Industrial Operations and Management Practices PDF

**INDUSTRIAL OPERATIONS and MANAGEMENT PRACTICES**[Lecture 1] **WHAT IS AN INDUSTRY?** It is the manufacturing or technically productive enterprises inaparticular field, country, region, or economy viewed collectively, or oneof these individually. It is a classification that refers to a group of...

**INDUSTRIAL OPERATIONS and MANAGEMENT PRACTICES**[Lecture 1] **WHAT IS AN INDUSTRY?** It is the manufacturing or technically productive enterprises inaparticular field, country, region, or economy viewed collectively, or oneof these individually. It is a classification that refers to a group of companies that arerelatedin terms of their primary business activities. **FOUR TYPES OF INDUSTRY** A. Primary industry -- involves obtaining or providing natural rawmaterialsfor conversion into commodities and products for the consumer. ex. mining, agriculture, or forestry Both the non-renewable and renewable resources are harvestedfromthe planet Earth so that the Secondary industry can manufacturefinished product, and the Tertiary industry can easily sell in theconsumer market. Primary industries are identified as those industries that can producethe raw materials for other sectors. It is concerned with the removal and collection of resources that are considered natural. [Ethiopia] is an example of a developing country where 88%of employment is to be found in primary industries, 10%in Tertiary and2% in Secondary industries. The most basic example of using products from primary industryisin[building your own home. The wood i]s part of the primary industry. Other day-to-day examples of the primary industry are the cattlegrazing on fertile land, miners mining and bringing out coal fromthemines and trees that provide us with fruits, vegetables, and wood. [Cotton is an example of a] [product] in the primary industry, but thedresswe wear is because of both Subsidiary and Tertiary industries. [Primary Industries] 1\. Farming 1 and vegetables. More than 1/3^rd^ of the workforce in theearthisstill employed in agriculture or farming sector. 2. Forestry It is the conserving, managing, repairing, using and harvestingof [woodlands], forests, and associated resources for environmental and human advantage. It is practiced in natural stands as well as plantations. Whererawmaterials like bamboo and raw timber are used to buildandconstruct buildings. Modern forestry also includes fuelwood, landscape, andwildlifehabitat. It is considered a very vital economic segment inindustrial countries. 3\. Mining Mining deals in extracting raw materials like clay, silt, rock, metals, gemstones, and minerals from the earth. The secondary industry relies heavily on raw materials fromminingfor manufacturing and producing lots of important [products. Lithium]for [batteries and steel f]or building are important examples of primary products that are later developed [by secondary industry. Oil] [and gas a]re used as fuel and lubricants in vehicles. Oil is usedfor electricity, chemicals, and plastics. Mining in a broader concept also includes non-renewable [resources like natural gas, petroleum], and [water]. Mining [ operations] [h]urt [the] [environment], and it continues evenafter the mine is closed. The modern process has brought about somechanges to increase the safety in these mines. 4\. Fishing The fishing industry is one of the important primary industriesintheworld. It includes [activities like selling, marketing, transporting], [storing], [preserving], [and processing f]ish products. The fishing industry is further divided into three sectors commercial, recreational, and traditional sectors. Nearly 500 million peoplearedirectly and indirectly involved in this primary industry. B. Secondary industry -- industry that deals with the raw materials effectively [collected by the] [primary industry] [s]o that they can convert them [into finished] [products] [(]involves manufacturing). These [finished] [goods] are in turn sold by Tertiary industries in the [consumer market]. The secondary industry [sector includes steel] [production], [ automobile m]anufacturing, [and telecommunications], amongst others. This is the key sector that has the potential *tochangeworld economies.* The secondary industry is responsible for acquiring the rawmaterials and making them into viable goods that can be consumed by thecustomers in the consumer market. It requires manufacturing plants, factories, machinery, and energyfor successfully converting the raw materials into usable products. The*side effect of secondary industries* is the waste heat and wasteproducts that it leaves behind during the production process. It causessevere [harm to the] [environment] [a]s pollution is at its height in recent times. The secondary sector is often considered a *bridge between boththeprimary and tertiary industries.* The [wheat and rice] grown during farming [ ] *are [made into bread]*, [themilk]*from the cattle is turned to butter, curd, and cheese*, factories turnraw[metal] into [pipes, steel] is [ ] *made [into cars,]* [wool] into *woolen clothes*, the[wood f]rom the trees helps to *create beautiful furniture* inside our homesand [office areas and fruits and vegetables a]re turned into *pies andpuree* respectively. [Secondary Industries] 1\. [Light Industry] It is defined as manufacturing activity that takes a small amount of product that is partially processed or is a raw material to createproducts of the high price per unit weight. Its impact on theenvironment is low if compared with heavy industries. *Examples are:* Textile mills, manufacturing of apparel and leather manufacturing. Products related to tobacco and beverage like wineries, panmasala, gutka, distilleries, manufacturing of bottled water, soft drinks andbreweries. Manufacturing of food items like breakfast cereal, frozen food, dehydrated food, ice cream. Manufacturing food items for pets like cats and dogs food. [2. Heavy Industry] Heavy industries refer to the manufacturing and productionprocesson a large scale that involves heavy and large facilities, equipment, areas, machine tools, and complex and large-scale infrastructure. It [needs] [h]igh capital investment compared to light industries. *Examples are:* Glass and various related products Chemical manufacturing like industrial gas, petrochemical manufacturing of ethyl alcohol, fertilizer, synthetic dye and pigment Industrial machinery, mining, construction and agriculture Concreteand cement production Manufacturing of coal and petroleum products like asphalt shingle, refineries, petroleum and coating materials ex. teaching, nursing Tertiary industries enable consumers to obtain and use the finishedgoods. Most of the time these are grouped with Quaternary industriesbecause of their similarities, both providing services. Tertiary industries focus on broader subjects. They provide servicesother than goods. D. Quaternary industry -- involves research and development. TheQuaternary Industry plays a significant role to develop a country'sknowledge and scientific base. This industry similar to the TertiaryIndustry focuses on services and intangible aspects of the economy. The difference between the two relates to the specialized component noticed in the Quaternary Industry. The Quaternary Industry offers a more specialized approach for example business consulting, research and development, datacollection or specialized financial services. For example, this industry provides access to scientists, researchers and developers to explore and identify new inventions. Thesediscoveries allow for an improved lifestyle by the country's citizens. (Geography Revision) **What is Industrial Operation?** **Industrial Operations** means all commercial activities which develop, produce and/or manufacture Material and/or information, including Informationand Communications Technology, for or on behalf of the defense organizations of either Party. (Law Insider) Industrial Operations include: 1\. Planning the operation system 2\. Organizing the necessary human and capital resources 3. Directing operations and personnel 4\. Monitoring the system's performance An organization whether produces goods or provide services is a **system.** A set of related and interacting components that performfunctionsand have goals pertaining to the whole are called **subsystems.** This is composed of all the outside factors or influences that impact theoperation of business. The business must act or react to keep up its flowof operations. The **external environment** can be broken down into twotypes: the **micro** environment and the **macro** environment. The **micro environment** consists of the factors that directly impact theoperation of a company. The **macro environment** consists of general factors that a businesstypically has no control over. The success of the company dependsonits ability to adapt. The **micro environment** Suppliers Others: Competitors Customers Marketing Intermediaries (ex. distributor) Financiers (ex. banks) Public (perceptions) The **macro environment** The PESTLE : Political (ex. gov't policies) Economic (ex. inflation) Sociocultural (ex. consumer behavior) Technical/Technological (ex. innovation) Legal (ex. legal obligations) Environmental considerations (ex. calamity) [Inputs] Inputs are the resources invested in accomplishing a task, andtypicallyinclude time, money, and effort. Ex. workers money land equipment materials building [Transformation or Conversion Process] A **transformation process** is any activity or group of activities that takes one or more inputs, transforms and adds value to them, and providesoutputs for customers or clients. In short, this is how inputs being applied to come up with an output. ex. actual manufacturing health-care treatment [Output] Outputs are those results which are achieved immediately after implementingan activity. This refers to finished products. [Feedback] -- information that support decisions whether changes are required or not. **DESIGNING PRODUCTION/OPERATIONS SYSTEMS** This involves making decisions about *what, how many, how, where, and who.* This consists of three basic steps: 1\. Research: generation of product/service idea. 2\. Selection: from among the research-generated ideas, choosethose that are technologically feasible, marketable, and compatible andcompatible with organizational strategy. 3\. Design: refers to final specifications of the product/service. This shouldbe optimal in terms of reliability, quality, and cost. B. Capacity Planning Second decision in designing the operation system. Howmany products or how much service -- is to be produced. [Steps in capacity planning:] Predicting future demand Translating predictions into actual physical capacity requirements. Generating alternative capacity plans to meet the requirements. Analyzing and comparing the economic effects of the alternative plans. Identifying and comparing the risks and strategic effects of the alternativeplans. Deciding on a plan for implementation. C. Process Selection Determines how the product or service will be produced. [Four Technological Decisions in Process Selection] 1. Major Technological Choice Does technology exist? Are there competing technologies among which we should choose? 2\. Minor Technological Choice Refers to technological process alternatives available. 3\. Specific Component Choice Refers to what type of equipment to be used. Must have specific purpose or general purpose. 4\. Process Flow Choice Determines how materials and products will move through thesystem. Example: Casting and moulding Machining Metal Working Assembly Finishing D. Facility Location Planning Factors to consider: Fixed costs -- land, equipment Variable operations costs -- wages, taxes, energy consumption. Lay out Planning -- the arrangement of physical facilities. E. Job Design -- refers to the structure of individual jobs. \- specifying individual tasks \- specifying the method of performing the tasks \- END OF PRELIM TOPICS - **REFERENCES** Hitesh Bhasin, October 18, 2019, "Primary Industry: Meaning, Types &Example of Primary Industry Explained," Marketing91 Annisesiaw, Septermber 14, 2013, "What is Tertiary Industry?," Geomega Geography Revision, February 29, 2020, "Quaternary Industry," GeographyRevision 2008-2020 Law Insider, 2013-2020, "Definition of Industrial Operations," LawInsider Inc. Study.com, 2020, "What is an External Environment in Business? -- Definition, Types and Factors (chapter 5, Lesson 14)," Nathan Cragg, January 31, 2017, "Inputs, Processes, Outputs: Howtoimprove your field service business," Tract Systems Blog The Open University Open Learn, 2020, "Understanding Operations Management," OpenLearn FundsforNGOs, "While defining project results in a proposal, what is thedifference between outputs and outcomes?" Prepared by: **Asst. Prof. Celerina R. Teodosio** Faculty