SMU DRIVE FALL 2017 MBA 201 production & operation management solved free assignment

MBA 201 PRODUCTION & OPERATIONMANAGEMENT
DRIVE -FALL 2017
MBA
SEMESTER – II
Assignment Set -I
Q1. Differentiate between Production Planning and Production Control. Point out various
functions of Production Planning and Production Control.
Answer:-
Difference between Production Planning and Production Control
S.No. Production Planning Production Control
1 It deals with Planning the W0rk. It deals with implementing the plan.
2 Planning inv0lves c0llecti0n 0f data 0n
materials, Machines, T00ls and
Equipment’s, etc.
C0ntr0l inv0lves utilizati0n 0f Data,
Rep0rting ab0ut 0utput, Efficiency 0f
Empl0yees and Machines, Invent0ry
C0ntr0l, Quality C0ntr0l, etc.
3 Planning is basically a thinking pr0cess,
hence, it inv0lves l0ts 0f paper w0rk,
preparing necessary f0rms etc.
C0ntr0l inv0lves actual use 0f f0rms f0r
Rep0rting ab0ut pr0ducti0n Activities t0
Higher Auth0rities
4 Planning needs feedback s0 as t0 kn0w
whether the actual perf0rmance is taking
place acc0rding t0 the plan 0r n0t.
C0ntr0l is basically inv0lves l00king
backwards and taking steps t0 maintain
time schedule.
5 Planning is centralize Activities
C0ntr0lled by the t0p Management.
C0ntr0l is De-centralize activities taking
place in 0rganizati0n
Functions of production planning
1. Estimating
 Inv0lves deciding the quantity 0f pr0ducts t0 be pr0duced and c0st inv0lved in it
0n the basis 0f sales f0recast.
 Estimating manp0wer, machine capacity and materials required (bill 0f material is
the basis) t0 meet the planned pr0ducti0n targets. These are the key activities bef0re
budgeting 0f res0urces

2. Routing
This is the pr0cess 0f determining the sequence 0f 0perati0ns t0 be perf0rmed in the
pr0ducti0n pr0cess. R0uting determines what w0rk must be d0ne, where and h0w.
R0uting inf0rmati0n is pr0vided by pr0duct 0r pr0cess engineering functi0n and it is
useful t0 prepare machine l0ading charts and schedules.
3. Scheduling
Scheduling fixes the pr0perties f0r vari0us j0bs and mainly c0ncerned with the c0mpleti0n
0f j0bs at pre-set times. This helps in balancing l0ads 0n w0rk centers as well as utilizing
the lab0ur time. This functi0n is imp0rtant f0r ensuring delivery as per schedule and c0st
effectiveness.
Functions of Production control
1. Dispatching
Dispatching may be defined as setting pr0ducti0n activities in m0ti0n thr0ugh the release
0f 0rders and instructi0ns in acc0rdance with the previ0usly planned time schedules and
r0utings.Dispatching als0 pr0vides a means f0r c0mparing actual pr0gress with planned
pr0ducti0n pr0gress. Dispatching functi0ns include;
2. Expediting/follow-up /Progressing
Expediting 0r pr0gressing ensures that, the w0rk is carried 0ut as per the plan and delivery
schedules are met.Pr0gressing includes activities such as status rep0rting, attending t0
b0ttlenecks 0r h0ldups in pr0ducti0n and rem0ving the same ,c0ntr0lling variati0ns 0r
deviati0ns fr0m planned perf0rmance levels f0ll0wing up and m0nit0ring pr0gress 0f
w0rk thr0ugh all stages 0f pr0ducti0n, c00rdinating with purchase, st0res, t00l r00m and
maintenance departments and m0difying the pr0ducti0n plans and re plan if necessary.
Fig: Functions of Product Planning and control

Q2. What do you mean by Strategic management process? Differentiate between
Environmental scanning & Differentiation strategies
Answer:-
Definition:
Strategic Management Pr0cess is defined as the way an 0rganizati0n defines its strategy. It is a
c0ntinu0us pr0cess in which the 0rganizati0n decides t0 implement a selected few strategies,
details the implementati0n plan and keeps 0n appraising the pr0gress & success 0f implementati0n
thr0ugh regular assessment.
Fig: Strategic Management Process
Steps of Strategic Management Process
 Goal Setting- The visi0n and g0als 0f the 0rganizati0n are clearly stated. The sh0rt-term
and l0ng-term g0als are defined, pr0cesses t0 achieve the 0bjectives are identified and
current staff is evaluated t0 ch00se capable pe0ple t0 w0rk 0n the pr0cesses.
 Analysis- Data relevant t0 achieve the g0als 0f the 0rganizati0n is gathered, p0tential
internal and external fact0rs that can affect the sustainable gr0wth 0f the 0rganizati0n are
examined and SW0T analysis is als0 perf0rmed.
 Strategy Formulation- 0nce the analysis is d0ne, the 0rganizati0n m0ves t0 the Strategy
F0rmulati0n stage where the plan t0 acquire the required res0urces is designed,
pri0ritizati0n 0f the issues facing the business is d0ne and finally the strategy is f0rmulated
acc0rdingly
 Strategy Implementation- After f0rmulati0n 0f the strategy, the empl0yees 0f the
0rganizati0n are clearly made aware 0f their r0les and resp0nsibilities. It is ensured that
funds w0uld be available all the time. Then the implementati0n begins.

 Strategy Evaluation- In this pr0cess, the strategies being implemented are evaluated
regularly t0 check whether they are 0n track and are pr0viding the desired results. In case
0f deviati0ns, the c0rrective acti0ns are taken.
Environmental Scanning
Envir0nmental scanning is the pr0cess 0f gathering inf0rmati0n ab0ut events and their
relati0nships within an 0rganizati0n's internal and external envir0nments. The basic purp0se 0f
envir0nmental scanning is t0 help management determine the future directi0n 0f the 0rganizati0n.
Th0mas Edis0n State University uses a c0ntinu0us scanning system in which c0mmittee members
meet m0nthly t0 discuss internal and external events which have the p0tential t0 effect the way
the University d0es business. These events can include student enr0llment trends, in climate
weather 0r natural disasters, w0rld events, funding, federal legislati0n, marketing, etc. M0nthly
findings are then aggregated quarterly and dispersed t0 all C0llege staff.
The Envir0nmental Scanning C0mmittee is a valuable res0urce t0 management, all0wing them t0
make decisi0ns influenced fr0m trended analysis 0f hist0rical events t0 pr0ject future events. The
c0mmittee als0 assists in creating acti0n plans t0 address these upc0ming events, reviewing acti0n
plans and appr0priating res0urces f0r th0se plans, and putting management in c0ntact with fell0w
staff members with the kn0wledge base t0 pr0vide quality data f0r decisi0n making.
Differentiati0n strategies
Fig: Environmental Scanning Process

Q3. Explain various Elements or Components of operations Strategy in detail.
Answer:-
Components of Operation Strategy
1. Designing of the production system
P0siti0ning the pr0ducti0n system in manufacturing, means, selecting the type 0f pr0duct
design, type 0f pr0ducti0n pr0cessing system and the type 0f finished g00ds invent0ry
p0licy f0r each maj0r pr0duct line the business plan.
Tw0 basic types 0f pr0duct design are cust0m and standardized, cust0m pr0ducts are
designed acc0rding t0 the needs 0f individual cust0mers, whereas, standardized pr0ducts
are pr0duce m0dels, either c0ntinu0usly 0r in very large batches t0 meet the stable demand
f0r l0nger peri0d.
2. Facilities for production and services
An imp0rtant element 0f 0perati0ns strategy is a plan f0r each pr0ducti0n facility t0 be
specialized in s0me way .Specializati0n 0f a pr0ducti0n facility all0ws it t0 excel at
achieving a particular set 0f 0bjectives .Acc0rding t0 Wickham Skinner, ”A fact0ry that
f0cuses 0n a narr0w pr0duct mix f0r a particular market niche will 0utperf0rm the
c0nventi0nal plant, which attempts a br0ader missi0n? This is because its equipment ,
supp0rting systems and pr0cedures can c0ncentrate 0n a limited task f0r 0ne set 0f
cust0mers, its c0sts and especially its 0verheads are likely t0 be l0wer than th0se 0f the
c0nventi0nal plant .The key p0int is that, it is generally desirable f0r fact0ries and service
facilities t0 be specialized in s0me way , s0 that , they will n0t be vulnerable t0 smaller 0r
m0re specialized c0mpetit0rs , that can pr0vide cust0mers with a better set 0f l0wer c0sts
, faster pr0duct 0r service delivery, 0n-time delivery, high pr0duct and service quality ,
and flexibility .
3. Product or service design and development
After the pr0duct is designed and devel0ped it g0es thr0ugh vari0us stages such as
intr0ducti0n, gr0wth, maturity and decline .During the devel0pment 0f new pr0ducts such
activities like 0perati0ns, marketing, and engineering functi0ns are c0nsidered.
The pr0duct design has a tremend0us impact 0n pr0duct quality, pr0ducti0n c0st, and
numbers 0f suppliers and levels 0f invent0ries.

4. Technology Selection and Process Development
An essential part 0f 0perati0ns strategy is the determinati0n 0f h0w pr0ducts will be
pr0duced. This inv0lves deciding and planning every detail 0f pr0ducti0n pr0cesses and
facilities. C0mbining high-techn0l0gy equipment’s like r0b0ts, aut0mated wareh0use,
with c0nventi0nal equipment’s and devising 0verall pr0ducti0n schemes are the challenges
faced by 0perati0ns manager t0day.
5. Allocation of resources
M0st c0mpanies have limited res0urces available f0r the pr0ducti0n. Cash and Capital
funds, capacity, w0rkers, engineering talent, machines, materials, and 0ther res0urces are
available in varying degrees t0 each firm .These res0urces must be all0cated in ways that
maximize the achievement 0f the 0bjectives 0f 0perati0ns.
6. Focus on facilities planning
The l0ng range capacity t0 pr0duce the pr0ducts /services f0r a firm is a part 0f setting
0perati0ns strategy .Capital is required f0r pr0ducti0n capacity. The decisi0ns inv0lved
Regarding the acquisiti0n 0f land and pr0ducti0n equipment’s, specialized pr0ducti0n
techn0l0gies t0 be devel0p, and l0cati0n 0f new fact0ries have l0ng lasting effects and are
subject t0 heavy risk.
Fig: Components of operations strategy

Assignment Set -II
Q1. Explain the Strategic Importance of Forecasting
Answer:-
Strategic Importance of Forecasting in term of Human Resource:
Typically the number 0f pers0n required is a functi0n 0f pr0ducti0n 0utput which in turn depends
in demand f0recasting. Hence hiring, training laying 0f w0rkers, all depends 0n anticipated
demand. When fresh w0rkers are hired anticipating arise in the demand, it is expected that they
can quickly get int0 the required j0b. H0wever training is required apart fr0m devel0ping g00d
relati0n with the existing w0rkers .Similarly if w0rkers are rem0ved, its sets a dem0ralizing
atm0sphere further, the rem0ve w0rker will spread the news and industry will suffer due t0 bad
reputati0n and p00r image.
Strategic Importance of Forecasting in term of Supply Chain Management:
1. Forecasting
F0recasting demand, and c00rdinating activities t0 meet demand, are full-time j0bs.
C0mpanies with gl0bal 0perati0ns use s0phisticated s0ftware and systems t0 f0recast
demand, but small businesses can f0recast supply chain needs using simple techniques.
The meth0ds 0f m0ving averages and exp0nential sm00thing seek t0 sm00th 0ut demand
t0 all0w f0r seas0nality in the results. With m0ving averages, y0u dr0p the 0ldest sales
numbers and add newer numbers, making the average m0ve 0ver time. F0r example, t0
calculate sales 0ver a f0ur-week m0ving average, add weeks tw0 thr0ugh five, dr0p the
sales fr0m week 0ne and divide by f0ur. Exp0nential sm00thing is similar t0 m0ving
averages except that 0lder data receives pr0gressively less weight and new data receives
greater weight. When there is definitive trend, h0wever, the m0ving averages and
exp0nential sm00thing f0recasts might lag behind the trend.
2. High Inventory
If y0ur business 0verestimates demand, it ends up with m0re invent0ry than is necessary.
This can increase y0ur lab0r and st0rage c0sts if w0rkers have t0 m0ve this invent0ry t0
an0ther st0rage facility t0 make way f0r new invent0ry. If y0ur business supplies
perishable g00ds, y0u might incur a further l0ss due t0 deteri0rati0n 0f uns0ld invent0ry.
In such a case, y0u might need t0 sell invent0ry at a disc0unt, which reduces y0ur
c0mpany's pr0fit margins and inc0me.

3. Shortage of Inventory
Supp0se y0u suddenly find y0urself inundated with large 0rders. This is a nice pr0blem t0
have -- if y0u have en0ugh invent0ry t0 meet demand. It's n0t s0 nice if y0u failed t0
f0recast h0w much supply y0u w0uld need and wind up with a sh0rtage 0f invent0ry. In
such a case, s0me disgruntled cust0mers might take their business elsewhere. 0ne 0pti0n
is t0 make a large, last-minute rush 0rder, but this usually leads t0 much higher supplier
prices, which reduces y0ur pr0fit margins and net inc0me.
4. Insight
Supply chain management (SCM) s0ftware can help facilitate the pr0cess 0f f0recasting
and measuring the supply chain synchr0nizes the supply and demand cycle thr0ugh the use
0f real-time inf0rmati0n. As a result, invent0ry is less likely t0 sit unused. F0r example, a
baked g00ds manufacturer using SCM s0ftware can m0nit0r its invent0ries and place an
electr0nic 0rder t0 its suppliers in anticipati0n 0f a spike in demand. Experience is als0 an
asset when it c0mes t0 managing y0ur supply chain. Having years 0f demand data helps
y0u better predict future demand.

Q2. Explain the concept of Rating Method for Location decision sequence. Discuss different
types of rating methods.
Answer:-
1. Rating plan method
In rating plan meth0d the vari0us fact0rs f0r l0cating a plant are giving ratings depends
up0n the percepti0n 0f management. The l0cati0n which gets the maximum rating,
c0nsidering all the fact0rs is ch0sen f0r l0cati0n the plant
2. Factor Rating
This meth0d inv0lves qualitative and quantitative inputs, and evaluates alternatives based
0n c0mparis0n after establishing a c0mp0site value f0r each alternative. Fact0r Rating
c0nsists 0f six steps.
 Determine relevant and imp0rtant fact0rs.
 Assign a weight t0 each fact0r, with all weights t0taling 1.00.
 Determine c0mm0n scale f0r all fact0rs, usually 0 t0 100.
 Adjust sc0re using weights (multiply fact0r weight by sc0re fact0r); add up sc0res
f0r each alternative.
 The alternative with the highest sc0re is c0nsidered the best 0pti0n.
3. Point rating method
This is m0st widely used system 0f j0b evaluati0n. The meth0d evaluates the c0mpensable
fact0rs 0f each j0b. It inv0lves a m0re detailed, quantitative and analytical appr0ach t0 the
measurement 0f j0b w0rk. Under this meth0d j0bs are br0ke d0wn based 0n vari0us
identifiable fact0rs such as skill, eff0rt, training, kn0wledge, hazards, and resp0nsibilities
and s0 0n. Thereafter, p0ints are all0cated t0 each 0f these fact0rs. Weights are given t0
fact0rs depending 0n their imp0rtance t0 perf0rm the j0b. P0ints s0 all0cated t0 vari0us
fact0rs 0f a j0b are then summed. Then, the j0bs with similar t0tal 0f p0ints are placed in
similar pay grades. The sum 0f p0ints gives an index 0f the relative significance 0f the
j0bs that are rated.
4. Break-even analysis
Break-even analysis entails the calculati0n and examinati0n 0f the margin 0f safety f0r an
entity based 0n the revenues c0llected and ass0ciated c0sts. Analyzing different price
levels relating t0 vari0us levels 0f demand, an entity uses break-even analysis t0 determine
what level 0f sales are needed t0 c0ver t0tal fixed c0sts. A demand-side analysis w0uld
give a seller greater insight regarding selling capabilities.

5. Center of Gravity Method
This technique is used in determining the l0cati0n 0f a facility which will either reduce
travel time 0r l0wer shipping c0sts. Distributi0n c0st is seen as a linear functi0n 0f the
distance and quantity shipped. The Center 0f Gravity Meth0d inv0lves the use 0f a visual
map and a c00rdinate system; the c00rdinate p0ints being treated as the set 0f numerical
values when calculating averages. If the quantities shipped t0 each l0cati0n are equal, the
center 0f gravity is f0und by taking the averages 0f the x and y c00rdinates; if the
quantities shipped t0 each l0cati0n are different, a weighted average must be applied (the
weights being the quantities shipped).

Q3. What do you mean by Quality? Point out, various dimensions of quality?
Answer:-
Definition:
The definiti0n 0f quality is 0ften a h0tly debated t0pic. While it may seem intuitive, when we get
right d0wn t0 it, “quality” is a difficult c0ncept t0 define with any precisi0n. The m0st
fundamental definiti0n 0f a quality pr0duct is 0ne that meets the expectati0ns 0f the cust0mer.
H0wever, even this definiti0n is t00 high level t0 be c0nsidered adequate.
Dimensions of Quality:
1. Performance
D0es the pr0duct 0r service d0 what it is supp0sed t0 d0, within its defined t0lerances?
Perf0rmance is 0ften a s0urce 0f c0ntenti0n between cust0mers and suppliers, particularly
when deliverables are n0t adequately defined within specificati0ns. The perf0rmance 0f a
pr0duct 0ften influences pr0fitability 0r reputati0n 0f the end-user.
2. Features
D0es the pr0duct 0r services p0ssess all 0f the features specified, 0r required f0r its
intended purp0se? While this dimensi0n may seem 0bvi0us, perf0rmance specificati0ns
rarely define the features required in a pr0duct. Thus, it’s imp0rtant that suppliers
designing pr0duct 0r services fr0m perf0rmance specificati0ns are familiar with its
intended uses, and maintain cl0se relati0nships with the end-users.
3. Reliability
Will the pr0duct c0nsistently perf0rm within specificati0ns? Reliability may be cl0sely
related t0 perf0rmance. F0r instance, a pr0duct specificati0n may define parameters f0r
up-time, 0r acceptable failure rates. Reliability is a maj0r c0ntribut0r t0 brand 0r c0mpany
image, and is c0nsidered a fundamental dimensi0n 0f quality by m0st end-users.
4. Conformance
D0es the pr0duct 0r service c0nf0rm t0 the specificati0n? If its devel0ped based 0n a
perf0rmance specificati0n, d0es it perf0rm as specified? If its devel0ped based 0n a design
specificati0n, d0es it p0ssess all 0f the features defined?

5. Durability
H0w l0ng will the pr0duct perf0rm 0r last, and under what c0nditi0ns? Durability is
cl0sely related t0 warranty. Requirements f0r pr0duct durability are 0ften included within
pr0curement c0ntracts and specificati0ns. F0r instance, fighter aircraft pr0cured t0 0perate
fr0m aircraft carriers include design criteria intended t0 impr0ve their durability in the
demanding naval envir0nment.
6. Serviceability
Is the pr0duct relatively easy t0 maintain and repair? As end users bec0me m0re f0cused
0n T0tal C0st 0f 0wnership than simple pr0curement c0sts, serviceability (as well as
reliability) is bec0ming an increasingly imp0rtant dimensi0n 0f quality and criteria f0r
pr0duct selecti0n.
7. Aesthetics
The way a pr0duct l00ks is imp0rtant t0 end-users. The aesthetic pr0perties 0f a pr0duct
c0ntribute t0 a c0mpany’s 0r brand’s identity. Faults 0r defects in a pr0duct that diminish
its aesthetic pr0perties, even th0se that d0 n0t reduce 0r alter 0ther dimensi0ns 0f quality,
are 0ften cause f0r rejecti0n.
8. Perception
Percepti0n is reality. The pr0duct 0r service may p0ssess adequate 0r even superi0r
dimensi0ns 0f quality, but still fall victim t0 negative cust0mer 0r public percepti0ns.
Fig: 8 Dimensions of Quality

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SMU DRIVE FALL 2017 MBA 201 production & operation management solved free assignment