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Understanding of Product and Resources Used in Producing It.
A business cannot be started unless the customer requirement is understood and a product or service that satisfies those requirements is developed and designed. Once a product is developed, complete understanding the products features that the benefits they provide to the customer or the requirements they satisfy is to be understood by many in the business. The marketing and sales people have to know the product thoroughly and also the customer requirements which were targeted to be satisfied by the product.
A production or operation system is designed to produce the goods or services. Resources are used in the production system. In resource planning, which is part of organization function of management, based on the products to be produced and the output over a long period, resource requirements are determined and the resources are acquired. Operations managers have to understand the services that each resource can provide and its utilization. Such an understanding will provide opportunities to increase utilization and also cost effective utilization.
Operations managers have to understand the utility of machine, material, man, information and energy. They have to assess the rationality of each of these resources or entities in their role in the operations system they are running.
Product - Customer requirements and approval of the design in the form of prototype. Operations analysis from the manufacturability angle, quality angle, and productivity angle.
Machine - Understanding the operations that can be performed on the machine. Is the operation specified and machine selected right decision from quality and cost angles?
Material - Is the material specification right? In value engineering, a question regarding applicable standards is raised. Are applicable standard materials being used in appropriate way?
Man - Operations managers have to understand the man. They have to study human sciences adequately and utilize the practice implications of various theories developed in human sciences and organization behavior subject. Ergonomics is an applied science related work of man.
Information -The role of information in shop management or operations management was indicated by F.W. Taylor in 1895. Emphasis on written operations instructions is the first point that highlighted the importance of information and information system. The evolution of information systems into Internet of Things systems, a comprehensive information system that includes machines and men makes understanding information systems imperative for operations managers.
Energy - Energy is now a significant input in operations/production systems. Automation has increased in operations systems. Now operations managers have to understand energy utilization and ways to conserve energy.
Understanding all the resources or inputs used in a process is part of process analysis.
Understanding manufacturing processes is essential to ensuring a firm's competitiveness. A process is any part of an organization that takes inputs and transforms them into outputs that ideally are of greater value to the customer than the original inputs. Processes can be analysed and improved for increasing effectiveness and efficiency. Effectiveness improves when a process can produce to better specifications in terms size and performance. Efficiency is improved when a process utilizes less resources and produces less number of defects. Operations managers use industrial engineering techniques to improve efficiency of processes.
In the book (Chase et al.), Using examples of a fast food restaurant and a Las Vegas slot machine, processes are described and cycle time and utilization are presented. In the slot machine example, the diagram or process flowchart is discussed.
Analyzing a process allows some important questions to be answered, such as: What is the production rate? How much does the process cost? What is the process capability? etc. The purpose of the analysis needs to be clarified first to select an analysis technique.
Processes can be either single-stage or multiple-stage. For multiple-stage processes buffers or storage areas exist between manufacturing activities. Key manufacturing issues arising from multiple-stage operations include buffering, blocking, starving, and bottlenecks.
An additional way to classify manufacturing processes is either as make-to-order or make-to-stock. The type of process depends on whether the production is initiated in response to an actual order or whether customer orders are filled from existing finished goods inventories. Hybrid processes combine features of both make-to-order and make-to-stock environments.
Process Metrics
Measuring process performance is an important activity. Companies can be compared to others in a benchmarking process.
The most common process metric is utilization. Utilization is the ratio of the time that a resource is actually being used relative to the time it is available for use.
Productivity is the ratio of output to input. It is also popularly used to assess a firm's performance. Efficiency is defined as the ratio of the actual output to a standard output.
Run time is the time required to produce a batch of parts. Setup time, and operation time along with throughput time and throughput rate are also important metrics.
Process velocity (also known as throughput ratio) is the ratio of the total throughput time to the value added time.
The chapter ends with a discussion of ways to reduce throughput time and offers suggestions including performing activities in parallel, changing the sequence of activities, and reducing interruptions.
An operations manager uses job design techniques to structure work to meet the physical and behavioral needs of the employee. Work measurement methods are used to determine the most efficient means of performing a given task, as well as to set reasonable standards for performing it. Work performance standards are important to the workplace so accomplished can be measured and evaluated. Standards permit better planning and costing and provide a basis for compensating the work force and even providing incentives.
Trends in job design include quality as part of the worker's job. Today many workers are cross-trained to perform multiskilled jobs and total quality programs are important for all employees. Team approaches, information, use of temporary workers, automation, and organizational commitment are other key issues in job design decisions.
Behavioral considerations in job design include how specialized a job will be. Specialization has unique advantages and disadvantages. At the other extreme from specialization are the concepts of job enlargement and job enrichment. Sociotechnical systems of the interaction between technology and the work group influence job design as do ergonomic or physical consideration.
Work methods determine how the work should be accomplished in organizations, while work measurement determines how performance may be evaluated. Work methods can be established for an overall productive system, a worker alone, a worker interacting with equipment, and a worker interacting with other individuals.
Work measurement and standards exist to set time standards for a job. A technique used in work measurement is the time study. Examples of time studies are included for a four-element job and for a nursing environment. Finally, work sampling is compared to time study.
Another issue in job design is the financial incentive plan. These plans determine how workers should be compensated. In preparing a financial incentive plan, management must consider individual, group, and organization wide rewards.
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