Production Management PECI471 Quiz

Module Information

• Module Title: Production Management
• Module Code: PECI471
• Department: Chemical Engineering
• University: Mangosuthu University of Technology

Learning Outcomes

• Define production and operation management
• Identify and describe the three major functional areas of an organization (Operation, Finance, Marketing) and how they relate
• Describe the operation function
• Differentiate between design and operation systems
• Describe different types of operations
• Compare and contrast service and manufacturing

Definitions

• Production Management: Planning, implementation, and control of industrial processes to ensure smooth and efficient operation.
• Operation Management: Management of systems/processes that create goods and/or provide services.

Functions within a Business Organization

• Businesses are focused on producing goods or providing services.
• A business has three main functions: Operation, Finance, and Marketing.
• These three functions are interdependent.

Operations Function

• Includes all activities directly related to producing goods or providing services.
• Is the core of most organizations.
• Converts inputs (raw materials, equipment, energy, transport, information, staff, customers, suppliers) into outputs (products, profit, customer satisfaction, environmental impacts).

Output of Operations

• Output of the operation system is called products.
• Products can be tangible goods, intangible services, or a combination of both.

Finance Function

• Involves securing resources at favorable prices and allocating them across the organization.
• Finance and operation personnel cooperate by exchanging information and expertise in activities such as budgeting, economic analysis of investment proposals, and providing funds

Marketing Function

• Involves selling and/or promoting goods/services.
• Marketing people make advertising and pricing decisions.
• Marketing assesses customer needs and wants and communicates with operations.

Other Functions

• Other functions in a business organization include maintenance, public relations, security, accounting, distribution, and procurement.

Design & Operation System

• Creation of goods and services involves resource acquisition and transformation processes.
• Transformation processes involve planning, coordinating, and controlling process elements (workers, equipment, facilities, allocation of resources, work methods).
• Design Systems involve decisions related to system capacity, geographical location of facilities, arrangement of departments, placement of equipment, and product & service planning.
• Operation Systems involve management of personnel, inventory planning & control, project management, and quality assurance.

Production Systems

• Production systems refer to methods/processes used to produce goods and services.
• Production features can be differentiated by standardization, types of operation, and degree of automation

Degree of Standardization

• Standardized output means a high degree of uniformity in goods and services.
• Standardized goods examples: TV, Radio, Computers.
• Standardized services examples: Car wash, Banking services, Laundry services
• Customized output means product/service is designed for a specific case or individual
• Customized goods examples: Eye glasses, Custom fitted clothes, Wedding Cakes
• Customized services examples: Tailoring, Taxi rides/e-hailing services, Surgery, Travel Itinerary

Types of Operation

• Projects: Special case, non-routine, complex set of activities completed in a limited time span. Examples include large construction projects, new product development, or disaster relief efforts
• Job production: Manufacturing a single or small batch of products to meet specific customer requirements. Design and material may vary from one job to another.
• Batch production: Producing a specific quantity of products in batches. Also known as intermittent processing. Quantities are too large for job production, yet too small for mass production
• Mass Production: Large volumes of standardized products using assembly lines/automation. High volumes, standardization, automation, low labor cost, economies of scale
• Continuous Production: Large volumes of highly standardized items. Materials are processed and products are produced without interruption. Process runs 24/7. Uninterrupted workflow, high volumes, standardization, automation, consistency

Mass Production Benefits & Constraints

• Benefits: Cost efficiency, consistency in products, fast production, predictable & stable schedule
• Constraints: Lack of flexibility, high initial cost, monotony for workers, risk of over production

Continuous Production Benefits & Constraints

• Benefits: High efficiency, low unit cost, consistency in quality, reduced labor costs
• Constraints: High initial investment, inflexibilities, complex maintenance, risk of downtime

Degree of Automation

• Manual Production: Relies heavily on human labor and manual processes
• Automated Production: Uses machinery and robots to perform tasks with minimal human intervention
• Semi-Automated Production: Combines both manual and automated processes