Production & operation(1) PDF

Department of Chemical Engineering Module: Production Management Module Code: PECI471 Production & Operations management Learning outcomes Define the term production and operation management Identify the three major functional areas of an organization & describe how they relate...

Department of Chemical Engineering Module: Production Management Module Code: PECI471 Production & Operations management Learning outcomes Define the term production and operation management Identify the three major functional areas of an organization & describe how they relate Describe the operation function Differentiate between the design & operation systems Provide description of different types of operation Compare and contrast service and manufacturing DEFINITION Production Management - Is the planning, implementation & control of industrial processes to ensure smooth and efficient operation. Operation Management - Is the management of systems/processes that create goods and/or provide services. Functions within a business organization Businesses are either committed to produce goods or provide a service. A business has 3 major functions Operation Finance Marketing The 3 functions are interdependent Major Business Functions OPERATION The 3 major functions interact to achieve the goals of the organization MARKETING FINANCE OPERATIONS FUNCTION Consist of all the activities that are directly related to producing goods or providing a service. Is the core of most organizations, They convert a set of input such as raw materials into one or more output INPUT PROCESS OUTPUT Raw Materials &Equipment Products Energy Process Flow Profit Transport Progressing & control Customer satisfaction Information, Work-in-Progress Environmental Impacts Staff, Customers, Suppliers Planning & Scheduling Operations function Output of the operation system are called PRODUCTS These products maybe tangible good or intangible services or a combination of both FINANCE FUNCTION Consist of all activities that relate to securing resources at favourable prices and allocating these resources across the organization. The finance and operation personnel co- operate by exchanging information and expertise in activities such as: Budgeting Economic analysis of Investment proposal Provision of funds Marketing Function Consist of selling and/or promoting the good / services. Advertising & pricing decisions are made by marketing people Marketing is also responsible for assessing the needs and wants of customers and communicate with the operations Other functions in a business organization Include: Maintenance Public relation Security Accounting Distribution Procurement Design & Operation System Design & Operation System Creation of goods & services involves resource acquisition And conversion of input to output using one or more transformation processes The transformation process involves: (i) Planning (ii) Co-ordinating and controlling elements that make up the process WORKERS EQUIPMENT FACILITIES ALLOCATION OF RESOURCES WORK METHODS DESIGN SYSTEMS Involves decision that relate to: System capacity Geographical location of facilities Arrangement of department Placement of equipment within physical structure Acquisitions of equipment Product & service planning Operation System Involves: Management of personnel Inventory planning & control Project management Quality assurance Production System PRODUCTION SYSTEMS Production Systems refers to the methods/process used to produce goods & services Production features can be differentiated in 3 ways : Standardisation Types of operation Degree of automation PRODUCTION SYSTEMS (i) Degree of Standardisation Standardised output means there is a high degree of uniformity in good & services. Examples of standardised goods Examples of standardized services T.V Car Wash Radio Banking services Computers Laundry services PRODUCTION SYSTEMS Customised Output - Means the product/service is designed for a specific case or individual Examples of customised goods: Examples of customised services Eye glasses Tailoring Custom fitted clothes Taxi rides / e-hailing services Wedding cakes Surgery Travel Itinerary PRODUCTION SYSTEMS (ii) Types of Operation Projects Job production Batch production Mass Production Continuous Production (a) PROJECTS Types of Operation (a) Projects - Are special case - A type of processing that is employed to handle a non-routine job encompassing a complex set of activities - Are set up to handle complex jobs consisting of unique sets of activities that must be completed in a limited time span - Examples include: large / unsual construction project - New product development or promotion - Disaster relief efforts (b) Job Production Is a manufacturing process in which a single or small batch of products is made to meet specific customer requirements Used for custom-made products where design and material may vary from one job to another. Benefits Constraints High Quality – as workers can High Labour costs, as workers must concentrate on one product be skilled in a number of areas Work is varied – Brings motivation to Production can be slow / time workers consuming Products are custom made A wide range of specialist tools may be needed. Flexible production method- not monotonous Require close consultation with client to meet exact specifications Batch Production  Batch Production Produces a specific quantity of products in batches Is sometimes referred to as Intermittent processing Key Characteristics: Intermittent production Moderate Volumes- Produces moderate volumes of similar products - Quantities are too large for job production yet too small for mass production Same Resource utilisation- Equipment & labour are shared across different batches Examples: Food processing, Bakeries, Paint production and pharmaceuticals Mass Production  Mass Production Produces large volumes of standardized products using assembly lines/ automation. Key Characteristics High Volumes Standardisation Automation – use of machine, robots & automated systems to ensure speed, accuracy and consistency Low labour cost Economies of scale – High production level lead to lower cost per unit as fixed cost are spead over large number of items  Benefits and Constraints for Mass Production Benefits Constraints Cost efficiency Lack of flexibility Consistency in products High initial cost Fast production Monotony for workers Predictable & stable production Risk of over production schedule Examples: Automobiles; Consumer electronics (Smartphones, TV , Computers) Continuous Production Produce Large volumes of highly standardized items Materials are processed & products produced without interruption The process runs 24/7 Key Characteristics: Uninterrupted workflow High volumes Standardization Automation Consistency Benefits & constraints of Continuous Production Benefits Constraints High Efficiency High initial Investment Low Unit cost Inflexibilities Consistency in quality Complex maintenance Reduced Labour costs Risk of downtime Degree of Automation Automation- refers to the use of technology and/or machine to perform tasks without much human power involvement. (i) Manual Production: - Relies heavily on human labor and manual processes. (ii) Automated Production: Uses machinery and robots to perform tasks with minimal human intervention. (iii) Semi-Automated Production Combines both manual and automated processes.