Operations and Quality Management BMG774'

1
Operations and Quality Management BMG774.

• Lecture 1,
• Overview.
• Brian ODonnell,
• Department of International Business, UU.

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Developments in Management Theory.

• It is quite logical that from earliest recorded
  time groups of people have been organised to work
  together to achieve planned goals.
• There efforts have been coordinated and
  controlled by other individuals or organisations
  to achieve specific outcomes.
• Although not formally studied, management
  techniques have been practised throughout history.

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History.

• One has only to examine the management skills
  necessary to construct the pyramids, the great
  wall of china or the network of roman roads,
  aqueducts and viaducts throughout Europe to see
  that there was some guiding hand at work,
  planning, controlling and organising.
• Consider that without computers, modern handling
  fixtures and methods the ancient Egyptian's
  positioned two million 2.5 ton stones into
  position deviating only 7 inches from a perfect
  square over a distance of 75,600 square feet.

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History.

• Meng Tse three hundred years before the birth
  of Christ wrote about production concepts.
• The Greeks developed work songs to develop a
  rhythm,to achieve smooth working and less tiring
  tempos.
• Plato in his book the republic wrote on
  division of labour A man whose work is
  confined to such limited task must necessarily
  excel at it

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History.

• Two of the inventions that sparked Scientific
  Management, were the invention of the clock by
  Heinrich von Wych in Paris in 1370 and the
  invention of the printing press by Johannes
  Gutenberg (1400/68)
• One allowed for accurate measurements to be made
  the other for information to be recorded and
  communicated.

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• Definition Management is the process of
  determining the objectives of an enterprise
  deciding how those objectives are to be achieved
  in general terms devising an appropriate
  organisation to pursue the objectives providing
  funds which will enable the organisation to be
  adequately supplied with staff equipment and
  other items necessary making initial
  arrangements to commence operations and then
  keeping them under constant review.
• Source Business management and Administration,
  Whitehead and Whitehall ICM. 2000

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• So how do we determine all these factors?
• We use information !
• What is information? It is defined simply as,
• Data processed for a purpose.
• Why do we need information?
• To aid management in decision making.

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Information.

• Data such as details of a sale may be in the
  appropriate accountancy day books but it is not
  information, until it is manipulated for a
  specific purpose (e.g. aggregated with other
  sales to provide sales for the month or
  transferred to that debtors specific account and
  again aggregated to show sales to that customer
  over a period of time).

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Information Technology.

• The advent of information technology and the
  introduction of integrated software has
  revolutionised the way that organisations deal
  with information and indeed how they carry out
  their business.
• The timely (fast), flow of accurate,
  understandable,useful information is vital to
  support decision making at operational, tactical
  and strategic levels.

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Information needs.

• Information requirements at different levels.

Strategic information.
Tactical information.
Operational Information.
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Organisational structure.
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Organisational structure.

• Organisations not only have formal control
  mechanisms but are interlaced with informal
  arrangements. necessarily pulling together to
  achieve organisational aims.

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Interfaces.

• Informal interfaces.

Marketing.
Purchasing.
Quality.
Finance.
Production.
HR.
RD.
IT.
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Information!Accurate and Meaningful?
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Operations management.

• Production or Operations Management is the art
  and science of producing things for consumption.
• These manufactured goods and services are called
  products.
• The purpose of the Operations Department in an
  organisation is to make available the goods or
  services required by the customer in the most
  efficient and cost effective way possible.

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Operations Management.

• Operations Management seeks to extract
  competitive advantage from areas such as
• Product Design and Development.
• Facilities Location.
• Capital Equipment.
• Facilities Layout.

• Work design and Measurement.
• Production Forecasting Production Planning and
  Scheduling.
• Purchasing, Materials Management.
• Inventory management.
• Quality Management

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Operations management.

• Historically
• Started with First Crude Tools and Specialisation
  of Labour
• By 15th Century, Manufacturing was carried out by
  independent artisans
• In 18th Century, Adam Smith The Wealth of
  Nations

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Operations management.

• Early 1900s F.W. Taylor Scientific Approach
• 1915 F.W. Harris Economic Order Quantity
• 1925 Probability Theory introduced to quality
  control. Random sampling theories.
• 1940s W.W.11 Operations Research Maximise
  effectiveness from scarce resources. Computers
  arrived. Complex models replaced judgement and
  guesswork

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Operations management.

• 1980s Mini-computers allowed smaller companies
  to avail of possibilities. MRP 11/CAD/CIM/EPOS
• Further developments have allowed vision across
  organisations and links with strategic partners
  to refine and reduce lead time across the supply
  chain.

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Future of Operations Management

• Driven by requirements of the customer.
• Flexible manufacturing systems
• More choice for consumers
• Shorter lead times
• Even shorter product life cycles
• Continuous improvement in quality
• Ongoing cost reduction
• Expansion in service sector
• Competitive global markets
• Accelerating change
• Risk Reduction.

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THREE TYPES OF PROCESS

• JOB PRODUCTION
• BATCH PRODUCTION
• FLOW (MASS) PRODUCTION

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TYPES OF PROCESS EMPLOYED STEMS FROM

• TECHNOLOGIES
• COMPLEXITY AND SIZE
• OF PRODUCT

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• Manufacture of Simple unit articles to customer
  order
• Manufacture of technically complex unit articles
• Fabrication of large equipment in stages
• Production of small batches
• Production of components in large batches
• Subsequently assemble diversely
• Production of large batches
• Mass Production
• Process production combined with the preparation
  of
• A product for sale by large batch or mass
  production
• Methods
• Process production of chemicals in boxes
• Continuous flow production

Process Mass Batch Job
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JOB PRODUCTIONVariety of different parts to be
done

• SIMPLE EXAMPLES
• ONE OFF CRAFTSMAN PIECE
• CAR REPAIR
• PROTOTYPE
• SAMPLES.

• ADVANCED EXAMPLES
• SHIPBUILDING
• LARGE CIVIL ENGINEERING CONTRACTS
• LARGE BUILDING
• HEAVY ENGINEERING

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Characteristics of Job Production

• A comparatively large technical sales
  organisation
• A wide range of general-purpose machines, tackle
  and equipment
• Large storage space
• Accurate store keeping to check on the movement
  and use of each item of equipment
• A base workshop in which as many as possible of
  the various detailed parts required can be
  manufactured in their ones and twos off

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Characteristics of Job Production

• A permanent staff of highly skilled workmen
  capable of undertaking manufacture of any of a
  wide range of different parts, each of which may
  present special problems in fabrication.
• Highly competent general engineers as foremen in
  the base workshop
• A fluctuating demand for specialized labour at
  the site on which the job is to be done.
• A group of site engineers, practical men with a
  complete technical training, capable of taking
  sole charge of each contract form the aspects of
  costing, production and labour management.

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BATCH PRODUCTION

• Batch Production is the production of
  standardised units or parts in small or large
  lots.
• A factory method of control and is the most
  common method of organising work
• Many products going through in
• identifiable lots, made for shipment or for stock

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Characteristics of Batch Production

• A general purpose manufacturing plant capable of
  undertaking a wide range of different kinds of
  work
• Comparatively expensive tooling arrangements in
  order to provide interchangeability of each part
  produced from the same drawing frequent changes
  of set-up
• Machines grouped together in batteries of the
  same type
• Working passing from one battery of machines to
  the next in batches, movement being intermittent
• Departmentation dependent on the type of
  processing carried out

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Characteristics of Batch Production

• Comparatively long production periods for making
  each part, due to the time that each batch has to
  wait before going into operation at each machine.
• A fairly even labour strength (under good
  planning)
• A costing system which will throw up the total
  cost of producing each piece of work and each
  batch of finished product
• A comparatively large product-design department
• Efficient planning and progress control over
  production work to enable a continuously altering
  plan of work output to be applied

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Characteristics of Batch Production

• Generally a lack of balance in the work load of
  different departments
• Large production stores areas and general
  facilities for internal transport of materials to
  and from each point in the production process
  high stock in process

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FLOW (MASS) PRODUCTION.

• Specialised (complicated) production at a rate to
  justify dedicated machinery and plant.
• Car production
• Petrol production
• Chemical processing
• Corrugated packaging production.

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Characteristics of Flow Production

• A rigid production specification on which all
  development work has been carried out before the
  production drawings or specifications are
  released to the manufacturing unit.
• Sufficient sets of material authorised for
  manufacture to cover not less than the rate of
  production multiplied by the total time taken
  between authorising production and completing the
  finished product
• Highly specialised machine tools and equipment
  laid out in line formation for the production of
  each component

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Characteristics of Flow Production

• Supervision trained to a high standard of
  production technique
• Heavy expenditure on jigs, tools and plant so
  long as such expenditure can be recovered within
  twelve to eighteen months by savings in
  production costs
• A production run on the same type of product for
  as long as possible
• A high degree of standardisation of methods,
  tools and materials

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Characteristics of Flow Production

• A system of production control based on the rate
  of flow of each piece of production material
  through the production process
• Strict arrangements to ensure that materials
  arrive neither faster or slower than this
  specified rate
• Crash measures to overcome any block, however
  slights, in the flow of production material in
  order to avoid stoppage in the processes not
  blocked
• Complete cessation of work while production
  equipment is rearranged in sequence, to suit a
  new product

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Characteristics of Flow Production

• Use of conveyor systems for handling production
  material from the point of completion to the
  assembly point
• A daily shift-end check on production output at
  each key point of completion to the assembly
  point
• Assembly operations split up into even amounts of
  work for each operator, based on standard cycle
  times.

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Product positioning Process choice
focusProduct Structure

• Low Volume Medium Volume High
  Volume High Volume
• High Variety Medium Variety Low
  Variety Standard
• Job Shop 1
• Batch Flow 2
• Mixed-model
• Repetitive 3
• Dedicated Repetitive 4
• Continuous 5

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Product/market/process Characteristics
Product Structure Group 1
Group 2 Group 3
Order Winner Variety Implications Machinery
High Quality High flexibility High Cost General
purpose
High Quality Some flexibility High Cost General
purpose
High Quality Some flexibility Medium
Costs General purpose
Group 4 Group 5
Order Winner Variety Implications Machinery
Competitive Cost Low flexibility Some
Automation Specific purpose
Low Cost Standardised Automated Specific purpose