Production and Operations Management - …

1 Prod 2100/2110 Introduction 0 PROD 2100 - 2110 Production and Operations Management 2004-2005 Pierre Semal Prod 2100/2110 Introduction 1 Rules of the Game Tutorials Readings Morgan, Mechanization Takes Command in Images of Organizations , Sage Press, 1986. Meal, Putting Production decisions where they belong , HBR, 1984. Zeithaml, Berry, Parasuraman, Communication and control processes in the delivery of service quality , Journal of marketing, 1988. Working Sessions: Individual Computerized Classical Manuals: commented transparencies (Culb IAG, web) exercise manual (Culb IAG, web) readings (Culb IAG) personal notes Chase and Aquilano, Production and Operations Management , Irwin (Edt). McLain, Thomas and Mazzola, Operations Management : Production of goods and services, Prentice Hall (Edt). Objectives / Exam.

2 Winnie the Pooh spent the rest of the day by walking and happily humming a new hum, all about the common sense approach and what The Stranger has been teaching them and the hum went like this: Select the problem of the day Finding one that s right to do, You can choose it either way, You pick it ot it picks you. Observe it very carefully, Where do I start? Where am I going? And don t forget about the bee, What s in the way of doing or knowing? Prod 2100/2110 Introduction 0 Introduction What is POM ? What kind of problems are studied in POM ? 1. 3 Production AND 3 Production 4 EXAMPLES OF Production 5 8 2. PROBLEMS STUDIED IN 9 THE MAKOFFEE Production 9 LIST OF POM 12 LIFE CYCLE OF A Production 13 TABLE OF 14 THE GETUP Production 15 3. Production AND THE OTHER DEPARTMENTS .. 16 Prod 2100/2110 Introduction 1 1. Definitions The terms Production Management and Operations Management are often interchanged.

3 See, for example, the titles of the above mentioned books. Production and Operations In order to define what is " Production Management " or " Operations Management ", clear definitions of the terms Production and Operations are needed. Roughly: Production is directly related to the manufacturing of goods (products are produced). In the world of services, Production refers to the service delivery. Operations has to be understood as in: Military Operations or in Stock Exchange Operations . It refers to the daily actions necessary for the Production system to work. What is Production ? What is Production Management ? What is Operations What is Operations Management ? Everybody has his/her own perception of what Production is. Let us consider the following kinds of "industries" and try to determine what is produced in each of them.

4 Examples of industry - products Steel Works Production : steel beams or sheets from iron ore. Automobile factory Production : complete cars from components or from metal sheets ? Bakery The bakery produces breads, cakes, pies. The baker's shop exchanges these products. It is not clear what is really the job. Restaurant The problem is the same here: the kitchen produces meals and these meals are delivered in the dining room. A restaurant can be a meal factory, a meal delivery system or both. Airlines Here travel units are produced. They can be used to transport goods or people. Bank University Recreation center In these industries, the goods/services that are produced are very different. Nevertheless, in each of them, a kind of Production system has been designed and installed. Here is a very general definition of a Production system : Prod 2100/2110 Introduction 2 Production System Definition: A Production System is a system whose function is to transform an input into a desired output by means of a process (the Production process) and of resources.

5 The definition of a Production system is thus based on four main elements: the input, the resources, the Production process and the output. The examples in the following three pages illustrate what these elements are in different types of industries. Why such a broad Definition ? This definition is so broad that most of the activities of a person can be seen as Production systems. This is the goal we pursue with this definition. Indeed, the concepts, models and techniques developed in this course first apply to the industry world and to the classical manufacturing activities. However, most of these concepts, models and techniques apply to the normal activities of a person too. Looking at these activities as if they were Production processes will show them in a different light. The example of preparing coffee that is given at the end of this section is a perfect example of such a light.

6 Resources Input Production Process Output Prod 2100/2110 Introduction 3 Examples of Production Systems Automobile Factory Input raw material Output complete cars Process fabrication, assembly Resources assembly line, workers There are different levels of input: raw material such as steel or chestnut wood and semi-final products such as doors, seats or motors. Bakery Input water, flour Output breads, cakes Process fabrication Resources oven, workers Here is the bakery described, not the shop. Hospital Input patients Output healthy individuals Process health care Resources medical doctors, nurses, medical supplies, equipment All three examples show processes which correspond to physical transformation of the input. Prod 2100/2110 Introduction 4 Examples of Production Systems Department Store Input shoppers Output sales to satisfied customers Process transport, storage, promotion, information, exchange Resources displays, stock of goods, clerks The input here is not the goods but the shoppers.

7 They undergo the transformation. Restaurant Input hungry customers Output satisfied customers Process prepare meals, serve customers in a comfortable environment Resources food, chef, waiter, stove, environment The process here is twofold: prepare the meal and serve it. Some restaurants focus on the meal preparation only, some on the service only and some on both. University Input students Output educated individuals Process imparting knowledge and skills Resources teachers, books, classrooms Other output can be specified for a university. After this course, should you be able to solve all the basic Production problem, should you be able to deal with any new problem related to Production or should you have a diploma that states you followed a course in Production Management ? Prod 2100/2110 Introduction 5 Examples of Production Systems Here we want to show other dimensions in the service industry.

8 They are Production systems too. Carrier Input things Output things at another place Process transport Resources cars, trucks, planes, sorting devices, storage areas Examples are express carriers such as DHL, Federal Express or UPS and classical carriers such as the mail or the railway organizations. Warehouse Input things Output things at a later time Process store and preserve Resources vaults, storage areas, storage devices Think at banks, at movers or at parking lots. Prod 2100/2110 Introduction 6 Summary Let us try to summarize the various forms the four elements of a Production system can take. Resources Input Production Process Output Input raw material people with requests Output products service serviced people Process types physical exchange location storage educational Resources tools labor energy Definition of POM: Production and Operations Management (POM) provides: tools, techniques, concepts, models, ideas, to: design, dimension, control, improve Production systems Prod 2100/2110 Introduction 7 2.

9 Problems Studied in POM In this section we will first look at an example which will allow us to list the kind of problems studied in POM. Then, we will try to structure these problems. The Makoffee Production system Preparing coffee in the morning is a nice example of a Production system. coffee machine electricity operator water, filter, coffee Prepare drinkable coffee When somebody prepares coffee in the morning, she/he performs different Operations and makes different decisions. Here we will review these Operations and decisions and draw a parallel between the problems the coffee maker faces and those faced by a Production manager in his/her company. 0. When do you make coffee in the morning ? Before washing is convenient because it is ready when you come back from the bathroom. You must here schedule the Production of coffee and the other activities.

10 Scheduling / project Management In a company, you need to organize the different activities (sequence, priority, ..) 1. Get water, coffee, filter and coffee machine. Where is the coffee machine? Usually, the coffee machine is in the kitchen where you get the water and drink the coffee. You locate the Production system where you get the raw materials and where you use the finished products. location Where are the different ingredients? Usually, the coffee and the filters are together and close to the coffee machine. The coffee machine is close to the water faucet. You place the different elements to avoid useless trips and handling. layout In a company, where to locate your plant or your shop is a strategic question. The layout is also critical. It usually follows the material flow. 2. Estimate how much coffee must be prepared. How many people will drink coffee today and at what time?