS.

T.V. Sundaram Lyenger (TVS) Limited is one of the largest automobile distribution

companies in India.

During the mid 1940 to 1960s, TVS based in Madurai was ranked as the best bus

transportation system in India. It could manage to run the fleets for about 96% of the

time.

TVS used the VE approach to restore the mobility of buses that had broken down.

They stocked their garage with some critical assemblies of a bus. Wheneve r, a part or

an assembly failed of a bus, they replaced it immediately with a new one, thus

restoring mobility within a couple of hours.


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When compared to the traditional method, this approach has gained much more

benefits to the company, it helped to save time, reduce cost, efficient, quicker, and

competitive.

4. MODI XEROX.

Modi Xerox designed the VE-d low cost copier 1025 ST, which uses a single tray. The

advantage ofnew design is that it is easy to operate and the cost is also very low.

5. TITAN

Titan

watches in

troducedn

ew design

s adoptin

g a strategy of inn

ovation

.

Q.3 Explain different types of quantitative models. Differentiate between work

study and motion study.

Ans. There are different quantitative models.

1. LINEAR PROGRAMMING: Linear programming technique is often used for

optimizing a given objective like; profit or revenue maximization, or cost outgo

minimization. Distribution of the revenues is the critical issue, when there are

limited resources and they have to meet competing demands.

2. TRANSPORTATION MODEL: Transportation model is concerned with goods

from manufacturing centres or warehouses which have to be supplied to

depots or retails outlets. The demand and supply position of the places where

they are required or produced and the cost of transportation are considered in

the model. We use this model to economize.

3. ASSISGNMENT MODEL: Allocating jobs or persons to machines, awarding

different projects to contractors is done so that maximum returns occur or less

expenses are incurred. Hence, calls for the use of this model.

4. INVENTORY CONTROL MODEL: Inventory control model considers the:


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y Frequency of placing orders.

y Quantities per order considering the cost of placing an order.

y Number of pieces that are to be kept in reserve.

y Rate of consumption.

y Lead time required for the supplier.y Cost involved in storage.

We have different models which give solutions to optimization depending

upon the probabilities of consumption and supply.

5. WAITING LINE MODELS: Queues are formed when the rate of services is at a

variance with the rate of arrival. They are formed when the rate of production

is less at particular points compared to the previous one. Sometimes we see

multiple service points and a single queue are formed for feeding them.Number of items which includes the following is studied with some special

techniques.

y People to be serviced.

y Rate of service

y Type of queue discipline that is intended to be followed.

y Policy of priority

y Tolerable amounts of waitin

y

Others.6. SIMULATION MODELS: Simulation models are used when we will not be able

to formulate mathematical model. So, we develop a model which resembles a

real life situation. Based on this pattern, we predict and plan our procurement,

production, delivery and other actions.

7. PERT (PROJECT EVALUATION AND REVIEWTECHNIQUE) AND CPM (CRTICAL

PATH METHOD) MODELS:When projects are undertaken with a number of

activities, some happens in sequence, with gaps of weeks or months and some

happens simultaneously. It is important to estimate the time required for

completion of the project. A lot of coordination is needed while supplying the

resources. It is also equally important to identify the bottlenecks and

smoothen resources so that time schedules are maintained. Delayed

completion may entail penalties. In this model, we adopt special methods to

make the system.


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Q.4 What is rapid prototyping ? Explain the difference between Automated flow line and

Automated assembly line with examples.

Work study Motions study.

We can say that work study is being

conducted when analysis of work

methods is conducted during the period

when a job is done on a machine or

equipment.

Method study is on studying the method

currently being used and developing a new

method of performing the task in a better

way.

The study helps in designing the

optimum work method and

stan

dardization

of the work method.

Operation flow charts, motion charts, flow

process charts, which are the elements of the

task are studied to fin

d the purpose of eachactivity, the sequences in which they are

done, and the effect of these on the work.

The study enables the methods

engineer to search for better methods

for higher utilization of man and

machine and accomplishment of higher

productivity.

The study may help in changing some of

them and even eliminate some of them to

effect improvements.

The study gives an opportunity to the

workmen to learn the process of study

thus making them able to offer

suggestions for improved methods.

The new method should result in saving of

time, reduced motions and simpler activities.


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Ans. Prototyping is a process by which a new prod uct is developed in small numbers.

Prototyping is helpful to:

y Determine the suitability of the materials

y Study the various methods of manufacture

y Determine type of machinery required

y Develop techniques to overcome problems that may be encountered when full scale

manufacturing is undertaken.

Prototype do meet the specification of the components that enter a product and performance can

be measured on those. It helps in confirming the design and any shortcomings can be rectified at

low cost. If serious def ects or problems arise during manufacturing, a thorough change in design or

even its replacement may be considered. Toa arrive at decisions and to make use of the

advantageous stated above, it is important that the prototypes are made within the shortest

possible time, Rapid prototyping facilities this.

The advanced Rapid Prototype Modelling Processes are:

ComputerAided Design (CAD)

Selective Laser Sintering (SLS)

Fused Deposition Modelling (FDM)

Lamination Object Manufacturing (LOM)

Electronic Beam Melting (EBM)

Different between Automated Flow lines and Assembly Flow line.

AUTOMATED FLOW LINES ASSEMBLY FLOW LINES

Several Automated machines are linked by a All equipments are needed to in automated


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transfer system. Assesmbly line

Handling machine have main role to move semi

finished product to the next stage.

All equipments make role of making sub-assemblies

put together and fitted.

Semi-finished products are the main core

activities.

Here Sub-assemblies product are the core activites.

Here raw materials are achieving to get required

shapes and acquire special properties.

Here intermediated products are achieving to get

finished product.

The materials are needed to be moved, held,

rotated, fitted and positioned for completing

different operations.

Here All parts or sub-assemblies are fitted to enables

the product to be in readiness to perform the

function it was designed to. This process is called

assembly.

Human intervention may be needed to verify

that the operations are taking place according to

standards.

No human intervention is needed, methodologies

are framed to achieve the final result, basic principle

is to fit parts together and ensure linkages so that

the functions are integrated and give out the desired

output.

Q.5 Explain Break even Analysis and centre of gravity methods. Explain product layout and

processlayout with examples.

Ans. Break even analysis

Every manufacturing company will have three major contributors to cost;

1. Investments made for land, plant and machinery r esulting in interest and depreciation.

2. Recurring expenses, which are not proportional to the quantity of production.

3. Variable costs, which are directly proportional to the quantity produced.

For our calculations, we combine the first two costs together and call them fixed costs. We call

those costs that depend on the quantity of production as variable costs.

We compare the total costs for different locations on estimated amounts per annum and select

whichever locations costs the least. However we will have to consider the possible variations in

production levels during the foreseeable time spans and take decision.


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CENTRE OF GRAVITY METHOD.

Centre of gravity method is used mainly when;

y Transportation costs, either for distribution of products or collection of materials from

different suppliers is the main criterion.

y Production rates are high.

y The volume and weights of materials that have to be moved are huge.

y Time taken either to receive materials 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, that is, number of items, or the weights that need to be moved from the

central location to the existing or demanding point. We use this method when, both distance and

load have to be considered for optimality in terms of costs.

PRODUCT LAYOUT

Product layout is also called as production lines or assembly lines. They are designed and laid out in

such a way that only few products are capable of being manufactured or assembled. Materials flow

through the various facilities. These use special machines to perform specific operations to produce

only one product at one time. So, companies should set different set of machines for different

products. Workers perform a narrow range of activities to complete the operations on the product

as it moves in a flow line. The operation times, the sequence of movements and routing procedures

are highly standardized to meet production requirements which are synchronized with many such

TO THECOST

CONTRIBUTING

COMPANIESMAJOR

CONTRIBUTORSTOCOST

FIXED COSTS

LAND,PLANTAND

MACHINERY

RECURRINGEXPENSES

VARIABLECOSTS

PRODUCTIONCOST


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products to complete finished goods to meets demands. Using special machines and implementing

standardization in operations have many advantages which are listed below:

y The skill required of the workers is low

y Supervision is minimal

y Training needs are small

Precautions to be taken are:

y Constant check on the processes needs to be performed so that quality is assured.

y Corrective measures have to be implemented to avoid rejections, since, the quantities that

get manufactured will be continuous.

y Check for the behavioral of the worker. As jobs are repetitive, workers tend to be bored and

lose concentration. This may affect productivity and quality.

Example:

Let us consider an examples of a stainless steel manufacturing industry, in which the operations

turning, milling and drilling happen in a sequence. Testing is performed in each process to assure

the quality. The items are then sent to the assembly block. The items that arrive for assembly are

either bought out items or made item components from elsewhere in the plant. The final product

inspection is made and send to the packing dispatch.

TURNINGOPERATION

MILLINGMACHINES

DRILLINGMACHINES

PACKING

DISPATCH

INSPECTION ASSSEMBLY

PROCESS LAYOUT

DESIGN OF PROCESS LAYOUT

The analysis involved in the design of production lines and assembly lines relates primarily to

timing, coordination, and balance among individual stages in the process.

For process layouts, the relative arrangement of departments and machines is the critical

factor because of the large amount of transportation and handling involved.


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PROCEDURE FOR DESIGNING PROCESS LAYOUTS

Process layout design determines the best relative locations of functional work centres.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.

1. List and describe each functional work centre.

2. Obtain a drawing and description of the facility being designed.

3. Identify and estimate the amount of material and personnel flow among work centres

4. Use structured analytical methods to obtain a good general layout.

5. 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 incl ude 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 runn ing

water or an

elevator) or restriction

s (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.

However, in many cases the facility and its characteristics are a given. In these situations, it is

necessary to obtain a drawing of the faci lity being designed, including shape and dimensions,

location

s of fixed structures, an

d restriction

s on

activities, such as weight limits on

certain

parts

of a floor or foundation.


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Fig 2.11Relationship flow diagram

To minimize transport times and material-handling costs, we would like to place close

together those work centres that have the greatest flow of materials and people between them.

To estimate the flows between work centres, it is helpful to begin by drawing relationship diagram

as shown in Fig. 2.11.

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.

The amounts and/or costs of flows among work centres are usually presented using a flow

matrix, a flow-cost matrix, or a proximity chart.

Q.6 Explain Jurans Quality Trilogy and Crosbysabsolutes ofquality. List out thepillars of total

productivemaintenance.

Ans.JURANS QUALITYTRIOLOGY

Juran uses his famous universal Breakthrough Sequence to implement quality programmes. The

universal break through sequences are ;

y Proofofneed: there should be a compelling need to make changes.

y Project identification: here what is to be changed is identified. Specific projects with time

frames and the resource allocation are decided.

y Topmanagement commitment:Commitment of the top management is to assign people

and fix responsibilities to complete the project.


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y Diagnostic journey:Each team will determine whether the problems result from systemic

causes or are random or are deliberately caused. Root causes are ascertained with utmost

certainty.

y Remedial Action: This is the stage when changes are introduced. Inspection, testing, and

validation are also included at this point.

y Holding on to thegains: the above steps results in beneficiary results. Having records or all

actions and consequences will help in further improvements. The actions that results in the

benefits derived should be the norm f or establishing standards.

JURAN HAS CATEGORISED COSTOF QUALITY INTO FOUR CATEGORIES:

1. Failure costs internal: 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 spare parts

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, Quality

planning, Quality control, and Quality improvement, forming t he triology to achieve TOTAL

QUALITY MANAGEMENT.

JURANS ARGUMENTSAYS THAT;

y Quality is the result of good planning consideration the needs of both internal and external

customers and develops processes to meet them. The processes are also planned to meetthem.

y Quality is built into the system of manufacture, inputs and processes that are on stream like

raw material, spare parts, labour, machine maintenance, training, warehousing, inspection

procedures, packaging, and other. All these have to follow standards and control exercises

to make sure that mistake do not occur often and that if mistakes do occur then they are

corrected at the source.

y Quality improvement measures are essential to keep the quality culture alive. Newer

methods will be found, some operations can be eliminated, improved technology available.

In short, as experience is gained things can always be done better. IT is for the management

to take the initiative an encourage the employees to be on lookout for opportunities for

improvement.

CROSBYS ABSOLUTES OF QUALITY


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Like Deming, Crosby also lays emphasis on top management commitment and responsibility for

designing the system so that defects are not inevitable. He urged that there be no restriction on

spending for achieving quality. In the long run, maintaining quality is more economical than

compromising on its achievement. His absolutes can be listed as under:

y

Quality is con

forman

ce to requiremen

ts,n

ot goodn

essy Prevention, not appraisal, is the path to quality.

y Quality is measured as the price Paid for non-conformance and as indices

y Quality originates in all factors. There are no quality problems. It is the people designs and

processes that create problems.

Crosby also has given 14 points similar to those of Deming. His approach emphasizes on

measurement of quality, increasing awareness, corrective action, error cause removal and

continuously reinforcing the system, so that advantages derived are not lost over time. He opined

that the quality management 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, every

time.

2. Communication: Flow of information between departments, suppliers, customers helps inindentifying 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 in good condition.

Generally equipments deteriorate because usage wear to the parts introducing inaccuracies on the products

made on them. When the deterioration produces components which exceeds the permitted deviations

rendering them unacceptable, maintenance is undertaken to bring back the machine to produce acceptable

components. Sometimes the failure is sudden and serious and the equipment stops working. Disruption of

production and emergency repairs works are costly and schedules are missed causing delays in supplies and

consequent losses. These breakdowns occur because the equipment was carrying hidden defects which

were not apparent. All theses are attended to by the maintenances department. Historical records indicate

the probability of failures over different periods thus enabling us to plan to attend to them. With progress in

automation, we have costly equipments. We have flow lines and any one machine breaking down causes a

series of machine to be idle. So, we have to move towards zero breakdowns like we want to move towards

zero defects by implementing TQM Tools.

TPM puts the responsibility of maintenance where it belongs to and the operator who uses the equipment. It

is a companywide activity which involves all the people. The main thrust is eliminating all break downs. The

focus is on the operating personnel because they would know about malfunctioning earlier and more than


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anybody else. They work on the machine and are aware of the slightest 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 point for learning and excellence. The worker can

suggest better ways of improving quality, productivity, and design. This help in continuous improvement,

Team work an

d participation

improves the quality culture. The prin

ciples of 5S- the housekeepin

g activitieswhich improve efficiency at workplace is considered a measurable standard to aid the implementation at

TPM even in the office rooms.


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(Book ID: B1133)

Set- 2 (60 Marks)

Q1. EXPLAIN LOGICAL PROCESS MODELLING AND PHYSICAL PROCESS MODELLING.

WHAT ARE THE INGREDIENTS OF BUSINESS PROCESS?

ANS.LOGICAL PROCESS MODELLING

Logical process modeling is the representation of putting together all the activities of

business process in details and making a representation of them.

The initial data collected need to be arrange in a logical manner so that, links are

made betweennodes for making for the workflow smooth. The steps to be followedto make the work smoother are given below:

1. Capture relevant data in detail to be acted upon.

2. Establish controls and limit access to the data during processes execution

3. Determine which task in the process is to be done and also the subsequent

task in that process.

4. Make sure that all the relevant data is available for all the tasks.

5. Make the relevant and appropriate data available for that task.

6. Establish a mechanism to indicate acceptance of the results after every task orprocess. This is to have an assurance that flow is going ahead with

accomplishments in the desired path.

Some of these activities may occur in a sequential order whereas, some of them run

parallel. There may even be circular paths, like re -work loops. Complexities arise

when the processes activities are not connected together.

Logical processes model consists of only the business activities and shows the

connectivity among them. The process model is a representation of the businessactivities different from the technology dependent ones. Thus, we have a model that

is singularly structured only for business activities. Computer programmes are also

present in the total system. This allows the business oriented executives to be in

control of the inputs, processes and outputs. The logical process model improves,


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control on the access to data. It also indentifies, who is in possession of data at

different nodes in the dataflow network that has been structured.

A few of the logical modeling formats are given below.

1. Process Descriptions with task sequences and data addresses.2. Flow chart with various activities and relationships

3. Flow diagrams

4. Function hierarchies

5. Function dependency diagram

Every business activity, when considered as a logical process model, can be

represented by a diagram, it can be decomposed and meaningful names can be given

to the details. Verb and noun form combinations can be used to describe at each

level. Nouns give the name of the activity uniquely and are used for the entire model

meaning the same activity.

PHYSICAL PROCESS MODELLING

Physical process modeling is concerned with the actual design of data base meeting

the requirement of the business.

Physical modeling deals with the conversion of the logical model into a relation

model. Object gets defined at the schema level. The objects here are tables created

on the basis of entities and attributes. A database is defined for the business. All the

information is put together to make the database software specific. This means that

the objects during physical modeling vary on the database software being used. The

outcomes are server model diagrams showing tables and relationships with a

database.

BELOWARE THE INGREDIENTS OF BUSINESS PROCESS.

The ingredients that might be used in a business process can be briefly outlined as

shown below.

y The data which accomplishes the desired bus iness objective.


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WORK BREAK DOWN STRUCTURE.

Theen

e process of a projec

may becons

ere to be made up onnumber ofsubprocess placed

in different stagecalled the work breakdownstructure (WBS

WBS is the technique to analysis the content of work and cost by breaking it down into its

component parts rojects keystages from the highest level of the WBS which is then used to show

the details at the lower levels of the project. Each keystagecomprises many task identified at the

start of planning and later this list will have to bevalidated.

WBS is produced by indentifying the keyelements breaking each elements down into component

parts and continuing to breakdown until manageable work packages have indentified. These can

ROJECTMA AGEME T

ROJECTI TERGRATIO

MA AGEME T

ROJECT COSTMA AGEME T

ROJECTCOMMU ICATIO

ROJECT SCO EMA AGEME T

ROJECT QUALITY

MA AGEME T

ROJECT RISKMA AGEME T

ROJECT TIMEMA AGEME T

ROJECT HR

MA AGEME T

EXECUTI G ROCESSES


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then be allocated to the appropriate person. The WBS does not shown dependencies other than a

grouping under the key stages. It isnot time based - there isno timescale on the drawing.

Chart showing the example of work break down structure.

A Work Breakdown Structure is a results-oriented family tree that captures all the work of a project

in an organized way. It is often portrayed graphically as a hierarchical tree, however, it can also be a

tabular list of "element" categories and tasks or the indented task list that appears in your Gantt chart

schedule. As a very simple example, Figure 1 shows a WBS for a hypothetical banquet.

EXAMPLE 1.


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EXAMPLE -2


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Q.3 T AKE AND EXAMPLE OF ANY PRODUCT OR PROJECT AND EXPLAIN PROJECT MANAGEMENT

LIFE CYCLE.

ANS. A life cycle of a project consists of the following steps.

y Understanding the scope of the project.

y Establishing objectives of the projects

y Formulating and planning various activities.

y Executing the project

y Monitoring and controlling the project resources.

y Closing and post completion analysis

PHASES OF PROJECT MANAGEMENT LIFECYLCE.

Project man

agemen

t life cycle has six phases:

1. Analysis and evaluation phase.

2. Marketing phase

3. Design phase

4. Execution phase

5. Control-inspecting, testing, and delivery phase

6. Closure and post completion analysis phase.

1. ANALYSIS AND EVALUATION PHASE: Analysis and evaluation phase is the initial phase ofany project. In this phase, information is collected from the customer pertaining to the

project. From the collected information, the requirements of the project are analyzed.

According to the customer requirement, the entire project is planned in a strategic manner.

The project manager conducts the analysis of the problem and submits a detailed report to

the top management.

2. MARKETING PHASE: A project proposal is prepared by a group of people including the

project manager. This proposal has to contain the strategic adopted to market the product

to the customer.

3. DESIGN PHASE: Design phase involves the study of inputs and outputs of the various project

stages.

a. Inputs received consist of project feasibility study, preliminary project evaluation

details, project proposal, and c ustomer interviews.

b. Outputsproduced consist of system design specifications, functional specifications

of the project, design specifications of the project and project plan.


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4. EXECUTION PHASEIn execution phase, the project manager and the term members work on

the project objectives as per the plan. At every stage during the execution, reports are

prepared.

5. Control- inspecting testingand delivery phase: During this phase, the project teams works

under the guidance of the project manager. The project manager has to ensure that the

team working under him is implementing the project designs accurately. The project has to

be tracked or monitored through its cost, manpower, and schedule. The project manager

has to ensure ways of managing the customer and marketing the future work, as well as

ways to perform quality control work

6. Closureand post completionanalysisphase: Upon satisfactory completion and delivery of

the intended product or service the staff performance has to be evaluated. The project

manager has to document the lessons from the project. Reports on project feedback are to

be prepared and analyzed. A project execution report is to be prepared.

Let us havea quick recap ofwhat isinvolved in theabovephases

a. Analysisand evaluationphase: The preparation stage involves the preparation and

approval of project outline, project plan, and project budget.

b. Assigning task to the teammembers: The next stage involves selecting and briefing

the project team about the proposals, followed by discussions on the roles and

responsibilities of the project member and the organization.

c. Feasibility study: The feasibility or research stage establishes whether the project is

feasible or not and establishes the risk factors likely to be faced during the course of

the project execution and the related key factors to overcome the problem

d. Executionphase:A detailed definition and plan for the project and its execution is

prepared by the team and coordinated by the project manager.e. Implementation stage: The implementation stage involves the execution of the

project as per the plan, this also involves careful monitoring of the project progress

and managing the changes, if any, within the scope of the project framework.

7. Closureand post completionanalysisphase: The final stage involves satisfactory delivery of

the product/service to the customers. Upon completion, a project review is to be conducted

by the project manager along with team member, sponsors, and customer. A project review

process involves discussions about the progress, performance, hurdles that were overcome

and problems faced , so that, such instances could be avoided in future projects.

ExampleNo.1


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ExampleNo.2


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ExampleNo.3

Q.4 EXPLAIN PMIS. WHATIS DIFFERENCEBETWEEN KEY SUCCESS FACTOR (KSF) AND KNOWLEDGE

(K) FACTOR ? EXPLAINWITH EXAMPLES.

ANS. PMIS (PROJECTMANAGEMENT INFORMATION SYSTEM)

An information system is mainly aimed at providing the management at different levels with

information related to the system of the organization. It helps in maintaining discipline in the

system.

An information system dealing with project management tasks is the project management

information system. It helps in decision making in arriving at opti mum allocation of resources. The

information system is based on a database of the organization. A project management information

system also hold schedule, scope changes, risk assessment and actual results.

The information is communicated to managers at different levels of the organization depending

upon the need. Let us find how a project management information system is used by different

stakeholders.


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WHONEEDS INFORMATION AND WHY?

Upper managers To know information on all project regarding progress,

problem, resource usage, costs and project goals. Thisinformation helps them take decisions on the projects. They

should review the projects at each milestone and arrive at

appropriate decision.

Project manager and department

managers

To see each project schedule, priority and use of resources to

determine the most efficient use across the organization.

Project team members To see schedule, task lists and specification so that they know

what needs to be done next.

Thefoursmajorsaspects ofa PMIS are:

1. Providing information to the major stakeholder.

2. Assisting the team members, stakeholders, managers with necessary information and

summary of the information shared to the higher level managers.

3. Assisting the manager in doing what if analysis about project staffing, proposed staffing

changes and total allocation of resources.

4. Helping organizational learning by helping the members of the organizations lean about

project management.

Usually, the team members, and not the systems administrators of the company, develop a good

PMIS. Organisations tend to allocate such responsibility by rotation among members with a well

designed and structured data entry and analytical format.

DIFFERENT BETWEENKEY SUCCESS FACTORS (KSF) AND KNOWLEDGE (K) FACTOR


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Key successfactors (KSF) Knowledge (k) factor

The KSF should be evolved based on a basic

consensus document (BCD)

Knowledge is the most powerful mover of the

wheels of progress

KSF will also provide an input to effective exit

strategy (EES)

Knowledge (k) factor is an index of the extent to

which one can manager today with yesterdays

knowledge content and also the extent to which

todays knowledge will be used tomorrow.

Broad level of KSF should be available at the

conceptual stage and should be firmed up and

detailed out during the planning stage. The

easiest way would be for the team to evaluate

each step for chances of success on a scale of

ten.

K factor would render the development process

more productive. The k factor of course,

undergoes correction through obsolescence, since

changes are now phenomenal.

KSF should be available to the management,

duly approved by the project manager before

execution and control stages.

Leaders should recognize the knowledge potential

of the younger managers. Seniority is no more an

automate scale for knowledge. It is equally

important for younger member not suppress their

knowledge potential from its application.

KSF rides normal consideration of time and

cost- at the levels encompassing client

expectation and management perception-time

and cost come into play as subservient to thesemajor goal.

Here time and cost does not matter, knowledge is

to be updated time to time to get better results.

In order to provide complete stability to

fulfillment of goals, a project manager needs to

constantly evaluate the key success factor from

time to time.

As age and experience advance wisdom gains, but

knowledge should always be updated and utilized.

It is the task of every team members to maximize

the k factor in all directions.

Example ofKey successfactor

According to TeachMeFinance.com, a turnkey project is "a project in which a builder/developer

contracts to construct a completed facility that includes all items necessary for use and

occupancy." Unfortunately, many turnkey businesses never capture the interest of the buyers.

Whether you're building in brick and mortar or building in computer code, there are several

factors critical to the success of your turnkey project.


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Know the Business

Several businesses can be set up as turnkey businesses, from food service to copy

management to telemarketing and sales. Whichever you decide, it is important to have an

intimate knowledge of the business you are building. One key factor in a successful turnkey

business is being able to anticipate the needs and desires of the potential owners before theyare brought on board. A salesman, for example, looking to purchase a turnkey sales business

will need an office as a base of operations; but since so much of the sales process is done

through phones, computers and other electronic devices, the turnkey developer may want to

include additional power outlets in the construction of the building, or desks with o nboard power

strips and surge protectors. These small additions can make a turnkey project a success.

Know the Area

Internet businesses often have nationwide access to clientele, but brick -and-mortar turnkey

operations sometimes run into trouble in areas poorly suited to the service they offer. For

example, an outdoor food service stand opening in Wilkes -Barre, Pennsylvania, will not do asmuch business (at least during the winter months) as one opening in an Orlando, Florida,

theme park. Knowing the area where you are constructing your turnkey business includes

knowing the weather conditions, the dominant demographic, the current popularity and number

of businesses like the one you are creating and the average income of the public. Planning a

turnkey business that uses these factors to its advantage will make the business more readily

sellable.

Make Connections

Turnkey businesses are designed to be ready to operate as soon as the buyer takes ownership.

Still, once they are sold, many businesses of this type run into problems when it comes toresupplying, logistics and advertising. Because of this, many buyers are wary of turnkey

operations. One way to quell any "down the road" fears is to have this part of the infrastructure

accounted for. Make contact with businesses which help advertise businesses, ship products,

supply copy paper and any other stock the owner might require. Obtain discounts from as many

as possible

Example ofKnowledge (k) factor

ABSTRACT

Most organisations are aware that in todays highly competitive environment managing effectively

their knowledge is the only way to achieve a sustainable competitive advantage. One of the primary

areas to which knowledge management can be applied is the field of project management. An

increasing number of business sectors are adopting a project approach to carry out a range of

essential activities where valuable knowledge is gained. Knowledge from projects is an important

resource for further projects, because projects solve innovative and interdisciplinary tasks. However,

the majority of organisations do not manage the information gained through past projects. Failure to

transfer knowledge from past to future projects leads to wasted activity and unnecessary expenses by


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reinventing the wheel. Therefore, knowledge management is a critical success factor for manyprojects.

The purpose of this Management Report is to approach knowledge management from the perspective

of project management. The main objective is to define how knowledge management can be

enhanced within a project by analysing suitable tools and relevant theories. The research is based on

the high-speed train project XY of the company XXX. This project is an important milestone forXXX to improve its market position in Spain. The knowledge gained through the XY project will be

the key factor for the success of the further high-speed train projects.

The main finding of the case study highlights that there is a lack of formal knowledge management

activities at the project. The project team focuses mainly on personal interaction for transferring

knowledge and information technology is not used to its full potential. A hybrid approach to

knowledge management for project environments is suggested, taking into account technical as well

as human-specific aspects. The main recommendation is to determine a knowledge management

strategy, which preferably focuses on transferring tacit knowledge and gives information technology

a support function. Other areas of improvement are creating an open and constructive project culture,

including knowledge initiatives in reward systems and fostering documented project review sessions.

Finally, general conclusions are provided to answer the main research question of this managementreport.

Q.5 EXPLAINTHE SEVEN PRINCIPAL OF SUPPLY CHAIN MANAGEMENT.TAKE AND EXAMPLE OF

ANY PRODUCTINTHE MARKETAND EXPAINTHE SECENRIO OFBULLEHIP EFFECT.

Ans: Seven principles of SCM are:

1. Group customer by needs: Effective SCM groups customers by distinct service needs,

regardless of industry and then tailors services to those particular segments.

2. Customize the logisticsnetworks: In designing their logistic network, companies need to

focus on the service requirement and profit potential of the customer segments identified.

3. Listen to signals ofmarket demand and planaccordingly: sales and operations planners

must monitor the entire supply chain to detect early warning signals of changing customers

demand and needs. This demand driven approach leads to more consistent forecast and

optimal resource allocation.

4. Differentiate theproduct closer to the customer: companies today no longer can afford to

stockpile inventory to compensate for possible forecasting errors. Instead, they need to

postpone product differentiation in the manufacturing process closer to actual consumer

demand. This strategy allows the supply chain to respond quickly and cost effectively to

changes in customer needs.

5. Strategically manage thesources ofsupply: By working closely with their key suppliers to

reduce the overall costs of owning materials and services, SCM maximizes profit margins

both for themselves and their suppliers.

6. Developasupply chain wide technology strategy: As one of the cornerstones of successful

SCM, information technology must be able to support multiple levels of decisions making. It

also should afford a clear view and ability to measure the flow of products, services and

information.


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7. Adopt channel spanning performance measures: Excellent supply chain performance

measurement systems do more than just monitor internal functions. They apply

performance criteria to every link in the supply chain -criteria that both service and financial

metrics.

BULLWHIP EFFECT IN SCM

An organization will always have up and downs. It is necessary that the managers of the

organization keep track of the market conditions and analyze the changes. They must take

decisions on the resources and make necessary changes within the organization to meet the

market demands. Failing to do so may results in wild swings in the orders. This may adversely

affect the functioning of the organization resulting in lack of coordination and trust among

supply chain members. The changes may affect the information and may led to demand

amplification in the supply chain. The Bullwhip effect is the uncertainty caused from distorted

information flowing up and down the supply chain. This has its affect on almost all the

industries, poses a risk to firms that experience large variations in demand, and also those firm

which are dependent on suppliers, distributors and retailers. A bullwhip effect may arise

because of:

y Increase in the lead time of the project due to increase in variability of demand

y Increase in the stocks to accommodate the increase demand arising out of complicated

demand models and forecasting techniques.

y Reduced service levels in the organization.

y Inefficient allocation of resources.

y Increased transportation cost.

How to prevent it ?

Bullwhip effect may be avoided by one or more of the following measures:

y Avoid multiple demand forecasting.

y Breaking the single order into number of batches of orders.

y Stabilize the prices, avoid the risk involved in overstocking by maintaining a proper stock

y Reduce the variability and uncertainty in point of sale (POS) and sharing information

y

Reduce the lead time in

the stages of the projecty Always keep analyzing the past figures and track current and future levels of requirement.

y Enhance the operational efficiency and outsourcing logistics to a capable and efficient

agency

Example ofoneproduct theeffect Bullwhip theory.


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The Beer Game

The beer game was developed at MIT by the Systems Dynamic Group in the 1960s. The game

involves a simple production/distribution system for a single brand of beer. There are three

players in the game including a retailer, a wholesaler, and a marketing director at the brewery.

Each player's goal is to maximize profit.

A truck driver delivers beer once each week to the retailer. Then the r etailer places an order with

the trucker who returns the order to the wholesaler. There's a four week lag between ordering and

receiving the beer.

The retailer and wholesaler do not communicate directly. The retailer sells hundreds of products

and the wholesaler distributes many products to a large number of customers.

The following represents the results of a typical beer game:-

3.1 The Retailer

Week 1: Lover's Beer is not very popular but the retailer sells four cases per week on average.

Because the lead time is four weeks, the retailer attempts to keep twelve cases in the store by

ordering four cases each Monday when the trucker makes a delivery.

Week 2: The retailer's sales of Lover's beer doubles to eight cases, so on Monday, he orders 8

cases.

Week 3: The retailer sells 8 cases. The trucker delivers four cases. To be safe, the retailer decides

to order 12 cases of Lover's beer.

Week 4: The retailer learns from some of his younger customers that a music video appearing on

TV shows a group singing "I'll take on last sip of Lover's beer and run into the sun." The retailer

assumes that this explains the increased demand for the product. The trucker delivers 5 cases.

The retailer is nearly sold out, so he orders 16 cases.

Week 5: The retailer sells the last case, but receives 7 cases.All 7 cases are sold by the end of

the week. So again on Monday the retailer orders 16 cases.

Week 6: Customers are looking for Lover's beer. Some put their names on a list to be called


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when the beer comes in. The trucker delivers only 6 cases and all are sold by the weekend. The

retailer orders another 16 cases.

Week 7: The trucker delivers 7 cases. The retailer is frustrated, but orders another 16 cases.

Week 8: The trucker delivers 5 cases and tells the retailer the beer is ba cklogged. The retailer is

really getting irritated with the wholesaler, but orders 24 cases.

3.2 The Wholesaler

The wholesaler distributes many brands of beer to a large number of retailers, but he is the only

distributor of Lover's beer. The wholesaler or ders 4 truckloads from the brewery truck driver

each week and receives the beer after a 4 week lag. The wholesaler's policy is to keep 12

truckloads in inventory on a continuous basis.

Week 6: By week 6 the wholesaler is out of Lover's beer and responds by ordering 30 truckloads

from the brewery.

Week 8: By the 8th week most stores are ordering 3 or 4 times more Lovers' beer than their

regular amounts.

______________________________________________________________________________

___________________________ _____________________________________________________

Week 9: The wholesaler orders more Lover's beer, but gets only 6 truckloads.

Week 10: Only 8 truckloads are delivered, so the wholesaler orders 40.

Week 11: Only 12 truckloads are received, and there are 77 truckloads in backlog, so the

wholesaler orders 40 more truckloads.

Week 12: The wholesaler orders 60 more truckloads of Lover's beer. It appears that the beer is

becomin

g more popular from week to week.

Week 13: There is still a huge backlog.

Weeks 14-15: The wholesaler receives larger shipments from the brewery, but orders from

retailers begin to drop off.

Week 16: The trucker delivers 55 truckloads from the brewery, but the wholesaler gets zero


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orders from retailers. So he stops ordering from the brewery.

Week 17: The wholesaler receives another 60 truckloads. Retailers order zero. The wholesaler

orders zero.

The brewery keeps sending beer.

3.3 The Brewery

The brewery is small but has a reputation for producing high quality beer. Lover's beer is on ly

one of several products produced at the brewery.

Week 6: New orders come in for 40 gross. It takes two weeks to brew the beer.

Week 14: Orders continue to come in and the brewery has not been able to catch up on the

backlogged orders. The marketing manager begins to wonder how much bonus he will get for

increasing sales so dramatically.

Week 16: The brewery catches up on the backlog, but orders begin to drop off.

Week 18: By week 18 there are no new orders for Lover's beer.

Week 19: The brewery has 100 gross of Lover's beer in stock, but no orders. So the brewery

stops producing Lover's beer.

Weeks 20-23. No orders.

At this point all the players blame each other for the excess inventory. Conversations with

wholesale and retailer reveal an inventory of 93 cases at the retailer and 220 truckloads at the

wholesaler. The marketing manager figures it will take the wholesaler a year to sell the Lover's

beer he has in stock. The retailers must be the problem. The retailer explains that demand

increased from 4 cases per week to 8 cases. The wholesaler and marketing manager think

deman

d mushroomed after that, an

d then

fell off, but the retailer explain

s that didn

't happen

.

Demand stayed at 8 cases per week. Since he didn't get the beer he ordered, he kept ordering

more in an attempt to keep up with the demand. The marketing manager plans his resignation.

3.4 Lessonsfrom the Beer Game

1. The structure of a system influences behavior. Systems cause their own problems, not external


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forces or individual errors.

2. Human systems include the way in which people make decisions.

______________________________________________________________________________

________________________________________________________________________________

3. People tend to focus on their own decisions and ignore how these decisions affect others.

3.5 LessonsRelated to the Learning Disabilities

1. People do not understand how their actions affect others.

2. So they tend to blame each other for problems.

3. Becoming proactive causes more problems.

4. The problems build gradually, so people don't realize there is a problem until its too late.

5. People don't learn from their experience because the effects of their actions occur somewhere

else in the system.


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Stockvariability amplification in a supplychain due toBullwhip Effect

Q.6 TIME TAKEN BY THREE MACHINES ON FIVE JOBS IN A FACTORY IS

TABULATED BELOW IN TABLE BELOW. FIND OUTTHE OPTIMALSEQUENCE TO

BE FOLLOWED TO MINIMIZE THE IDLE TIME TAKEN BY THE JOBS ON THE

MACHINES.


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ANS.

Documents

40 40 Production and Operations Management