NETA PowerPoint
Presentations to accompany
The Future of
Business
Fourth Edition
Adapted by
Norm Althouse,
University of Calgary
Copyright © 2014 by Nelson Education Ltd.
Achieving World-Class
Operations Management
Chapter 15
Chapter 15
Copyright © 2014 by Nelson Education Ltd.
Making the Connection
Copyright © 2014 by Nelson Education Ltd.
Learning Outcomes
1.
2.
3.
4.
5.
4
Discuss why production and operations management are
important in both manufacturing and service companies.
List the types of production processes used by
manufacturers and service companies.
Describe how organizations decide where to put their
production facilities and what choices must be made in
designing the facility.
Explain why resource-planning tasks like inventory
management and supplier relations are critical to
production.
Discuss how operations managers schedule and control
production.
Copyright © 2014 by Nelson Education Ltd.
Learning Outcomes (cont’d)
6.
7.
8.
5
Evaluate how quality management and leanmanufacturing techniques help companies improve
production and operations management.
Identify the roles that technology and automation play
in manufacturing and service industry operations
management.
List some of the trends affecting the way companies
manage production and operations.
Copyright © 2014 by Nelson Education Ltd.
Discuss why production and operations
management are important in both manufacturing
and service companies.
6
Copyright © 2014 by Nelson Education Ltd.
Basic Terms
Production – Creation of products by turning inputs into
outputs, which are goods and services.
Operations management – Management of the
production process.
Production planning – Aspect of operations
management in which the company considers its resources
and its own strategic goals to determine
the best production methods.
7
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Exhibit 15.1: Production Process for
Products and Services
8
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Production and Operations
Management
Production Planning
Decisions
Production Control
Improving Production and
Operations
9
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Production Planning
Short-Term
Medium-Term
1 year
Long-Term
2 years
3 – 5 years
Type of Production Process
Site Selection
Planning
Decisions
Facility Layout
Resource Planning
10
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List the types of production processes used by
manufacturers and service companies.
11
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Exhibit 15.2: Classification of
Production Types
12
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Converting Inputs to Outputs
Production involves converting inputs (raw
materials, parts, human resources) into
outputs (products and services).
Process
Manufacturing
Assembly Process
13
Basic input is broken down into
one or more outputs.
Basic inputs are combined or
transformed into the output.
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Exhibit 15.3: Converting Inputs to
Outputs
14
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Production Timing
Continuous
Process
Intermittent
Process
15
Long production runs without
equipment shutdown.
Short production runs to make
batches of different products.
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Describe how organizations decide where to put
their production facilities and what choices must be
made in designing the facility.
16
Copyright © 2014 by Nelson Education Ltd.
Location, Location, Location





Availability of production inputs.
Marketing factors.
Manufacturing environment.
Local incentives.
International location considerations.
17
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Designing the Facility
Process Layout
Work flows according to the process.
Product Layout
Workstations/departments arranged in a line,
with products moving along the line.
Fixed-Position
Layout
Product stays in one place.
Cellular
Manufacturing
Small, self-contained production units.
See Exhibit 15.4 in the textbook.
18
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Explain why resource-planning tasks like inventory
management and supplier relations are critical to
production.
19
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Resource Planning
Make or Buy
Inventory Management
Computerized Resource
Planning
Manufacturing Resource
Planning (MRP)
20
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Make or Buy Decisions
Some of the factors would include:





quantity of items needed.
standard or nonstandard items.
size of components.
special design features.
quality and reliability of suppliers.
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Inventory Management
Inventory
Inventory
Management
Perpetual
Inventory
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Supply of goods a company holds for
use in production or for sale.
Determines how much inventory a
company will keep on hand and the
ordering, receiving, storing, and
tracking of inventory.
Continuous updated list of
inventory levels, orders, sales, and
receipts.
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Computerized Resource Planning
Materials Requirement Planning (MRP)
computerized system of controlling the flow of resources and inventory
Manufacturing Resource Planning II (MRPll)
complex computerized system that integrates data from many departments to
allow managers to forecast and assess the impact of production plans on
profitability more accurately
Enterprise Resource Planning (ERP)
computerized resource-planning system incorporates information about the
company’s suppliers and customers with its internally generated data
23
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Supply Chain Management
Supply Chain
Entire sequence of securing inputs,
producing goods, and delivering them to
the customers.
Supply Chain
Management
Process of smoothing transitions along
the supply chain to satisfy customers
and develop tighter
bonds with suppliers.
Goal:
Satisfy customers with quality products
and services.
24
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Discuss how operations managers
schedule and control production.
25
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Production Control
Routing
Value-Stream Mapping
Scheduling
Gantt Chart
Critical Path Method (CPM)
PERT
26
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Exhibit 15.5: A Typical Gantt Chart
27
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Exhibit 15.6: A CPM Network for Building
a House
28
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Evaluate how quality management and leanmanufacturing techniques help companies improve
production and operations management.
29
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Improving Production and Operations
30
Quality
Quality
Control
Total Quality
Management
Continuous
Improvement
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Putting Quality First
Six Sigma
Defining what needs to be done to ensure quality; measure and analyze results
and ongoing improvement.
ISO 9000
Set of five technical standards of quality management to provide a uniform way of
determining whether there is conformity to sound quality procedures.
ISO 1400
Set of technical standards to promote clean production processes to protect the
environment.
31
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Lean Manufacturing
Lean Manufacturing
Streamlining production – eliminating
steps that do not add benefits for end
users.
Just-in-Time (JIT)
Materials arrive exactly when they are
needed for production, rather than being
stored on site.
32
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Identify the roles that technology and automation
play in manufacturing and service industry
operations management.
33
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Technology and Automation at Your
Service
Computer-Aided Design and Manufacturing Systems
Robotics
Flexible Manufacturing Systems
Computer-Integrated Manufacturing
POS, ATMs, and so on
34
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List some of the trends in trends affecting the
way companies manage production
and operations.
35
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The Future of Production and Operations
Management

Asset management.

Modular production.

Designing products for production efficiency.
36
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