Pages

March 31, 2022

Operations Scheduling - Review Notes



Manufacturing Execution Systems
The Nature and Importance of Work Centers

Priority Rules and Techniques

Shop-Floor Control

Personnel Scheduling in Services



Chapter Outline of

Richard B. Chase, F. Robert Jacobs, Nicholas J. Aquilano, Operations Management for Competitive Advantage, 10/e, McGraw-Hill Higher Education, 2004

Manufacturing Execution Systems
The Nature and Importance of Work Centers
Typical Scheduling and Control Functions
Objectives of Work-Center Scheduling
Job Sequencing
Priority Rules and Techniques
Scheduling n Jobs on One Machine
Comparison of Priority Rules
Scheduling n Jobs on Two Machines
Scheduling a Set Number of Jobs on the Same Number of Machines
Scheduling n Jobs on m Machines
Shop-Floor Control
Gantt Charts
Tools of Shop-Floor Control
Input/Output Control
Data Integrity
Principles of Work Center Scheduling
Personnel Scheduling in Services
Scheduling Consecutive Days Off
Scheduling Daily Work Times
Scheduling Hourly Work Times
Summary for Revision

Manufacturing execution systems

Manufacturing execution system is an information system that schedules, dispatches, tracks,  monitors, and controls production on the factory floor. The system links to MRP systems, product information, process planning system, and SCM system.

Work Center


Work centers are areas in a business in which productive resources are organized and work is completed. It may be a single machine, a group of machines, or an area where a particular type of work is done. The work centers can be organized in a variety of ways including by function in a job-shop configuration; or by product in a flow, assembly line, or group-technology-cell configuration.


Scheduling and controlling functions of an operation are critical. The functions must be performed beginning with allocating orders, equipment, and personnel to work centers or the specified locations for short-run capacity planning. Next is the determination of the sequence of order performance or establishing job priorities. Initiating the scheduled work or dispatching of orders is followed by shop-floor control.


Loading - Infinite loading or Finite loading

A characteristic that distinguishes one scheduling system from another is how capacity is considered in determining the schedule. The scheduling systems can use infinite loading or finite loading.

Infinite loading occurs when work is assigned to a work center simply based on what is needed over time.

Finite loading actually schedules in detail each resource using the setup and run time required for each order.

Another characteristic, that distinguishes scheduling systems, is whether the schedule is generated forward or backward in time.

Processes can be machine limited or labor limited. Determining the sequence of orders and establishing job priorities are critical as is dispatching orders.

Shop floor control

Shop floor control is necessary to review job status and expediting late and/or critical orders when necessary. The schedule must be revised as necessary to reflect changes in order status.


Various priority rules work to satisfy job arrival patterns, the number and variety of machines in the manufacturing facility, the ratio of workers to machines in the shop, the flow pattern of jobs through the shop, the priority rules for allocating jobs to machines, and schedule evaluation criteria. Priority rules for allocating jobs to machines can use a variety of methods.



The objectives of work-center scheduling are to meet customer due dates, minimize lead-time, minimize set-up time, minimize work in process inventory, and maximize machine or labor utilization.




Role of Simulation


In manufacturing job shops, scheduling relies heavily on simulation to estimate the flow of work through the system to determine bottlenecks and adjust job priorities. Software packages are available to do this. In services, the focus is typically on employee scheduling using mathematical tools that can be used to set work schedules in light of expected customer demand.





More information

Manufacturing Execution Systems

Manufacturing Execution System (MES) are IT enabled systems that provide solutions for improving and optimizing the manufacturing process to the production floor engineers and managers. MES provides solution as to how the current conditions of the shop floor be altered to generate greater output at minimal cost. MES provides for the middle layer between the ERP system and the process control system.

https://www.hcltech.com/technology-qa/what-is-manufacturing-execution-system

Enterprise 360
https://www.hcltech.com/manufacturing


Industrial Engineering is System Efficiency Engineering. It consists of Machine Effort and Human Effort Engineering. Industrial Engineering Knowledge Center. The Most Comprehensive Blog on Industrial Engineering.



Originally posted on Knol - 2utb2lsm2k7a/ 436

Updated 1.4.2022, 1 April 2018,  30 March 2015, 9 Dec 2011

Revision article for 1 April

Designing The Global Supply Chain

 


Designing Global Supply Chain Networks


LEARNING OBJECTIVES

After reading this chapter, you will be able to

1. Identify factors that need to be included in total cost when making global sourcing decisions.

2. Define uncertainties that are particularly relevant when designing global supply chains.

3. Explain different strategies that may be used to mitigate risk in global supply chains.

4. Understand decision tree methodologies used to evaluate supply chain design decisions under uncertainty.


Earlier Edition Chapter: Network Design in an Uncertain Environment

Globalization has offered tremendous opportunity as well as increased risk in the development of supply chains. Companies like Zara have taken full advantage of globalization. In contrast, several companies could not manage the increased risk that has accompanied globalization. Managers must account for both opportunities and uncertainties over the long term when designing a global supply chain network. In this chapter, the main focus is on the sources of risk for global supply chains, risk mitigation strategies,  the methodologies used to evaluate network design decisions under uncertainty. The discussion helps in  improving global supply chain decisions.

Designing the Distribution Network in a Supply Chain


Important Issues of the Chapter

  • The Role of Distribution in Supply Chain
  • Factors Influencing Distribution Network Design
  • Design Options for a Distribution Network
  • Online Sales and the Distribution Network.
  • Distribution Networks in Practice


The Role of Distribution in Supply Chain


Distribution is moving a product from the supplier's processing facility to a customer's facility  in the
supply chain. In the supply chain of any firm, supply side network and distribution side network can be separately identified. The configuration alternatives and the foundation for the configuration alternatives differ between these two network in  supply chains of firms. Distribution is a key driver of the overall profitability of a firm because it affects the customer value and the supply chain cost directly. In the apparel retail industry, distribution impacts (including its influence on markdowns and lost sales) about 35 percent of the revenue. In India, the outbound distribution cost of cement is about 30 percent of the cost of producing and selling it

Factors Influencing Distribution Network Design


Why do you require a distribution network between manufacturing facility and customer location?

The performance of  distribution network system or a distribution network in place or proposed has to be evaluated on two major dimensions.

1. The customer needs that are being met.
2. Cost of the network or costs incurred in the meeting those needs.

The distribution network can change the satisfaction of the  following customer needs that differ from product to product as well as from  distribution outlet to distribution outlet.

  • Response time
  • Product variety
  • Product availability
  • Customer experience
  • Order visibility
  • Returnability


When customers demand less response time, the firm needs more outlets close to the customer. When customers are happy with larger response times, the firm can more centralized facilities.

Changing the distribution network design affects the following supply chain costs:

• Facilities and handling related cost
• Inventory cost
• Transportation cost
• Information system cost

As the number of facilities in a supply chain increases, the inventory and resulting inventory costs also increase.  For example, Amazon has fewer facilities and therefore is able to turn its inventory about twelve times a year. Borders has  about 400 facilities and it achieves only about two turns per year.

As long as inbound transportation costs to warehouses are kept the same, increasing the number of facilities decreases total transportation cost. But, if the number of facilities is increased to a point where there is a significant loss of economies of scale in inbound transportation (as full truck loads are not employed), increasing the number of facilities increases total transportation cost.

A distribution network with more than one warehouse allows initially to reduce transportation cost relative to a network with a single warehouse. Total logistics costs are the sum of inventory, transportation, and facility costs for a supply chain network. As the number of facilities is increased, total logistics costs first decrease and then increase.  Each firm should have at least the number of facilities that minimize total logistics costs.

As a firm wants to further reduce the response time to its customers, it may have to increase the number of facilities beyond the point that minimizes logistics costs. A firm should add facilities beyond the cost- minimizing point only if managers are confident that the increase in revenues because of better responsiveness is greater than the increase in costs because of the additional facilities.


There are two key decisions when designing a distribution network:

1. Will product be delivered to the customer location or picked up from a preordained site (door delivery or a retail facility delivery)?
2. Will product flow through an intermediary or a distribution channel separate from retailer (or intermediate location)?


Based on the choices for the two decisions, there are six distinct distribution network designs that are classified as follows:

1. Manufacturer storage with direct shipping
2. Manufacturer storage with direct shipping and in-transit merge (cross docking)
3. Distributor storage with package carrier delivery
4. Distributor storage with last mile delivery
5. Manufacturer / distributor storage with costumer pickup
6. Retail storage with customer pickup

While the book gives above categories  We can identify Manufacturer, Distributor, Retailer as three entities and  Customer pickup or door delivery as two options. If the door delivery options is used the mode of door delivery (transport alternative) is to be determined. Also there is transport between manufacturer and distributor, distributor and retailer and between manufacturer and retailers.


The customer preference for each alternative, resulting demand for the product or products and cost of the distribution arrangement come into the picture to take the distribution system decision.


Only niche companies will end up using a single type of distribution network. Most companies are employ  a combination of different types for different products, different customers and different usage situations. In a company, fast moving and emergency items are stocked locally and customers can either pick them up directly or have them shipped depending upon the urgency. Slower moving items are stocked at a national distribution center from where they are shipped to the customer within a day or two. Very slow moving items are typically drop shipped from the manufacturer and involve a longer lead time. 

Updated:  1.4.2022,  3 April 2015,  2.1.2013

Paper by Sunil Chopra - Available on his web page
http://www.kellogg.northwestern.edu/faculty/chopra/htm/research/deliverynetwork.pdf


https://www.transportation.northwestern.edu/docs/research/core-topics/logistics-and-supply-chain-management/Chopra_DistributionSupplyChain.pdf  (Accessed on 1.4.2022)


Activities of Engineering Supervisors



A to Z - Activities, Competencies, Education and Training of Engineering Supervisors - Article Series


Job Specifications Given by Taylor for 8 Foremen for a Machine Shop

As the popular model in practice is single foreman supported by staff and assistants, foreman is responsible for all these activities in his shop. He has to do the liasoning with others to get things in proper order in his shop and support the operators will all equipment related facilities, material related facilities and personal need related facilities.

The gang boss has to plan and see that every man under him has at all times at least one piece of work ahead at his machine, with all the jigs, templates, drawings, driving mechanism, sling chains, etc., ready to go into his machine as soon as the piece he is actually working on is done. The gang boss must show  how to set  work in the machines in the quickest time.  He is responsible for the work being accurately and quickly set.

The speed boss must see that the proper cutting tools are used for each piece of work, that the work is properly driven, that the cuts are started in the right part of the piece, and that the best speeds and feeds and depth of cut are used. He has to ensure that operators use the speeds and feeds and depth of cut as directed on the instruction card. He has to demonstrate that the work can be done in the specified time by doing it himself in the presence of his men.

The inspector is responsible for the quality of the work, and both the workmen and speed bosses must follow his directions to see that the work is all finished to dimensions to suit him. The inspector, must have the capability to finish work to specification with in the specified time. 

The repair boss sees that each workman keeps his machine clean, free from rust and scratches, and that he oils and treats it properly, and that all of the standards established for the care and maintenance of the machines and their accessories are rigidly maintained, such as care of belts and shifters, cleanliness of floor around machines, and orderly piling and disposition of work. (Can you recognize total productive maintenance in this description?)


Order of Work and Route Clerk. As a route clerk the exact route which each piece of work is to travel through the shop from machine to machine in order that it may be finished at the time it is needed for assembling, and the work done in the most economical way is to be specified. The order of work task is to  daily write lists instructing individual workmen the order in which they have to take up the jobs. These lists constitute the chief means for directing the workmen in this particular function by the gang boss.

Instruction Card Foreman and Clerks. The "instruction card," is the chief means employed by the planning department for  providing instructions to both the executive foremen  and the men in all of the details of their work. It tells them briefly the general and detail drawing to refer to, the piece number and the cost order number to charge the work to, the  special jigs, fixtures, or tools to use, where to start each cut, the exact depth of each cut, and how many cuts to take, the speed and feed to be used for each cut, and the time within which each operation must be finished. 


Time and Cost Clerk. This man sends to the men through the "time ticket" all the information they need for recording their time and the cost of the work, and secures proper returns from them. He refers these for entry to the cost and time record clerks in the planning room.

Shop Disciplinarian. In case of insubordination or impudence, repeated failure to do their duty, lateness or unexcused absence, the shop disciplinarian takes the workman or bosses in hand and applies the proper remedy. He sees that a complete record of each man's virtues and defects is kept. This man should also have much to do with readjusting the wages of the workmen.  One of his important functions should be that of peace-maker to maintain harmony in the shop (discipline for peace and harmony).

-------------------

Taylor's Writing in Detail




Evidently the foreman's duties are in no way clearly circumscribed. It is left each day entirely to his judgment what small part of the mass of duties before him it is most important for him to attend to, and he staggers along under this fraction of the work for which he is responsible, leaving the balance to be done in many cases as the gang bosses and workmen see fit. The second principle calls for such conditions that the daily task can always be accomplished. The conditions in his case are always such that it is impossible for him to do it all, and he never even makes pretence of fulfilling his entire task. The third and fourth principles call for high pay in case the task is successfully done, and low pay in case of failure. The failure to realize the first two conditions, however, renders the application of the last two out of the question.

The foreman usually endeavors to lighten his burdens by delegating his duties to the various assistant foremen or gang bosses in charge of lathes, planers, milling machines, vise work, etc. Each of these men is then called upon to perform duties of almost as great variety as those of the foreman himself. The difficulty in obtaining in one man the variety of special information and the different mental and moral qualities necessary to perform all of the duties demanded of those men has been clearly summarized in the following list of the nine qualities which go to make up a well rounded man:

Brains.

Education.

Special or technical knowledge; manual dexterity or strength.

Tact.

Energy.

Grit.

Honesty.

Judgment or common sense and

Good health.

Plenty of men who possess only three of the above qualities can be hired at any time for laborers' wages. Add four of these qualities together and you get a higher priced man. The man combining five of these qualities begins to be hard to find, and those with six, seven, and eight are almost impossible to get. Having this fact in mind, let us go over the duties which a gang boss in charge, say, of lathes or planers,
is called upon to perform, and note the knowledge and qualities which they call for. 

First. He must be a good machinist--and this alone calls for years of special training, and limits the choice to a comparatively small class of men.

Second. He must be able to read drawings readily, and have sufficient imagination to see the work in its finished state clearly before him. This calls for at least a certain amount of brains and education.

Third. He must plan ahead and see that the right jigs, clamps, and appliances, as well as proper cutting tools, are on hand, and are used to set the work correctly in the machine and cut the metal at the right speed and feed. This calls for the ability to concentrate the mind upon a multitude of small details, and take pains with little, uninteresting things.

Fourth. He must see that each man keeps his machine clean and in good order. This calls for the example of a man who is naturally neat and orderly himself.

Fifth. He must see that each man turns out work of the proper quality. This calls for the conservative judgment and the honesty which are the qualities of a good inspector.

Sixth. He must see that the men under him work steadily and fast. To accomplish this he should himself be a hustler, a man of energy, ready to pitch in and infuse life into his men by working faster than they do, and this quality is rarely combined with the painstaking care, the neatness and the conservative judgment demanded as the third, fourth, and fifth requirements of a gang boss.

Seventh. He must constantly look ahead over the whole field of work and see that the parts go to the machines in their proper sequence, and that the right job gets to each machine.

Eighth. He must, at least in a general way, supervise the timekeeping and fix piece work rates. Both the seventh and eighth duties call for a certain amount of clerical work and ability, and this class of work is
almost always repugnant to the man suited to active executive work, and difficult for him to do; and the rate-fixing alone requires the whole time and careful study of a man especially suited to its minute detail.

Ninth. He must discipline the men under him, and readjust their wages; and these duties call for judgment, tact, and judicial fairness.

It is evident, then, that the duties which the ordinary gang boss is called upon to perform would demand of him a large proportion of the nine attributes mentioned above; and if such a man could be found he should be made manager or superintendent of a works instead of gang boss. However, bearing in mind the fact that plenty of men can be had who combine four or five of these attributes, it becomes evident that the work of management should be so subdivided that the various positions can be filled by men of this caliber, and a great part of the art of management undoubtedly lies in planning the work in this way. This can, in the judgment of the writer, be best accomplished by abandoning the military type of organization and introducing two broad and sweeping changes in the art of management:

(a) As far as possible the workmen, as well as the gang bosses and foremen, should be entirely relieved of the work of planning, and of all work which is more or less clerical in its nature. All possible brain work should be removed from the shop and centered in the planning or laying-out department, leaving for the foremen and gang bosses work strictly executive in its nature. Their duties should be to see that the operations planned and directed from the planning room are promptly carried out in the shop. Their time should be spent with the men, teaching them to think ahead, and leading and instructing them in their work.

(b) Throughout the whole field of management the military type of organization should be abandoned, and what may be called the' "functional type" substituted in its place. "Functional management" consists in so dividing the work of management that each man from the assistant superintendent down shall have as few functions as possible to perform. If practicable the work of each man in the management should be confined to the performance of a single leading function. Under the ordinary or military type, the workmen are divided into groups. The men in each group receive their orders from one man only, the foreman or gang boss of that group. This man is the single agent through which the various functions of the management are brought into contact with the men. Certainly the most marked outward characteristic of functional management lies in the fact that each workman, instead of coming in direct contact with the management at one point only, namely, through his gang boss, receives his daily orders and help directly from eight different bosses, each of whom performs his own particular function. Four of these bosses are in the planning room and of these three send their orders to and receive their returns from the men, usually in writing. Four others are in the shop and personally help the men in their work, each boss helping in his own particular `line or function only. Some of these bosses come in contact with each man only once or twice a day and then for a few minutes perhaps, while others are with the men all the time, and help each man frequently. The functions of one or two of these bosses require them to come in contact with each workman for so short a time each day that they can perform their particular duties perhaps for all of the men in the shop, and in their line they manage the entire shop. Other bosses are called upon to help their men so much and so often that each boss can perform his function for but a few men, and in this particular line a number of bosses are required, all performing the same function but each having his particular group of men to help. Thus the grouping of the men in the shop is entirely changed, each workman belonging to eight different groups according to the particular functional boss whom he happens to be working under at the moment.

The following is a brief description of the duties of the four types of executive functional bosses which the writer has found it profitable to use in the active work of the shop: (1) gang bosses, (2) speed bosses, (3) inspectors, and (4) repair bosses.

The gang boss has charge of the preparation of all work up to the time that the piece is set in the machine. It is his duty to see that every man under him has at all times at least one piece of work ahead at his machine, with all the jigs, templates, drawings, driving mechanism, sling chains, etc., ready to go into his machine as soon as the piece he is actually working on is done. The gang boss must show his men how to set their work in their machines in the quickest time, and see that they do it. He is responsible for the work being accurately and quickly set, and should be not only able but willing to pitch in himself and show the men how to set the work in record time.

The speed boss must see that the proper cutting tools are used for each piece of work, that the work is properly driven, that the cuts are started in the right part of the piece, and that the best speeds and feeds and depth of cut are used. His work begins only after the piece is in the lathe or planer, and ends when the actual machining ends. The speed boss must not only advise his men how best to do this work, but he must see that they do it in the quickest time, and that they use the speeds and feeds and depth of cut as directed on the instruction card In many cases he is called upon to demonstrate that the work can be done in the specified time by doing it himself in the presence of his men.

The inspector is responsible for the quality of the work, and both the workmen and speed bosses must see that the work is all finished to suit him. This man can, of course, do his work best if he is a master of the art of finishing work both well and quickly.

The repair boss sees that each workman keeps his machine clean, free from rust and scratches, and that he oils and treats it properly, and that all of the standards established for the care and maintenance of the machines and their accessories are rigidly maintained, such as care of belts and shifters, cleanliness of floor around machines, and orderly piling and disposition of work.

The following is an outline of the duties of the four functional bosses who are located in the planning room, and who in their various functions represent the department in its connection with the men. The first three of these send their directions to and receive their returns from the men, mainly in writing. These four representatives of the planning department are, the (1) order of work and route clerk, (2) instruction card clerk, (3) time and cost clerk, and (4) shop disciplinarian.

Order of Work and Route Clerk. After the route clerk in the planning department has laid out the exact route which each piece of work is to travel through the shop from machine to machine in order that it may be finished at the time it is needed for assembling, and the work done in the most economical way, the order of work clerk daily writes lists instructing the workmen and also all of the executive shop bosses as to the exact order in which the work is to be done by each class of machines or men, and these lists constitute the chief means for directing the workmen in this particular function.

Instruction Card Clerks. The "instruction card," as its name indicates, is the chief means employed by the planning department for instructing both the executive bosses and the men in all of the details of their work. It tells them briefly the general and detail drawing to refer to, the piece number and the cost order number to charge the work to, the  special jigs, fixtures, or tools to use, where to start each cut, the exact depth of each cut, and how many cuts to take, the speed and feed to be used for each cut, and the time within which each operation must be finished. It also informs them as to the piece rate, the differential rate, or the premium to be paid for completing the task within the specified time (according to the system employed); and further, when necessary, refers them by name to the man who will give them especial directions. This instruction card is filled in by one or more members of the planning department, according to the nature and complication of the instructions, and bears the same relation to the planning room that the drawing does to the drafting room. The man who sends it into the shop and who, in case difficulties are met with in carrying out the instructions, sees that the proper man sweeps these difficulties away, is called the instruction card foreman.

Time and Cost Clerk. This man sends to the men through the "time ticket" all the information they need for recording their time and the cost of the work, and secures proper returns from them. He refers these for entry to the cost and time record clerks in the planning room.

Shop Disciplinarian. In case of insubordination or impudence, repeated failure to do their duty, lateness or unexcused absence, the shop disciplinarian takes the workman or bosses in hand and applies the proper remedy. He sees that a complete record of each man's virtues and defects is kept. This man should also have much to do with readjusting the wages of the workmen. At the very least, he should invariably be consulted before any change is made. One of his important functions should be that of peace-maker.

Thus, under functional foremanship, we see that the work which, under the military type of organization, was done by the single gang boss, is subdivided among eight men: 

(1) route clerks, (2) instruction card clerks, (3) cost and time clerks, who plan and give directions from the planning room; (4) gang bosses, (5) speed bosses, (6) inspectors, (7) repair bosses, who show the men how to carry out their instructions, and see that the work is done at the proper speed; and (8) the shop disciplinarian, who performs this function for the entire establishment.

The greatest good resulting from this change is that it becomes possible in a comparatively short time to train bosses who can really and fully perform the functions demanded of them, while under the old system it took years to train men who were after all able to thoroughly perform only a portion of their duties.

A glance at the nine qualities needed for a well rounded man and then at the duties of these functional foremen will show that each of these men requires but a limited number of the nine qualities in order to successfully fill his position; and that the special knowledge which he must acquire forms only a small part of that needed by the old style gang boss. The writer has seen men taken (some of them from the ranks of the workmen, others from the old style bosses and others from among the graduates of industrial schools, technical schools and colleges) and trained to become efficient functional foremen in from six to eighteen months. Thus it becomes possible with functional foremanship to thoroughly and completely equip even a new company starting on a large scale with competent officers in a reasonable time, which is entirely out of the question under the old system. Another great advantage resulting from functional or divided foremanship is that it becomes entirely practicable to apply the four leading principles of management to the bosses as well as to the workmen. Each foreman can have a task assigned him which is so accurately measured that he will be kept fully occupied and still will daily be able to perform his entire function. This renders it possible to pay him high wages when he is successful by giving him a premium similar to that offered the men and leave him with low pay when he
fails.

The full possibilities of functional foremanship, however, will not have been realized until almost all of the machines in the shop are run by men who are of smaller calibre and attainments, and who are therefore cheaper than those required under the old system. The adoption of standard tools, appliances, and methods throughout the shop, the planning done in the planning room and the detailed instructions sent them from this department, added to the direct help received from the four executive bosses, permit the use of comparatively cheap men even on complicated work. Of the men in the machine shop of the Bethlehem Steel Company engaged in running the roughing machines, and who were working under the bonus system when the writer left them, about 95 per cent were handy men trained up from laborers. And on the finishing machines, working on bonus, about 25 per cent were handy men.

To fully understand the importance of the work which was being done by these former laborers, it must be borne in mind that a considerable part of their work was very large and expensive. The forgings which they were engaged in roughing and finishing weighed frequently many tons. Of course they were paid more than laborer's wages, though not as much as skilled machinists. The work in this shop was most miscellaneous in its nature.

Functional foremanship is already in limited use in many of the best managed shops. A number of managers have seen the practical good that arises from allowing two or three men especially trained in their particular lines to deal directly with the men instead of at second hand through the old style gang boss as a mouthpiece. So deep rooted, however, is the conviction that the very foundation of management rests in the military type as represented by the principle that no workman can work under two bosses at the same time, that all of the managers who are making limited use of the functional plan seem to feel it necessary to apologize for or explain away their use of it; as not really in this particular case being a violation of that principle. The writer has never yet found one, except among the works which he had assisted in organizing, who came out squarely and acknowledged that he was using functional foremanship because it was the right principle.

The writer introduced five of the elements of functional foremanship into the management of the small machine shop of the Midvale Steel Company of Philadelphia while he was foreman of that shop in 1882-1883:

(1) the instruction card clerk, (2) the time clerk, (3) the inspector, (4) the gang boss, and (5) the shop disciplinarian. 

Each of these functional foremen dealt directly with the workmen instead of giving their orders through the gang boss. The dealings of the instruction card clerk and time clerk with the workmen were mostly in writing, and the writer himself performed the functions of shop disciplinarian, so that it was not until he introduced the inspector, with orders to go straight to the men instead of to the gang boss, that he appreciated the desirability of functional foremanship as a distinct principle in management. The prepossession in favor of the military type was so strong with the managers and owners of Midvale that it was not until years after functional foremanship was in continual use in this shop that he dared to advocate it to his superior officers as the correct principle.

Until very recently in his organization of works he has found it best to first introduce five or six of the elements of functional foremanship quietly, and get them running smoothly in a shop before calling attention to the principle involved. When the time for this announcement comes, it invariably acts as the proverbial red rag on the bull. It was some years later that the writer subdivided the duties of the "old gang boss" who spent his whole time with the men into the four functions of (1) speed boss, (2) repair boss, (3) inspector, and (4) gang boss, and it is the introduction of these four shop bosses directly helping the men (particularly that of the speed boss) in place of the single old
boss, that has produced the greatest improvement in the shop.

When functional foremanship is introduced in a large shop, it is desirable that all of the bosses who are performing the same function should have their own foreman over them; for instance, the speed bosses should have a speed foreman over them, the gang bosses, a head gang boss; the inspectors, a chief inspector, etc., etc. The functions of these over-foremen are twofold. The first part of their work is to teach each of the bosses under them the exact nature of his duties, and at the start, also to nerve and brace them up to the point of insisting that the workmen shall carry out the orders exactly as specified on the instruction cards. This is a difficult task at first, as the workmen have been accustomed for years to do the details of the work to suit themselves, and many of them are intimate friends of the bosses and believe they know quite as much about their business as the latter. The second function of the over-foreman is to smooth out the difficulties which arise between the different types of bosses who in turn directly help the men. The speed boss, for instance, always follows after the gang boss on any particular job in taking charge of the workmen. In this way their respective duties come in contact edgeways, as it were, for a short time, and at the start there is sure to be more or less friction between the two. If two of these bosses meet with a difficulty which they cannot settle, they send for their respective over-foremen, who are usually able to straighten it out. In case the latter are unable to agree on the remedy, the case is referred by them to the assistant superintendent, whose duties, for a certain time at least, may consist largely in arbitrating such difficulties and thus establishing the unwritten code of laws by which the shop is governed. This serves as one example of what is called the "exception principle" in management, which is referred to later.

Before leaving this portion of the subject the writer wishes to call attention to the analogy which functional foremanship bears to the management of a large, up-to-date school. In such a school the children are each day successively taken in hand by one teacher after another who is trained in his particular specialty, and they are in many cases disciplined by a man particularly trained in this function. The old style, one teacher to a class plan is entirely out of date.

F.W. Taylor, Shop Management





Important Statements.

The speed foreman of the shop must be able to train operators to achieve specified productivity.
The quality foreman of the shop must be able to train operators to produced the specified quality in specified standard time. - F.W. Taylor
Productivity Methods Training - Principle of Industrial Engineering













Sourcing Decisions in a Supply Chain - Summary of the Chapter



Chopra and Meindl's book, Supply Chain Management: Strategy, Planning, and Operation,  a comprehensive introduction on supply chain management.

Sourcing Decisions in Supply Chain


Learning Objectives


1. Understand the role of sourcing in supply chain
2. Understand the factors that determine whether a component or service is outsourced or not.
3. Identify dimensions of supplier performance that affect total cost.
4. Structure successful auctions and negotiations.
5. Understand the impact of risk sharing arrangement with suppliers or distributors.
6. Design a tailored supplier portfolio.




Purchasing: Also called the procurement, is the process by which companies acquire raw materials, components, product, services or other resources from suppliers to execute their operations.

Sourcing: The entire set of business process required to purchase goods and services.

Benefits of effective sourcing

Better economies of scale can be achieved by aggregating orders with in a firm.
Reduction in the overall cost of purchasing (for items with large number of low value transaction).
Design collaboration can result in products that are easier to manufacture and distribute, resulting in lower overall costs. ( for products that contribute a significant amount to product cost and value)
Coordination with the supplier to improve forecasting and planning.
Appropriate supplier contracts can allow for the sharing of risk, resulting in higher profits for both the
supplier and the buyer.
Firms can achieve a lower purchase price by increasing competition through the use of auctions.

In-house or Outsource


A firm should consider outsourcing if the growth in supply chain surplus is large with a small increase in risk.
Performing the function in-house is preferable if the growth in surplus is small or the increase in risk is large.

How Do Third Parties Increase The Supply Chain Surplus

Third parties increase the supply chain surplus if they either increase value for the customer or decrease the supply chain cost relative to a firm performing the task in-house. Three important factors that affect the increase in surplus that a third party provides: scale, uncertainty, and the specificity of assets.

1. Capacity aggregation: Surplus can be created by firms specialising in a component or service by  aggregating demand across multiple firms and gaining production economies of scale that no single firm can on its own.
 The growth in surplus from outsourcing is highest when the needs of the firm are significantly lower than the volumes required to gain economies of scale.
2. Inventory aggregation: Surplus can be created by aggregating inventories across a large number of customers.
Aggregation allows them to significantly lower overall uncertainty and provide higher level of service with lower inventories.
 The third party performing inventory aggregation adds most to the supply chain surplus when demand from customers is fragmented and uncertain.
3. Transportation aggregation by transportation intermediaries: Surplus can be created by aggregating the transportation function to a higher level than any shipper can on its own. The transportation intermediary aggregates shipments across multiple shippers, thus lowering the cost of each shipment below what could be achieved by the shipper alone.
 This is particularly true if the shipper's transportation flows are highly unbalanced, with the quantity coming into a region very different from the quantity leaving the region.
4. Transportation aggregation by storage intermediaries: Surplus can be created by aggregating in bound and out bound transportation.
 This form of aggregation is most effective if the intermediary stocks products from many suppliers and serves many customers, each ordering in small quantities.
5. Warehousing aggregation: Surplus can be created by aggregating warehousing needs over several customers. (in terms of lower real estate cost and lower processing cost).
 Savings through warehousing aggregation arise if a supplier's warehousing needs are small or if its needs fluctuate over time
6. Procurement aggregation: Surplus can be created if a third party if it aggregates procurement for many small players and facilitates economies of scale in production and inbound transportation.
 Procurement aggregation is most effective across many small buyers.
7. Information aggregation: Supply chain surplus can be increased by aggregating information to a higher level than can be achieved by a firm performing the function in-house. This information aggregation reduces search costs for customers.
 Information aggregation increases the surplus if both buyers and sellers are fragmented and buying is sporadic.
8. Receivables aggregation: Supply Chain surplus cab be increase if third party can aggregate the receivables risk to a higher level than the firm or it has a lower collection cost than the firm. Collecting receivables from each retail outlet is a very expensive proposition for a manufacturer.
 Receivables aggregation is likely to increase the supply chain surplus if retail outlets are small and
numerous and each outlet stocks products from many manufacturers that are all served by the same
distributor.
9. Lower costs and higher quality: A third party can increase the supply chain surplus if it provides lower cost or higher quality relative to the firm. If these benefits come from specialization and learning, they are likely to be sustainable over the longer term. A specialized third party that is further along the learning curve for some supply chain activity is likely to maintain its advantage over the long term.
A firm gains the most by outsourcing to a third party if its needs are small, highly uncertain and shared by other firms sourcing from the same third party.


Risks of using a Third Party
 The process is broken
 Underestimation of the cost of coordination: The cost of the effort required to coordinate activities across multiple entities performing supply chain tasks.
 Reduced customer/supplier contact: The loss of customer contact is particularly significant for firms that sell directly to consumers but decide to use a third party to either collect incoming orders or deliver outgoing product.
 Loss of internal capability and growth in third-party power
 Leakage of sensitive data and information.
 Ineffective contracts: Contracts with performance metrics that distort the third party's incentives often significantly reduce any gains from outsourcing


Supplier Scoring and Assessment (Total Cost Approach)

When scoring and assessing suppliers, the following factors other than quoted price must be considered:
 Replenishment lead time: dictates the amount of inventory required
 On-time performance: affects the variability of the lead time and hence the safety stock
 Supply flexibility(variation in order quantity): less flexible the supplier, more lead-time variability it will display as order quantities change .
 Delivery frequency/minimum lot size: affect the size of each replenishment lot ordered by a firm - cycle and safety inventory
 Supply quality: Quality affects the lead time taken by the supplier order and also the variability of this lead time because follow-up orders often need to be fulfilled to replace defective products.
 Inbound transportation cost: The distance, mode of transportation, and delivery frequency affect the inbound transportation cost
 Pricing terms: allowable time delay before payment has to be made and any quantity discounts offered by the supplier- affects the working capital required.
 Information coordination capability: affects the ability of a firm to match supply and demand- reduces bull whip effect.
 Design collaboration capability: Given that a large part of product cost is fixed at design, collaboration capability of a supplier is significant
 Exchange rates, taxes, and duties

Contracts and Supply Chain Performance


Contracts for Product Availability

To improve overall profits, the supplier must design a contract that encourages the buyer to purchase more and increase the level of product availability. This requires the supplier to share in some of the buyer's demand uncertainty. Three contracts that increase overall profits by making the supplier share some of the buyer's demand uncertainty are as follows:

Buyback or returns contracts: A buy-back or returns clause in a contract allows a retailer to return unsold inventory up to a specified amount, at an agreed-upon price.

In some instances, manufacturers use holding-cost subsidies or price protection to encourage retailers to order more. In the high-tech industry, in which products lose value rapidly, manufacturers share the risk of product becoming obsolete by providing price support to retailers.
 A downside to the buy-back clause (or any equivalent practice such as holding cost subsidy or price support) is that it leads to surplus inventory that must be salvaged or disposed. The task of returning unsold product increases supply chain costs. The cost of returns can be eliminated if the manufacturer gives the retailer a markdown allowance and allows it to sell the product at a significant discount.

Revenue-Sharing Contracts: In revenue-sharing contracts, the manufacturer charges the retailer a low wholesale price c, and shares a fraction f of the retailer's revenue. Even if no returns are allowed, the lower wholesale price decreases the cost to the retailer in case of an overstock. The retailer thus increases the level of product availability resulting in higher profits for both the manufacturer and the retailer. If the production cost v, retail price p, salvage value is sR , optimal order quantity
O*, where the cost of under stacking is Cu = (1 - f)p - c and the cost of overstocking is Cu = c - sR. We thus obtain
Expected manufacturer's profits = (c - v) o* + fp( o* - expected overstock at retailer)
Expected retailer profit = (1 - f)p( O* - expected overstock at retailer)+ SR * expected overstock at retailer - cO*
One advantage of revenue-sharing contracts over buy-back contracts is that no product needs to be returned, thus eliminating the cost of returns. Revenue sharing contracts are best suited for products with low variable cost and a high cost of return.
 Revenue sharing contracts counter double marginalization by decreasing the cost per unit charged to the retailer thus decreasing the cost of over stocking. They increase information distortion and lead to lower retailer effort in case of over stocking, just as but back contracts do.
Quantity Flexibility Contracts: Under quantity flexibility contracts, the manufacturer allows the retailer to change the quantity ordered after observing demand. If a retailer orders 0 units, the manufacturer commits to providing Q = (1 + α)O units, whereas
the retailer is committed to buying at least q = (1 - β )O units. Both α and β are between 0 and 1.
Expected Manufacturer Profit = O*
* (c - v) - (b - sM) * expected overstock at retailer
Quantity flexibility contracts are common for components in the electronics and computer industry. If the supplier has flexible capacity, a quantity flexibility contract increases profits for the entire supply chain and also each party. The quantity flexibility contract requires either inventory or excess flexible capacity to be available at the supplier. If the supplier is selling to multiple retailers with independent demand, the aggregation of inventory leads to a smaller surplus inventory with a quantity flexibility contract compared to either a buy-back or revenue-sharing contract.
Relative to buy-back and revenue-sharing contracts, quantity flexibility contracts have less information distortion.
 Quantity flexible contracts counter double marginalization by giving the retailer the ability to modify the order based on improved forecasts closer to the point of sale. They result in lower information distortion than buy back or revenue contacts when a supplier sells to multiple buyers or supplier has excess flexible capacity.

The Procurement Process
There are two main categories of purchased goods: direct and indirect materials. Direct materials are components used to make finished goods. For example, hard drives, and CD drives. Indirect materials are goods used to support the operations of a firm. For eg: PCs. The procurement process for direct material should be focussed on improving visibility and coordination with the supplier. For indirect materials, the process should focus on decreasing the transaction cost for each order. The procurement process in both the cases should consolidate orders to take advantage of the economies of scale and quantity discounts.


Based on the value and criticality of the product, they are classified into four groups:
1. General Items: Low value, Low Criticality. Mostly Indirect Items. Aim: Lower the cost of acquisition.
2. Bulk purchase items: High value, Low Criticality. Method: well-designed auctions.
3. Strategic Items: Low value, High Criticality. Components with long lead times. Aim: ensure availability
4. Critical Items: High value, High Criticality. Aim: Long term buyer-supplier relationship

Risk Management in Sourcing


 Supply Disruption: Developing multiple sources especially for products with high demand.
 Delay from suppliers: Carry inventory(low value items) or develop backup source(high value items).
 Higher procurement costs: have a portfolio of long- and short-term contracts
 Exchange-rate risk: Financial hedging can be done so that purchase price in local currency becomes fixed.
 Intellectual Property risk: keeping sensitive production in-house. maintain ownership of part of the equipment

Making Sourcing Decisions in Practice


Use multifunctional teams
Ensure appropriate coordination across regions and business units.
Always evaluate the total cost of ownership
Build long-term relationships with key suppliers


Updated 31.3.2022,  10 Apr 2016
9 Dec 2011

March 30, 2022

Performance Appraisal and Career Strategy

The performance of staff has to be appraised periodically to assess them for current job as well as for future career planning.

Appraising Managers


Managerial appraisal is closely related to selection, placement, and promotion. Actually we can selection is appraisal only. But, appraisal term is used for the employees of an organization and one of the purposes it serves is  identifying persons within the enterprise who are ready for promotion. On the other hand, the candidates from outside the firm must first be recruited, selected, and placed before their performance can be appraised.


Appraisal is a necessity in organizational life. Superiors need to know about the quality of performance of their subordinates. Subordinates also want to know where they stand. There are many traditional performance appraisals that focus on personality traits and do not give a clear answer to the question, How well am I doing? An approach that focuses on performance in accomplishing goals and plans is more effective.


In this chapter, Koontz and O'Donnell focus more on appraising managers.

Performance appraisal can have three components - a comprehensive review, progress or periodic reviews, and continuous monitoring.

It is generally agreed that comprehensive review must be done at least once a year. Formal review must be supplemented by progress or periodic reviews wherein the superiors learns about factors hindering an effective performance in case it is needed. Also there reviews maintain communication between a superior and subordinate. Also objectives can be changed during these periodic reviews if necessary. People need not pursue obsolete goals.

As an appraisal approach, the greatest deficiency of management by objectives is that it provides for appraisal of results of operating performance only.  There are other factors to appraise, the managerial abilities and development needs.

Koontz and O'Donnell suggest a checklist for appraising managerial abilities against management principles for fundamentals.

Senior managers can do career planning for the people under them and discuss the development plan for a subordinate to acquire the competencies for the immediate next career position and the next. Sometimes, managers may have to acquire additional academic qualifications and a discussion between the superior and subordinate can help to decide to focus on the career progression and acquire the required competencies.

13th Edition

Sections

Choosing Appraisal Criteria
Appraising Managers against Verifiable Objectives
Appraising Managers as Managers: A Suggested Program
A Team Evaluation Approach
Application of Performance Review Software
Rewards and Stress of Managing
Formulating the Career Strategy


Management: A Global, Innovative and Entrepreneurial Perspective (15th Edition)
Heinz Weihrich, Mark V Cannice, Harold Koontz
McGraw-Hill Education, 18-Nov-2019 - Business & Economics

The thoroughly revised and updated fifteenth edition of Management - A Global, Innovative and Entrepreneurial Perspective takes an international view of management. This book comprehensively covers the latest management advancements. Entrepreneurial and innovative perspectives of management are integrated throughout in this edition.



Based on real-life business experiences and integration of theory with practice, this edition focuses on the professional development of its readers by providing exercises that encourage students to enhance their professional profile and network.
https://books.google.co.in/books/about/Management_A_Global_Innovative_and_Entre.html?id=YnbgDwAAQBAJ   

Ud. 31.3.2022
Pub. 20.5.2014

Understanding the Supply Chain and Supply Chain Management - Review Notes




Supply Chain Management: Review Notes Based on Chopra and Meindl's Book

Supply chain

A supply chain consists of all stages involved directly, or indirectly, in fulfilling a customer request for a product in an economy. Thus it includes customers who give the requests, transporters, retailers, wholesalers, warehouses, manufacturers, and component, service as well as miners who supply raw material suppliers. Within an organization there is a supply chain that includes all functions involved a filling a customer request or the order. The functions carried out within an organization include marketing, purchasing or procurement or supply, new product development, new process development, operations (manufacturing, material handling, maintenance, industrial engineering, quality control/inspection), distribution, finance and customer service.

In a supply chain there is constant flow of information, product and funds between stages. Usually supply chain is imagined as materials and product moving from suppliers to manufacturers and from there to wholesalers and retailers and then further to customers. But supply chains have two way movements. There is movement of information and funds apart from the product.

Customer is an integral part of the supply chain and the primary purpose of a supply chain is satisfying customer needs and generating profit for itself in the process.

The routine supply chain activities begin with a customer order and end when a satisfied customer has paid for his purchase.

In a supply chain, number of customers are there, number of retailers are there, number of transporters are there and number of manufacturing plants can be there. For the manufacturing plants, there are number of suppliers. In the case of a retailer, for his store, stores or warehouses, there are number of suppliers. Hence a supply chain is actually a network or a web. Hence, the terms, supply network and supply web also describe a supply chain.

The objective of every supply chain is to maximize the overall value generated. The term includes both the revenue generated which value created and exchanged in reference to the customer and profit which is value created for the supply chain.  Supply chain management involves the management of flows between and among stages in a supply chain to maximize total profitability along with the revenue for the supply chain. To realize that objective,  it has to provide expected value to the customer.

Supply Chain Performance


A supply chain can be described initially by two performance characteristics responsiveness and efficiency.

Various supply chain characteristics contribute to responsiveness and efficiency.

Supply chain responsiveness is measured by the abilities of the chain to do the following:


Ability to respond to fluctuations in demand
Ability to provide short lead times
Ability to handle large variety of products
Ability to come out with innovations and highly innovative products
Ability to provide a very high service level (On time delivery as per requirement of the customer).


Supply chain efficiency is the cost of making and delivering a product to the customer. Increase in costs lowers efficiency.

Cost-Responsiveness Efficient Frontier


It is a chart or graph with cost on the X-axis (origin is high cost) and Responsiveness on the Y axis (origin is low responsiveness). See Example

The frontier shows the minimum cost for a given responsiveness. If a company is operating within the frontier,  at a higher cost, it can decrease the cost by appropriate actions but keep the responsiveness same. When it is operating on the efficient frontier, any increase in responsiveness can only come by incurring extra cost.

The frontier curve is a short-run phenomena and companies continually try to improve their supply chain by reducing cost further and increasing responsiveness and thus change the frontier over each period.

Prof. David Simchi Levi uses the cost-responsiveness efficient frontier charts in his supply chain presentations to emphasize benefits of his innovations.

Supply Chain Industrial Engineering


In supply chains of engineering products/services and supply chains using engineering equipment, industrial engineers are the specialists employed to take care of the efficiency dimension of the supply chain. Industrial engineers use the process chart framework to increase the efficiency of material processing operations, inspection operations,  material handling and transport operations, storage and warehousing operations. They analyze planning and control activities to reduce delays and increase material flow. They also examine product and service design to do production industrial engineering and reduce their costs through product design modifications.

Supply Chain Industrial Engineering (8 Apr 2013)

Supply Chain Industrial Engineering
Productivity and Efficiency Improvement in Supply Chain Partner activities. This applied IE was initiated by Prof. Narayana Rao K.V.S.S. in 2012. 


Decision Phases in a Supply Chain

Supply Chain Strategy (Design), Plan and Operation (execution of plans) are identified as three significant decision phases by Chopra and Meindl.

Supply Chain Design: Supply chain strategy is another word used for this phase. Supply chain design decisions or strategy decisions include products to be manufactured, location and capacities of manufacturing plants and warehouses, supply sources, modes of transport to be utilized and information system to be utilized. In supply chain management paradigm careful design of supply sources, modes of transport and information system to be used between the end customer firm or focal firm of the supply chain and supplier firms are the new areas of attention. In the earlier operations management literature and marketing literature, decisions regarding products to be manufactured, location and capacities of manufacturing plants and warehouses were researched and many  decision models were created,

McKinsey consultants proposed in 2019 supply chain redesign based on zero-based approach. Read more about in: Zero-Based Productivity Management of Supply Chain - McKinsey Way Supply Chain Industrial Engineering

Supply Chain Planning: Planning, typically done for an year, establishes parameters within which a supply chain will function over a specified period of time.

Supply Chain Operation: In this phase the time horizons are small, monthly, weekly and daily. The decisions are driven by customer order and are related to individual customer orders. There are also decisions related to individual production facilities, warehouses and transporters.

Process Views of a Supply Chain

There are two views.

1. Cycle view

In cycle view, the supply chain processes are divided into cycles that are performed at the interface between two successive stages of a supply chain and one describes the following cycles.

  • Customer order cycle
  • Replenishment cycle
  • Manufacturing cycle
  • Procurement cycle

A. Customer order cycle

Normally occurs at the retailer place between the customer and the retailer.

Activities involved
Customer arrival, Customer order entry, Customer order fulfillment, Customer order receiving, Customer funds payment

B. Replenishment cycles

Normally thought to occur at the retailer/wholesaler or distributor interface.

Activities involved
Retail order trigger, Retail order entry, Retail order fulfilment, Retail order receiving, Funds payment

C. Manufacturing cycle

Normally thought to occur at the wholesaler/manufacturer interface. Depending on the number of channels in the distribution channel it can occur at customer - manufacturer, or retailer - manufacturer also.

Activities involved

Order arrival, Production scheduling, Manufacturing and shipping, Receiving by the person ordered, Funds payment

D. Procurement cycle

Occurs at the manufacturer/supplier interface

2. Push/Pull View


In this view, a supply chain is viewed as a chain composed of pull processes and push processes.  Each supply chain will have some pull processes and push processes. There is a push - pull boundary. The activities initiated by customers' orders form pull process activities. The activities initiated and carried out in anticipation of customer demand are push process activities.


Importance of Supply Chain Flows


Flow of information, material and product and cash are important for supply chain functioning and fulfillment of its objectives.

Information is key to produce as per customers' order and also to forecast in case of made-to-stock supply chains.

Supply Design, Planning and Operation Related Questions. 


One will find answers to these questions in various chapters of the Supply Chain Management Book which we are summarizing chapter-wise.

1. Why a company outsources some assembly activities and does some within its assembly plant? What characteristics of the product or order characterize outsourced activities?
2. When does a company have only one manufacturing location for the entire country or world? When does it have multiple plants?
3. Why certain orders are despatched via couriers for overnight delivery or one day delivery and why certain other orders are sent via trucks on full load or part load basis?
4. How inventories are determined for components and finished goods?

Reference
Sunil Chopra and Peter Meindl, Supply Chain Management: Strategy, Planning and Operations, Prentice Hall, 2001.





Originally posted at
http://knol.google.com/k/narayana-rao/supply-chain-management-basic/ 2utb2lsm2k7a/ 1348# before 2011.


Updated on 3.4.2022, 31.3.2022,  12.8.2021,  2 March 2021,   29 June 2019,   1 May 2019,   27.3.2013


Related Article
Supply chain management - Detailed Introduction

ICFAI University - MBA Programme Curriculum

 

https://www.ibshyderabad.org/mba-program.html


SHGM501 Business History

SL OP 502 Operations Management

SL GM 611 Business Strategy


Electives - 


Finance Area


Global Capital Markets

Security Analysis

Strategic Cost Management

Portfolio Management and Mutual Funds


OP IT Area


Supply Chain Management

Service Operations Management

Supply Chain Analytics

March 29, 2022

Leadership - Koontz and O'Donnell - Review Notes


Basic Theories of Leadership - from OB Books


4th Edition of Koontz and O'Donnell

Along with motivation and communication activities, leadership is a means of directing.

Carter identifies five approaches to leadership definition:
(1) polarization of members of a group around some central person.
(2) the person able to direct a group toward its goals
(3) the person selected by group members to lead them
(4) the person able to move a group along a specific dimension, such as sociability or integration and
(5) the person possessing certain behavior.

Groups require a common sense of authority. According to Bronislaw Malinowski, authority means the privilege and the duty of making decisions, of pronouncing in cases of dispute or disagreement, and also the power of enforcing such decisions. Authority is the very essence of social organization.

A leader is given authority by his group. They accept him voluntarily as the common center of authority.

People also seem to require frequent reminders of group goals to overcome forgetfulness and indifference. The leaders have long view and foresight to overcome boredom and limited vision.

Leadership is the ability of a manager or in general a person to induce subordinates (followers) to work with confidence and zeal. Zeal reflects ardor, earnestness, and intensity in the execution of assignments; confidence reflects experience and technical ability.

No doubt subordinates of a manager are driven by the need for a job and income. If they are guided only by rules and requirements enforced by the organization structure through managerial authority, they tend to work at about 60 or 65 per cent of capacity. To raise output toward total capacity, the manager must induce zealous response on the part of subordinates by exercising leadership. He does this based on the needs of subordinates, especially their ego and self-development needs.


Confidence Building

The confidence exhibited by a subordinate manager rests upon the quality of his knowledge and his sense of security.

Orientation of a subordinate comes first. Second is follow up supervision. Third is providing job security to the subordinate.

Zeal Building

Koontz and O'Donnell write that zeal building escapes scientific analysis. They provide two idea for this activity.

1. Inspiration

2. Strengthening personal qualities






------------------------------------




From a different edition (14 Edition)



The essence of leadership is followership.

A person has to attract followers to become a leader and practice leadership.

Weihrich, Cannice and Koontz  defined leadership as influence, that is, the art or process of influencing people so that they will strive willingly and enthusiastically toward the achievement of group goals.

Ingredients of Leadership


Leadership skill seems to be a compound of four major ingredients.

1.The ability to use power effectively in a responsible manner.

2. The ability to comprehend the different motivating factors of human beings at different times and in different situation. There has to be a periodic assessment of factors that will motivate followers.

3. The ability to inspire.

4. The ability to act in a manner that will develop a climate conducive to responding to and arousing motivations.


The sociological view of leadership:

Selznick is an important contributor.
The leader has the task of building goals and policies into the social structure of the enterprise.

--------------------------------------

Presentation Based on Recent HBR Article and a Book

Be selfless - Be compassionate
Become Better Leader – Human Relations First Perspective

https://www.youtube.com/watch?v=6qZL-eQLqP8

Compassion is the intention to bring happiness to others.


___________________________




Book - The Mind  of the Leader

“The Mind of the Leader”, is published by Harvard Business Publishing
Rasmus Hougaard, M.A., Jacqueline Carter, M.Sc. and Vince Brewerton



LEAD WITH MINDFULNESS, SELFLESSNESS, AND COMPASSION

https://books.google.co.in/books/about/The_Mind_of_the_Leader.html?id=ZSE6DwAAQBAJ


Based on extensive research, including assessments of more than 35,000 leaders and interviews with 250 C-level executives, “The Mind of the Leader” concludes that organizations and leaders aren’t meeting employees’ basic human needs of finding meaning, purpose, connection, and genuine happiness in their work.

 “The Mind of the Leader” offers a  practical solution and helps  managers and executives to lead with three core mental qualities: Mindfulness, Selflessness, and Compassion.

With real world inspirational examples from Marriott, Accenture, McKinsey & Company, LinkedIn, and many more, “The Mind of the Leader” illustrates  this new kind of leadership. It represents a radical redefinition of what it takes to be an effective leader – and a practical, hard-nosed solution to every organization’s engagement and execution problem.

YouTube Video  https://www.youtube.com/watch?v=re10u7f2Qxk

https://www.potentialproject.com/books/the-mind-of-the-leader/

___________________________


Reddin - 3D Leadership Model


Blog posts visited
https://analysisproject.blogspot.com/2012/12/behavioral-theories-of-leadership.html
https://aminbles.blogspot.com/1986/12/administrative-leadership-theory.html
https://dameanusabun.blogspot.com/2020/08/situational-theory-of-leadership-key-to.html
http://akoallana.blogspot.com/2016/01/ldc-10-leadership-theories.html
https://montting.blogspot.com/1994/07/path-goal-theory-of-leadership-examples.html
https://mccormickfoundation.blogspot.com/2021/01/leadership-in-democracy.html
https://dynamics-of-leadership.blogspot.com/2020/12/lecture-4-team-leadership-17-december.html


Updated  2022  30.3.2022
2021 - 21 July
2018 - 22 November 2018,  8 February
10 Feb 2015, 11 Dec 2011

Building Trust in Teams and Organizations


Growing trust workshop: “In Team We Trust” by Alexey Pikulev

__________________

__________________



An article by Pikulev on Linkedin

https://www.linkedin.com/pulse/building-team-trust-using-alexey-pikulev


Pikulev's model in use in Astrakhan


8Cs to Build Trust

Clarity - Connection - Compassion - Culture (Values) - Competency - Commitment - Contribution - Consistency



TRUST AND COMMITMENT 

Commitment is an enduring desire to maintain a relationship, and trust is the confidence that one partner has in the other’s reliability and integrity. Confidence is associated with partner’s consistency, competence, honesty, fairness, willingness to make sacrifices, responsibility, helpfulness and benevolence. 

Trust is cornerstone of relationship commitment. Without it commitment flounders. 

Geyskens and Steenkamp conclude that there is a consensus emerging that trust encompasses two essential elements: trust in the partner’s honesty and trust in the partner’s benevolence. Honesty refers to the belief that the partner stands by its word, fulfils promised role obligation and is sincere. Benevolence reflects the belief that one partner is interested in the other’s welfare and will not take unexpected actions to the detriment of the partner. Trust brings about a feeling of security, reduces uncertainty and creates a supportive climate. 

What is trust

https://www.igi-global.com/dictionary/digitally-enabled-design-management/30660





Ud. 30.3.2022

Pub: 14.9.2016




March 16, 2022

Relationship Redefinition - New Development in Branding

Earlier consumers had relationships with brands. But in this social media age brought about by digital progress, brands are the relationships. There are existing traditional relationships in every industry. But by defining that relationship, some companies have created  greater engagement, differentiation, and loyalty.

In the evolution of brands, this is a new development.  Branding started out as an identifying mark. Cattle owners used particular symbols stamped on their cattle to indicate ownership. This “brand as object” model is still in the American Marketing Association’s definition: “Name, term, design, symbol, or any other feature that identifies one seller’s good or service as distinct from those of other sellers.” The definition says, brand is something applied by an organization to what it makes.

The next development is brand as an idea. Al Ries and Jack Trout  define a brand as “a singular idea or concept that you own inside the mind of a prospect.” In this view, brand of you is created in the mind of the consumer by the cognitive processing of him, You can only facilitate this process and hence you can only try to manage.

Then "brand as experience" made its appearance. Sergio Zyman, in The End of Marketing as We Know It, says: “A brand is essentially a container for a customer’s complete experience with the product or company.” The brand for your product is the cumulative sum of experience with you, your product, your marketing activities. You can only influence it from now on by delivering the expected experience at every customer touch point.

Some companies are redefining the very nature of the relationship they have with their customer.

If the first three waves in branding were brand as object, idea, and experience, the next wave will be brand as relationship.

The way to put “brand as relationship” into action is by identifying the present relationship and redefining it. Relationship is described by the roles and responsibilities of the company and customer. The default brand relationship in any industry is provider/consumer. It’s a one-directional and asymmetrical relationship.

Brand innovators now are focusing on collaborative and reciprocal relationships.

Airbnb has a mission of “belonging,” Airbnb has cultivated a neighbor-to-neighbor and citizen-to-citizen relationship on a global scale. It is reciprocal, symmetrical, and collaborative. Persons who stay in a place may offer their rooms and houses in their city of living. They exchange ideas on improvement.

Uber and Lyft established new relationship in transport industry. The shift from driver/passenger to friend/friend. You do not treat the other man as a driver for life. He may be anybody offering you lift as a friend. To emphasize it, Lyft passengers are encouraged to “sit up front” as if they were getting a ride from a friend. Uber developed an entrepreneur/supporter relationships with owners of cars. Uber is a platform that fits the demands of lifestyle of its car owners.

In the airline industry, Southwest brought in a relationship that might be described as “fun friends.” JetBlue, with the mission of “Inspiring Humanity,” has promoted a “human-to-human” relationship. Virgin America's innovation is being described as a brand relationship between the hip friend,  and host of the party and his friends and guests.

The concept of brand-as-relationship now identifies past successes of some organizations due to redefining relationships. American Express redefined the roles card issuer/card holder to club/member. Disney redefined the relational roles as cast member/guest.

Marketers have an opportunity to redefine brand roles in every industry. There is an opportunity to create a new relationship based on co-creation and collaboration. Do it. The successes achieved with this brand innovation indicate that there will  be greater engagement, differentiation, and loyalty if you successfully redefine the relationship. Do market research, find out what consumers need and then take the decision.


Read
https://hbr.org/2016/05/build-your-brand-as-a-relationship

The article in this post is based on the above.



Grönroos , C 2019 , Are you ready for relationship marketing? It is a business challenge . in A Parvatiyar & R Sisodia (eds) , Handbook of Advances in Marketing in an Era of Disruptions : Essays in Honour of Jagdish N. Sheth . Sage publications , New Delhi , pp. 307-317 .

Title: Are you ready for relationship marketing? It is a business challenge
Author: Grönroos, Christian
Editor: Parvatiyar, Atul; Sisodia, Rajendra
Contributor: Hanken School of Economics, Marketing, Helsinki
Belongs to series: Handbook of Advances in Marketing in an Era of Disruptions Essays in Honour of Jagdish N. Sheth
https://helda.helsinki.fi/dhanken/handle/10227/407407

Total Relationship Marketing: Marketing Strategy Moving from the 4Ps--product, Price, Promotion, Place--of Traditional Marketing Management to the 30 Rs-- the Thirty Relationships--of a New Marketing Paradigm

Evert Gummesson
Routledge, 2002 - Business & Economics - 350 pages

30 different types of relationships in marketing are discussed in this book.

Total Relationship Marketing provides a genuinely unique new view of the meaning of marketing management and a complete introduction to the rapidly evolving field of relationship marketing.

A major contribution to marketing thought internationally, this new edition of Gummesson's seminal title presents a powerful and in depth analysis of modern relationship marketing. Highly informative, practical in style, and packed with examples and cases from real companies, it is an essential resource for all serious marketing practitioners as well as both undergraduate and postgraduate students.

Customer Relationship Management (CRM) is a key feature throughout this newly revised edition
Comprehensive coverage on the Internet, e-Business and one-to one marketing
New examples, cases, concepts and references have been added to aid the reader

https://books.google.co.in/books?id=x-iZOqS91eAC

Handbook of Relationship Marketing

Atul Parvatiyar, Jagdish N Sheth
SAGE Publications, 22-Dec-1999 - Business & Economics - 680 pages

As businesses increasingly stress the importance of cooperation and collaboration with suppliers and customers, relationship marketing is emerging as the `core' of all marketing activity. In recent years, there has been an explosive growth in business and academic interest in relationship marketing, yet no comprehensive book has been available to present key concepts, theories, and applications. The editors of this volume have assembled an authoritative and global cast of chapter contributors and crafted a volume that will become the seminal, founding work in this growing field. Their approach is eclectic, including a broad coverage of topics, diverse theoretical and conceptual paradigms, and global viewpoints.
https://books.google.co.in/books?id=2KvxCQAAQBAJ


Ud. 17.3.2022
Pub: 2.4.2017