MB-0044 Production and Operations Management

Question no.1. State the important considerations for locating an automobile plant? Answer. .Plant location involves a strategic decision that holds once taken. Plant location is the choice of region and the selection of a particular site for setting up a business. An ideal location need to be select involves to such which incur minimum cost of the products with a large market share, the minimum risk and the maximum social gain. It is the place of least net advantage or which gives lowest unit cost of production as well as distribution. For achieving this objective, smallscale entrepreneur can make use of location analysis for this purpose. Locational analysis is a strategic decision involving of following:(I) Demographic Analysis: Population in the area in terms of total population (in no.), age composition, per capita income, educational level, occupational structure etc. becomes a part of study. (ii) Trade Area Analysis: Geographic area that provides continued clientele to the firm are analyzed .The possibility of accessing the trade area from alternative sites is also considered. (iii) Traffic analysis: It targets to have a rough idea about the number of potential customers passing by the proposed site at the time of working hours of the shop. (IV) Competitive Analysis: It aids to judge the nature, location, size and quality of competition in a given trade area (v) Site economics: Operational costs and establishments need to be measure. By comparing cost between alternative sites best one have to taking into consideration. The ways for selecting a suitable location are given as follows: a) Climatic or nature conditions. b) Ready easy available to the sources of raw material. c) Distribution or marketing finished products to the ultimate users plus transport costs-in obtaining raw material and also considered. d) Access to market: small businesses in retail or wholesale or services should be located within the vicinity of densely populated areas. e) Availability of Infrastructural facilities.

f) Availability of skilled and non-skilled labor. g) Banking and financial institutions are located nearby.

Question no.02. Explain essentials of Project Management Philosophy?

Answer: Dimensions: Well-engaged sponsor guides who has both adequate authorities and resources to charter the project effort. Bringing about a beneficial change for a programmer of nonroutine work is always considered. It does have a start and an end date. And again multi - disciplinary team binds together for the project. It has well defined work along with its scope. Its limitation of cost, time and quality are must. This is a constraint. Last but not the least project parameters for negotiation are carefully dealt.

During the course of a project a team negotiates for one or more of these: A. Scope, cost & schedule objectives B. Changes to scope, cost or schedules C. Contract terms and conditions D. Resources Project Management does Add Value:Projects may be completed with one or more of the following ways: 1. Stretched Deadlines 2. Over Stressed team 3. Wasted resources 4. Unmet customer functional requirements

Overshot budget however a good project management methodology provides a framework, process, guidelines and techniques to greatly increase the chances of being successful, and therefore provides value to the project. Five dimensions that must be managed on a Project are like feature, quality, cost, schedule, and staff. These dimensions are dependent on one another - if you add staff, the schedule may shorten and the cost will increase.

Question no.03. Several different strategies have been employed to assist in aggregate planning. Explain these in brief

Answer. Two pure planning strategies available to the aggregate planner: a level strategy and a chase strategy. LEVEL STRATEGY: It aims to produce an aggregate plan that maintains a steady production rate and/or a steady employment level. In order to satisfy changes in customer demand, the firm must raise or lower inventory levels in anticipation of increased or decreased levels of forecast demand. The firm maintains a level workforce and a steady rate of output when demand is somewhat low. This allows the firm to establish higher inventory levels. As demand increases, the firm is able to continue a steady production rate/steady employment level, while allowing the inventory surplus to absorb the increased demand. A second alternative would be to use a backlog or backorder. A backorder is simply a promise to deliver the product at a later date when it is more readily available, usually when capacity begins to catch up with diminishing demand. In essence, the backorder is a device for moving demand from one period to another, preferably one in which demand is lower. A level strategy allows a firm to maintain a constant level of output and still meet demand Negative results of the level strategy would include the cost of excess inventory, subcontracting or overtime costs, and backorder costs, which typically are the cost of expediting orders. CHASE STRATEGY A chase strategy deals with matching capacity and demand period by period. This could result in a considerable amount of hiring, firing or laying off of employees; insecure and unhappy employees; increased inventory carrying costs; problems with labor unions; and erratic utilization of plant and equipment. It also implies a great deal of flexibility on the firm's part. The major advantage of a chase strategy is that it allows inventory to be held to the lowest level possible, and for some firms this is a considerable savings. Most firms embracing the just-intime production concept utilize a chase strategy approach to aggregate planning. Question no.04. Illustrate the different methods by which quality is sought to be achieved using various tools and techniques

Answer. Achieving quality product or services there are some tools or techniques .which are as follows:Check sheets/data collection forms Pereto Diagram Cause & Effect Diagram Process Flowchart Scatter Diagram Histogram Control Charts 01. Check sheets/data collection forms Checks sheet record data about a process. It is a pre-prepared form with to be checked. Purpose-easily collect and compile data. Immediately visualized and some cases analyzed. To eliminate or reduce error. 02. Pereto Diagram Systematically able to identify major causes or defects. Able to determine loss in monetary form. Can decide most important areas to improve-not by guessing .Able to compare before & after improvement effect using Pereto Can use for different problem areas quality, inventory, maintenance, safety etc .Most importantly it is simple yet Powerful. 03. Cause and Effect Diagram Identify all relevant factors through examination &discussion. Express characteristic as clear as possible. Construct different Cause & Effect characteristic-Weight &Length. Discover where action can be taken. Can improve diagram during use-check, modify, delete and add new things. 04. Process Flowchart This is a picture of a process plus important tool for process improvement and helps communicate, understands agree on how a process is accomplished. 05. Scatter Diagram To study the interaction between two different variables, are there any relationship that exist or not, ex-temperature and viscosity, yield and concentration etc. and can find the correlation between those two variables. 06. Histogram Help you evaluate a digital image; ex- It is a graph which is used on digital cameras and even in computer software, graphically present information, shows the relationship between data and can easily extrapolate the mean, median, mode & other statistical information. 07, Control Charts: Routinely monitor quality, can add warning limits and examine the relationship between natural process limits and the specifications.

Question no.05. Explain the basic competitive priorities considered while formulating Operations strategy by a firm? Answer: Competitive priorities are vital key decision variables for operations managers and researchers. A competitive priority refers a strategic emphasis on developing certain manufacturing capabilities that may enhance a plants position in the marketplace. Key competitive priorities are as follows: a. Cost b. Quality c. Flexibility d. Speed In the following we will briefly discuss the cases of various instances which clearly define its role. Cost Lincoln Electric Skilled machine operators save the company millions that would have been spent on automated equipment Southwest Airlines One type of airplane facilitates crew changes, record-keeping, maintenance, and inventory costs. Direct flights mean no baggage transfers. $30 million annual savings in travel agent commissions by requiring customers to contact the airline directly Quality Ritz-Carlton Every employee is empowered to satisfy a guests wish. Teams at all levels set objectives and devise quality action plans. Each hotel has a quality leader Quality reports tracks -Guest room preventive maintenance cycles -Percentage of check-ins with no waiting -Time spent to achieve industry-best clean room appearance Flexibility Andersen Windows -Number of products offered grew from 28,000 to 86,000 Custom Foot Shoe Store -Customers feet are scanned electronically to capture measurements Prices are comparable to off-the-shelf shoes National Bicycle Industrial Company Delivers within two weeks at costs only 10% above standard models

Speed Citicorp Advertises a 15-minute mortgage approval L.L. Bean Ships orders the day they are received Wal-Mart Replenishes its stock twice a week

Question no.06. Explain briefly the four classification of scheduling strategies? Answer: Burst Campaigns: Often associated with the awareness objective, it compact media activities into a series of relatively short time frames, with relatively long periods of absence from media activity in between. This pattern may be used when a new product is being introduced. Flighting: Wave method or the flighting method is another kind of scheduling. In flighting, advertisements are bunched with the intention of providing a concentrated impact. It is used in relating to a scheduling technique, refers to a method that has advertising going on and off the air. This method of media planning allows the messages and themes of the campaign to reach the voter through radio or cable TV, less costly alternatives to broadcast TV. Continuous Campaign: Another approach mostly associated with reminder campaigns, it provides continuity of the message. These continuous patterns are often used for mature products, where reminder advertising is appropriate. There can be perfect continuous advertising, rising continuity or falling continuity. I. Rising continuity: this pattern is used when the advertising circles around a particular event. E.g. advertisement of jewelry at the festival of "Dhanteras". II. Falling continuity: this pattern may follow an initial burst to launch a new product or to inform a product modification. Pulsing Campaign: A compromise between the burst and the continuous strategy is the development of the pulsing campaign. Here a comparatively low level of media activity is maintained over long period of time, with periodic increases in the expenditure patterns. It is often associated with seasonal or other influences on buyer activities. Normally, scheduling is done for a 4-week period. The six types of schedules available are: I. Steady pulse: it is the easiest. For instance, one ad/week for 52 weeks or one ad/month for 12 months.

II.Seasonal pulse: ads are scheduled to meet seasonal peaks by appearing in concentrated doses ahead of buying season. Products like Vicks Balm, Glycodin Terp-Vasaka Syrup, and Ponds cold cream follow this approach. III.Period pulse: Scheduling follows a regular pattern, e.g., media scheduling of consumer durables, non-durables, etc. IV.Erratic pulse: The ads are spaced irregularly. Perhaps, we want to change the typical purchase cycles. V.Start-up pulse: It is concentrated media scheduling. It launches a new product or a new campaign. VI.Promotional pulse: A one-shot affair it suits only particular promotional theme. Heavy concentration during a period is the characteristic of this scheduling. For instance, financial advertising of companys issue.