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Production & Operations ManagementChapter : The Role of Operations Management

Business Process Reengineering

Inventory Management

Operations Strategy

Total Quality Management

Supply Chain Management

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Planning & Control

Analyzing Operations

New Product/process development

Project Management

Issues For International Operations

Time Based Competition

Cost Elements

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Start Questioning operations productivity

Eliminating unuseful operations

CombinIing operations

Improving Operations Productivity

(Re) Design of new processes

Discussing the 9 primary approches to Operations Analysis

Lecture Outlines

1. Operation Purpose

2. Part Design

3. Tolerances and Specs

4. Material

5. Manufacturing Sequence and Process

6. Setup and Tools

7. Material Handling

8. Plant Layout

9. Work Design

Operation Purpose

Ask:

“Does this operation serve a useful purpose?”“Is this operation really needed?”

Try to:

Eliminate operationsCombine operations

As many as 25% of operations in American Industry can be eliminated.

Example 1 : Operation Elimination

Many stores have dropped the requirement that customers sign their credit slip for small totals: less than $15 - $50.

This makes the payment transaction very fast!E.g. in coffee shop study,

Average payment transaction time: 27 sec

Example 2 : Operation Elimination Outsource operations

Ask: “Can a supplier an operation more economically than we can in-house?”

Operation: pack ball bearings in grease

Modification: purchase sealed bearings from supplier.

Example 3 : Operation Elimination Eliminate re-workCoffee shop worker:Worker pours milk into stainless steel beaker,Steams milk, pours into cup.Runs out of milk – must pour and steam more while customer waits impatiently.

Solution: Add measuring lines to inside of beaker so worker does not have to estimate how much milk to pour.

Part DesignDesign for manufacturing and life-Cycle

Reduce parts – simplify designs

Reduce processing operations

Utilize better material

Loosen tolerances where possible

Design for manufacturing: choose an easy to manufacture shape over a difficult one.

Minimum cost design

It helps designers if they understand processes such as: casting, molding, bending, etc.Example: instead of:

Four bends in sheet metal to make part, Make lower cost extrusion with 4 bends already

in it.

This type of thinking is called

“Design for Manufacturing”

Tolerances and specifications

Designers tend to incorporate tolerances that are more rigid than necessary

Why? To be extra sure that product will function in all situations.

It is perceived to reduce risk, but it can add much unnecessary cost,

Need to consider risk/cost trade-off.

Taguchi (86) methods develop quality products and reduce cost.

Material

Incorporate better, more economical material in designs:

Less expensiveEasier to processUse materials more economicallyUse supplies and tools more economically,Standardize materialsFind best vendor: price, stock. Can achieve

10% to 15% reductions by shopping around, sometimes every year.

Example: New material

Replace stamped gear with plastic gear in assembly. saved $0.13 per unit, $10,000 per year.

Keiretsu: (Japanese term) interlocking relationship between manufacturers and suppliers.

Manufacturing Sequence and Tools

Re-sequence operations Group operations that can share common fixturingMechanize manual operations where economically feasible (see section on setup)Use more efficient facilities (see section on layout) Example, substitute Super automatic cappuccino machines for old style.Manufacture near-net shape.Use Robots (where economically feasible – usually for long product runs, small product variability)

Example: re-sequencing

Original sequence:• Paint part 1• Paint part 2• Paint part 3• Paint part 4• Rivet parts together

New sequence:• Rivet parts together• Paint one assembly

Setup, Tools and Fixtures

Carefully consider economic trade-offs:

Will the setup, fixtures, or tools be used enough to justify their expense?

Prevalent mistake of tool makers and planners:Too much specialized tooling and fixturing

Example: Tooling

Good choice: Tooling that saves 10% on each job and is used frequently.

Poor choice: Tooling that saves 90% on each job but is used only twice a year. (Will not recover expense of creating and storing tooling).

Material Handling

The best way to handle material is NOT to handle it.

Moving, storing, positioning, tracking.Insuring that materials get where they need to be when they are needed.Material Handling Institute survey says 35 to 85% of the cost of getting a product to market is associated with material handling.

Better Material Handling

Reduces cost, time

Increases safety, health and well being of workers:

40% of plant accidents happen during material handling

25% are caused by lifting and shifting material

Approach to reducing material handling time

Reduce time spent picking up material

Use mechanized of automated equipment (where economically feasible)

Make better use of existing handling facilities

Handle material with greater care

Consider bar coding

Plant Layout

Poor layout can result in major costs through increased travel time, increased material handling, etc.

Two types of layouts for plants:Product layout: machines placed in the order used in

the manufacturing process. Advantage: reduces travel time

Process layout: machines grouped by type: e.g. all lathes together, all drill presses together, etc.

Advantage: makes training easier.

Later we will discuss Muther’s Systematic Layout Process (SLP).

Work Design

Eliminate operations,Re-sequence, re-design operations

Many of our remaining chapters focus on many different types of work design!

Muther’s (1973) Systematic Layout Process (SLP)

Goal: identify how to rearrange space to make it more effective for a task.

1. Chart out relationships between areas based on magnitude of material handling,

2. Establish space requirements,3. Make activity relationship diagrams4. Space relationship layout5. Evaluate alternative layouts6. Select best layout, plan installation.

Decision Matrices

“Goodness” score for each option i is Σ (importance weight j * performance score i j)

 Renovation

Cost

Material handling cost Use of Space Aesthetics

Goodness Score

importance(1 -

least, 10 -

most) 8 10 5 7  

Option 1 3 3 4 2 88

Option 2 4 3 4 1 89

Option 3 2 4 3 3 92

Performance Parameters

A PM is whatever is important to the decision maker in the situation,

Select the best layout for your purposes

Choose the Layout with the highest “score” from your decision matrices

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88

89

92Best!

THANK YOU!

Ahmed BELAFQUIH