Production and Operations Management

Transcription

1 Copyright 2013 Pearson Education, Inc. Publishing as Prentice Hall Production and Operations Management Chapter 10

2 Learning Objectives Explain the strategic importance of production. Identify and describe the production processes. Explain the role of technology in the production process. Identify the factors involved in a location decision Explain the job of production managers. Discuss controlling the production process. Determine the importance of quality. 4

3 Production & Operations Management 3 Production: Use of resources, such as workers and machinery, to convert materials into finished goods and services. Production and Operations Management: Oversee the production process by managing people and machinery in converting materials and resources into finished goods and services.

4 Typical Production Systems 4

5 Strategic Importance of Production 5 Production is a vital business activity and function necessary for generating money to pay employees, lenders, and stockholders. Effective production and operations management can: Lower a firm s production costs Boost the quality of its goods and services Allow it to respond dependably to customer demands Enable it to renew itself by providing new products

6 Mass, Flexible, and Customer-Driven Production 6 Mass Production - a system for manufacturing products in large quantities by combining employees with specialized skills, mechanization, and standardization. Flexible Production - more cost-effective for producing smaller batches using information technology, communication, and cooperation Customer-Driven Production - evaluating customer demands in order to make the connection between products manufactured and products bought

7 Production Processes 7 Analytic Production System Reduces a raw material to its component parts in order to extract one or more marketable products. Synthetic production system Is the reverse of an analytic system. It combines a number of raw materials or parts or transforms raw materials to produce finished products. An intermittent production process Generates products in short production runs, shutting down machines frequently or changing their configurations to produce different products.

8 Technology and the Production Process 8 Green Manufacturing manufacturing focused on reducing waste, energy use, and pollution. Robot - a reprogrammable machine capable of performing tasks requiring the repeated manipulation of materials and tools. Computer-Aided Design - allows engineers to design components and entire products on computer screens more efficiently than traditional drafting systems.

9 9 Technology and the Production Process (continued) Computer Aided-Manufacturing - computer tools to analyze CAD output and enable a manufacturer to analyze the steps that a machine must take to produce a product or part. Flexible Manufacturing Systems - a production facility that can be modified to manufacture different products. Computer-Integrated Manufacturing - production system in which computers assist, in an integrated function, in the design of products, control machines, handle materials, and control the production function.

10 The Location Decision 10

11 The Job of Production Managers 11 Plan the overall production process Determine the most appropriate layout Implement the production plan Control the manufacturing process for quality

12 Planning the Production Process 12 Choose what goods or services to offer in order to satisfy customers. Other decisions include: machinery purchases, pricing decisions, and selection of retail outlets Convert original product ideas into final specifications Design the most efficient facilities to produce those products.

13 Determining the Facility Layout 13

14 Process Layout 14 Process layout groups machinery and equipment by function Facilitates production of a variety of nonstandard items in relatively small batches Work-in-process moves around the plant to reach different workstations.

15 Product Layout 15 Product layout sets up production equipment along a product-flow line, and the work in process moves along this line past workstations. Efficiently produces large numbers of similar items

16 Fixed-Position Layout 16 Places the product in one spot, and workers, materials, and equipment are brought to it.

17 Customer Oriented Layout 17 Customer-oriented layout arranges facilities to enhance the interactions between customers and a service.

18 18 Implementing the Production Plan Make, Buy, or Lease Decision Choosing whether to manufacture a needed product or component in-house, purchase, or lease. Decision factors: cost, supplier availability, duration of supply needs, and confidentiality. Selection of Suppliers Choosing the best vendors by comparing quality, pricing, delivery reliability, and services. Inventory Control Balancing stock-on-hand against carrying costs.

19 Implementing the Production Plan (continued) 19 Just-in-Time Systems Providing the right part, at the right place, at the right time. Materials Requirement Planning Computer-based production planning system to track parts and materials needed for production

20 Controlling the Production Process 20 Production control creates a well-defined set of procedures for coordinating people, materials, and machinery for production efficiency. A five-step process: Planning Routing Scheduling Dispatching Follow-up

21 Gantt Chart and PERT Diagram 21

22 The Importance of Quality 22 Quality - goods and services free of deficiencies Fixing, replacing, redesigning deficient products is costly. The costs of poor quality can equal 20 percent of revenues. Benchmarking - A process used by companies to ensure high quality products are produced Involves determining how well other companies perform business functions and tasks

23 Quality Control 23 A good or service free of deficiencies Poor quality can account for loss in revenue Benchmarking is the process of analyzing other firms best practices Quality control is measuring goods and services against established quality standards. Six Sigma concept A company tries to make error-free products % of the time, a tiny 3.4 errors per million opportunities.

24 ISO Standards 24 International Organization for Standardization (ISO)- mission is to promote the development of standardized products to facilitate trade and cooperation across national borders. Representatives from more than 146 nations. ISO 9000 series of standards sets requirements for quality processes. Nearly half a million ISO 9000 certificates have been awarded to companies around the world. ISO series also sets standards for operations that minimize harm to the environment.