Process Planning

Product/Operations Management

Chapter 2.0 – Process Planning

Process Planning – The determining the required input resources, e.g. machines, tools, skilled workers, and methods to be used in the process.

Process Planning is anchored on two concepts:

1.      Process Analysis – the determination of the general flow of materials and work.

2.      Operations Analysis – the determination of specific work content and methods.

Items Operations Managers must consider in process planning:

·        If the operation can completely satisfy the desired output and cost.

·        If quality will be assured.

·        What the manpower requirements are.

·        What specific equipments are needed.

·        If the process flow that has been designed is totally justifiable.

Forecasting

Product/Operations Management

Chapter 4.0 – Forecasting

Forecast – A statement about the future.

Forecasting – the science of predicting states of the future.

Two uses of a forecast

1.      To help managers plan the system –planning the system involves the long-range plans about the types of products and services to offer. What facilities and equipment to have, where to locate, etc.

2.       To help managers plan the use of the system – this refers to short range and intermediate range, which involves tasks such as planning inventory & work force level, planning purchasing and production, budgeting, scheduling.

Forecasting pertains to more than predicting demand. Forecasts are also used to predict profits, revenue costs, productivity changes, prices, and availability of energy, and raw materials, interest rates, movements of key economic indicators (GNP, inflation, government borrowings) and prices of stocks and bonds.

In spite of use of computers and other sophisticated mathematical models, forecasting is not an exact science. No single technique works at all times.

Generally, the responsibility for preparing forecasts lies with marketing and sales rather than operations. But, operations people are often called on to make forecasts and help others prepare the forecasts.

Capacity Planning

Product/Operations Management

Chapter 3.0 – Capacity Planning

Capacity –  an upper value or limit on the load that an operating unit can handle.

Decisions involved in Capacity Planning:

1.      Machine requirements

a.      Purchase new equipment

b.      Lease or buy second hand machines

2.      Number of workers to be maintained

Importance of Capacity Decisions

1. Impacts ability to meet future demands

2. Affects operating costs

3. Major determinant of initial costs

4. Involves long-term commitment

5. Affects competitiveness

6. Affects ease of management

7. Globalization adds complexity

8. Impacts long range planning

Introduction to Production/Operations Management

Product/Operations Management

Chapter 1.0 – Introduction

Production – is the management function concerned with the transformation of input resources into desired outputs.

Production as a System

                                  

   Inputs of a Production System

   • External

     – Legal, Economic, Social, Technological

   • Market

     – Competition, Customer Desires, Product Info.

   • Primary Resources

     – Materials, Personnel, Capital, Utilities